Tax exemption was granted for...
...property owned by a religious organization but used for residential purposes. That exemption still required the payment of special district taxes.
Since the bldgs were used for "residential purposes" it appears that Watchtower got the tax exemption they should have gotten. If a fire had broken out they would certainly have expected the local fire dept to come to their rescue.
It'll be interesting to see how this turns out but it seems like Watchtower should pay the tax.