Real Estate Tax Exemptions
Robert Tideman
[Reprinted from The Gargoyle, January, 1959]
Overlooked in last month's article on the taxation of private schools
in California were vital considerations that have forced themselves
upon the attention of some of us who are close to the California
scene.
The taxes at issue are not income or sales taxes, but property taxes,
a most significant part of which fall upon the value of land. Gargoyle
readers do not need to be reminded that taxes on the value of land are
not an "attack" by the State. On the contrary, any
nongovernmental landholders who seek or defend exemption from such
taxes are themselves making necessary the oppressive taxes on labor
and capital which do attack private enterprise.
The private schools involved in the recent contest -- including
parochial schools which, of course, are also private -- paid taxes on
the land they occupied from the earliest days of statehood right up to
1952. During this long period they grew and flourished. In 1926 and
1933 they had sought the privilege of tax exemption but were defeated
at the polls. In 1937 a similar attempt was defeated in the
Legislature. But in 1952 California voters wearily conceded the
long-sought real estate tax exemption by the narrow margin of 50.8
percent to 49.2 percent of the vote. Thus the late initiative
amendment was scarcely a "subtle attempt
to tax them out
of existence," as The Gargoyle reports. It was simply an
attempt by citizens to return these private schools to the same real
estate tax obligations which they had shared with other landholders,
from the State's earliest days until six years ago.
The genuinely "subtle attempt" is the one being made to
represent all resistance to such land tax exemptions as "attacks"
motivated by "bureaucracy" or even "bigotry." Such
hot charges, it seems to me reflect a weakness of argument.
To be sure, certain marginal private schools occupying valuable land
might have to move or even close if compelled to resume paying for the
public services such as police and fire protection which give value to
the land they hold. And why not? Any enterprise whose customers do not
get enough value from its service to pay its bills ought to retrench.
Granted that parents have both a natural and a constitutional right
to choose their children's schools, this right does not convey the
privilege of holding school land tax exempt. Each of us has the right
to construct private parks, roads, libraries or tennis courts, to
provide his own police and fire protection, or to furnish any like
facility also provided by government. But that right does not convey
the privilege of tax exemption to the land so used. For any tax
exemption of nongovernmental land compels other taxpayers to pay for
the public services enjoyed by the exempt landholders. In effect, such
exemptions compel the payment of taxes for the support of private
schools, which is indeed the accepted practice in some foreign lands
but not in the United States -- not yet. Land tax exemptions deprive
the public schools of their natural revenue, deny "the equal
protection of the laws" guaranteed by the 14th Amendment, deny,
in fact, the equal right to Nature's gifts, and are indefensible on
any ground whatsoever.
As for Bishops' reaffirmation of the "right to teach"
conveyed to the Roman Catholic Church by "her Divine Founder
Himself," it goes without saying that this right is shared by
all.
The Bishops are quoted as declaring "Under whatever form of
tyranny, from Caesarism to Sovietism, the subversion of human freedom
has almost invariably begun with restriction or denial of the right of
the Church to teach." This is not correct. The Gracchi brothers
were stoned and beaten to death before the birth of Jesus, the
Nihilists of whom George wrote went to the gallows 38 years before the
Soviet Revolution, and, painful as it may be to admit it, in Spain and
the Dominican Republic, where the right of the Church to teach is
certainly not restricted, the face of freedom is all but ground to
powder.
The statement that "any governmentally run institution tends, at
best, to mediocracy" is generally true of federal agencies, which
do not summon the attention of direct land tax payers to oversee their
operations; but is not true of independent local school districts
which draw revenue from district landholders who themselves are in
competition with the landholders of nearby districts to attract
population to their areas.
As for the alleged superiority of private schools, recent surveys of
the college records of public and private high school graduates in
California reveal little difference between the scholastic records of
the two groups. Public school graduates, as a matter of fact, were
found to do somewhat better. Dr. Edward McGlynn, head of the largest
Roman Catholic Church in New York City, himself staunchly favored the
American public school system and resisted the introduction of church
schools in his parish. Henry George speaks best for himself. "The
great merit of our public schools", he wrote, "and the great
necessity for public schools in a country like ours, is that they
bring together children of all creeds and classes and thus wear away
the prejudices that must inevitably arise where children of one creed
or class are kept from association with children of other creeds or
classes. People hate each other and despise each other just in
proportion as they are kept separate from each other; and the most
important lesson which many a boy and girl learns in our public
schools is that children of other faiths, which the narrower teachings
of home and Sunday School might lead them to despise, are just as
intelligent, just as conscientious, just as kindly, and just as
lovable as anyone else. To our public schools more than to any other
of our institutions is due the growth of that spirit of toleration
between various creeds which is so marked in the United States."
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