Rivers and Cleveland applaud DOR decision to review rules for non-profit fundraisers on church property

OLYMPIA… Sens. Ann Rivers and Annette Cleveland are pleased with the state Department of Revenue’s decision to review regulations that could potentially prevent churches from holding non-profit fundraisers on their property.

“Non-profit religious institutions need clarity on what they can do on their properties without jeopardizing their property tax exemption,” said Rivers, R-La Center. “The department’s decision to examine its regulations affecting church-related fundraisers is a big step in the right direction.”

The issue was brought to the senators’ attention by St. Joseph’s Catholic School in Vancouver. The school’s fundraisers — particularly its iconic sausage festival — were in jeopardy due to an unenforced DOR regulation. The rule states that if a non-profit religious organization has an event on its property it cannot make any money and any profits made must be returned to a third party. As a result, religious institutions like St. Joseph’s were forced to consider cancelling these types of events.

Rivers and Cleveland responded by crafting Senate Bill 5740, a bipartisan measure that would have allowed non-profit organizations to hold events by third parties on their property without losing their non-profit status. Although this measure was not acted upon during the 2013 legislative session, Rivers and Cleveland continued pressing the issue.

In early July, Rivers and Cleveland joined with several other senators to urge DOR to reconsider its rules on non-profits.

“I agree with your proposal that this issue needs to be examined from a statewide perspective,” Carol R. Nelson, DOR’s director, responded. “To that end, the department plans to work with stakeholders and other interested parties to gather input and identify options that will address the concerns of churches and provide greater consistency in the ways non-profit organizations may use their tax-exempt property.”

DOR will provide the Legislature with recommendations on this issue by Dec. 1.

“Non-profit organizations help people throughout our community, and during tough times like these, their assistance is more needed than ever,” said Cleveland, D-Vancouver. “In this era of decreasing financial resources, the last thing we want to do is jeopardize the non-profit status of churches that rely on fundraisers to help raise income. It’s entirely appropriate that the Department of Revenue take the issue under review.”