Aydelu Inc loses its municipal tax exemption 

 

Laurent Robillard-Cardinal

Aydelu Inc was hit with a non-favorable decision by the Commission municipal du Québec on December 19, 2014. During its periodic review, the commission held that Aydelu is no longer exempt from municipal taxes.  This status is retroactive to January 1, 2014.

 

The commission had exempted the Aydelu building from municipal taxes since December 21, 2004.  Last  January 28, 2014, in anticipation of the upcoming periodic review, Aydelu Inc had requested that the commission confirm the exempt recognition for the building. However, in light of changes since the 2004 decision, the request was denied.

 

The Aydelu property now includes many buildings –  the Duchesnay and Frank Robinson arenas, Galaxie Bowling, five lots on the west side of the property and the Aydelu Centre (the Barn). The request for recognition Aydelu submitted did not include the two arenas since the Duchesnay arena is owned by the city and the Frank Robinson arena is subject to a 99 year emphyteutic lease with the City.

 

According to the commission’s ruling, Aydelu Inc may only receive the tax exemption if it conducts at least one of the activities eligible for that status and  if  the building is used mainly for eligible activities. “The activities must be related to creation, exhibits or visual art presentations, or any other informative or educational activities organized for people who want to improve, in their leisure-time, their knowledge or abilities in the areas of art, history, science or sport. Eligible activities also include activities organized for (or aimed at) people who are oppressed, socially or economically ... or (for activities) to help prevent people from becoming so.”

 

Community activities could

turn around decision

 

The ruling indicated that the only eligible activities directly organized by Aydelu Inc are the weekly bingos, with proceeds to the community, and the annual seniors’ dance. The rest of the time, Aydelu either rents or loans its halls to different organizations, such as the West Quebecers Regional Association and Impératif français, for special evenings. According to the commission, the building is not mainly used for informative or educational activities.

 

The commission’s ruling also said that even if Aydelu Inc donates part of its profits to different organizations, some of which help people in need, this is not the ultimate usage of the facilities. Although Aydelu distributes profits to organizations occasionally, the organizations are not just charitable, they are also cultural, sports or community-based. According to Administrative Judge Sandra Bilodeau, “for the bingo activities to be eligible, (the) distribution of profits to help people in need would have had to be their main purpose. The proof shows otherwise.”

 

Jacques Coderre, Aydelu’s interim president, explained that the bingo profits, as well as income from leasing lots, are mostly used to keep the centre open for the community.  In this way, the hall can be offered for free or rented at a low cost to different organizations.

 

However, the judge ruled that  the type of activities held by the different organizations are not eligible activities. “It is true that a few of these organizations donate money to people in need, but, as the president also said, the building rental and loan is not limited to such organizations; cultural or other organizations also use the building for leisure purposes,” noted the judge.  

Therefore, “The Aydelu Centre cannot benefit from the recognition.” The report indicated that in 2004, the commission concluded that the activities, at the time, were eligible for the tax exemption, but that this is not the case in 2014.

 

If major changes to Aydelu Inc activities are made in the near future, the charitable organization can send a sworn letter (affidavit) to the Commission municipal du Québec requesting that its file be reviewed.

 

Other Aydelu Inc lots

 

As for the lot on which the bowling alley is built, the judge again indicated that it does not fall into the eligible activities category since it is used by a private company for commercial purposes. Finally, the playgrounds and baseball ground, as well as the five parking lots rented out to the city, were also ruled out as being used for eligible activities according to the law and as such, cannot be recognized for the municipal tax exemption.