For years St. Raphael’s Parish has been fighting, and losing, a battle with the city of Madison over property taxes on the land at the corner of East Main and North Fairchild streets that once held its Cathedral.
Now the church has an unnamed ally in the Legislature who slipped into the budget a tailor-made property tax exemption.
But the Madison-based Freedom From Religion Foundation is considering a legal battle if the provision makes it through the final budget process.
The budget amendment allows a property tax exemption for properties owned by “churches and religious associations” that intend to “replace a building destroyed by fire, natural disaster, or criminal act.”
St. Raphael’s Cathedral at 204 W. Main St. fell victim to arson in 2005 and the parish has yet to replace it. Rather, it erected a “Way of the Cross,” a pathway commemorating the 14 stations of Jesus Christ’s crucifixion, to attach a religious purpose to the land.
That didn’t wash with Dane County Judge Rhonda Lanford, who last year rejected St. Raphael’s court challenge to the property tax. The church subsequently paid $97,500 in 2016 taxes on the property, which has an assessed value of just over $4 million. The bill this year is likely to increase, as the assessment in 2017 rose to nearly $4.5 million.
But the tax exemption promises to spark a prompt court challenge.
“We would consider challenging it,” said Freedom From Religion senior counsel Patrick Elliot. “We are absolutely interested in upholding the First Amendment and upholding the Wisconsin Constitution.”
The foundation contends that the measure violates First Amendment prohibitions on state-sponsored religion and also runs counter to state Constitution equal protection provisions.
“The drafter of this amendment didn’t account for any of the negative consequences this provision would create,” reads a letter Elliot sent to state lawmakers. “All other municipal taxpayers will have to pay more in taxes if properties like the St. Raphael’s plot are exempted.”
The letter notes that the U.S. Supreme Court has already shot down an attempt to give preferential tax exemptions to religious groups. In a 1989 case, the court found unconstitutional a Texas law that gave a tax exemption to religious publications.
“Likewise, a state’s property tax exemption law cannot treat churches more favorably than other charitable groups,” the letter says.
In an interview, Elliot said that the foundation plans to file public records requests with the Legislature’s Joint Finance Committee, which crafts the state budget, to find out how the measure was slipped into the budget.
“I call it pork,” he said. “Somebody got the ear of somebody on the Joint Finance Committee to put this in, and it’s about to become law for the entire state.”
Online state lobbying records show that St. Raphael’s spent $20,000 during the current session on lobbying under the subject “Revenue: Tax Administration.” St. Raphael’s registered lobbyist is Alice O’Connor.
O’Connor didn’t immediately reply to an email seeking comment on the identity of the lawmakers targeted in her lobbying efforts. Nor did St. Raphael’s pastor, Monsignor Kevin Holmes.
Catholic Diocese of Madison spokesman Brent King declined comment, but passed along a press release on the amendment, which states, "The recent proposed modification by the legislature simply closes a lacuna in the law, specifying that the Cathedral site is not presently subject to property tax."
The release called the budget amendment "common sense," and maintained that the "Way of the Cross" display preserved the "sacred character and religious use of the site."
After the city imposed a property tax five years ago, the release states, the parish committed to "prayerfully consider all of its options in disputing this taxation, while at the same time paying these property taxes, albeit in protest, from the insurance proceeds from the Cathedral fire."
Madison Mayor Paul Soglin — who earlier this week blasted another budget amendment of uncertain origin that could block construction of bike facilities and sidewalks — said it's another example of GOP legislative leaders making the state's "economic system more unfair to the average citizen."
"It's just one thing after another where they go out and they look for whatever they can do that's terrible public policy," he said.
The amendment would allow qualifying properties to be held tax-free for 25 years.
Under current state law, the congregation would need to start work on a new building, such as a new cathedral to replace the old one, to qualify for a tax exemption.
The city started taxing the 150-year-old congregation in 2012, after it had cleared the debris from the site and bought an adjoining property for $2 million to accommodate a new one.
Last year, Matthew Fleming, a Madison Diocese attorney, said that conceptual plans for a new cathedral put a price tag at about $50 million.
The congregation received $6.4 million in insurance payouts after the conflagration. It then bought an ad
Diocese spokesman King said then that those plans had been put on hold because the diocese spent $25 million on a new St. Paul’s Catholic University Center on the UW-Madison campus, and it kicked in $30 to a Priests for Our Future campaign to recruit seminarians.
“The plan remains firm,” King said in an email last year, “and by the grace of God (and in context of the Church and her history) a new cathedral will adorn the diocese and city in the not-too-distant future.”