County can't refund taxes, penalties to club

Flathead County commissioners expressed their sympathy to leaders from the Boys & Girls Club of Glacier Country, but declined the group’s request for a refund of property taxes or penalties and interest assessed the group for taxes paid late.

Boys & Girls Club Director Alan Sempf told commissioners on Feb. 9 that board members of the club encountered some problems with the required government paperwork for the group to qualify as a tax-exempt organization.

That meant the organization received property tax bills for their properties in Evergreen and Columbia Falls. As they worked to clear up their 501(c)(3) status, they accrued penalties and interest on their unpaid taxes from 2008, 2009 and 2010, he said.

The club was granted tax-exempt status in mid-February and won’t be assessed property taxes this year.

Sempf said he and other club leaders thought once the club was granted that status, the old tax bills would no longer be due, but they learned that isn’t the case.

Club officials first sought relief from the Montana Department of Revenue, but “we’ve had a hard time getting answers from state officials,” Sempf said.

To avoid incurring any more penalties or interest charges, club leaders paid off the three years of tax bills in late January, spending $14,600 to do so.

“We’re hoping for some forgiveness of penalties,” he told commissioners. The penalties totaled $2,624.

Any refund “would be an incredible boost to the Boys & Girls Club of Glacier Country,” board member Jeremy Presta told commissioners. The club has struggled for the last couple of years because of a weakened local economy, the men told commissioners.

Presta said the club’s board wanted to act in good faith and pay its 2011 taxes, too, but if the commissioners were inclined to waive any of the bill, they’d hold off on the payment.

“We know getting taxes back would be difficult,” Presta said.

The Department of Revenue declined to make a recommendation to commissioners regarding the club’s request, county Administrator Mike Pence told commissioners.

Commissioners told club leaders they didn’t want to act on their request until they could seek advice from the county attorney’s office. That advice came to commissioners a week later, on Feb. 16.

“Unfortunately we were not able to come up with any legal authority to provide a refund,” Deputy Flathead County Attorney Peter Steele told commissioners.

Steele said there is no provision for penalties or interest to be refunded.

“We’re very sorry we weren’t able to do something,” Commissioner Dale Lauman said.

In the week between the commissioners’ discussions, the club paid its 2011 taxes, which totaled about $4,000.

Sempf said club leaders are optimistic they will generate surplus money at their upcoming fundraising auction and dinner to offset the $20,000 they just spent paying off taxes and penalties.

That event is set for April 14.

The club accepts donations any time, Sempf said, and the Flathead community has been generous in donating.

“Our programs are functioning well. We’re keeping the doors open and helping kids,” he said. “And, when all is said and done, we have to take care of the kids.”

Reporter Shelley Ridenour may be reached at 758-4439 or sridenour@dailyinterlake.com.