What's at stake
- The ability of a church to exist without being subjected to illegal taxation that would result in foreclosure of the church.
The Church of the Isaiah 58 Project is a small church in Quartzsite, Arizona. Started by Pastor Mike Hobby and his wife Linda, the church meets weekly for services like other churches, but also has a substantial outreach to the homeless. The church provides thousands of meals every year to the homeless, it operates a food and clothing bank, gives free showers to the homeless and provides free transportation.
In 2009, the Church filed an application for property tax exemption for its property but the County Property Assessor refused to grant the exemption because the Church did not have a 501(c)(3) letter from the IRS. The Church explained that it was not required to have an IRS letter but the Assessor sat on the exemption request for three years and then, inexplicably, granted the exemption for the future but assessed taxes against the Church for 2009-2012.
ADF filed a lawsuit on behalf of the Church and argued that the tax was illegally assessed and that the Church should not be required to pay the tax because payment would result in closing the Church. The Arizona courts held that the Church must first pay the tax before it could challenge it as illegal. The Church faced foreclosure because it did not have enough money to pay the tax.
With ADF’s assistance, the Church engaged in last minute fundraising and churches and individuals across the country responded by giving enough money for the Church to pay the tax and avoid impending foreclosure. The payment opened the way for ADF to argue that the tax was illegally assessed and to attempt to recover the tax.
Our role in this case
ADF filed a lawsuit on behalf of the Church and we assisted the Church in raising funds to pay the illegally assessed property tax.