La Salette Shrine wins unanimous decision in property tax appeal

By Kenneth J. Souza
Anchor Staff

ATTLEBORO, Mass. — The National Shrine of Our Lady of La Salette will not have to pay taxes to the City of Attleboro for property where its welcome center, shrine and maintenance buildings are located, according to a unanimous ruling issued by the Supreme Judicial Court in Boston on March 21.

The court, however, decided that the shrine would have to pay taxes on two portions of its nearly 200-acre campus that have been deemed to be for “non-religious” use — a large tract of conservation land to which the Massachusetts Audubon Society was recently granted exclusive easement rights and the Abundant Hope Pregnancy Resource Center, a Pro-Life ministry leased to and operated by an outside non-profit group.

This important Supreme Judicial Court ruling effectively reverses the previous City of Attleboro’s assessors’ taxation determination and a subsequent Appellate Tax Board’s ruling that portions of the La Salette property that were not specifically used for worship could be taxed.

“I am very happy with the result because it is an exciting decision that favors the shrine and the Catholic Church in general,” said Father Cyriac Mattathilanickal, M.S., retreat director at La Salette Shrine. “I think the shrine, the Church, the diocese, and all religious denominations benefit as well. Part of the excitement is at least the court recognizes that facilities that are extensively used for religious worship and instruction should be tax exempt. All of the activities that we do and the use of the different places (here at the shrine) are connected to the work that we do.”

The decision ends a nearly five-year long legal battle that began with a 2013 tax bill for $92,000 that La Salette disputed. The Attleboro assessors would only exempt the chapel, retreat house and parsonage structures on the La Salette property from taxes for that year, along with 60 percent of the other property on the grounds such as its cafeteria and bistro operations.

The town maintained that four parts of the La Salette campus — including its welcome center, maintenance shed, as well as the wildlife refuge and women’s shelter — should be taxed because they were used for non-religious purposes. They assessed the full value of the campus at about $13 million, of which about $5 million was taxable.

When the state Appellate Tax Board likewise upheld the local assessors’ decision, the shrine ultimately took its appeal to the state’s highest court, which originally heard oral arguments on the case April 5, 2016.

A second round of arguments was made before six of the seven members of the SJC on Dec. 5, 2016 in Boston, which resulted in the final decision in La Salette’s favor.

“The vast majority of the shrine will be tax-exempt,” explained attorney Diane C. Tillotson, who represented La Salette Shrine during the appeal. “But the roughly 100 acres of conservation land would not be exempt because the Audubon Society holds the conservation restriction over that property — which essentially gave the Audubon Society complete control. The following year that property was actually deeded — conveyed, gifted — by the shrine to the Audubon Society. It was a fairly substantial portion of the tax assessment that, going forward beginning in fiscal year 2014, the shrine will not be responsible for.

“The only other portion of the property that the court found was taxable was the so-called ‘safe house.’ That, again, was largely due to the fact that the safe house, while recognized as having a charitable purpose that was consistent with the La Salette Fathers’ mission, the dominant purpose there was not religious worship or anything connected with it. And secondly, and perhaps more importantly, the court determined that the safe house was leased to another (non-profit) organization and the La Salette Fathers had pretty much given up complete control and exclusive use of that property to another organization.”

Moving forward, Father Mattathilanickal said La Salette can file for a waiver under the Massachusetts “Return of Property Held for Charitable Purposes” exemption — known simply as Form 3ABC — for those portions of the shrine property that are not deemed to be used for “dominant religious purposes.”

“For the tax years 2014 through 2017 we are claiming an exemption based on charitable works and we have filed Form 3ABC (for those years),” Father Mattathilanickal told The Anchor. “We did not file the form in 2012 and 2013. We filed it in 2014, but we were late. It has to be in by February 1 of every year. The following year we filed the form, but still the city did not grant us the exemption.”

Calling the decision a “very significant victory for us and for the Church in general,” Father Mattathilanickal noted how the case also drew the attention of many from outside the diocese who feared it might set a precedent for taxing religious entities in the future.

To that end, an “amicus curiae” or “friend of court” brief was jointly filed by the Massachusetts Council of Churches, United Synagogue of Conservative Judaism, the Council on American Islamic Relations Massachusetts and Our Lady of Fatima Shrine in Holliston stating that if the ruling were upheld it would have “sweeping, potentially disastrous effects for religious organizations across the Commonwealth.”

“There was a major conference of all religious communities and this really raised a red flag for them,” Father Mattathilanickal said. “For example, every parish has a parish hall or a pastoral center, and any city or town could decide to tax (those properties) and that would have been a real problem for all charitable works of the Church and also other denominations and other non-profits — this would have been a major blow to all of them.”

Tillotson agreed that had La Salette’s appeal been denied, it would have set a precedent whereby assessors could “go in and apportion certain uses and calculate that 60 percent of the welcome center was utilized for religious worship purposes and 40 percent was used for purposes unrelated to religious worship and tax it on that basis,” she said.

“The court said you can’t take a property or a building or a portion of a property whose dominant use is religious worship and then go through, room by room, including the broom closet and the boiler room and say that these aren’t used for religious worship and are going to be taxed,” Tillotson said. “Again, I think it was a very important decision and I think people were starting to get very nervous about advertising bake sales and fund-raisers, and people were getting concerned about the taxability (of those things) based on what Attleboro had done. Fortunately, the court rejected the notion that all those things could subject a property to taxation.”

Although she would have preferred that the entire National Shrine of Our Lady of La Salette property remain tax-exempt, Tillotson understands the court’s reasoning behind upholding the assessments on the conservation land and safe house.

“In my view, I think the two carve-outs are understandable and it’s probably the right decision,” she said. “Had the La Salette Fathers kept the (conservation land) and not conveyed the easement to the Massachusetts Audubon Society and more actively used it for retreats and prayer garden purposes, it would have been exempt as well. In terms of the (Abundant Hope) center, if the lease hadn’t been exclusive — I think if (La Salette) ran the shelter as part of the Church’s own mission — it probably would have come out differently in that regards, too.”

Having previously paid all the tax bills due to the City of Attleboro while awaiting the verdict, La Salette Shrine can now expect to be refunded upwards of $300,000, along with eight percent annual interest.

“In order to challenge a tax assessment, one of the prerequisites is you have to pay the bill — that’s a jurisdictional requirement,” Tillotson said. “So, sadly, they paid a lot of taxes over the past several years and most of it relates to the welcome center and those operations and they will be getting a fairly substantial amount of money back from the City of Attleboro.”

“Most of the money we’re getting back is going to go towards the lawyers’ fees anyway,” Father Mattathilanickal said. “We paid quite a bit of money to file the appeal and we even had to borrow money to pay for the taxes, so we’ll have to pay that back. So we’re not going to be sitting on a pile of money, that’s for sure.”

Despite all the time, effort and money the shrine has expended over the last five years, Father Mattathilanickal doesn’t regret taking on this important battle.

“The challenge that the city raised was that we were appropriating these facilities for non-religious activities or non-religious purposes,” Father Mattathilanickal said. “But the court very clearly said: as long as the shrine maintains the dominant use of the (property) for religious purposes, which is very true — around 90 percent of the activities held here at the shrine are all religious in nature, and that includes religious worship and instruction — then it should be exempt.

“The court is saying that even the Church cannot live on prayer alone — and I’m quoting from the opinion of what one chief justice said. Yes, we are occasionally using it for purposes that are not religious, but they help support our ministries at the shrine.”

Father Mattathilanickal also expressed his gratitude to everyone who supported La Salette Shrine throughout this process.

“All of the La Salette Missionaries and staff — the Fathers, Sisters and Brothers working here — are immensely grateful for all the prayers and support that we have received during this time,” he said. “We’d especially like to thank everyone who supported us here in the Fall River Diocese and beyond. On behalf of myself and the shrine, we thank you. It was a big thing for all of us, and I’m glad with the outcome.”

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