Update: Outcry Over Nonprofit Filing Requirement Leads to Extension of Deadline

UPDATE: The Office of Property Assessment has officially announced that the deadline for the filing requirement has been extended to June 1, 2015. It will also only require that the nonprofits submit “documentation to support their Non-Profit Tax Exemption status.” Other documents requested in past notifications are not required.

Last month, the owners of the city’s 6,500 tax-exempt properties received a letter in the mail outlining a series of documents they needed to submit by March 31 to prove their status as a purely public charity and thus eligible for tax exemption under state law.

The filing requirement was created by a 2013 ordinance that gave the Office of Property Assessment the ability to request certification of nonprofit status, as well as other documents concerning the property, on an annual basis.

The notice of the filing requirement sparked a highly organized outcry from the city’s black church ministers, which culminated in a packed house at a City Council Finance Committee hearing earlier this week to discuss two bills that would change the requirement — one extending the deadline, introduced by David Oh, the other to outright remove the requirement, introduced by Jannie Blackwell.

At the hearing, the ministers, represented by Terrence Griffith of the Black Clergy of Philadelphia, made the case that the requirement was an undue hardship and, in their view, unconstitutional.

But even before Griffith spoke, Michael Piper, chief assessment officer of OPA, testified that his agency would change the requirement. It would be required every three years, rather than annually, and would require only one document — some written certification of nonprofit status. He said a simplified form would also be mailed out to nonprofits with a new deadline attached.

Oh withdrew his bill to extend the deadline after learning about OPA’s intention to tweak the requirement.

In response to Blackwell’s bill to outright remove the requirement, Piper made the case that while he agrees the wording of the ordinance and the process ought to be revised, the requirement should be kept in some form.

“The ordinance essentially put into the Philadelphia code support for a regular and fairly comprehensive means for what the city had only done in the past when some evidence of a nonprofit’s non-compliance had been brought to our attention,” Piper said. “This had always amounted to an ad-hoc audit, which in itself creates the perception of unfairness and non-uniformity as we weren’t looking at all exempt properties.”

The Finance Committee was not moved by Piper’s argument. Blackwell’s bill passed out of the Finance Committee favorably and will be voted on at the next full council meeting. 

As for Griffith and the Black Clergy of Philadelphia, compromise is not an option.

“We are not interested in a delay or a postponement,” Griffith said in his testimony.

He added that he was prepared to take the issue all the way to Supreme Court if the requirement is implemented in any capacity.

Photo via Flickr User Sarah Cady