At first glance, the fitness center at Dawson Baptist Church in a suburb of Birmingham looks like any other recreation center. There are treadmills, an aerobics studio, even two basketball courts.
“I like the church environment. When I was younger I played church league basketball. So it was a pretty easy decision to make to come here.”
On this night, Kennan Reed shoots hoops with his oldest son. Reed says at $35 a month for his family of six, Dawson is a deal. But critics say it’s not just a deal, it’s a steal, because church fitness centers are tax-exempt. They don’t pay federal income taxes. They’re built on land that’s often exempt from property taxes. And in many states, churches don’t pay sales tax on new fitness equipment. For-profit fitness centers, which don’t get the tax breaks, say it’s unfair competition.
“If a church has a business such as a fitness club with all kinds of services that are not related to their religious function, they’re in competition with other similar businesses.”
“I think it’s important to note that when the department sent out the letters notifying people about this, we did not send these letters to Hindu temples or Buddhist temples. These were sent to businesses that were charging for their services and were not restricting it to people of a certain religion.”
But back at Dawson Baptist Church, they don’t restrict fitness center memberships to church members. Fitness Director Nancey Legg says they accept people of all faiths and even no faith. Still, she says Dawson provides a service that’s different from the for-profit gyms down the road.
Across the country, courts have ruled that some religious nonprofits are directly competing with commercial health clubs. Most notably the YMCA’s in some cities have lost all or part of their tax exemption because of their fitness centers.