Washington County commissioners approve tax exemptions for Midvale Legion Hall, Pythian Castle

By: 
Steve Lyon

The Midvale American Legion hall and historic Pythian Castle in Weiser were both granted tax-exempt status by Washington County commissioners after lengthy discussions.
 The county assessor’s office gives commissioners a list of properties seeking tax-exempt status every year for approval. Usually, it’s a formality to approve the list, but this year a couple of applications were singled out for review.  
 Commissioners decided to approve the tax-exempt status for the Midvale American Legion on May 18 after initially hearing from the assessor’s office that building didn’t qualify because it was renting out space to a church and earning income.
 Following discussions, commissioners decided the nonprofit American Legion hall qualified as mixed use under state law and is exempt from property taxes.
 In the second application reviewed by commissioners, the nonprofit Bee Tree Folk School is leasing the Pythian Castle and filed for tax-exempt status on the property, which is owned by another nonprofit, the Weiser Architectural Preservation Commission.
 A question arose over the status of the second floor of the castle, which is part of the lease but is not being used, and whether the space qualified as tax-exempt or should be taxed. The first floor is used by the Bee Tree Folk School for educational purposes and also for preservation by housing the Vassar-Simpson collection.
 County prosecuting attorney Delton Walker said the fact that one non-profit is leasing property to another non-profit does not automatically qualify as tax-exempt. It is not as simple as one nonprofit leasing a building to another nonproft equals an exemption. In researching the issue, he said he contacted the state tax commission for some clarification.
 There was not an example in case law that matched perfectly. The law allows for a tax exemption for educational purposes and another section of Idaho law that allows tax-exempt status for nonprofit purposes. The property owner would hold an exemption unless it was leased “for profit.” The amount of property taxes involved totaled about $1,800 annually.
 “I don’t have a final answer on this,” he said. “It’s not completely resolved under Idaho case law.”
 He said the application filed for tax exempt status cited applicable provisions in Idaho law but didn’t designate which portion of the building is used for educational purposes and which was used for preservation of historical artifacts.
 One state tax official he contacted said the portion of the building used for administrative offices might be apportioned and be subject to property taxes. The landowner would pay the property taxes on the value of the portion of the building not used for educational or preservational purposes.
 Dennis and Sandy Cooper, founders of the nonprofit Bee Tree School, said the entire building should be tax exempt based on use. The first floor is used for teaching folk art classes in the community and to house the historical and cultural artifacts that were bequeathed to the nonproft.
 The second floor of the castle is not up to code and there are no improvements. When time and money allow, the upstairs will be renovated and used exclusively for educational purposes. There are currently occasional tours of the second floor, which are educational, Dennis Cooper said..
 Debbie Moxley-Potter said she reached out to a couple of other counties to see how they handled similar types of situations. One county exempted the property and one taxed a portion of the building.
 Commissioner Kirk Chander said if Bee Tree Folk School is leasing the castle for educational purposes, it should be tax-exempt under the law.
 In the end, commissioners said the nonprofit Bee Tree Folk School qualifies for a tax-exemption under mixed use and voted to grant it.

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18 E. Idaho St.
Weiser, ID 83672
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