Coloradans May End Nonprofit Property Tax Exemptions

Article excerpt

COLORADO SPRINGS, Colo. -- If John Patrick Michael Murphy has his way, this state would become the first in the nation to impose property taxes on its churches, charities and groups like the Boy Scouts.

"You can't blame the other side for being scared, `cause we're planning to change the world as they know it," says Murphy, who helped place the controversial initiative on Colorado's ballot this November.

That's no exaggeration. If approved -- and opponents concede it might be -- Colorado would be the only state to strip churches and other nonprofit organizations of most of their property-tax exemptions -- a move supporters estimate could bring in an additional $70 million a year, although opponents challenge that figure.

Exceptions would be made for certain activities considered socially important, such as schools and low-income housing, but churches and charities argue that passage could have devastating effects on them and on America's moral character.

Coloradans for Fair Property Taxation, which Murphy heads, gathered far more than the 54,000 signatures needed to get the referendum on the ballot. And polls show about 40 percent of state residents already favor the change -- even before a full-scale advertising effort begins this month.

Churches, religious organizations and nonprofit groups have rapidly organized a counterforce and plan their own expensive media blitz to fend off the assault. While the groups express nearly as much confidence as Murphy about prevailing, they also acknowledge they face a very tough fight.

The initiative likely will appeal to many voters who find some nonprofit group they don't like among those now receiving tax breaks. The greatest draw, though, is the backers' promise that the added revenue for the state would greatly reduce taxes for individuals.

"I think throughout our country today, there is this strong desire not to have to pay more taxes... and, simultaneously, to cut the use of government dollars for social services," said Rev. Lucia Guzman, executive director of the Colorado Council of Churches. "So in this atmosphere, especially coming in light of the Contract with America and some of the other changes going on at the federal level, I'm afraid many of our citizens could see this question as a prime opportunity, and it could well pass."

Even if the initiative fails, the detractors maintain it will cause considerable damage just by forcing groups to divert money and resources from charitable activities to wage a lengthy campaign for the referendum's defeat. Plus, if the outcome is close -- and both sides think it will be -- that could provide a powerful incentive for future efforts in Colorado and elsewhere.

Even at this early stage, the referendum drive already is having ripple effects: Murphy said he's been contacted by organizers in more than 20 states, and similar attempts have begun in New York State and Pennsylvania for future elections.

Critics contend Murphy, a colorful Colorado Springs lawyer and radio talk-show host, is spearheading this controversial attack because of his personal animus for the Catholic Church. …