April 19, 2019

Colorado Court of Appeals: Board of Assessment Appeals Erred by Not Addressing YMCA’s Declaration of Religious Purposes

The Colorado Court of Appeals issued its opinion in Larimer County Board of Commissioners v. Colorado Property Tax Administrator on Thursday, April 11, 2013.

Property Tax Exemption—Charitable Use Exemption—Religious Purpose Exemption—Jurisdiction.

In this property tax exemption case, the Young Men’s Christian Association of the Rockies (YMCA) and the Colorado Property Tax Administrator (Administrator) appealed the Board of Assessment Appeals (BAA) orders. The BAA found that the YMCA was not entitled to a charitable use exemption or a religious purposes exemption from property taxes, except for its chapels and religious activity center. The orders were vacated in part, the appeal was dismissed in part, and the case was remanded.

The YMCA owns and operates facilities in Grand and Larimer Counties. The Counties contended that the Court of Appeals did not have jurisdiction to entertain the Administrator’s appeal. Because the BAA did not recommend that the matter was of statewide concern, the Administrator may not appeal. Accordingly, the Court did not have jurisdiction to hear the Administrator’s appeal and, therefore, dismissed it.

The Counties contended that the Court did not have jurisdiction to entertain the YMCA’s appeal. CRS § 39-2-117(5)(b) gives any owner of taxable property in such county the right to appeal the tax administrator’s determination regarding an application for a property tax exemption. Therefore, the Court of Appeals had jurisdiction to hear the YMCA’s appeal from the BAA’s determination.

The YMCA also argued that the BAA erred when it found that the YMCA did not qualify for a religious purposes exemption. The BAA did not discuss the YMCA’s declared purpose in using the properties, whether the YMCA’s activities are in furtherance of the YMCA’s religious purposes, or whether the activities are an integral part of the YMCA’s religious worship. Further, the BAA did not address the YMCA’s declaration of religious purposes contained in its application, the effect of the declaration’s presumed validity, or whether the presumption had been overcome. Because such declarations are presumptive with regard to the religious purposes for which property is used, the BAA did not apply the proper legal standards and, therefore, erred as a matter of law.

The YMCA further contended that the BAA erred when it found that the YMCA did not qualify for a charitable use exemption. Based on the record, the BAA did not properly consider whether the YMCA used the properties solely and exclusively for charitable purposes. Accordingly, the BAA did not apply the correct legal standards and, therefore, erred as a matter of law.

Summary and full case available here.

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