Schenectady County

Nonprofits must pay tax bills

The taxman has come for 13 nonprofits who didn’t follow state rules last year.

The taxman has come for 13 nonprofits who didn’t follow state rules last year.

Thirteen local agencies, including Carver Community Center and the Loyal Order of the Moose, are paying five-digit tax bills this year because they didn’t tell the city they were nonprofits by last year’s deadline. Even though that rule has been around for decades, none of them is happy about the consequences of ignoring it.

Several, including Carver, have appealed to the Schenectady City Council to erase their taxes. Many have refused to pay any of the bill.

Carver Community Center has so far paid none of its $24,429 bill. Already, the agency that provides after-school activities for youth has racked up $534 in interest charges, according to city tax records.

Former Carver Executive Director A.C. “Budd” Mazurek asked Councilman Joseph Allen to defend the agency’s tax-free status. But Allen was quickly knocked down when he raised the issue at Monday’s council committees meeting.

By law, every nonprofit must confirm its status annually by filing a form with the local assessor’s office, Corporation Counsel L. John Van Norden said. If they don’t, he added, there’s no leeway in the law.

The forms are due by March 1 each year. It’s not clear why Carver and others missed the deadline in 2007, but the assessor’s office went above and beyond to urge the agencies to follow the law, Director of Operations Sharon Jordan said.

The taxable status form is sent to every nonprofit on Dec. 1 each year. Last year, the assessor’s office also sent a reminder to every agency that hadn’t applied by early February. Thirteen agencies ignored the letters, offering no reason why they shouldn’t get a 2008 tax bill.

They offered a quick response when they got their first bill this January, but by then it was too late. The city can’t go back and change the tax roll after the deadline, Van Norden said.

This year, the city tried even harder to help nonprofits avoid paying taxes, according to officials. After the reminder was sent, Jordan called the nonfiling agencies personally. That seemed to help. Only three organizations skipped the paperwork this year, and one of them seems to be defunct, Assessor Patrick Mastro said.

That’s why the law must be followed every year. Some nonprofits move or go out of business, which sends their building back onto the tax roll. Case in point is the Broadway United Methodist Church, which folded in December 2005.

When Mastro sent out his reminder notices this spring, the letter was returned with no forwarding address. That was his first clue that the building is no longer eligible for tax-free status.

“That is a good example of why we do this,” he said. “You have ownership changes. And we need to examine their income statements to make sure they’re nonprofit. To just give them the status would be unlawful.”

He added that before he took over as assessor in 2005, it’s possible the assessor’s office quietly offered exemptions to nonprofits even if they didn’t file.

“I don’t know what the process was prior to me coming here,” he said. “But are they legally required to file? Yes.”

The issue is no longer Mazurek’s concern. He has left Carver Community Center to become executive director of the Saratoga County Rural Preservation Corp., which oversees a shelter for homeless veterans and other housing programs.

Mazurek will remain active in city politics though, and has so much support on the council that he was given a ceremonial resolution when he switched jobs early this month.

Mazurek will also keep his position as chairman of the Civilian Police Review Board and will still live in the city.

“I’m not going anywhere,” he said when he received the resolution thanking him for his service. “I will continue to serve as long as they want me on the police review board.”

Councilwoman Denise Brucker quickly answered, “We’ll never let you go.”

A week later, Allen brought up Carver’s tax issue, although city officials did not support rescinding the agency’s bill.

Mayor Brian U. Stratton also firmly resisted a similar request from the Loyal Order of the Moose, which owes $19,000 in taxes after it didn’t file for a nonprofit exemption on time. That agency must pay its taxes too, he said.

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