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Campground May Lose Tax-Exempt Status

May 18, 2011 by   - () Leave a Comment

The motel and campground at Pioneer Village in Minden, Neb., have been exempt from  paying property taxes since 1983, but that could change soon, the Kearney Hub reported.

In April, Nebraska Tax Commissioner Doug Ewald and Property Tax Administrator Ruth  Sorensen appealed the tax exemption to the Nebraska Tax Equalization and Review Commission.

In the appeal filed April 11, Ewald and Sorensen said the motel and campground do not fit with the Harold Warp Pioneer Village Foundation’s educational purpose.

“Not all of that facility is used for tax-exempt purpose,” Ewald said. “It’s a hotel. There’s more to that property than just the tax-exempt purpose, and we don’t think the entire property is there for a tax-exempt purpose. The hotel is there for profit, obviously.

“When we become aware of things like this, we think we have an obligation to the taxpayers of the state to make sure we have the right property on the tax rolls, and sometimes that means we file an appeal,” Ewald added.

The Kearney County Board of Equalization reaffirmed the 28-year-old tax exemption in a meeting March 8. Nebraska tax regulations allow property tax exemptions if the property is owned by educational organizations and used exclusively for educational purposes.

Marshall Nelson, general manager of Pioneer Village, said the appeal was a surprise.

“We received our tax-exempt status in 1983 and have been tax exempt in our entirety since that date, both at the state and the federal level. Our county assessor has objected to that for several years. However, we’ve gone to the board, presented our documentation every year for the last several years, and the board, we believe correctly, has chosen to extend or continue our exemption,” Nelson said.

Nelson said 97% of the people who stay in the campground or motel are museum visitors. He compared the situation to student residence halls on a college campus.

The motel is valued at $1.08 million, and the campground is valued at $134,915, according to Kearney County Assessor Linda Larsen. Using the 2010 tax levy, Pioneer Village would pay an additional $25,021 on the motel and $3,125 on the campground if TERC overrules the tax exemption.

Nelson said he’s not sure how the extra expense would affect Pioneer Village and said it’s too early in the process to speculate.

“Of course, we’re always concerned about taxes as well as utility rates and other fixed costs we have. All those things that we pay are a concern to all of us, and it would certainly affect our operation if we would lose that tax-exempt position,” he said.

Kearney County Board of Equalization Chair and County Supervisor Roy John Nelson said he was also surprised by the appeal.

“It’s like with churches and stuff. A church can have bingo in the basement or bake sales or whatever, but they are a place of worship, so they’re tax exempt. We kind of based it off the same thing,” he said.

“If there was someone who had a problem with it, when we had a public hearing on it, you would think they would have come and said, ‘Hey, why is Pioneer Village exempt?’ But we had no protests at the public hearing,” he said.

“If they were full all the time and it was just people passing through or people going to Kearney or whatever, yeah, maybe there would be a question, but that’s not what their statistics show … .The burden will probably be on Pioneer Village as well as the county to prove that it should be tax exempt. We’re going off their statistics and their reason for wanting it tax exempt,” Roy John Nelson added.

“We’re pleased with the board’s decision, and we believe the board has made the right decision for the last 26 years. That doesn’t preclude the possibility that somebody disagrees. They have the right to appeal it or to protest it,” Marshall Nelson said.

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