A dustup between a Southwest Florida botanical garden and a county property appraiser could soon bring tax protections for nonprofits statewide.
Legislation (HB 889) that would ensure nonprofits’ tax-exempt status remains intact even if a private vendor sells goods on the property cleared its second committee, the House Ways and Means Committee, Wednesday with a unanimous vote. It also cleared the Local Administration and Veterans Affairs Subcommittee last week.
Meanwhile, a Senate bill (SB 1214) also moved with ease through its first two stops.
“Not-for-profit organizations in the state — schools, foundations, food banks, churches — won’t be burdened by for-profit tax rates,” said Rep. David Borrero, a Sweetwater Republican. That impacts thousands of organizations operating as nonprofit entities.
The move theoretically should not cost the state any money, revenue estimators have ruled. But there have been instances of county property appraisers who want to get a share of taxes from organizations that allow some private business to happen at their facilities.
Sen. Joe Gruters brought the bill forward in the upper chamber after a dispute in Sarasota County between Property Appraiser Bill Furst and Marie Selby Botanical Gardens made local headlines. The county constitutional officer wanted to drop a $1.2 million tax bill on the institution after plans moved forward for a restaurant on-site run by management for the high-end restaurant Michael’s on East.
How did that number come in so high? Furst said by allowing a private business to operate on-site, that meant the entire property owned by Selby Gardens needed to be taxed like a business operating on waterfront property near posh downtown Sarasota.
Gruters set about working both with the state organizations representing county property appraisers and with leaders in the nonprofit world to reach a compromise. Before presenting his own bill to the Senate Finance and Tax Committee, he secured the support of state property appraisers.
Basically, the legislation allows for taxes to be assessed, but only on any property used by a private vendor for commercial business. That means appraisers can levy tax on space for a gift shop without putting that burden on an entire museum, for example.