The home of Wichita City Council member and state Senate candidate Michael O’Donnell is going back on the tax rolls and his father’s church will get a bill for back taxes through 2010, the Sedgwick County Appraiser’s Office has ruled.
O’Donnell’s residence at 1435 W. Haskell in south Wichita, which has been off the tax rolls since at least 2002 as a Grace Baptist Church parsonage, is subject to property taxes because it is not being used as a church parsonage, Mark Clark, the county’s deputy appraiser, said Thursday.
“We have reviewed the situation and we do believe the property should be taxable,” Clark said. “So we’re processing the paperwork to make it taxable from 2010.”
The Rev. Michael O’Donnell, pastor of Grace and father of the council member, said the church will refile a tax exemption request to the Kansas State Board of Tax Appeals, essentially appealing the appraiser’s ruling.
The tax status of the council member’s residence was raised in August by the Wisconsin-based Freedom From Religion Foundation, which wrote County Appraiser Mike Borchard asking for an investigation.
“Sedgwick County taxpayers should not have to pay more taxes because a church and its leaders have falsely claimed an exemption,” foundation attorney Patrick Elliott wrote to Borchard.
It wasn’t clear how much the church could owe in back taxes, or why the county would set 2010 as the date the house should become taxable. Borchard was out of the office Thursday and could not be reached for comment by The Eagle or county staff.
Elliott said Thursday his foundation is satisfied with the appraiser’s ruling.
“I think it proves everything we had understood to be valid about the use of that property and the tax implications,” he said. “There is a presumption that property is taxable. They have to show it is not.”
The centerpiece of the dispute is the younger O’Donnell’s agreement with the church to live at the Haskell address. In August, the council member told an Eagle reporter he had paid rent for the house since 2008 or 2009, when his original deal to live there rent-free in exchange for work at the church as a janitor ended when the work stopped.
Earlier this month, the younger O’Donnell recanted that and told The Eagle he continues to work for the church — including building work, facilities and grounds maintenance — and has never paid rent on the facility. O’Donnell contended the monthly payments he made to the church were gifts, not rent. The foundation said the church would have to pay income taxes on any rent.
“My role changed at the church,” he said Thursday. “But I’ve always had a financial commitment on top of my tithe that is not legally classified as rent.”
His father corroborated the September account.
“He did voluntarily give to the church and while he may have thought of those gifts as rent, they were not expected, recorded, or designed as such,” the elder O’Donnell said in an e-mail.
“We had made a formal decision not to rent the home so it would not violate our understanding of what is necessary for tax exemption and because we use the facility for access and did not want to hassle with trying to earn income from the property, which we believe is the key to tax exemption.”
In August, Borchard told The Eagle that if the home’s predominant use isn’t for church clergy or a pastor, it would no longer be tax-exempt.
The elder O’Donnell said his talks with Borchard’s office have not been adversarial.
“We agreed that the best course of action would be to refile our application for tax exemption, which we are doing and will have completed by October 10th — the date both parties agreed upon,” he said. “Presently our attorney is reviewing the application to ensure we state things correctly. We feel confident that once the proper application is delivered that we will satisfy the requirements of tax exemption.”
The Haskell residence has been appraised this year at $76,100, and Sedgwick County records show no general property taxes have been billed since at least 2002.
O’Donnell’s residency has been an issue since 2007, when he first ran for Wichita City Council. He was disqualified because he was still a registered voter in Bel Aire, where his parents live. O’Donnell said he was living at the West Haskell address at the time.
O’Donnell defeated Wichita Republican Sen. Jean Schodorf in the August primary race. He faces Democrat Timothy Snow and Libertarian Dave Thomas in the November general election.
The elder O’Donnell apologized to his son in the e-mail for any political impact of the controversy.
“We apologize that this situation has brought undo negative publicity to Councilman O’Donnell as he has more than met the requirements for his living in the home,” his father said. “We look forward to appearing before the Kansas State Board of Tax appeals and presenting our situation.”
His son said the issue shouldn’t negatively affect the Kansas Senate bid.
“It started out as a political agenda from the Wisconsin atheists,” council member O’Donnell said. “Nothing has changed with this issue being between the church and the county.”
Elliott chuckled at the accusation.
“We’re an apolitical group, a nonprofit that does not get involved in elections or campaigns,” he said, “but we are concerned about state-church issues, including churches abusing tax privileges, which was the case here.”