The five members of Alaska’s highest court heard arguments last Thursday in a long-running dispute between the operators of a Christian camp and the Fairbanks North Star Borough about whether or not the camp qualifies for an exemption from local property taxes.
Though the dispute involves only a single camp in Fairbanks, the justices’ ruling could redraw the limits that decide when religious groups’ operations qualify for tax exemptions in Alaska.
In court, an attorney representing the borough and one representing the camp’s operator, Victory Ministries of Alaska, said the key question is whether Camp Li-Wa was used exclusively for charitable purposes during 2021.
The borough and Victory Ministries disagree on other years’ taxes, but only one dispute was escalated to the Supreme Court.
The borough contends that because Victory Ministries operates a Christian Bible camp for only two months during the year, it should not be able to claim tax-exempt status for the remaining 10 months of the year, or on buildings not used by the camp.
In arguing its case, the borough submitted advertising material published by Victory Ministries that described the camp as “currently one of the finest retreat locations in the Interior of Alaska” and said it was advertised for vacations, recreation and other profitable purposes, not just charity.
The borough also submitted financial documents obtained from Camp Li-Wa, suggesting that the camp was used more for commercial, profitable purposes than charitable ones.
Victory Ministries fought back, saying that the camp operates at a deficit, and — among other arguments — that paying users are not required to be nonprofit groups, and that charity can involve self-care and pleasure.
In 2024, a Fairbanks Superior Court judge ruled in favor of the borough, causing the defendants to appeal to the Supreme Court.
In part, the operators of Camp Li-Wa argue that the borough and superior court “erred by improperly limiting what constitutes ‘charitable activity’ in violation of the state constitutional protections.”
Janella Kamai, attorney for Victory Ministries of Alaska, told the justices that while Camp Li-Wa may offer programs like horseback riding for a fee, “The fun activities, it’s just a sideline. The purpose is to provide the churches, the schools, with a place for them to host their own spiritual retreats and community events.”
She said the camp’s mission applies even if someone who isn’t religious comes to the camp. “You have to understand that Victory operates to both evangelize and proselytize. Evangelism means they’re going to bring people onto the campus so that they can introduce them to the concepts of Christian camping, introduce them to Camp Li-Wa, so if they want to know more, they can,” Kamai said.
In many cases, the camp is being used as a religious retreat, she said.
Ehren Lohse, the attorney representing the Fairbanks North Star Borough, said that under the borough’s definitions, a retreat isn’t a charitable activity.
“A retreat, by definition, is time away from your other work. So they may be doing charitable and religious work at their normal places,” he said of camp users, “but when they’re having a retreat, that can happen anywhere.”
Justice Dario Borghesan said that raises a problem for the justices: There’s no way to know whether camp users were engaging in religious activity or taking a break.
“I’m just not sure how ultimately this gets resolved,” he said.
The court took the case under consideration at the end of Thursday’s hearing and will issue a written order at a future date.