The final curtain could fall at the iconic Penn Theatre in downtown Plymouth without some relief from current property taxes.
Ellen Elliott, executive director of the Friends of the Penn, told an assembled crowd last week that the theater is in jeopardy without tax relief from the city. The application for a tax exemption for the iconic theater was denied by the Plymouth assessor and there has been no response to an appeal filed with the city board of review. The application for tax exemption has now been filed with the Michigan Tax Tribunal, Elliott said, but she has been informed that decision could take up to three years. The Penn simply does not have that long, she said.
During the meeting last week, Elliott explained that the theater has been paying the $25,000 tax bill annually since the non-profit Friends of the Penn leased the building and assumed operations about 20 years ago. The Friends of the Penn took full ownership in December of 2021, Elliott said, and as a nonprofit charitable organization is eligible for a full property tax exemption. She stressed that 16 other nonprofit theaters in Michigan currently enjoy the exact exemption being sought for the Penn.
Elliott said the group has been given no reason for the denial of the tax exemption which, according to Plymouth City Manager Paul Sincock was based on a deficiency in one of the requirements in the application. Sincock said he would not comment on the issue since litigation is pending and referred to the property tax law regulations of the Michigan General Property Tax Law. He said tax exempt status is not automatic and any question is referred to the tax tribunal.
Elliott responded that the Penn “checks every box” of criteria for tax-exemption as detailed in a 2006 Michigan Supreme Court decision ruling that a taxpayer must be a nonprofit institution to qualify as a charitable institution for the property tax exemption. The ruling lays out six criteria to be considered when evaluating exemption status.
Elliott said the situation has reached a “level of ridiculousness” as no reason for the denial has been provided by the assessor, city officials, the attorneys for the city or anyone else involved in the situation. She said a Freedom of Information Act request for the information was filed with the city July 6 but has gone unfulfilled.
Elliott explained that with the serious drop in attendance at the theater following COVID, the Friends of the Penn will need to use any money generated from fundraisers to pay the tax levy. At the current level of ticket sales and donations, there would be no funding available for programming or building maintenance, she said.
“It's an old building, built in 1941, and needs a lot of attention. Anything that detracts from what we need to do with the building puts it in jeopardy,” she said. She reminded the assembled group that the Penn is an “irreplaceable asset in our town” that was saved from destruction by the intervention of a group of local investors responding to the public outcry to save the building. Since then, donations from the community have funded nearly $1 million in improvements at the theater, she said.
“We need some help. We want the community to come forward and let them (city officials) know how important this is,” Elliott said.
She urged residents to attend the 7 p.m. Aug. 21 meeting of the city commission, to voice their concerns and reinforce the importance of the Penn as an asset of the entire community and an important part of the city.
The outcome of that meeting was not known at press time.
