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San Francisco archdiocese wins tax case after 3-year fightNovember 22nd, 2011
By George Raine
A Superior Court judge on Nov. 18 issued an opinion that would throw out an attempted multi-million-dollar “delinquent” tax bill imposed on the Archdiocese of San Francisco by the San Francisco assessor/recorder, Phil Ting, after a more than three-year legal fight.
Judge Richard A. Kramer issued a 43-page “Tentative Statement of Decision” in favor of the archdiocese, Catholic San Francisco, the newspaper of the archdiocese, reported Nov. 22. A case management conference is scheduled Jan. 9, 2012.
The archdiocese fought the attempt by Ting to impose transfer taxes on more than 200 parish and school properties involved in an internal reorganization by the archdiocese. The archdiocese maintained that the effort came despite the fact that the city’s documentary transfer tax ordinance applies only to property “sold” in San Francisco and specifically exempts internal reorganizations of this kind. The church also countered that state and federal law have long recognized that intra-church reorganizations such as this are not transfers and are not subject to such taxes.
Kramer agreed with the archdiocese’s central arguments: The transfers were not “realty sold,” and the transfers were a change in the form of ownership that did not make them subject to transfer tax.
The Assessor/Recorder’s office acknowledged that it had never before levied such a tax, that no other county has ever done so and that it has never taxed similar transactions even by for-profit companies, the archdiocese said in a statement after the ruling.
“The Archdiocese of San Francisco is delighted that the Superior Court has vindicated the position the archdiocese has taken all along,” said George Wesolek, director of communications for the archdiocese.
“The land and buildings involved are all used to serve the nearly half-million families and children in the archdiocese’s parishes and schools and countless others,” he said, noting that the tax would have had “had a crippling effect” on the parishes and schools.
In his ruling, Kramer stated that each party may submit proposed revisions to the Tentative Statement of Decision. He added that they may not reargue the substance of the matters decided, but rather shall be limited to such things as the accuracy of citations to the administrative record.
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