It is safe to say the Yacht Club’s tax exemption has reverberated around the county a time or two so now it’s time we put everything together and illustrate both how the process under which tax exemption was given is fatally flawed, lacking any semblance of transparency and what the elected officials can do to fix it.
There has been lots of information posted already and then Geoff Belcher’s article for the Sea Coast Echo proved as an invaluable resource because the players behind the events made on the record comments. First things is to emphasize the update to the first post because we did get a fact wrong and the correct facts need to be emphasized:
Slabbed has been contacted by the Department of Revenue in response to communications from Jimmie Ladner’s office. Jeff Foreman of MDOR indicated this this type of tax exemption does not require MDOR approval:
As I understand from ……. below, the Bay Waveland Yacht Club is claiming exemption as a “perpetual or fraternal and benevolent organization”. As you have already established in this thread, such an exemption is clearly authorized under Miss. Code Ann. Section 27-31-1(d). Under current Mississippi law, case law and guidance from the Mississippi Attorney General, the duty to determine eligibility for such an exemption lies solely with the county. The Department of Revenue plays no role in the approval of such exemptions and, as such, there is no requirement for any information regarding such exemptions to be filed with the Department.
The takeaway from Mr. Foreman’s very important clarification needs highlighting because it drives the inescapable logic that follows:
Under current Mississippi law, case law and guidance from the Mississippi Attorney General, the duty to determine eligibility for such an exemption lies solely with the county.
In response to the headlines in last Friday’s paper, it is everyone’s Civic Duty to pay Ad Valorem/Property Taxes. There are certain exceptions and that is the elderly, the incapacitated, churches, CASA, Hope Haven etc… What we have now is a system of Rewards for those organizations that claim all this Civic Goodwill and yet they are not wanting to pay their Basic Civic Obligation on property taxes. There are plenty of them not to just pick on a few. They need to get Awards not Rewards. Awards are Recognition and Rewards are financial Gifts.
Property Taxes pay for all the things we need as a civilized society. Public Safety to include Fire and Police Protection, Ambulance Services, 911 Services, Roads, Drainage, City and County Employees deserve a livable salary, Public Works, Schools, Street Lights, Parks, Walking Paths, Crime Prevention, Grass Maintenance, Jails, Public Buildings, Public Litter Control and other amenities just to name some of the obvious things as there are many others.
Non Profits are coming here faster than Businesses. There a few organizations that say they promote businesses but they are bringing Non Profits in faster than businesses. The County and City Taxing Authorities can’t keep up with these type of back door leakages with Tax increases.
The next time you see a tax increase don’t say what am I getting for it say where did it all go and to who? Question organizations you feel should not be exempt from the Basic Civic Obligation. That is also another basic Civic Obligation to be Involved.
Belcher snagged quotes from Jimmie Ladner and Yacht Club Treasurer Chris Roth which is good. Slabbed has some additional quotes to share from Jimmie while Lana got an important clarification from the Mississippi Department of Revenue. We also are in the final stages of information gathering on how the by law change went down at the Yacht Club. This is really a discussion that should have taken place in October 2015 at a Supervisor’s meeting that is open to the public but that never happened folks so we’re going to have it now.
If you are a church or a 501(c)(3), I would urge you to read Mississippi Code Ann. Section 27-31-1, which has the property tax exemptions listed. I imagine there will be some fear mongering and there is no reason for that. Churches are exempt as would most 501(c)(3) organizations.
Finally folks, consider what the statute that Jimmie Ladner is relying upon actually says because there are words after “fraternal and benevolent organization” that are very important and they appear in the very code section (MCA 27-31-1(d)) that Ladner told Slabbed he relied upon to grant the tax exemption to the Yacht Club:
All property, real or personal, owned and occupied by a fraternal and benevolent organization, when used by such organization, and from which no rentals or other profits accrue to the organization, but any part rented or from which revenue is received shall be taxed. (Emphasis added)
The Yacht Club was paying over $19K a year in advalorem. She showed them how to go non profit and quit paying local taxes run the non profit thru her and just pay her.
That comment raised two distinct questions in our minds here at Slabbed. The first question is whether or not the Bay Waveland Yacht Club was paying property taxes. The second question would pertain to the local Chamber of Commerce being involved in getting tax exemptions for a social club. I’ll answer the second question first because we need to line through it for the purposes of the rest of this post as we found no evidence the Chamber was involved in the Yacht Club’s local property tax assessments. The Yacht club however, was given a tax abatement by Hancock County Tax Collector Jimmie Ladner and that is plenty interesting on its own.
On October 5, 2015 the Bay Waveland Yacht Club, Inc filed a status report with the Mississippi Secretary of State which indicated it changed its corporate charter:
The period of existence is perpetual Second: The purpose for which it is created are: Mission and Purpose: Associate as a
fraternal and benevolent organization for the common purpose, promotion and pleasure of doing good works related to boating, racing, athletics and related activities Donate use of its facilities, boats and personnel for the advancement of high school sailing, sailing instruction to the children of the community, providing boat storage and launching to the Department of Marine Resources and for search and rescue initiatives, sponsoring annual events open to the community in the celebration of national holidays, hosting civic club functions and fishing rodeos Encourage the owning and use of power and sailing boats for pleasure and a safe harbor for boaters in distress Host international, national and regional regattas in order to exhibit the resources of the Mississippi Gulf Coast to international, national and regional visitors Erect and maintain a building and marina facilities to be used for its good works, charitable endeavors and as a club house for its members Provide periodic donations of use of its facilities and property for the benefit of the community.
That is interesting that it donates its facilities for sailing instruction. The summer program cost $450/child so I am not sure what is exactly being donated to the public but boy that new mission statement sure sounds good. Jimmie Ladner indicated to Slabbed that after the club changed its by laws he gave it the property tax exemption under authority section 27-31-1(d) of the Mississippi Code, which does allow for certain nonprofits to gain a property tax exemption. The problem is the Bay Waveland Yacht Club, per its own 990 forms filed with IRS, is a 501(c)(7) social club. Worse, the 990 forms indicated that no changes were made to its governing documents so there is a fundamental contradiction between the story BWYC is telling the local tax collector and the one it is telling the IRS. Continue reading “Why Hancock County Can’t Afford Nice Things….. (Updated)”