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Category: Real Estate Law
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I wish to donate land to my local Catholic church. Would the

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I wish to donate land to my local Catholic church. Would the church be liable to pay future county property taxes and any possible future city improvement assessments (e.g. for street upgrades, installation of sewer & water, etc.)?
Submitted: 1 year ago.
Category: Real Estate Law
Expert:  Law Pro replied 1 year ago.

Welcome to JustAnswer! My goal is to do my very best to understand your situation and to provide a full and complete excellent answer for you.

My name is XXXXX XXXXX I'm going to assist you with your question.

Please bear with me if you believe my answer isn’t coming fast enough because I’m also working with other customers too. I apologize for any seemingly late response.


Generally, recognized churches (the catholic church is "recognized") because of their "non profit" categorization are exempt from having to routine property taxes.

America’s tax laws are designed to favor non-profit and charitable institutions which presumably benefit the community. The buildings of private schools and universities, for example, are also exempt from property taxes.


However, they would have to pay for upgrades to their buildings or property and use of the sewer and water systems.

As to roads - they would only have to pay to upkeep the roads within the land itself.


If you have any further questions, please feel free to let me know…

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Customer: replied 1 year ago.
You stated that the church would have to pay for USE of the water and sewer systems which makes sense. However, my situation is that in about 6 to 10 years from now, the city anticipates (not specifically in their current 5 year plan) to make improvements to the road my property borders by installing a new road in the same location with curb & gutter, a bike trail, sewer & water as well as storm sewer. If I continue to own the property, I will be assessed a very sizable amount of money (about $160,000) because my land has 510' adjacent to the road. I specifically need to know if the church would have to pay these assessments if I donated my land to them prior to the improvements coming through and the adjacent property owners being assessed for them?
Expert:  Law Pro replied 1 year ago.
Most times "roads" and their improvements are not directly taxable to the property owners although indirectly they are through their property taxes payable to the municipality.

So the church wouldn't pay for the road improvements.


Moreover, since the property is already "tapped-into" the water and sewer - they wouldn't have to pay for that either. They would have to pay if they needed to run new lines from the "main line" to the structure if that would be needed. But usually the municipality pays for connecting the existing property owners lines to the main as part of the upgrade or improvements.


Lastly, are you sure that the church will accept your property as a donation? Have you asked them?
Customer: replied 1 year ago.
So are you saying that the church WOULD NOT be required to pay for any future improvements in the form of special assessments that the city may run by them in the future if they accepted my land as a donation?

No I'm not sure the church will accept my land as a donation because I have not asked them yet. But when I do, I want to have a clear answer to the above question.

We DO pay separate property taxes, and additionally and separately for improvements that the city installs such as for roads, sewer, water, trailways, etc.
Expert:  Law Pro replied 1 year ago.
That's an issue - the church (regardless of what religion) just doesn't take any land given.

For there to be a valid gift - there needs to be:

1) intent by the donor to donate the property (which you have the intent)
2) delivery of the gift (a deed is a symbolic delivery of the property)

AND

3) ACCEPTANCE by the donee of the gift - one can give something to someone if they don't want it. Moreover, the donee (grantee) must sign the deed acknowledging acceptance of the property.


I know of many situations where a church or other charitable institution won't accept property - for instance - they won't accept ownership of timeshares.


So, you must find out if they will take your property as a donation.


As to your other questions:

So are you saying that the church WOULD NOT be required to pay for any future improvements in the form of special assessments that the city may run by them in the future if they accepted my land as a donation?

Correct. Generally they are not required to pay for such - because they are tax exempt.

No I'm not sure the church will accept my land as a donation because I have not asked them yet. But when I do, I want to have a clear answer to the above question.

We DO pay separate property taxes, and additionally and separately for improvements that the city installs such as for roads, sewer, water, trailways, etc.



Generally they do not pay for any "improvements" - those costs are generally born by the taxpayers of the municipality. They only pay for their useage of utility services and "tap-ins" from their structures to the "mains".


If you have any further questions, please feel free to let me know…

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Customer: replied 1 year ago.
Could you please quote/reference the applicable federal and Minnesota State statutes that verifies your statement that "Generally they (the church) do not pay for any 'improvements' - those costs are generally born by the taxpayers of the municipality"?

When you use the word "generally", it sounds as though there may be exceptions. What could those exceptions be?
Expert:  Law Pro replied 1 year ago.
Minnesota Statute 272.02, subdivision 7 describes the qualifications necessary for an
institution of purely public charity to be eligible for property tax exemption.

Here is the statute in part - it's way to long to paste the entire statute:

272.02 EXEMPT PROPERTY.

Subdivision 1.Exempt property described.

All property described in this section to the extent limited in this section shall be exempt from taxation.

Subd. 1a.Limitations on exemptions.

The exemptions granted by subdivision 1 are subject to the limits contained in the other subdivisions of this section, section 272.025, and all other provisions of applicable law.

Subd. 2.Public burying grounds.

All public burying grounds are exempt.

Subd. 3.Public schoolhouses.

All public schoolhouses are exempt.

Subd. 4.Public hospitals.

All public hospitals are exempt.

Subd. 5.Education institutions.

All academies, colleges, and universities, and all seminaries of learning are exempt.

Subd. 6.Church property.

All churches, church property, and houses of worship are exempt.



Here is an application for them to claim the exemption:

http://www.co.olmsted.mn.us/prl/propertyrecords/AssessingProperty/Documents/Institution%20of%20Purely%20Public%20Charity.pdf


As to the specifics about the roads - you would have to contact the municipality to be certain about what they would not wouldn't be exempt as to their maintenance and improvements programs they are going to do in the near future.

Property taxes are one thing - maintenance and use of the municipal property another.

So you should contact the local municipality to be certain.


Good luck!!!


Please press the Accept Button(and the Smiley Face if prompted :) if I have helped you today so I am credited for my time assisting you.



Customer: replied 1 year ago.
You have made it clear that the church would be exempt from annual property taxes. However, outside of property taxes, it seems that you are saying that from municipality to municipality the municipality can individually set their own rules regarding if a church would have to pay city road improvements or the installation of adjacent water & sewer services that the church could hook up to. Is this correct? If this is correct, please quote/reference the applicable statue(s) that allow municipalities to assess and collect money from churches for the provision of such improvements and services.
Expert:  Law Pro replied 1 year ago.
That is correct.


It depends on the municipality.

Currently there is Minnesota: Legislation being considered in Minnesota would authorize municipalities to establish street improvement districts and charge nonprofits and others "street improvement fees,” for up to 20 years, on anything from street lighting to sidewalks. Nonprofits in the state, led by the Minnesota Council of Nonprofits, oppose the bill for several reasons including its direct financial impact on organizations that are exempt from property taxes. Street improvements have generally been paid for out of property tax funds or special assessments.

Revisor number: 13-1196

Description

Municipalities authorized to establish street improvement districts and apportion street improvement fees within districts, adoption of street improvement plan required, and collection of fees authorized.



Currently it's up to the municipality as I stated.


As I stated, you must contact your local municipality as to their decisions on the matter as to what they consider to be improvements and the like for which they charge non-profits.



Good luck.



Please press the Accept Button(and the Smiley Face if prompted :) if I have helped you today so I am credited for my time assisting you.
Law Pro, Lawyer
Category: Real Estate Law
Satisfied Customers: 24040
Experience: 20 years extensive experience in real estate law, foreclosure, finance, and landlord tenant law.
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Expert:  Law Pro replied 1 year ago.
If you have any further questions, please feel free to let me know…

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