Christian congregation sues city over getting taxed

A church in San Rafael, California, is suing the city for charging thousands of dollars through a special property tax from which religious facilities are supposed to be exempt.

The action was brought in Superior Court for Marin County by the Pacific Justice Institute on behalf of Valley Baptist Church.

The legal team explained voters in San Rafael approved a special tax in 2010 through a referendum.

It provides that the city can charge the owners of "non-residential structures" up to 14 cents per square foot each year.

But in California, churches and religious institutions are exempt from ad valorem taxes, which are assessed in proportion to the estimated value of the property.

Paul Marshall, Lela Gilbert and Nina Shea have collaborated to create “Persecuted: The Global Assault on Christians,” which confirms that groups like Pew Research, Newsweek and The Economist also identify Christians as “the world’s most widely persecuted religious group.”

"The special tax is a de facto property tax because it triggers a duty on the part of owners of non-residential structures to pay the tax," said PJI President Brad Dacus. "The California Constitution exempts churches from paying such taxes, pure and simple. Valley Baptist did not owe a penny to the city of San Rafael, and it's unfortunate that the church now has to go to court to win back money that it never should have had to pay to begin with."

The church had to pay thousands of dollars to the city to bring the case, which it filed when the city subsequently refused to return the money that allegedly was not due.

"Federal, state, and local governments have long granted tax exemptions to churches and other religious non-profit organizations because of the significant and beneficial social services they provide to their communities," PJI said.

"This concept is being lost in our generation because, sadly, church membership has declined," Dacus said. "People in government thus unfortunately assume that churches aren't paying their 'fair share' without understanding why they're tax-exempt to begin with."

Valley Baptist challenged the city because officials suddenly slapped the church with a bill for more than $13,000, claiming it was for taxes that had been due in previous years but weren't paid.

But PJI found that under California law "all taxes on real property must be ad valorem taxes – in other words, they must be levied in proportion to the property's value as determined by assessment or appraisal."

"Because the California Constitution exempts real property used for religious purposes from ad valorem taxation, Valley Baptist contends that it does not owe any money to the city under the special tax."

The complaint argues that since the property is for religious purposes, it is exempt.

The church seeks a refund plus "a declaration that the city has violated plaintiff's rights under the California Constitution and that churches and other religious organizations are exempt from paying special taxes that are de facto ad valorem taxes in form and function."

The church had argued to the city that because the special tax is a real property tax, the church was exempt.

It explained: "VBC is a non-profit entity organized for religious and charitable purposes that presumable uses the property for such purposes. As such, VBC qualifies for the exemptions available to it under the California Constitution and California's Tax and Revenue Code."