Mt. Sinai Christian Fellowship Church of God in Christ, Inc. v. Scott Cnty. Bd. of Supervisors

• Decision Date: 21 September 2022
• Docket Number: 21-1531
• Parties: MT. SINAI CHRISTIAN FELLOWSHIP CHURCH OF GOD IN CHRIST, INC., Plaintiff-Appellant, v. SCOTT COUNTY BOARD OF SUPERVISORS, Defendant-Appellee, MT. SINAI CHRISTIAN FELLOWSHIP CHURCH OF GOD IN CHRIST, INC., Plaintiff-Appellant, v. SCOTT COUNTY TREASURER, Defendant-Appellee.
• Court: Iowa Court of Appeals

MT. SINAI CHRISTIAN FELLOWSHIP CHURCH OF GOD IN CHRIST, INC., Plaintiff-Appellant, v. SCOTT COUNTY BOARD OF SUPERVISORS, Defendant-Appellee, MT. SINAI CHRISTIAN FELLOWSHIP CHURCH OF GOD IN CHRIST, INC., Plaintiff-Appellant, v. SCOTT COUNTY TREASURER, Defendant-Appellee.

No. 21-1531

Court of Appeals of Iowa

September 21, 2022

Appeal from the Iowa District Court for Scott County, Joel W Barrows, Judge.

Mt Sinai Christian Fellowship Church of God in Christ, Inc. appeals from the district court's denial of its petitions for writ of mandamus against the Scott County Board of Supervisors and the Scott County Treasurer.

Aaron M. Miers of Brooks Law Firm, P.C., Rock Island, Illinois, for appellant.

Robert L. Cusack of the Scott County Attorney's Office Davenport, for appellees.

Considered by Bower, C.J., Chicchelly, J., and Scott, S.J. ^[*]

SCOTT SENIOR JUDGE.

Mt. Sinai Christian Fellowship Church of God in Christ, Inc. (Mt. Sinai) appeals from the district court's denial of its petitions for writ of mandamus against the Scott County Board of Supervisors (Board) and the Scott County Treasurer (Treasurer) (collectively, the County) regarding the County's failure to abate property taxes or refund previously paid property taxes.^[1]

A writ of mandamus may issue to "command[] an inferior tribunal, board, corporation, or person to do or not to do an act, the performance or omission of which the law enjoins as a duty resulting from an office, trust, or station." Iowa Code § 661.1 (2021). Mt. Sinai claims it is entitled to the refund of property taxes paid on its behalf for tax years 2016 and 2017 and the abatement of property taxes owing for tax year 2018-all of which it claims are based on a religious organization's exemption from property taxes found in Iowa Code section 427.1(8) and (14).^[2] The district court granted summary judgment to the County, and Mt. Sinai appeals. Because we concur with the district court's statutory interpretation and conclusions, we affirm the dismissal of Mt. Sinai's mandamus actions.

I. Background Facts and Proceedings.

The district court provided a straightforward statement of undisputed facts:

Living Water Family Church, Inc. (Living Water) owned property located at [XXX] Northwest Boulevard, Davenport, Iowa (the property). Living Water was a registered religious and charitable organization incorporated in the State of Iowa. From tax years 2008 through 2015, Living Water used the property primarily as a worship space for their congregation and office space for their staff. During this time, the property was exempt from property taxes and no taxes were assessed.

On July 29, 2015, [Mt. Sinai] purchased the property. Mt. Sinai is also a registered religious and charitable organization incorporated in the State of Iowa .... Mt. Sinai intended to and did use the property for the same primary purposes as it was used by Living Water. On August 5, 2015, the Davenport City Assessor's Office sent a courtesy notice to Mt. Sinai informing them of the need to file a request for tax-exempt status on the property. This notice was sent to [ZZZ] North Pine Street, Davenport, Iowa, due to an error in the deed listing the common address of the property as that address. However, Mt. Sinai also owned [ZZZ] North Pine Street until 2018.

During tax years 2016, 2017, and 2018, the property was assessed taxes in the amounts of $33,096, $34,294, and $34,238, respectively. Mt. Sinai paid a portion of the first half of the 2016 property taxes, but did not pay the other assessed taxes. Tax delinquency notices were sent to the [ZZZ] North Pine Street address, but not to the true address of the property. Mt. Sinai filed for a tax exemption on the property on May 22, 2018. On May 28, 2018, Mt. Sinai sent [the Board] a written request to abate their taxes then owing and reimburse the taxes already paid for tax years 2016 through 2018. Mt. Sinai met with Board Chairman Tony Knobbe regarding this request on May 31, 2018.

On June 18, 2018, [the Treasurer] sold the unpaid taxes from 2016 at tax sale to HI 100, LC. These taxes were redeemed by LBC1 Trust, the lender who financed Mt. Sinai's purchase of the property. On November 19, 2018, and May 20, 2019, the 2017 property taxes were sold in two halves at tax sales to OHP1 LC, also known as Oak Helm Partners. On August 20, 2019, Mt. Sinai made another request to the Board to abate the taxes, and Mt. Sinai made another request to reimburse the taxes already paid on May 29, 2020.

On June 16, 2020, Mt. Sinai asked the Treasurer to abate the first half of the 2018 property taxes. The Treasurer refused, and Mt. Sinai made another request to the Board to abate these taxes-and reimburse those already paid-on July 7, 2020. The Board took no action on this request, and the first half of the 2018 property taxes were scheduled to go to tax sale in June, 2021. The Board abated the second half of the 2018 taxes, citing the timing of Mt. Sinai's exemption filing.

On October 12, 2020, Mt. Sinai filed the petitions in these two cases, requesting writs of mandamus to the Board and the Treasurer instructing them to abate the first half of the 2018 taxes and reimburse the 2016 and 2017 taxes. Due to these cases being filed, the unabated 2018 taxes were withdrawn from the anticipated tax sale. On July 16, 2021, the parties filed all three pending motions for summary judgment.

In its motion for summary judgment, Mt. Sinai argued the taxes were illegally or erroneously assessed because the religious use exemption continues with the property until the use of the property changes-regardless of ownership. Mt. Sinai argued that upon a change of ownership, Iowa Code section 427.1(14) requires the county recorder to provide notice to the county assessor, who then evaluates the use of the property to determine a tax liability. It asserts the provision does not require the religious entity purchaser from a religious entity seller to file any exemption form.

The County sought summary judgment, arguing a new exemption filing is required whenever the property changes ownership and the statutes raised by Mt. Sinai do not vest them with discretion to reimburse or abate its property taxes.

The district court concluded section 427.1(14) "requires a new exemption filing whenever property subject to the [religious or] charitable use exemption changes hands, even if the new owner uses the property in the same manner as the previous owner." The district court reasoned:

requiring a new owner of property previously subject to the charitable use exemption to refile for the exemption is a matter of practical necessity.... [The County] state[s] that the county government would have no way of knowing whether the exemption is appropriate without some level of self-reporting by the taxpayer. The court agrees that this is a legitimate concern which displays the absurd results which would follow from automatically extending the exemption to subsequent purchasers.

Because the court determined the property taxes were not illegally or erroneously assessed, the district court also rejected Mt. Sinai's arguments that County was required to refund the taxes under Iowa Code section 445.60. Finally, the court accepted the County's assertions that it had no discretion to abate and reimburse the assessed taxes, despite Mt. Sinai's contrary claims. The district court granted the County summary judgment. Mt. Sinai appeals.

II. Scope and Standard of Review.

"Mandamus is an equitable action generally reviewed de novo. But our review of a summary judgment ruling in a case filed in equity is for errors of law." Knoer v. Palo Alto Cnty. Bd. of Sup'rs, No. 15-0742, 2016 WL 3556431, at *2 (Iowa Ct. App. June 29, 2016) (internal citation omitted). Summary judgment is appropriate when "there is no genuine issue as to any material fact and . . . the moving party is entitled to a judgment as a matter of law." Iowa R. Civ. P. 1.981(3). "In considering a motion for summary judgment that requires an interpretation of a statute, our review is for correction of legal error." Dolphin Residential Coop., Inc. v. Iowa City Bd. of Rev., 863 N.W.2d 644, 647 (Iowa 2015).

III. Discussion.

Our task is to determine what the Code requires when a new owner purchases a property previously granted an exemption. Section 427.1 states, "The following classes of property shall not be taxed." Subsection 8 is applicable to "Property of religious, literary, and charitable societies," and provides:

(a) All grounds and buildings used or under construction by literary, scientific, charitable, benevolent, agricultural and religious institutions and societies solely for their appropriate objects, not exceeding three hundred twenty acres in extent and not leased or otherwise used or under construction with a view to pecuniary profit.... For assessment years beginning on or after January 1, 2016, the exemption granted by this subsection shall also apply to grounds owned by a religious institution or society, not exceeding a total of fifty acres, if all monetary and in-kind profits of the religious institution or society resulting from use or lease of the grounds are used exclusively by the religious institution or society for the appropriate objects of the institution or society.

(b) All deeds or leases by which such property is held shall be filed for record before the property herein described shall be omitted from the assessment. All such property shall be listed upon the tax rolls of the district or districts in which it is located and shall have ascribed to it an actual fair market value and an assessed or taxable value, as contemplated by section 441.21,^[3] whether such property be subject to a levy or be exempted as herein provided and such information shall

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