Care Initiatives has asked 35 Iowa communities to reclassify its nursing home facilities to residential properties from commercial, the Cedar Rapids Gazette reported.

Citing an Iowa law that allows nonprofits that provide “land and buildings that are used primarily for human habitation” to be classified as residential properties, the West Des Moines-based nonprofit organization stands to have its taxes cut in half as a result of the petitions.

Twenty counties and cities would lose about $620,000 in tax revenue next year should they approve the changes.

“To me, it’s a commercial property,” said Harrison County Assessor Dennis Alvis. That county is set to lose nearly $30,000 following the Board of Review’s decision to change the status of the Dunlap Nursing & Rehab Center to residential. “But the law, according to how it’s written, there’s a back door,” Alvis said. “We don’t have the capacity to take this to court.”

Care Initiatives has appealed 15 rejections, including those from Johnson and Cedar counties, to the Iowa Property Assessment Appeal Board. Polk and Black Hawk counties are undecided.

“Care Initiatives fits squarely within this statutory provision and so is seeking residential classification,” wrote Deb Tharnish, an attorney with the Davis Brown Law Firm, in a letter to the Johnson County Board of Review.

Nursing homes may be a fusion of commercial and residential structures, according to Drake University law professor Jonathan Rosenbloom. “Whatever the property tax is, even if it’s reduced, will be more than if (the nursing home) moves to the next county,” he said.

Care Initiatives provides services to more than 3,000 residents in 63 nursing homes and other housing units. It reported 2009 expenses of about $143 million, which included $80.6 million in salaries.