HOUSE BILL REPORT

SB 6292

BYSenators Zimmerman, Bauer, Smith, Conner and DeJarnatt

Revising the property tax exemption for public assembly halls and meeting places.

House Committe on Ways & Means/Revenue

Majority Report:  Do pass with amendment.  (9)

      Signed by Representatives Appelwick, Chair; Basich, Bristow, Dellwo, Holland, Rust, Schoon, Valle and Winsley.

House Staff:Bill Freund (786-7136)

AS REPORTED BY COMMITTEE ON WAYS & MEANS/REVENUE

FEBRUARY 27, 1988

BACKGROUND:

The real and personal property owned by nonprofit organizations used in the operation of a public meeting hall or assembly place is exempt from property tax.  The exemption is limited to improved property no larger than one acre and unimproved property up to 29 acres in size.  The exemption is nullified if the property is used for monetary gain or to promote business other than fund raising activities conducted by a nonprofit organization.  The department of revenue is directed to construe this property tax exemption narrowly.

There have been some cases where organizations conducting annual community celebrations have rented part of their property to concessionaires who run carnivals or other activities in conjunction with the celebration.  The Department of Revenue has interpreted this as the promotion of business and has denied the property tax exemption.

SUMMARY:

BILL AS AMENDED: To qualify for property tax exemption, the property of a nonprofit organization used as a public assembly hall or meeting place must comply with statutory conditions for obtaining property tax exemptions by nonprofit organizations.  Duplicative language is eliminated.

Deletes the requirement that the department of revenue shall narrowly construe the property tax exemption for public meeting halls or assembly places.

AMENDED BILL COMPARED TO ORIGINAL:  The original bill created an exception to the provision which nullifies the property tax exemption if the property is used for monetary gain or to promote business.  The amended bill accomplishes the same objective by reference to existing statutes which allow nonprofit organizations to loan or rent property to for-profit entities without impairing the tax exempt status of the property.

Fiscal Note:      Available.

House Committee ‑ Testified For:    None Presented.

House Committee - Testified Against:      None Presented.

House Committee - Testimony For:    None Presented.

House Committee - Testimony Against:      None Presented.