May 28, 2014 Leave a comment
First, a quick assessment of your Salisbury House knowledge:
(1) Who occupied Salisbury House for the longest period of time?
- (a) Carl and Edith Weeks
- (b) The Iowa teachers’ union
- (c) Drake University College of Fine Arts
- (d) Salisbury House Foundation
It may come as a surprise to learn that the teachers’ union – the Iowa State Education Association (ISEA) – occupied Salisbury House from 1954 until 1998. If you guessed (b), pat yourself on the back!
The ISEA was headquartered at the House for forty-four years. Carl and Edith lived here for twenty-eight years,during which time Drake University planned for two decades to turn the property into a fine arts college. The Salisbury House Foundation was formed in the 1990s, purchased the house, grounds, and collections in 1998, and continues to run the property today.
Our historic interpretation of Salisbury House now focuses primarily on the Weeks family. However, Drake’s and ISEA’s control of the property represent significant chapters in this narrative as well. Documents in our archives trace the curious route of Salisbury House’s ownership, and also illustrate the unique challenges inhered in owning this singular property.
One factor plays an outsized role in this story: taxes. Even before Carl Weeks’ Salisbury House was completed in 1928, this knotty issue preoccupied its owner. Because Salisbury House potentially posed a whopping tax liability for Carl, he applied his considerable inventiveness to circumventing the issue. A proposal dated November 1927 illustrated one plan he developed.
The gist of the document lies in Carl’s framing of Salisbury House as a “high grade investment for the Armand Company.” In this scenario, house was to be financed by Armand corporate funds instead of Weeks family money. Carl continued: “My verbal proposal to the Armand Company was that we would move in, attend to the upkeep of the house so far as servants, light, heat and power were concerned, and begin paying rent when the house was finally pronounced complete.” Rent, as suggested below, would run $25,000 per year.
Why would Carl pursue this plan in 1927? One explanation might lie in the reorganization of federal tax statutes in 1926. Maybe the “rental agreement” in 1927 stemmed from an unfavorable tax situation that resulted from the revised tax laws. Perhaps Carl wanted to use payment of rent to offset his personal income tax as part of his own business. In other words, he would take his business income minus business expenses, including rent, to arrive at his taxable income. Alternatively, it seems possible that Carl wished to offset the tax on Armand corporate income – if the company could claim the the expenses involved in building Salisbury House, this could considerably reduce Armand’s taxable corporate income. Or, instead of an income tax issue, onerous property taxes might have prompted Carl to consider alternative tax arrangements.
We’re not sure if Carl was able to put this, or a similar plan, into action. Still, it’s clear that issues surrounding ownership of and tax liability for Salisbury House represented significant concerns. During the early 1930s, though, he executed a master stroke that eliminated his property’s heavy tax burden.
In November 1934, the news was announced: Carl deeded Salisbury House to Drake University in Des Moines. The university planned to eventually use the property as a fine arts college. The Weeks family would continue to live in the house for a minimum of five years and pay $100 monthly in rent to Drake. Ultimately, the terms of the lease remained in place for the next twenty years.
By deeding Salisbury House to Drake University, the property (theoretically) became exempt from taxes. Taxes on the property went from $8,500 in 1933 to $0. The above article from November 21, 1934, pointedly noted the fact that Carl would continue to reside in Salisbury House without paying any tax on the property.
Newspaper reports in subsequent years also remarked upon the sweetheart deal. A 1942 article reported that Salisbury House claimed the title of highest appraised valuation in Des Moines. Terrace Hill, then home to the Hubbell family and now to the governor of Iowa, represented the highest assessed valuation in the city. Despite Salisbury House’s towering appraisal, the article observed, “Because Weeks deeded the property to Drake university [sic] in 1934 as the future site for the fine arts college, Salisbury House is tax exempt. The manufacturer and his family still occupy the home….paying rent to Drake.”
Still, questions surrounding Salisbury House’s tax liability – and Drake University’s subsequent responsibility for it after 1934 – did not go away. A pair of articles published in the Des Moines Tribune in 1937 indicates that Polk County nearly took the deed to Salisbury House due to delinquent taxes.
Our archives do not contain further articles about this particular incident, and additional research thus far has yielded little. Still, because Drake University’s arrangement with the Weeks family remained in place for twenty years, the delinquent tax issue must have been ultimately laid to rest.
Reports in 1950 suggested that the American Bar Association considered moving its headquarters from Chicago to Salisbury House in Des Moines. While Drake “agreed to discuss it with them,” nothing substantive resulted.
Then, in late 1953, word was announced that a buyer had been found. The Iowa State Education Associate purchased Salisbury House, the collection, and the 11-acre property, for $200,000. According to published reports, $100,000 of the proceeds went to Drake, while the remainder of the purchase price went to the Weeks family.
Almost immediately, ISEA also had to deal with the thorny issue of Salisbury House taxes. The central question in determining the tax status for the new occupants of Salisbury House hinged on “whether the ISEA is held to be an educational and charitable organization or a professional organization.”
Ultimately, as later reported by the Des Moines Register, the ISEA successfully sued to obtain tax-exempt status of the portions of Salisbury House kept open to the public for educational tours (the Library, Great Hall, and Common Room.
The tax question, as far as ISEA was concerned, appeared settled. Still, as Salisbury House transitioned from the family home of Carl and Edith Weeks to the headquarters of the Iowa State Education Association, some ambiguity remained in terms of the ownership of furnishings, pieces from the Weekses’ considerable collections, and other objects. Soon after the ISEA purchase was completed, efforts began to sell off objects deemed extraneous to the organization’s operations.
A little more than a month after the announced sale of Salisbury House, Charles Martin – then the executive secretary of ISEA – circulated a letter “concerning the disposal of “for sale” items in Salisbury House. Cedar closets, ceramic tile, bathroom fixtures, kitchen and laundry facilities, “and any odd furniture not bound by the purchase contract” was available for purchase.
A number of bids were placed for Salisbury House items. The VA hospital in Des Moines offered $30 for a stainless steel sink and $15 for the Reliable gas stove. Another individual offered $2 for “the small round mahogany tables and for the small drop leaf tables,” in addition to a $5 bid for a pair of metal twin beds. A Des Moines man placed a $5 bid for a cedar closet. Bathroom fixtures were sold for $25.
All bids (for which records remain) appeared to have been quickly accepted – with one exception. For reasons that remain unclear, Carl was in the position of having to purchase some items he wished to retain from Salisbury House after the sale to ISEA. We don’t know why these pieces weren’t exempted from the purchase contract in the first place. Essentially, Carl had to buy back objects from the ISEA that he had himself previously purchased. Most of the offers made by Carl were found agreeable by the ISEA administration, but his bid in August 1955 for a rug, table, and sofa was rebuffed.
Additional items were offered for purchase over the years. A public sale, for example, was held in the 1950s and anecdotal evidence suggests that similar events took place over the years. ISEA also actively sought buyers for a number of antiques, and contacted both Tiffany’s in New York and Marshall Field in Chicago to inquire whether or not they might be interested in purchasing some Salisbury House objects.
The most well-known ISEA sale came in the 1980s. Joseph Stella’s Tree of My Life brought $2.2 million at a Christie’s auction in December 1986. Later publications from the ISEA indicate the funds were invested in order to secure monies for restoration and related projects at Salisbury House.
Today, the Salisbury House Foundation, a private, nonprofit, 501(c)(3), owns and operates the property as an historic house museum. This status as a not-for-profit museum clarifies our role in terms of the custody and care of the house and grounds. Ultimately, though, the complicated history of Salisbury House ownership, taxes, and stewardship suggests the broader difficulties that are part and parcel of this extraordinary structure.Special thanks to attorney Martha Sibbel for identifying possible tax-related issues regarding the ownership of Salisbury House.