Church Or B&B?: Infamous ‘C Street House’ Should Lose Tax Break, Clergy Say

A group of clergy has asked the Internal Revenue Service to examine the tax-exempt status of a house in Washington, D.C., connected to a shadowy Religious Right group called The Family.

The residential building in question is located on Capitol Hill near congressional offices. The Family, also known as the Fellowship Foundation, has for years received a tax exemption for the property (formally called the C Street Center), claiming it is a church.

An alliance of Ohio-based ministers challenged that assertion. In a Feb. 23 letter to the IRS, members of Clergy Voice asserted that the C Street house is “an exclusive club for powerful officials…masquerading as a church.”

The house, the clergy say, meets none of the tests the IRS has set forth to determine when a religious group qualifies for tax exemption. Their letter was drafted by Marcus Owens, an attorney and former high-ranking IRS official.

Because of The Family’s fondness for secrecy, it’s difficult to know exactly what goes on at the house, located at 133 C Street S.E. It has been widely reported that some rooms are rented out to members of Congress at a low rate, and other news stories have said that Bible study and prayer meetings occasionally occur there.

The Ohio religious leaders say that is not enough to make the structure a church. In their letter, they assert that the C Street Center is really a boarding house and say it should not qualify for tax exemption.

“An organization whose chief activity is providing room and board to Members of Congress,” the letter asserts, “is not a church.”

The house drew unwanted scrutiny last year after several of its current or former residents were involved in sex scandals. (See “Behind the Green Door,” September 2009 Church & State.) The Family attracted further adverse publicity when it was revealed that the group has ties to a Ugandan legislator who has proposed harsh penalties, including death sentences, for gays.

The Rev. Eric Williams, senior pastor at North Congregational United Church of Christ in Columbus, told The Washington Post he considers this a matter of church-state separation, noting that The Family has used the house to gain undue influence over members of Congress.

“We’ve got an organization posing as a church,” Williams said.

An official at the Fellowship Foundation told The Post that his group has no ties to the house.

“C Street is a completely separate foundation with its own board,” said Richard Carver, president of the Fellowship Foundation. “It’s separate ownership, and I haven’t been there personally in probably six years. We have no direct connection in any way with their status or what goes on at C Street.”

District of Columbia tax officials have already decided to take a second look at the C Street property’s exempt status. As a result, the city’s tax office decided last year to partially tax the building, which is worth an estimated $1.8 million.