Changes in Exempt school property use by Third Parties

Changes in Current Practice concerning Exempt school property use by Third Parties

See below for clarification and change of procedures for outside vendors providing services on school property, including Teachers who provide after school hours tutoring!! Keep the offerings educational!! It continues to be the responsibility of the principal to be sure that all vendors are in compliance and meet all current archdiocesan requirements for Safe Environment, Background Checks, and proof of insurance, currently in place to assure the safety of the students.

Here are the relevant excerpts from WAC 458-16-270(6)(d) that allows exempt school property to be used by third parties:

(6) Examples of uses that do not nullify the exemption. In order to clarify the property tax exemption for schools and colleges, this subsection describes and gives examples of the types of use by third parties not entitled to a property tax exemption that do not nullify the tax exempt status of property owned or used by or for a school or college. The following examples should be used only as a general guide. The tax results of other specific situations must be determined after a review of all of the facts and circumstances. In the following examples, as long as any rent or donation associated with the use is reasonable and does not result in net income to the school or college, the exemption is not affected.

(d) Exempt property is used by third parties for educational or instructional programs, such as private instruction, tutoring, driving instruction, English as a second language or other language courses, examination preparation, or other similar programs. These programs are consistent with the educational programs of the school or college and the property remains exempt as long as the property use is contracted for and permitted by the school or college and the uses are consistent with the educational programs of the school or college.

“Net income” is defined in WAC 458-16-165 as rent that exceeds maintenance and operation expenses on the portion of the property being rented.

Will Crowley
Crowley Law Offices, P.S.