Fearing that some of their charitable functions could be imperiled, D.C. religious community leaders are strongly opposed to a proposal pending before the City Council that would impose what they see as a kind of property tax on churches, synagogues and other currently tax-exempt properties.
"That is not like a business where you can just pass the cost on to the consumer; you have to take it from one pocket and put it in another," said Daniel Mann, executive director of the Jewish Community Council of Greater Washington.
"The religious community is not oblivious to the needs of the city," Mann said. "But we don't want to put ourselves in a position where we can't function."
The latest proposal to impose such payments - technically known as payments in lieu of taxes - was made in March by Council member Arrington Dixon (D'four). Dixon's approach was sentatively supported a few weeks ago by the 20-member D.C. Tax Revision Commission, which is expected next month to make more than 50 recommendations to the City Council overhauling the city's patchwork of tax laws.
Some religious representatives had felt assured last month that any dilution of their tax exempt status was not possible, based on a conversation between a representative of the Interfaith Committee of Greater Washington and the executive assistant to Council member Marion Barry (D-at large).Barry is chairman of the Council's finance and revenue committee, which would have to give preliminary approval to the proposal.
Lynnette Yount, an assistant to the coordinator of the interfaith committee, said she was told by Barry aide Edward Meyers "flat out that the churches aren't going to lose their exemptions."
But Meyers said yesterday that he never made any assurance that church tax exemptions would be retained, but merely told Yount that Barry was personally opposed to the bill.
Barry, who is expected to run for mayor next year, said yesterday that he is not sure whether the measure will pass or fail, but he will hold hearings on it early next year after the report from the tax revision commission, which he established, is given to the Council.
"My own personal view is that I would be opposed to it but as chairman o the committee I have a responsibility to hold hearings," Barry said.
"That may be the story as of today," Yount said, "but that wasn't the story I got from them before."
The tax revision commission, a 20-member citizens advisory group, was set up more than a year ago and assigned the task of making suggestions on how to change the city's tax laws, which some feel are ineffective and outdated.
Included in the more than four dozen tentative recommendations of the commission is a proposal that would require all currently tax exempt properties to pay a charge equal to 10 per cent of what would be paid if the property were not tax exempt.
"Private institutions which enjoy real property tax ememptions also receive, directly and indirectly, many of the same benefits of the District's expenditures that accure directly and indirectly to tax-paying properties," the commission's draft recommendation reads.
"The current structure of property tax exemptions discriminates against those nonprofit organizations which must rent, and therefore utlimately pay some real property tax, and in favor of similar nonprofit organizations which own and occupy their real estate," the document says.
In addition to churches, that provision would apply to museums, libraries, schools and diplomatic properties. Donald R. Beach, acting associate director of the D.C. Department of Finance and Revenue, said that more than 50 per cent of the city's $19 billion tax base is exempt from paying property taxes.
Religious properties account for about $404 million of those exemptions and if not exempt would pay about $7 million annually in property taxes, Beach said. A 10 per cent alternative payment as tentatively proposed by the commission would bring in about $700,000 a year from the estimated 1,300 church-owned properties in the city, Beach said.
The tax commission's recommendation also would remove exemptions from about 43 properties whose owners have been excused from paying property taxes by acts of Congress. Some in that group, which includes such organizations as Howard University, the Daughters of the American Revolution and the Corcoran gallery of Art, would be required to make the 10 per cent payments. Others could be required to pay the full amount of taxes.
The commission projects that about $3 million would be brought in by lifting all the exemptions and requiring alternatives payment. The largest group of tax-exempt properties in the city are those owned by the federal government, which would not be covered by this particular recommendation.
However, in a separate recommendation, the commission suggests that the annual federal payment, which is supposed to compensate the city for the loss of tax revenues from those U.S.-owned properties, be much higher than the current ceiling, which is $300 million.
Local church leaders interviewed about the recommendation agreed with Mann that one effect the payments might have would be to reduce the amount of money that religious organizations now have available for charitable services.
Mann said some church groups already have adopted resolutions suppsrting the idea of Congress granting full taxing authority to the city and favoring a nonresident income or commuter tax.
The other major objection raised by representatives of the religious community is that any kind of required payment might violate consitutional guarantees of religious freedom.
"The power to tax does involve the power to define and to control. To us that is contrary to the Frist Amendment," said John W.Baker, associate director of the baptist Joint Committee on Public Affairs.
"Once the doors open to begin taxing church properties, it won't stop," said one leading official of the Council of Churches of Greater Washington who asked not to be named.
Dick Oden, director of the Alliance for the Preservation of Religious Liberties, said that "there is an antireligious movemnet that has been growing in the country; deprograming is part of it and it looks like this could be part of it, too."
It could not be immediately detemined yesterday how many churches in the city rent properties rather than own them. One church organization representative said, however, that there could be as many as 200 such properties - mostly "store front" churches - in the city.
An alternative sometimes discussed is for churches to donate money voluntarily to the city. Some church organization representatives said they could support such a program, as it remained voluntary.