Judge says church homes tax exempt

Posted: Sunday, July 06, 2008

ANCHORAGE - Homes owned by a prominent Anchorage church for teachers at its private school will remain exempt from local taxes under a decision by a Superior Court judge.

In his ruling Thursday, Judge Mike Spaan said a new state law exempting organization-owned homes of religious educators is constitutional.

Spaan said the exemption applies to all churches as well as residences of secular nonprofit educators as long as they are vitally necessary to the tax-exempt purpose.

At issue was a 2006 law passed by state lawmakers explicitly exempting church-owned religious teachers' housing from local taxes. The law was passed after the Municipality of Anchorage refused a tax exemption for six homes owned by the Anchorage Baptist Temple, saying the existing broad religious exemption did not apply to teachers.

Churches and church-owned homes of clergy have historically been exempt from property taxes. Those challenging the law said that including housing for non-clergy teachers was stretching it too far.

The American Civil Liberties Union of Alaska and a group of activists sued to have the exemption declared unconstitutional. The state defended the law with help from the Anchorage Baptist Temple and other churches.

Spaan's decision says tax exemptions are provided to religious and charitable organizations because they perform services that would otherwise have to be funded from tax revenues, and because they foster the moral and intellectual development of the community.

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