City Creek Owner Non Profit, Tax Exempt
March 28, 2012
(K U T V) SALT LAKE CITY – The arm of the LDS Church which served as "master
developer" of Utah's newest and most elaborate shopping, residential and office
complex has federal "tax exempt" status.
In response to questions from 2News, City Creek Reserve Inc, or CCRI, revealed
it's a "non-profit corporation."
As such, CCRI Spokesman Dale Bills noted the company "pays property and sales
taxes." But it appears CCRI may not pay federal income taxes.
If City Creek Reserve makes money, it will go the LDS Church.
"Much like a university endowment fund supports a university, any after tax
return on investment supports the religious, charitable and educational mission
of the Church," Bills said.
City Creek has already attracted thousands of people in the week since its grand
opening, transforming aging blocks south of the Salt Lake LDS temple into a
downtown hub of retail commerce.
But if a pervasive marketing campaign, and word of mouth is spreading news of
City Creek's lustrous shine, less known is the business end of the project.
A week ago, Dee Brewer, a representative for mega shopping center developer
Taubman Centers Inc, said Taubman "owns and operates the retail components of
But that ownership may not be what you think.
City Creek Reserve told 2News Taubman has a "long-term participating air space
lease" for the stores.
And Steven Anderson, a commercial appraiser in the Salt Lake County Assessor's
Office, put the lease at roughly 30 years.
"When that expires, the title reverts back to the church or CCRI," said
The City Creek project also has three condominium developments, the towering
Promontory building, the Regent - a swooping glass high rise, and the Richards
Court, with the most direct views of Temple Square.
Anderson said buyers of condos within the buildings have ownership for 99 years,
but like the retail space, that ownership reverts back to CCRI.
Said Anderson, "At the end of the day, CCRI owns everything."
What, exactly is 'everything' worth? That is still a question.
Anderson has yet to crunch all the numbers, and offer a figure on the total
taxable value, though that process is underway.
A 2News inquiry over a potential state tax exemption for City Creek Reserve Inc
was not available at news time.
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COLORADO TAX INITIATIVE GAINED NATIONAL ATTENTION
INITIATIVE WOULD HIT LDS CHURCH HARD
AMERICANS FOR TAXING ORGANIZED RELIGION
2000 Church and Clergy Tax Guide
Jos. Smith Papyri
THE UNITED STATES
COURT OF APPEALS FOR THE SIXTH CIRCUIT
AMERICAN ATHEISTS, INC.; STEVEWALKER; LAW OFFICES OF
DENNIS G. VATSIS, P.C.; AND DENNIS G. VATSIS,
Plaintiffs, Appellants, and Cross-Appellees,
CITY OF DETROIT DOWNTOWN DEVELOPMENT AUTHORITY,
Defendant, Appellee, and Cross-Appellant,
AND ST. JOHN’S EPISCOPAL CHURCH,
Defendant-Intervenor, Appellee, and Cross-Appellant.
The first recorded tax exemption for
churches was during the Roman Empire, when Constantine, Emperor of Rome
from 306-337, granted the Christian church a complete exemption from all
forms of taxation following his conversion to Christianity circa 312.
The law against churches intervening in political campaigns was passed
by the US Congress in 1954. Since then, the Internal Revenue Service
(IRS) has been successful in using the law to revoke the tax-exempt
status of only one church: the Church at Pierce Creek in Binghamton, NY,
which had placed an advertisement in USA Today and the Washington Times
rebuking Bill Clinton four days before the 1992 presidential election.
the "parsonage exemption" on religious ministers' housing costs were
revoked, American clergy members would cumulatively lose an estimated
$2.3 billion over five years.
spring 2010, the state of Oklahoma awarded tax-exempt status to a
Satanist group called The Church of the IV Majesties.
According to former White House senior policy analyst Jeff Schweitzer,
PhD, US churches own $300-$500 billion in untaxed property. New
York City alone loses $627 million in annual property tax revenue due to
9,500 churches being tax-exempt, according to a July 2011 analysis by
New York's nonpartisan Independent Budget Office.
Tax Exemption for Churches is bad
Tax exemptions for churches violate the separation of church and state
required by the Establishment Clause of the First Amendment of the US
Constitution. By providing a financial benefit to religious
institutions, government is supporting religion. Associate Justice of
the US Supreme court, William O. Douglas, in his dissenting opinion in
Walz v. Tax Commission of the City of New York, decided May 4, 1970,
stated: "If believers are entitled to public financial support, so are
nonbelievers. A believer and nonbeliever under the present law are
treated differently because of the articles of their faith… I conclude
that this tax exemption is unconstitutional."
A tax exemption is a privilege, not a right. Governments have
traditionally granted this privilege to churches because of the positive
contribution they are presumed to make to the community, but there is no
such provision in the US Constitution.
Churches receive special treatment from the IRS beyond what other
nonprofits receive, and such favoritism is unconstitutional. While
secular charities are compelled to report their income and financial
structure to the IRS using Form 990 (Return of Organization Exempt From
Income Tax), churches are granted automatic exemption from federal
income tax without having to file a tax return.
A tax break for churches forces all American taxpayers to support
religion, even if they oppose some or all religious doctrines. As Mark
Twain argued: "no church property is taxed and so the infidel and the
atheist and the man without religion are taxed to make up the deficit in
the public income thus caused."
A tax exemption is a form of subsidy, and the Constitution bars
government from subsidizing religion. William H. Rehnquist, then-Chief
Justice of the US Supreme Court, declared on behalf of a unanimous court
in Regan v. Taxation with Representation (1983): "Both tax exemptions
and tax deductibility are a form of subsidy that is administered through
the tax system. A tax exemption has much the same effect as a cash grant
to the organization of the amount of tax it would have to pay on its
The tax code makes no distinction between authentic religions and
fraudulent startup "faiths," which benefit at taxpayers' expense. In
spring 2010, Oklahoma awarded tax exempt status to Satanist group The
Church of the IV Majesties. In Mar. 2004, the IRS warned of an
increase in schemes that "exploit legitimate laws to establish sham
one-person, nonprofit religious corporations," charging $1,000 or more
per person to attend "seminars." The Church of Scientology, which
TIME Magazine described in May 1991 as a "thriving cult of greed and
power" and "a hugely profitable global racket," was granted
federal income tax exemption in Oct. 1993. The New York Times reported
that this "saved the church tens of millions of dollars in taxes."
Tax exemptions to secular nonprofits like hospitals and homeless
shelters are justified because such organizations do work that would
otherwise fall to government. Churches, however, while they may
undertake charitable work, exist primarily for religious worship and
instruction, which the US government is constitutionally prevented from
Exempting churches from taxation costs the government billions of
dollars in lost revenue, which it cannot afford, especially in tough
economic times. According to former White House senior policy analyst
Jeff Schweitzer, PhD, US churches own $300-$500 billion in untaxed
property. New York's nonpartisan Independent Budget Office
determined in July 2011 that New York City alone loses $627 million in
property tax revenue. Lakewood Church, a "megachurch" in Houston,
TX, earns $75 million in annual untaxed revenue, and the Church of
Scientology's annual income exceeds $500 million.
Despite the 1954 law banning political campaigning by tax-exempt groups,
many churches are political machines. Every fall, the Alliance
Defense Fund, a Christian legal group, organizes "Pulpit Freedom
Sunday," encouraging pastors to defy IRS rules by endorsing candidates
from the pulpit. More than 500 pastors participated in Oct. 2011, yet
none lost their churches' exemption status. In Oct. 2010,
Minnesota pastor Brad Brandon of Berean Bible Baptist Church endorsed
several Republican candidates and dared the "liberal media" to file
complaints with the IRS. Brandon later announced on his radio program:
"I'm going to explain to you what happened… Nothing happened."
American taxpayers are supporting the extravagant lifestyles of wealthy
pastors, whose lavish "megachurches" accumulate millions of tax-free
dollars every year. US Senator Chuck Grassley, MA (R-IA) launched an
investigation into these groups in Nov. 2007 after receiving complaints
of church revenue being used to buy pastors private jets, Rolls Royce
cars, multimillion-dollar homes, trips to Hawaii and Fiji, and in one
case, a $23,000, marble-topped chest of drawers installed in the 150,000
square foot headquarters of Joyce Meyer Ministries in Fenton, Missouri.
The tax break given to churches restricts their freedom of speech
because it prohibits pastors from speaking out for or against political
candidates. As argued by Rev. Carl Gregg, pastor of Maryland's
Broadview Church, "when Christians speak, we shouldn't have to worry
about whether we are biting the hand that feeds us because we shouldn't
be fed from Caesar/Uncle Sam in the first place."
The "parsonage exemption" on ministers' homes makes already-wealthy
pastors even richer at taxpayers' expense. The average annual salary for
senior pastors with congregations of 2,000 or more is $147,000, with
some earning up to $400,000. In addition to the federal exemption
on housing expenses enjoyed by these ministers, they often pay zero
dollars in state property tax. Church leaders Creflo and Taffi Dollar of
World Changers Church International had three tax-free parsonages: a
million-dollar mansion in Atlanta, GA, a two-million-dollar mansion in
Fayetteville, GA, and a $2.5 million Manhattan apartment.
Kenneth and Gloria Copeland, leaders of Kenneth Copeland Ministries in
Fort Worth, TX, live in a church-owned, tax-free $6.2 million lakefront
No full tax break for Mormon temple in England
By P E G G Y F L E T C H E R
S T A C K Mar 4, 2014
European judges have rejected the LDS Church’s human-rights complaint
against the United Kingdom, The Telegraph reported Tuesday, so now the
Utah-based faith will have to pay property taxes on its Preston Temple.
The Church of Jesus Christ of Latter-days Saints claims nearly 190,000
members in the U.K., where Mormon meetinghouses enjoy full exemptions
from property taxes. But LDS temples, unlike meetinghouses, are open
only to devout Latter-day Saints with "recommends."
The British government ruled in 2005 that a full property tax break was
not appropriate for the temple in Lancashire because it did not qualify
as a "place of public religious worship," The Telegraph reported. The
France-based European Court of Human Rights has now agreed.
The temple does receive an 80 percent reduction in rates because of its
use for charitable purposes, The Telegraph noted.
"The Church of Jesus Christ of Latter-day Saints respects the decision
of the Strasbourg court," said Malcom Adcock, a spokesman for the church
in Britain, "and is grateful that the charitable activities of churches
are recognized under U.K. and European law."
The LDS Church, which also has a temple in London, declined additional
Salt Lake City-based church representatives also could not immediately
provide an update on a summons for LDS Church President Thomas S. Monson
to appear in a British court on charges of fraud brought by a former
Mormon bishop, who alleges the faith’s teachings are deceptive.
A district judge in Westminster Magistrates’ Court of London previously
issued a summons to Monson, considered a "prophet, seer and revelator"
in Mormonism, to appear March 14.
M a t t h e w P i p e r