Churches in Jefferson County might qualify for a tax refund based on a recent court ruling, holding that a property tax exemption was wrongfully withheld from a Birmingham Baptist Association church and it was therefore entitled to a refund on taxes paid.
The ruling came as a relief to Winewood Baptist Christian Fellowship, near Pinson, which had been mired in the legal dispute since 2005.
"We feel vindicated," Pastor John H. Davis Jr. said. "We knew we were right."
The court’s ruling was in regard to 120 acres that Winewood Baptist purchased in 2003. At that time, the church resolved to use the land as an open-air sanctuary but laid out several strategies for long-term options, including constructing a new church building there. According to Davis, an employee of the Jefferson County tax assessor’s office visited the property in 2004 and told the church that it qualified for tax-exempt status.
But Tax Assessor Dan Weinrib later ruled that because the land is not contiguous to Winewood’s main property and there was no evidence that the land had been used for religious purposes, it did not qualify for tax exemption.
Weinrib said the main problem was use. "If Winewood Baptist had given us evidence that they had held a picnic on the land or if they had turned over a shovelful of dirt in a ground breaking, we would have given them an exemption with a smiling face."
Davis said the church never received notification of the change in status. In 2005, it received notice the land had been sold to the state and was about to be sold to another party because of its failure to pay taxes on the property.
After inquiring as to why no previous notice of the sale had been given, the church found that letters had been sent to the prior owner of the land, a fact Davis said the tax assessor’s office later admitted.
But after attempting to resolve the issue directly with the tax assessor, Davis said Weinrib sent a letter claiming his opinion could not be changed. As a result, the church was forced to pay all outstanding taxes on the property in order to redeem the land and retain ownership.
Winewood Baptist took the matter to court, and on April 23, Jefferson County Circuit Judge Robert S. Vance ruled that the property did qualify for tax exemption and the church could apply for a refund on taxes paid on the property, an amount totaling about $12,000.
And although it has not yet done so, Davis said the church will apply for the refund with interest included, as well as compensation for legal fees, bringing the total amount to around $18,000.
As of press time, Weinrib had not decided whether he would appeal the ruling.
"Right now, my office is exploring our options," Weinrib said.
If the court’s ruling does stand, however, then several other churches could also be entitled to a refund.
Gardendale’s First Baptist Church in North Jefferson Baptist Association is looking into the possibility of a refund on land it purchased over a period of two years, beginning in 2005, said De Allen, the church’s associate pastor of administration. Some of that land was not contiguous to the main church property, and the church was required to pay taxes on it.
But in order to avoid continually paying the tax, Gardendale’s First eventually bought the additional parcels that separated the land from the main property.
That sort of quick-fix option, however, is not always possible for smaller churches. And beyond the obvious financial burden, Allen added, "for a small church with a small staff, it can be very time-consuming and cumbersome to figure all of that stuff out and learn how it all works."
One such example is Harvest Community Presbyterian Church in Birmingham. According to Tonya Jones, accountant for Harvest Community Presbyterian, the church has been paying taxes on the main church property since it was fully paid off in 2001.
When the land was assessed in 2002, Jones told the tax assessor’s office she thought it should be exempt. "But they told me it should not. We never knew we weren’t supposed to pay," she said.
As a result, the church never applied for a property tax exemption.
In light of the court ruling in regard to Winewood, Harvest Community has applied for a refund on all the taxes it paid on the land. In addition, Jones said the church has signed a petition, along with several other area churches, requesting that the tax assessor’s office notify churches of the possibility of an exemption.
"Even when I asked about exemption, they never told me there was the option of applying to be exempt," Jones said.
For more information, call attorney Lee Wendell Loder at 205-326-0566 or e-mail him at loderlawfirm@aol.com.
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