Two contradictory rulings over whether YMCA of the Rockies should be exempt from paying property taxes on its two mountain camps could affect about 6,000 churches, schools and religious camps statewide, officials said last week.
The debate, which has split state authorities responsible for tax reviews, centers on whether the state can question an organization’s claims that property is being used for religious purposes.
“There’s sort of a conflict set up here between what we think we’re required to do as directed by statute and what the man on the street might say, ‘Well, is that activity truly religious?”‘ said Stan Gueldenzopf, manager of the exemption section for the state Division of Property Taxation.
Officials at the sprawling YMCA camps in Larimer and Grand counties have sought tax- exempt status dating back to 2002. The status would cover lodging, staff housing, trails and open space, cookout and recreation sites – including horseback riding, swimming and miniature golf areas – as well as Christian chapels.
In 2005, state property-tax administrator Karen Dvorak ruled the facilities should be tax- exempt, although she noted: “There does not appear to be any requirement for guests or users to participate in mission- oriented programs during their stay at the camp, unlike most other exempt religious camps in the state.”
Dvorak also noted that she is required by law to accept on face value a religious organization’s claims that property is being used to further its religious mission.
A three-member Board of Assessment Appeals, acting on an appeal filed by the counties and nearby business owners, ruled Feb. 2 that, with the exception of the chapels, the Y camps should not be exempt from taxes because the property is not used for overtly religious activities.
The latest ruling raises the question: Why could the appeals board legally consider the actual uses of the property when the state property-tax administrator could not?
“Obviously, everybody had a view of the statute as it was written and how you view each part,” said Diane Fechisin, the board administrator.
On Friday, the state filed a motion asking that the matter be determined “a statewide concern” so it could be cleared up in the courts.
“There are exempt properties similar to the YMCA, with camping, retreat or outdoor religious facilities, in at least 26 Colorado counties,” Assistant Attorney General Robert Dodd wrote in his brief.
More than 6,000 properties have religious exemptions in Colorado and another 200 to 300 applications are received each year, according to the state property-tax administrator.
YMCA of the Rockies, which has been in existence for a century, ceased paying property taxes after the 2005 ruling in its favor but has continued to place the money in escrow should it ultimately lose its tax-exempt status, said spokeswoman Laurie Van Horn.
If the organization prevails, the counties and all of the taxing subdivisions, including public schools, would be required to refund the money already collected.
The tax-exempt status is opposed by Larimer and Grand counties, which together stand to lose more than $500,000 annually in tax revenues, and local business owners, who contend that it gives the Y an unfair competitive advantage for its lodging and attractions.
Staff writer Steve Lipsher can be reached at 970-513-9495 or slipsher@denverpost.com.
