A tax dispute between Salt Lake County and the Salt Lake Organizing Committee has entered its third year.
With the question of how much property tax SLOC should pay on personal property for 2000 and 2001 already tied up in court, SLOC officials appeared before the Salt Lake County Council to request an exemption for 2002.
Like the previous two years, SLOC's tax bill for 2002 — about $200,000 — may have to be decided by a judge. Currently, the $233,000 that the county says SLOC owes for 2000 and 2001 is likely to be part of a lawsuit. Even a possible settlement offer, which the County Council has discussed, would probably not avert court hearings.
"We're not interested in settling," SLOC Controller Ross Welch said. "We've already contributed $100 million to the county."
SLOC is requesting an exemption for all of its personal property, which ranges from flags and carpets to scorekeeping equipment and medical supplies. Welch said that the purpose of the equipment should not matter because all of the money earned by the Olympics and all of the property will be donated to charities or government.
"Our whole organization is for the purpose of the Olympics, and all of our assets are for that charitable purpose," Welch said.
But a slim majority of county councilors feels that some of SLOC's property should be taxed because it was used in a for-profit capacity, such as office equipment used for commercial contracts or furniture that was included in rental properties. The council has asked SLOC to provide more extensive documentation that proves that the property was used for SLOC's primarily nonprofit purpose.
"I know you guys had a charitable purpose," Councilman Joe Hatch said. "I want to know use. There were items used for profit."
If SLOC were to provide the requested documentation, Hatch said that he would be willing to grant at least some exemption. Without evidence from SLOC, however, he said that he would prefer to tax everything.
"It's your burden to distinguish the two," he said. "If you won't provide that, I don't think you've met your burden."
It is not uncommon for the county to charge taxes to nonprofit organizations for property used for a profit, Councilman Steve Harmsen said. During the same meeting, he pointed out, councilors denied an exemption requested by a youth educational program that also used its property for mobile-home rentals.
"The argument was it was a business. We didn't ask if it made a profit," Harmsen said to SLOC officials. "The only difference between you and him was he didn't have the cachet of SLOC."
The County Council voted 6-3 to give SLOC additional time to provide the requested documentation, although whether SLOC provides much more is doubtful. Instead, SLOC may just wait for the court decision about the 2000 and 2001 taxes. Because of a previous Utah Tax Commission ruling in its favor, SLOC officials are confident they will also prevail in court.
"We're a shrinking organization," Welch said. "We're wondering how far we want to pursue this here if it's just going to litigation."
E-MAIL: jloftin@desnews.com