BR country club argues for tax exemption

• By ALLEN M. JOHNSON JR.
• Advocate New Orleans bureau
• Published: Oct 14, 2008 - Page: 4A - UPDATED: 12:05 a.m.

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NEW ORLEANS — The Louisiana Supreme Court on Monday heard arguments about whether the Sherwood Forest Country Club should be exempt from paying property taxes to East Baton Rouge Parish.

At one point, an attorney for the organization urged the seven justices to compare the country club to a college fraternity when deliberating over the tax case.

The high court’s decision could have ramifications for other clubs and social groups across the state seeking tax relief under exemptions for “fraternal” organizations, as provided — but not defined — by the state Constitution, according to arguments at Monday’s hearing.

Mark Hanna, an attorney for the country club, told the court that Sherwood Forest is indeed a “fraternal” group that meets strict criteria for nonprofits seeking exemptions from property taxes.

Hanna asked the court to affirm favorable rulings from the 1st Circuit Court of Appeal and the 19th Judicial District Court in Baton Rouge, granting the property tax exemptions to Sherwood Forest Country Club.

As to the state Constitution’s lack of definition of a “fraternal” organization, Hanna urged the seven justices to think of Sherwood Forest as a latter-day college fraternity or sorority.

“When you think about it, a country club is a more grown-up version of a fraternity,” Hanna said. Like college fraternal organizations, a country club has a “clubhouse” as well as recreational and social opportunities.

But Brian A. Eddington, an attorney for East Baton Rouge Parish Assessor Brian Wilson, argued that the 1st Circuit erred in its 3-0 decision, in favor of Sherwood Forest Country Club.

Eddington said that the appellate court applied an “inappropriate standard of review” to the country club’s case. The constitution requires that tax exemptions are “strictly construed” against the applicant in unequivocal language.

Sherwood Forest’s articles of incorporation states the organization operates a clubhouse, tennis courts and swimming pools for the “recreation, amusement and entertainment as country clubs usually provide.”

Hanna tried to assure the justices that the exemption for Sherwood Forest would not create “a rush” by other country clubs seeking property tax relief under a three-point criteria

“I don’t think there’s going to be a rush by country clubs to this exemption,” Hanna said, adding many would not qualify, including clubs owned by insurance companies. “I think that when you consider the gantlet you have to run, a lot of clubs won’t meet this exemption.”

After the hearing, Eddington and Hanna talked amicably in the marble hallway outside the courtroom. Eddington told a reporter: “The Constitution is absolutely silent on the meaning of — ‘fraternal’. If there was a definition (of the word), we would have settled this a long time ago.”