I recall some articles about the catholic church dioceses being sued for covering up or ignoring crimes committed by some of the priests, and I believe it mentioned that the individual docese itself was being sued, and whether that meant they would have to sell some churches and church property. One point was that donors would not be motivated to give money to the church if they knew it was instead being paid on directly to someone who had sued the diocese. Another problem was whether to sell the parochial school property instead rather than lose the parish church. (IIRC in Vancouver BC there was a disagreement over whether the order of nuns teaching there or the diocese owned the property) The impression that I got from this was that each diocese was separately incorporated. Since the bishop as head of the diocese was usually the one who made the decision to sweep matters under the rug, the diocese was liable.
Even in the one organisation there can be different funding models at different locations.
I’ve attended services where the pastor was provided by the central organisation as a missionary/outreach/development out of central funding. At the same time that other locations were being closed down / sold off.
In Anglican circles, this would be a Mission Church - other denominations might call it a Church Plant. The Diocese or overseeing body commits to paying for the minister (either full or part-time) and assisting with either temporary building costs or providing a building. The mission phase will be for a certain period of time (maybe 5 years to establish a viable church), and at the end of the period the new congregation will need to be self-supporting.
Mission churches are usually established in newly-developed areas, and can be established while non-viable churches in more established areas are having to close. If there is a thriving congregation in a region adjacent to a Mission church, the established church may dedicate resources and parishioners to supporting the church plant to improve the chances of success.
I’m quite surprised the church is permitted to do this. Typically churches don’t pay real estate taxes, but cannot then use the property for any commercial purpose.
I think in some church buildings, a cell phone tower is hidden in the steeple.
Well, I don’t know anything about the laws in play on this, but in our case, the cell antenna isn’t hidden at all, and it’s been there for a couple of decades, and I don’t think anyone has complained.
How is that different from renting space to a day care center, or renting meeting space?
Back home last time I checked any incurred tax from the renter’s commercial activity would be paid by the renter, if there was a building improvement or fixed installation needed to enable it, then the assessment on the improvement, not on the total whole church land and buildings, would be charged, on the telecoms company’s bill.
Generally speaking one not-for-profit organization can rent space to another, particularly if the activities are related to its mission. I could see it argued that day care is related. Renting to AA for a meeting, for example could be fine.
The Episcopal church I used to attend was approached by a local cell provider by doing this, and it would pay IIRC $750 a month, but the plan fell through; IDR why. That church also rents out their fellowship hall to AA groups and a chess club, although the chess club’s contribution is considered a donation (they weren’t charged a formal fee) because they mentor children and are open to the public.
Before AA starting meeting there, my old church also rented out the hall to a “Mommy and Me” group that was administered by the nearby community college. It was little kids and their parents, mostly mothers, who would dance and sing along to child-friendly recordings, 2 or 3 mornings a week.
The Salvation Army church down the street is shuttered, and they now meet for worship at their office. Before, they would always have big problems with people leaving their junk at the church, not the thrift store.
Depends on the law and exactly how it’s written , renting a small portion for a cell phone tower may not defeat the tax exemption especially since in many cases nothing is taken away from the exempt purpose of the building. The parochial school my kids went to rented space to cell phone towers. The space was on the roof, so renting it didn’t take away from any exempt use and as I far I know it didn’t eliminate the property tax exemption. Building a free-standing tower in the schoolyard may have.
I’m sure this varies from jurisdiction to jurisdiction. I took a quick look at New York City because I figured a big city would put some effort into communicating their policies. A qualifying non-profit is eligible for an exemption on property that is used for exempt purposes, which includes houses of worship. According to NYC’s eligibility guidelines, “Portions of the property that have no exempt use and are not actively being contemplated for an exempt use, as well as those portions leased to a commercial, non-exempt organization are not eligible for a property tax exemption.” So, if I understand correctly, the portion of the roof leased to the cell phone company is taxable, but it’s likely a tiny amount of tax on a relatively low-value part of the building, and the income from the lease far exceeds the tax payment. The church could also require the cell phone company to pay the tax as part of the lease. They might even be able to argue that the roof is still being used for an exempt purpose (keeping worshippers dry) and thus isn’t exclusively used for a non-exempt purpose, and thus shouldn’t be subject to property tax at all. Supporting that somewhat sketchy interpretation is more work than I plan to do.
In New York City, at least, pre-school education and uses for “mental or moral improvement” are explicitly exempt purposes if conducted by a qualifying non-profit (which I imagine most church-based operations are). In that case, the church can retain the property tax exemption as long as the rent basically only covers the expenses associated with the leased property.
This works basically the same way in my jurisdiction, which I learned when a charity I help run considered buying a space and subleasing a portion to other non-profits.
The tax laws are set up to allow non-profits to own for-profit businesses. I assume the for-profit business pays taxes as if it were an independent entity. For example, the Bose Corporation, manufacturer of audio equipment, is majority owned by MIT.
Oh yes.
Trinity Church’s real estate holdings date back to before the founding of the United States. They own a vast (by Manhattan standards) chunk of lower Manhattan, and it’s some of the most expensive real estate in the world.
The Archdiocese of New York also owns significant property in New York City, although their real estate holdings are dwarfed, unsurprisingly, by those of the city, state and federal governments. And, among private owners, Columbia University and New York University. And (unlike Trinity), I think most of that property is actually used for church-related purposes, rather than rented out to generate an income stream. I don’t have a cite for that at the moment, but I distinctly remember reading an analysis of the Archdiocese’s real estate holdings. Maybe the Times? I’ll poke around a bit, see if I can find it.
I gather it’s almost always volunteer efforts. Perhaps a priest or pastor or other church employee with a regular salary could be considered to get normal wage compensation, but as with your mother, these things couldn’t get pulled off otherwise.
More posts go into the subject but you describe the kind of thing that would likely be both profitable and improve community participation while there are also events that feature carnival rides and food trucks that may not rack up much money directly for the organization. A friend of mine with a food truck may have to pay a $50 entry fee to operate at a festival which is at least a guaranteed profit for them even if not a windfall (and woe betide a fool who thinks he can park a food truck down the street and avoid the fee). However, the possibility of increasing regular donations or membership fees through these activities could pay off very well over time.
Not exactly what I was referring to before, but the church Bingo operations around here lost a lot of their participants to legal casinos in the area. I’m not sure church participation had that much to do with it in the first place for the people who go to the casinos instead.
Also true, but that’s an issue of income tax, not property tax. Non-profits that engage in for-profit businesses are subject to Unrelated Business Income Tax under federal law. States usually have similar provisions in their tax code.
I just remembered that the church I attended in my old town, which was a large, wealthy Methodist congregation, had a commercial kitchen that they would rent out to people in the community, including the mosque once a year when they would host a dinner that was too big for the mosque. Apparently the dietary cleansings for halal dinners weren’t as rigorous as for kosher meals, so ours was adequate.
One data point on property taxes in Illinois - I used to serve on the board of directors of a church related non-profit that had a live-in religious sister to oversee the ministry and property. Her apartment took up about 19% of the building, and so we paid 19% of what would have been the property tax on the whole building. No big deal, the non-exempt portion of the building had taxes paid on it.