Porter County Assessor Jon Snyder has recently announced to the County
Council he intends to inspect the county’s 6,246 parcels that are receiving
property tax breaks or exemptions and check if they qualify under the
According to figures from the assessor’s office, exempt properties in the
county hold nearly $700 million total in assessed value and the county could
gain some revenues after reviewing the qualifications for tax exempt status.
At the Council’s meeting last week, Snyder said the county’s Property Tax
Assessment Board of Appeals (PTABOA) members suspect there could be
inequities in the application of tax exempt status across the county.
All tangible property must be assessed under Indiana code, but groups like
non-profit organizations can appeal to the PTABOA board to get an exemption.
Snyder cited two court cases that prompted him to reevaluate the parcels.
One case in particular was a legal challenge made by Snyder’s predecessor,
John Scott, against the Steelworkers Local 6787 Hall in Chesterton. Having
received a tax-exempt status in 2006, The Indiana Board of Tax Review in
2009 issued a determination that Local 6787 had not demonstrated the banquet
hall was used for charitable or educational purposes.
The second court case regards the Fraternal Order of Eagles #2455 in Noble
County which made a similar appeal to the Indiana Tax Board. Like the
Steelworkers, the Eagles did not provide sufficient evidence their building
was being used 100 percent for charitable purposes.
Snyder said his objective is not a political one and he takes no stance
against the unions or questions their role in the community. Instead, the
goal is to ensure “fair and equitable” assessments by abiding by what the
legislature has passed concerning the qualifications for tax exemptions and
using that to establish criteria for further exemptions.
“It is really about following the law,” said Snyder.
Partial charitable or educational work by non-profits, Snyder said, is not
recognized by Indiana’s legal principles governing real estate and taxation
Snyder said he has reached out to local state legislators to discuss
legislation that aims to clarify the criteria used to classify exempt
State Rep. Ed Soliday, R-Valparaiso, said there was a summer study committee
which considered legislation addressing the topic. A bill has been
introduced by state Rep. Milo Smith, R-Columbus, proposing that all
501(c)(3) organizations will be exempt from property tax. If the bill gains
momentum, Soliday said amendments are likely to be made since the bill does
not guard against the possibility of one of the groups opening or renting
out a shop or a restaurant tax-free that would be in direct competition with
Tax exemption laws written more than 30 years ago allow local officials to
interpret if community entities are actually making a contribution to
society, such as the Boys and Girls Clubs or the YMCA.
After subsequent rulings by courts, some counties interpret the law broadly
while there are others with narrower interpretations.
The situation can be complex and difficult for venues that have been tax
exempt for years such as Moose lodges and Masonic lodges which may not have
revenue enough to absorb property taxes if their status is revoked, Soliday
This may cause organizations to relocate to counties where their exempt
statuses are still valid, thus reducing services in the community.
Soliday believes more discussion between state officials and various
attorneys is needed on the issue before legislation is drafted, but says it
is unlikely a solution will be found before the bill drafts are due on Dec.
Minor amendments or tweaks may be passed, but the issue is complex with many
“Let’s start thinking about this because once you start down this path, you
have some very strong factions. There are some people, even in the
legislature, that say let’s tax everybody, there are some who say the system
works the way it is and there are those in the middle that say non-profit
groups should pay for some of it,” said Soliday.
PTABOA Attorney Christopher Buckley wrote a memo to Commissioner President
John Evans and County Council President Dan Whitten informing them of the
board’s intention to see that exempt properties are meeting legal standards.
Buckley said all tangible property is subject to taxation but may be
exempted if the property is used for municipal, educational, literary,
scientific, religious or charitable purposes which are generally formed as
501(c)(3) organizations. Certain community organizations are also exempted
by statute including the YMCA, Boys and Girls Clubs, the Salvation Army, the
American Legion and other veterans’ organizations.
Buckley said the taxpayer bears the burden of providing evidence of how
their organization fits the qualifications to be exempt from property tax.
Religious exemptions tend to be the simplest in determining an exemption,
Buckley said, while “charitable use” exemptions tend to be the broadest and
An organization’s 501(c)(3) non-profit status does not automatically mean
its property is entitled to charitable exemption. It must first show that
its charitable acts benefit the general public.
Snyder said the assessor cannot make a determination on PTABOA exemption
cases because he serves as secretary for the board and not as a voting
member, but he can make the effort to see that assessments are made fairly.
Buckley points out that the more property tax exemptions are granted, the
more burden is put on other property owners who must pay the remainder of
the tax levy.
The assessor and PTABOA plan to start reviewing all parcels within the next
Costs for the inspections will be paid out of the county auditor’s
non-reverting fund set up as part of the Total Quality Management plan at no
expense to taxpayers.
If properties lose their exemption status as a result of the reviews, Snyder
said the property owner can file an appeal to the Indiana Board of Tax