Maine church’s tax dilemma may lead to new law

Lawsuit prompts town to issue tax exemption, legislation proposed to end discrimination against churches

ROCKLAND, Maine — A Maine church’s ordeal in court may lead to a modification in state law that will help end inequities between how churches and non-church charities are treated in property taxation matters.

Alliance Defending Freedom attorneys filed suit against the town of Rockland on behalf of Aldersgate United Methodist Church last year. After a cumbersome resolution process, the lawsuit resulted in a property tax exemption for the church’s parking lot and parsonage Thursday.

“Churches shouldn’t live in fear of being targeted by the government in ways other groups aren’t,” said Senior Counsel Joel Oster. “While we appreciate that town officials helped find a way to issue the church the exemption it deserves, the church was forced to jump through hoops that non-church charitable groups do not have to. That’s why the Maine Taxation Committee has recommended passing a bill that would eliminate this type of discrimination against churches.”

The town originally denied the exemption even though it routinely grants such exemptions to non-church charities. The church makes its facilities available to a wide range of charitable and community groups and events.

The Maine Taxation Committee, comprised of both House and Senate members, recommended passing proposed legislation, LD 998 (SP 343), that would “provide consistency in the application of the property tax exemption for religious organizations.” Two leaders from Aldersgate testified to the committee in favor of the bill’s passage. Once the committee has completed reviewing the bill’s final language, it will send it to both houses for a vote.

Churches are at a distinct disadvantage under the current law, which grants a tax exemption for the entire property of a non-church charitable group but only grants a partial exemption for churches. Aldersgate finally obtained its exemption through the cumbersome process of placing its parking lot and parsonage into a separate legal entity. The proposed legislation would eliminate the need for such steps.

On March 20, Maine Superior Court in Knox issued a stipulated order and dismissal agreed upon by all parties in Aldersgate United Methodist Church v. City of Rockland. Portland attorney Stephen C. Whiting, one of more than 2,200 allied attorneys with Alliance Defending Freedom, served as local counsel in the case.

  • Pronunciation guide: Oster (OH’-stir)

Alliance Defending Freedom is an alliance-building, non-profit legal organization that advocates for the right of people to freely live out their faith. 

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