"As San Francisco´s Assessor-Recorder, it is my job to apply the law in a fair and equitable manner for all transactions. I have the utmost confidence that my office has done so in the Archdiocese transfer tax case.After a very thorough analysis, significant consideration, and several meetings with representatives of the Archdiocese of San Francisco, my office concluded that because the church's recent transfer of properties was in fact from one legal entity to a separate legal entity, they are considered taxable events under the law.
We respect the Archdiocese's decision to appeal our determination. However, it is a misstatement by the Church to say that my decision is ´misinterpreting transfer tax law and infringes on religious organization's right to reorganize themselves.´ In San Francisco the law is clear - if you transfer property, you owe property transfer tax, whether you´re an individual or an organization. There is no transfer tax exemption for religious organizations or nonprofit corporations. Therefore the Archdiocese is treated no differently than Macy´s, the Gap or AT&T in this situation. If any of these corporations did the same thing, they would be subject to transfer tax as well.
It's important to note that the Archdiocese remains exempted from annual property tax, as well as federal income tax related to their 501(c)(3) status.
It is commonplace for corporations to restructure to protect themselves from future litigation. Every corporation has the right to restructure however they please.
However, once the corporation brings their documents into our office to be recorded, the Office of the Assessor-Recorder must make a legal determination whether or not they owe taxes.
We have given the taxpayer every opportunity to demonstrate that they deserved an exemption and unfortunately, they have not been able to prove it.
By making this determination, we are merely treating the Archdiocese like every other taxpayer in San Francisco."
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