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“Upscale” Facility Qualifies For Iowa Property Tax Exemption

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Ballard Creek Community, an assisted living facility in Huxley, Iowa, is operated by a religious organization called Madrid Home for the Aging. Ballard Creek is a new development, and its current residents are mostly financially secure. Can such a facility qualify for a property tax exemption as a charitable use?

According to the Story County Board of Adjustment, Ballard Creek should not be accorded the preferential tax status because of the way it actually operates its business. The Board of Adjustment points out that Ballard Creek residents tend to be wealthy, the accommodations are plush, and the services provided are minimal. Even though the owner of Ballard Creek is unquestionably a charitable organization, reasoned the Board of Adjustment, it should not be exempt from property tax on this particular project.

Iowa law, like that of Arizona and most other states, exempts the property of both religious and charitable organizations from having to pay property tax. In Iowa, the owner of property must prove three things in order to qualify for the exemption:

1. The property must be used by a charitable, religious or educational organization,

2. The property may not be used for pecuniary gain, and

3. The use of the property must be solely related to the religious or charitable purpose of the organization.

While the Board of Adjustment conceded the first two points, it argued that Ballard Creek was essentially an upscale and profitable retirement home. Madrid Homes pointed to its bylaws, which require that its facilities be operated to “provide Christian care, including housing and medical services, to the elderly.” It also pointed out that every resident was required to contribute to a special fund, designed to help pay for those residents who become unable to afford the rent in the future.

Assisted living facilities are often confused with more traditional nursing homes and similar institutions. The very purpose of Ballard Creek, as its owners pointed out, is to provide support for elders in an apartment-like setting, encouraging independence and family involvement. When such facilities work, they help aging seniors stay out of nursing homes longer, and may even prevent institutionalization altogether.

Iowa’s Court of Appeals agreed with Madrid Home. Because plans had been made to provide financial assistance for residents as they became unable to pay their own way, and because volunteers and donations help to reduce the cost of care and extend residents’ ability to stay out of institutions, Ballard Creek is a charitable use of the land and the property tax exemption is appropriate. Madrid Home for the Aging v. Story County, November 10, 1999.

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Robert B. Fleming


Robert Fleming is a Fellow of both the American College of Trust and Estate Counsel and the National Academy of Elder Law Attorneys. He has been certified as a Specialist in Estate and Trust Law by the State Bar of Arizona‘s Board of Legal Specialization, and he is also a Certified Elder Law Attorney by the National Elder Law Foundation. Robert has a long history of involvement in local, state and national organizations. He is most proud of his instrumental involvement in the Special Needs Alliance, the premier national organization for lawyers dealing with special needs trusts and planning.

Robert has two adult children, two young grandchildren and a wife of over fifty years. He is devoted to all of them. He is also very fond of Rosalind Franklin (his office companion corgi), and his homebound cat Muninn. He just likes people, their pets and their stories.

Elizabeth N.R. Friman


Elizabeth Noble Rollings Friman is a principal and licensed fiduciary at Fleming & Curti, PLC. Elizabeth enjoys estate planning and helping families navigate trust and probate administrations. She is passionate about the fiduciary work that she performs as a trustee, personal representative, guardian, and conservator. Elizabeth works with CPAs, financial professionals, case managers, and medical providers to tailor solutions to complex family challenges. Elizabeth is often called upon to serve as a neutral party so that families can avoid protracted legal conflict. Elizabeth relies on the expertise of her team at Fleming & Curti, and as the Firm approaches its third decade, she is proud of the culture of care and consideration that the Firm embodies. Finding workable solutions to sensitive and complex family challenges is something that Elizabeth and the Fleming & Curti team do well.

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Amy Farrell Matheson has worked as an attorney at Fleming & Curti since 2006. A member of the Southern Arizona Estate Planning Council, she is primarily responsible for estate planning and probate matters.

Amy graduated from Wellesley College with a double major in political science and English. She is an honors graduate of Suffolk University Law School and has been admitted to practice in Arizona, Massachusetts, New York, and the District of Columbia.

Prior to joining Fleming & Curti, Amy worked for American Public Television in Boston, and with the international trade group at White & Case, LLP, in Washington, D.C.

Amy’s husband, Tom, is an astronomer at NOIRLab and the Head of Time Domain Services, whose main project is ANTARES. Sadly, this does not involve actual time travel. Amy’s twin daughters are high school students; Finn, her Irish Red and White Setter, remains a puppy at heart.

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Matthew M. Mansour


Matthew is a law clerk who recently earned his law degree from the University of Arizona James E. Rogers College of Law. His undergraduate degree is in psychology from the University of California, Santa Barbara. Matthew has had a passion for advocacy in the Tucson community since his time as a law student representative in the Workers’ Rights Clinic. He also has worked in both the Pima County Attorney’s Office and the Pima County Public Defender’s Office. He enjoys playing basketball, caring for his cat, and listening to audiobooks narrated by the authors.