Karleen Sempert, Assessor
Elk Rapids Township Assessor
P.O. Box 365
315 Bridge Street
Elk Rapids, MI 49629

July 31, 2024

Dear Ms. Sempert,

We, the undersigned members of the Elk Rapids community, are writing to express our collective support for the Chalfonte Foundation's appeal to the Michigan Tax Tribunal and to request that you reconsider your objection and grant a property tax exemption for 205 River Street, home of the Elk Rapids Cinema. The Chalfonte Foundation's use of this historic property is entirely for nonprofit charitable purposes, and we believe the objection is based on a misunderstanding of its operations.

The reasons for our support are as follows:

1. False Reason for Assessor's Action: The claim that the property is "not being solely used for nonprofit purposes" is incorrect. The Chalfonte Theatre, home of the Elk Rapids Cinema, the new Village Radio 99.7, and PuppetTV, under the ownership of the Chalfonte Foundation, is used exclusively for nonprofit charitable purposes.
2. Statutory Grounds for Exemption: Both MCL 211.7n and MCL 211.7o provide for the exemption of properties used for nonprofit charitable purposes. The Elk Rapids Cinema aligns perfectly with these statutes.
3. Compliance with the Three-Part Test: According to Department of Treasury Bulletin 26 of 2017, the Chalfonte Foundation meets the three-part test for exemption:
   1. Ownership and Occupancy: The real estate is owned and occupied by the Chalfonte Foundation, the exemption claimant.
   2. Nonprofit Charitable Institution: The Chalfonte Foundation is a recognized nonprofit charitable institution.
   3. Sole Use for Nonprofit Purposes: The buildings and other property are solely occupied and used for the purposes for which the Chalfonte Foundation was incorporated.

Additionally, it is important to note that the Harbor Springs Lyric Theatre to the north of Elk Rapids and The Bay Theatre directly across the Grand Traverse Bay to the west are both 501(c)(3) owned and operated cinemas that have been granted property tax exemptions. The Bay Theatre’s case went before the Michigan Tax Tribunal and the Tribunal ruled in their favor.  This precedent underscores the validity of the Chalfonte Foundation’s request and aligns with other similar cases in our region and across the state.

The Chalfonte Foundation supports a variety of nonprofit charitable activities that benefit our community, including:

• Piano Scholarship: Providing opportunities for local youth to pursue musical education.
• Village Radio: Establishing a community radio station that enhances cultural engagement and provides a platform for local voices.
• The HIP Show: A planned children's morning program that blends education and entertainment.
• PuppetART: Showcasing puppetry as an art form and offering related programming.
• Student Film Exhibitions: Supporting young filmmakers by providing a venue for their work.
• Discount Tickets: Offering discount tickets to elders and low-income individuals and families, ensuring that everyone in the community can access cultural and educational programming.

The Chalfonte Theatre, home of the Elk Rapids Cinema, relies on two paid staff members and over 20 dedicated volunteers. The President of the Chalfonte Foundation and the Elk Rapids Cinema General Manager both receive no monetary compensation, demonstrating a deep commitment to nonprofit operations and community service.

The Elk Rapids Cinema has been a cultural hub for over 80 years, enriching our community through cinematic and musical arts. It serves as a valuable space for arts enrichment, cultural exchange, and community engagement. The programs extend beyond entertainment, fostering educational opportunities and cultural appreciation among residents of all ages.

The burden of over $10,000 in summer taxes alone makes it almost impossible for the cinema to continue operating. Without the exemption, the financial strain could jeopardize the future of this vital community resource.

We, the community, urge you to reconsider your position. Granting the property tax exemption will enable the Chalfonte Foundation to continue its mission of providing valuable cultural and educational programming to Elk Rapids. The Foundation's work is crucial to maintaining the rich cultural fabric of our town.

Thank you for your attention to this matter. We are hopeful for a favorable resolution and appreciate your consideration.