The board of the Gingellville Community Center is wondering why the township has assessed them for property tax this year, when they are exempt from federal income tax. Orion Township Assessor John Attwell said the two exemptions are not the same.
Gingellville Community Center Director Pam Hutchison said she never received a letter from Attwell dated Nov. 25, 2003, asking the center to allow him to review their books and ledgers. In the letter, Attwell indicated the center was given tax exempt status in 1998, based on the center being a non-profit entity.
At that time, the center was moving to its new building on Waldon Road, from its original location at Baldwin and Maybee Road.
Attwell said the township agreed to give them some time to get ‘back on their feet? before seeing if their tax exemption would remain in effect after a future review of their non-profit status.
Celebrating its 65th anniversary this year, the center started as just a small club, but has always been youth-oriented, according to board member Lillian Hutchison. She said the old building was in need of repairs so a decision was made to sell that property and acquire a new building.
‘So we ended up over here (on Waldon Road),? she said. ‘It was a property trade. We’re still doing the same things…our membership has increased. We don’t charge anyone…Bingo and rentals are our only source of income.
‘We don’t take any funding from any government entity and we don’t solicit,? Lillian said, adding that anyone in the community was welcome to have a funeral dinner at the center, which is also used for Boys and Girls Scouts meetings, as well as other programs.
According to Pam, the center has been tax exempt from federal income tax ‘forever.? The township agreed to not assess property tax while the center moved.
‘We were kind of in limbo here,? Lillian said.
Pam said she received notice of assessment on March 3, 2004. ‘I called and called…I got no return call (from Attwell),? she said. The township clerk’s office eventually provided her with the Nov. 25 letter.
‘It was asking to see our records…we’ve been willing to do that,? said Lillian.
The center set up an appointment with the Board of Review for March 9. They were told there that they would need to speak with Attwell.
‘We had a copy of the letter of determination from the federal government saying we were tax exempt,? Pam said. ‘On March 15, Attwell came to the center and he didn’t ask for the books. All he wanted to see were our 2001, 2002 and 2003 tax returns, and a list of this year’s officers and last year’s.?
Pam said she provided Attwell with the requested material, as well as a copy of the center’s by-laws, as approved by the federal government.
‘In 1997, they did a land swap for a new center,? Attwell said. ‘There was a claim of error made by the title company…they said the property belonged to Larry Mullins, who was not eligible (for tax exemption), so it was put back on the roll.
‘In 1997, (the center) went to the Board of Review and asked for exemption for the building, but not the ball fields. As time has evolved, the use of the center has become less of a ‘community center?…that aside, there is still a four-part test for tax exemption,? he said.
In Michigan for property tax exemption, Attwell said an organization must ‘bear its burden of establishing its exemption ‘beyond reasonable doubt;? and the tax exemption statutes must be strictly construed in favor of the respondent taxing authority.
‘They have to prove beyond a reasonable doubt they qualify,? Attwell said. ‘They are claiming they should be exempt because they have a federal tax income exemption.?
The center received a notice they were being assessed for $416,090.
‘We haven’t actually received any bill, but we’ve been told we will,? said Lillian.
The notice of assessment said the township had changed the center’s status from exempt to Business Improved. Pam said the center filed a Freedom of Information Act request to find out why.
‘I want to know what law entitles the tax assessor to tax a 501(c)3 organization,? said Pam. ‘There is no law.?
‘We all volunteer here…we’re not going to volunteer to pay the township,? said Lillian. ‘The next thing we’ll be doing is closing.
‘I don’t want a new community center, I’m not for it…but we’re not in competition with anything (the township does). We’re a small group that’s trying to help,? she said.
Lillian said the federal government is very strict in their definition of a 501(c)3.
‘I don’t know where all the sudden the township’s decided they should tax us,? she said. ‘I don’t want to say they’re doing this because they’ve got a community center they want to build…but if we go belly up, this place doesn’t go to the township.?
‘Based on my review of their records, I informed the board of review,? Attwell said. ‘It looked questionable if they qualified for a charitable exemption.?
‘Once that roll is closed (by the Board of Review), there’s nothing anyone in this township can do. It goes to the state,? Orion Township Supervisor Jerry Dywasuk said.
Pam said the center’s only option now is to send a request to review the assessment to the Michigan Tax Tribunal by June 30.
‘Now we’ve decided to let the public know what’s going on,? said Lillian.
‘The opinion of the township attorney was that the federal papers we have are not what we think they are,? Pam said. ‘Did anybody bother to actually call that number (from the federal government) and talk to an actual person??
Attwell said other organizations such as the Knights of Columbus are assessed for property tax by the township, and currently pay.
‘They did not challenge it,? he said. ‘Because of the Michigan Property Tax Act, it’s not the same as having a federal exemption.?
Attwell said because the center’s been exempt in the past, they should be exempt now, but that property tax exemption must be established on an annual basis, and that the standards for exemption from Michigan Property Tax are more rigorous and demanding than the federal requirements.
‘If they felt strongly they are a non-profit, charitable organization…and those two words are key…what they do offer to the community as a whole, not a specific group, would have to be established to qualify them for exemption.?
As for the timing, Attwell said the matter was on his list of things to review.
‘I could have said in 1998 that they have to prove beyond a reasonable doubt…but I gave them some time,? he said. ‘I’ve kind of overlooked it since then.?
According to Attwell. after he got no response from his Nov. 25 letter, he put the property back on the roll.
‘What the township is trying to do is follow the law,? Dywasuk said. ‘We’re not trying to be mean to anyone.?
‘This is not a matter of intimidation or harassment to the center,? said Attwell. ‘The exemption has to be proved. It’s up to the center to decide if they have a strong enough case to take it to the tax tribunal.?
Attwell said if they are assessed yearly, the property tax for the center would be $20,000 a year. The township would collect only $400 of that for the general fund.
‘From a financial standpoint, this is not a wise thing to do,? said Attwell. ‘But from a legal standpoint, it’s the right thing to do. It’s a legal issue.?

‘We can’t have Bingo if we’re not a non-profit,’said Lillian. ‘If we sell the building, the proceeds will go to four youth groups that we chose. But we get nothing…we’ll just feel sad that this center has been in existence for 65 years…now the township needs our tax money. So we’re out of business.?
‘They do a great job, but we want to be fair,? said Dywasuk.