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Nonprofits don't reply, may lose exemption

| Sunday, Nov. 10, 2013, 11:50 p.m.

Allegheny County is set to revoke the tax-exempt status from almost 300 properties, some owned by Little League teams, volunteer fire departments and community organizations.

Nonprofits that failed to respond to the county's review of tax-exempt properties will lose their status at the beginning of 2014, county spokeswoman Amie Downs said. The county will notify delinquent organizations in December.

“One way or another, they are going to have to respond,” said county Solicitor Andrew Szefi, who noted that nonprofits that lose tax-exempt status can re-apply.

Despite repeated notifications, about 150 nonprofits — which collectively own 271 parcels — did not respond, county officials claim. Successfully revoked tax-exemptions for the properties could provide the county more than $800,000, officials said.

Peggy Outon, executive director of Bayer Center for Nonprofit Management at Robert Morris University in Moon, said many organizations on the list have small, volunteer staffs who did not understand what was asked of them or missed county notifications.

She suspects most of the organizations “haven't gotten their stuff together.”

“The ones who haven't responded are probably the small, the struggling and maybe the nonexistent,” she said.

Many of the nonprofits on the list did not respond to Tribune-Review inquiries.

County officials are reviewing 2,800 parcels designated as public charities and exempt from property taxes. County Council passed a law in 2007 requiring a review every three years, though this is the first. The goal is to ensure “that anyone who should be paying taxes is paying taxes,” Szefi said.

Organizations received letters in March asking them to justify their tax-exempt status for each property and explain their charity work. Ninety percent responded. County lawyers are looking at those responses — which range from two to 100 pages long, Szefi said.

County Executive Rich Fitzgerald proposed bulking up the Law Department's budget by nearly $163,000 to hire staff for the review.

Twenty organizations acknowledged they no longer qualify for exempt status and will add more than $40,000 to tax collections, said Jerry Tyskiewicz, director of the Department of Administrative Services.

Several nonprofits facing action contend they did respond, despite the county's claim to the contrary.

Keith Giles, CEO of First Step Recovery Homes, said his organization submitted responses for all its properties but the county claims five are missing. First Step provides temporary housing for recovering addicts.

Carol Lennon, executive director of Gilda's Club of Western Pennsylvania, which provides support for people living with cancer, said her nonprofit complied even though the county routinely sends notices to the wrong address.

“I'm not surprised there's been so much confusion over this,” Lennon said.

Tyskiewicz said the county verified its list in October and is confident with its assessment.

Aaron Aupperlee is a Trib Total Media staff writer. Reach him at 412-320-7986 or aaupperlee@tribweb.com.

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