Amendment would exempt veterans groups from tax

Tuesday, October 31, 2006 | 12:00 a.m. CST; updated 4:26 a.m. CDT, Saturday, July 19, 2008

JEFFERSON CITY — Amendment 6 would add four words to Missouri’s Constitution: “or for veterans’ organizations.” The proposed amendment would exempt real and personal property used solely for the activities of veterans groups from property taxes.

“Of all the issues that are on the Missouri ballot, this is probably the least controversial and easiest ‘yes’ vote for the people of the state of Missouri to clarify that we don’t want any more taxes on our veterans organizations,” said state Sen. Luann Ridgeway, R-Smithville, who sponsored the resolution in the Senate.

The Missouri Constitution exempts “purely charitable” organizations from paying property taxes. But in the late 1990s, the State Tax Commission ruled that certain aspects of veterans organizations do not qualify for the exemption.

“The parts of the property that they used for charitable purposes are exempt and the rest of it is taxable,” said Randy Turley, chief counsel for the commission.

Turley said activities that qualify as charitable are those that benefit society, such as soup kitchens and housing for the poor.

“But other activities like a restaurant and a bar ­— the typical ones for veterans’ organizations — under the current law would not be a charitable activity,” Turley said. “The court cases even say (that) even if the profits from it go to charitable purposes that doesn’t qualify it (as charitable).”

Rich Heigert, chairman of the Missouri Association of Veterans Organizations, said it makes no sense to not qualify veterans organizations as charitable.

“We are the primary activists for veterans’ rights that they are guaranteed when they raise their hand and say I do to fight,” Heigert said. “We are their advocates.”

Ridgeway said veterans organizations would struggle if forced to pay property taxes.

“Many of these buildings are older buildings that are in commercial areas now, and, if forced to pay taxes at the rate that would be assessed against a commercial organization, I think they would have a hard time staying in business,” she said.

Ridgeway said that, so far, only two taxing jurisdictions in the state, Jackson County and St. Charles County, tax veterans’ organizations. But Ridgeway argues that’s just the start.

“It will be like dominoes falling, “ Ridgeway said of counties taxing veterans groups.

Dewey Riehn, a member of the Veterans of Foreign Wars Post 280 in Columbia, said he is grateful the organization doesn’t have to pay property taxes. Its property is tucked away on Ashley Street behind the Municipal Power Plant.

“The post is located in a very desirable area, and we speculate by looking at the property around us that if we ever have to pay property tax it would be $50,000 to $60,000 a year,” Riehn said. “That would be about well over half of what we are able to put in the community now, and our community scholarships and projects would be hurt tremendously.”

Riehn said smaller posts in the state would be forced to close their doors if they had to pay property taxes.

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