Aquinnah selectmen consider remedies to church parsonage tax lien

Town officials suggest pro bono legal research on parsonage tax status.

Aquinnah selectmen met with a number of concerned town officials Tuesday regarding the tax taking of the parsonage at Gay Head Community Baptist Church, the nation’s oldest continuous Native American church congregation.

Town treasurer Sibel Suman told selectmen the first step in providing the parsonage with necessary financial relief would be to thoroughly research current tax laws, and determining what kind of warrant article to bring to town meeting.

According to Suman, assessors began taxing the parsonage after learning it was being rented out as housing. “What they [assessors] are doing is legal, whether or not it is right,” Suman said.

Normally, churches are tax-exempt and are not required to apply for exempt status from the IRS, according to the IRS website. But, according to Suman, two things have made it so assessors are able to impose taxes on the property. The first is that the parsonage land contains two separate lots. The building sits on only one of those lots, leaving the other lot under a non-exempt status. Suman recommended pro bono legal work to create a single lot.

Town administrator Jeffrey Madison made it clear that forming a single lot would not eliminate the outstanding tax lien. Another obstacle Suman hoped to address was that for many years, the parsonage had been rented out as affordable housing, she said. This removed the nonprofit status of the property, making it open to taxing.

However, the parsonage is in disrepair and has not had tenants in four years. The septic system inside the church parsonage has failed, and the structure itself has seen better days.

Suman suggested someone do pro bono legal research into the current town bylaws and tax laws to determine what would be the best method to stop additional taxing and forgive some of the tax lien. “This is not going to be a simple process,” Suman said.

She went on to describe the significant tax title amount that has already been imposed on the church property. “We can’t just wipe this out; no one has the authority or power to do it,” Suman said.

One loophole Suman mentioned would be for the church parsonage to change ownership, in turn forgiving 100 percent of the interest and 75 percent of the tax title amount. “We should have counsel really dive into what the options are in this case,” Suman suggested.

Derrill Bazzy, chairman of the Aquinnah Community Preservation Committee, said The Resource Inc. (TRI), a nonprofit community development organization, and Community Preservation Act funds have been dedicated to the church parsonage in the past. Emergency funds were also made available by the board of health to address the septic failure.

Bazzy reiterated Suman’s earlier comment: “There is a big difference between what you can do, and what you should do.”

Bazzy said the parsonage began to be taxed immediately after the failed septic made it uninhabitable. Because the church was no longer benefiting from the revenue stream provided by tenants in the parsonage, back taxes began to pile up. A lien was then placed on the property, making the emergency funds from the board of health and TRI unavailable.

As a community, Bazzy said, it is important to support the church in any way possible. “It is a center of our culture and our history of Gay Head,” he said.

The funds originally made available to the church are still there, but Suman said the church board must initiate the process by first submitting an application. “We can interject as soon as they put an application in to TRI,” she said. “We can bypass the tax title, since it’s our tax title, and still provide the septic repair.”

After that, Suman said the board of health can determine whether the septic repair cost will be forgiven, or whether it will be paid back over time.

“The goal would be to bring them a tenant so they can have money coming in,” Suman said. “We need to figure out how much we can legally forgive, and then after they have some cash flow, we can set up a payment plan so no more debt is accrued.”