Representatives of two of Lawrence's country clubs say they are disappointed in the action taken last week in the Kansas House to keep country clubs from being considered as nonprofit organizations for property tax purposes.
The House passed and sent to the Senate a bill strictly limiting which nonprofit organizations receive a property tax break under a constitutional amendment approved by voters in November.
Only Rep. Al Lane, R-Mission Hills, voted against the bill. There were 121 votes for it on final roll call.
Lane had unsuccessfully attempted during debate to amend the bill to include private country clubs among the organizations that would get their property assessment rate reduced from 30 percent to 12 percent.
Bob Billings, president and owners' representative of Alvamar Country Club, said the club has had a "rather major increase" in property taxes since a 1989 property classification amendment went into effect. He said the country club's property taxes went from $40,000 to $120,000 after reapportionment. After the country club went through a tax protest, the tax was lowered to $90,000 in 1991.
"IT CERTAINLY has been difficult on our members. The members are the ones that pay the bills," Billings said.
Bob Stephens, who was president of the Lawrence Country Club when classification took effect, said the club's property taxes increased from about $17,000 to about $70,000 under reappraisal.
Stephens said country clubs should not be taxed at commercial rates because the property is not zoned for commercial use. He said if the country club went out of business, a business could not be put in its place without having the land rezoned for commercial use.
Stephens said the Lawrence Country Club dealt with the matter by raising dues and trying to get more members.
THE BILL the House passed would limit the reduction to a narrowly defined group of charitable organizations that aren't already exempt from property taxes.
The tax break was contained in a constitutional amendment approved by voters last fall that also slightly reduced the residential assessment rate and lowered the rate for commercial property.
Opponents of the House's narrow interpretation of what the classification amendment allows said they believe a broader range of nonprofit organizations will share in benefits of the amendment once the courts interpret it.
Residential property assessment rate is lowered from 12 percent to 11.5 percent of market value under the amendment, while commercial property is reduced from 30 percent to 25 percent.
As advanced by the House, the bill would allow a lower property assessment rate for four categories of organizations that have tax-exempt status with the federal Internal Revenue Service.
Those groups are those whose entire financial efforts are devoted to charitable, educational or recreational purposes, those charitable groups that might have commercial ties but derive no profits from them, and fraternal organizations and lodges.
BILLINGS and Stephens said they don't expect much sympathy in the Senate.
Because there are such a small number of country clubs, Billings said he didn't think they would be able to muster much political clout.
However, he said there was a good case to be made for including country clubs in the nonprofit bracket.
"They do provide about the only open space for some communities or a significant open space for some communities, and it normally increases the value of the surrounding homes," he said. "Without the golf course in place, you probably lose some tax revenue from the adjacent properties."
He said that increased property taxes have to be passed on to the golfer which adds to the greens fees, he said.
Stephens said he didn't think the Senate would have any more sympathy for country clubs than the House, especially when the margin was so large.