In the 1990s, dozens of evangelical ministries have flocked to Colorado Springs, in part because of a generous 1990 state property-tax law. But some of these ministries may be forced to leave Colorado or cut back on programs if state voters in November support the nation’s first proposed state amendment to eliminate property-tax exemptions for all but a few churches, ministries, and secular nonprofit groups.
The amendment would end property-tax exemptions for around 5,000 churches, synagogues, and mosques; more than 1,500 nonprofit organizations involved in everything from arts to zoos; thousands of acres of Christian and New Age camp and retreat properties; more than 500 hospitals and health clinics; hundreds of fraternal organization properties; and most of the state’s cemeteries and soup kitchens. The amendment would not affect these groups’ existing state and federal income and payroll taxes, and it would have no impact on groups that rent facilities.
The only groups that would continue to qualify for property-tax exemptions would be nonprofit schools and universities and organizations that provide housing for prisoners, orphans, the elderly, the disabled, and the homeless.
State officials estimate the amendment would return nearly $3 billion worth of land to state tax rolls, yielding nearly $70 million in new property taxes. Under the terms of the amendment, this money would be returned to state residents in the form of decreased property taxes.
Edward McGlynn Gaffney, dean of the Valparaiso (Ind.) University School of Law and an expert on religious tax issues, calls the Colorado amendment “one of the most hostile measures imaginable” because it would reverse two centuries of government support for churches and charities.
“The message these disgruntled Colorado taxpayers seem to want to send is that nonprofits that can afford to should begin to pack their bags,” Gaffney says.
EVANGELICAL BACKLASH? The amendment was written by John Patrick Michael Murphy, a Colorado Springs personal-injury attorney, radio talk-show host, and crusading ex-Catholic who heads the grassroots Coloradoans for Fair Property Taxation. Murphy has spent $60,000 collecting nearly 90,000 signatures on petitions.
“It’s some of the finest money I’ve ever spent,” says the 50-year-old Murphy, who describes himself as an agnostic and a freethinker. A product of Catholic schools, Murphy says he is not a “fallen-away Catholic” but one who “walked away with my head held high.” This is not the first time he has provoked religious leaders. Just before Pope John Paul II visited Colorado in 1993, Murphy publicly asked the pope to apologize to Catholics like himself who had been sexually abused by priests.
Murphy insists the amendment is not an attack on religion or religious institutions. Instead, he and other amendment supporters wear buttons reading “It’s Only Fair” and say their effort is all about charities paying their fair share of the costs of schools and police and fire protection.
But some of the amendment’s most vocal supporters in Colorado Springs are clearly fed up with the growth of the city’s evangelical community.
The city of 280,000 is home to more than 70 evangelical ministries and businesses, such as Cook Communications, the Navigators, Young Life, Compassion International, and the International Bible Society. Combined, these organizations bring in more than half a billion dollars every year.
The largest and most visible is Focus on the Family; the $101 million-a-year ministry has become a leader in advocating traditional family values through its radio, magazine, and book publishing efforts. The ministry’s founder and president, James Dobson, also is involved in national legislative issues, such as efforts to restrict cyberporn and to ban partial-birth abortions. He is working hard to see that the Republican party and its 1996 presidential candidate maintain a firm pro-life stance.
“I’m a pro-choice activist, and Focus on the Family is one of the biggest publishers of anti-choice literature in America,” says Janet Brazill of Colorado Springs, an abortion-facility escort and one of about 80 people who volunteered to circulate petitions throughout the state.
ECONOMIC HOSTILITY: Lucia Guzman, executive director of the Colorado Council of Churches, says the amendment could force hundreds of small and inner-city churches to close. “This will be like killing the soul of our communities,” says Guzman, who adds that some government leaders are challenging churches to pick up the slack resulting from downsized federal aid programs. “This is the wrong time to load them up with more taxes.”
Focus spokesperson Paul Hetrick says the initiative represents a form of “economic hostility toward churches and nonprofits.” He also charges that petition circulators were dishonest, saying state residents would reap a financial windfall but ignoring the potential consequences should ministries such as Focus leave the state for less taxing pastures. If the amendment passes, Focus could have to pay an annual property tax bill of up to $570,000.
“In the early 1990s, some of the nonprofits, along with a few for-profit companies, were very much a part of helping turn around the local economy,” Hetrick says. “Our payroll in this community is $35 million a year, almost all of which comes into Focus from outside the state. Voters in Colorado are intelligent enough not to be hoodwinked by something like this.”
But executives at other nonprofits are not so confident. Even though local measures to tax churches have failed in communities such as Berkeley, California, Coloradans are a traditionally libertarian and antitax group, and in 1992, state voters approved a tough new tax-limitation amendment.
“We’re taking this pretty seriously, unfortunately,” says Pat Read, executive director of the Colorado Association of Nonprofit Organizations. The Denver-based group will be leading an effort to educate voters about the social and economic benefits nonprofits provide.
COURT TEST LIKELY: But even if the amendment passes, people on both sides of the issue predict it will be appealed in the courts.
Barry Lynn, executive director of Americans United for Separation of Church and State in Washington, D.C., says the amendment is poorly constructed and inconsistent. For example, it would allow exemptions for church-based shelters that provide housing for abused spouses, but not for churches that provide free counseling to battered women.
“I don’t think that we can allow the government, including the voters of the state of Colorado, to define the mission of the church,” Lynn says.
And some government officials say the amendment will cost Colorado residents more than it saves. “This initiative is going to be opening up a can of worms that will cost thousands of dollars, if not hundreds of thousands of dollars, in litigation fees,” says John Bass, chief appraiser with the El Paso County Assessor’s Office in Colorado Springs.
Bass says a more prudent tax fairness move would be to target owners of large apartment complexes or tracts of farmland, not churches and charities–which own only about 3 percent of the county’s $18.5 billion worth of land and buildings.
“At best, the owner of the average Colorado Springs house will save $44 a year on a $110,000 house,” Bass says.
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