Summary
In Herb Soc. of Am., Inc. v. Tracy (1994), 71 Ohio St.3d 374, 376, 643 N.E.2d 1132, 1134, we stated, "The dissemination of useful information to benefit mankind is, traditionally, charity."
Summary of this case from True Christianity Evangelism v. ZainoOpinion
No. 93-2447
Submitted September 29, 1994 —
Decided December 27, 1994.
APPEAL from the Board of Tax Appeals, No. 91-A-1761.
The Herb Society of America, Inc. ("Society"), appellant, applied to the Tax Commissioner, appellee, to exempt its real property , located in Kirtland, Ohio, from taxation for tax year 1989. The commissioner denied the exemption, and, on appeal, the Board of Tax Appeals ("BTA") affirmed the commissioner's order.
The Society, a national organization, attempts to further the use of and knowledge about herbs. According to the BTA's decision:
"The Herb Society publishes a variety of books and pamphlets on herbs written by both members and non-members and stores and ships them from its headquarters. These items are either sold at cost or are given away. Slide lectures are also maintained and can be used by a requesting organization at cost. A library dedicated to herbs is also maintained at the headquarters which is open to the general public.
"The Herb Society answers questions and requests for information regarding herbs from members and non-members alike at no charge. Additionally, a speakers' bureau is organized and maintained at the Society to respond to the general public's speaking needs, at no charge.
"The Society established an endowment fund to encourage research about herbs. Since 1970, grants, totaling over $50,000, have been given to further the study of herbs.
"The Society has an annual national symposium, as well as programs, lectures, and workshops at the headquarters that are open to the public. Local units also conduct symposiums and other programs.
"The Society maintains many public herb gardens throughout the United States. Each of the aforementioned 35 units maintains at least one garden. In addition, a national herb garden was established with matching funds from the U.S. Government and the Herb Society; the Herb Society also established an endowment fund to pay one-half of the salary of the individual who works with the curator of the National Herb Garden."
The property at issue is the Society's national headquarters. The Society purchased this property, approximately three acres, from the Holden Arboretum, which surrounds the subject property. The property contains a stone building, originally built in 1830 or 1840, which the Society plans to renovate for its programs. As of the date of the hearing, the building housed a library, conference room, office, kitchen, a storage area, and two large rooms, which the Society hopes to refurbish as classrooms.
The BTA noted that the Society performed the charitable activity of disseminating information about herbs. Nevertheless, the BTA denied exemption because it found that the Society benefited its members more than the public. The BTA also questioned the Society's admission requirements: an individual must be sponsored by two Society members and demonstrate some knowledge about herbs; if the individual did not demonstrate this knowledge, the membership committee would not accept the individual. The BTA wondered why the Society was selective when it would probably want as much support from as many members as it could attract.
The cause is now before this court upon an appeal as of right.
Walter Haverfield, Arthur P. Steinmetz and Ricky L. Bertram, for appellant.
Lee Fisher, Attorney General, and Janyce P. Katz, Assistant Attorney General, for appellee.
We conclude that the Herb Society of America is a charitable institution, and we reverse and remand the BTA's decision.
The Society applies for exemption under former R.C. 5709.121:
"Real property and tangible personal property belonging to a charitable or educational institution or to the state or a political subdivision, shall be considered as used exclusively for charitable or public purposes by such institution, the state, or political subdivision, if it is * * *
"* * *
"(B) Otherwise made available under the direction or control of such institution, the state, or political subdivision for use in furtherance of or incidental to its charitable, educational, or public purposes and not with the view to profit."
In Cincinnati Nature Ctr. Assn. v. Bd. of Tax Appeals (1976), 48 Ohio St.2d 122, 125, 2 O.O.3d 275, 277, 357 N.E.2d 381, 383, we stated:
"* * * To fall within the terms of R.C. 5709.121, property must (1) be under the direction or control of a charitable institution or state or political subdivision, (2) be otherwise made available `for use in furtherance of or incidental to' the institution's `charitable * * * or public purposes,' and (3) not be made available with a view to profit."
The BTA, citing Episcopal Parish v. Kinney (1979), 58 Ohio St.2d 199, 12 O.O.3d 197, 389 N.E.2d 847, focused its initial inquiry on whether the Society was a charitable institution. The BTA decided that the Society was not.
According to Planned Parenthood Assn. v. Tax Commr., 5 Ohio St.2d 117, 34 O.O.2d 251, 214 N.E.2d 222, paragraph one of the syllabus, "`charity' in the legal sense, is the attempt in good faith, spiritually, physically, intellectually, socially and economically to advance and benefit mankind in general, or those in need of advancement and benefit in particular, without regard to their ability to supply that need from other sources, and without hope or expectation, if not with positive abnegation, of gain or profit by the donor or by the instrumentality of the charity."
The dissemination of useful information to benefit mankind is, traditionally, charity. See id., paragraph four of the syllabus; Am. Humanist Assn., Inc. v. Bd. of Tax Appeals (1963), 174 Ohio St. 545, 23 O.O.2d 210, 190 N.E.2d 685.
So long as an institution is operated without any view to profit and exclusively for a charitable purpose, it is a charitable institution. It need not be open generally to the public if it promotes the lawful advancement of the charitable purpose. Am. Commt. of Rabbinical College of Telshe, Inc. v. Bd. of Tax Appeals (1951), 156 Ohio St. 376, 46 O.O. 217, 102 N.E.2d 589, paragraphs one and two of the syllabus.
Here, the Society, in good faith, attempts to advance and benefit mankind in general. The evidence establishes that the society physically, by tending herb gardens, including the National Herb Garden, intellectually, by lecturing and distributing literature, socially, by sponsoring symposiums, and economically, by endowing research grants, advances and benefits mankind.
Moreover, we can find no case that declares an organization not to be a charitable institution because it restricts membership to selected individuals. Its membership requirements actually foster the education that the Society promotes. An informed member will better serve the Society in its mission to educate the community than an uninformed member.
Accordingly, we reverse the decision of the BTA as to its finding that the Society is not a charitable institution and remand the cause to the BTA to determine whether the Society has established exemption under the remaining two prongs of Cincinnati Nature Ctr. Assn. v. Bd. of Tax Appeals, supra.
Decision reversed and cause remanded.
MOYER, C.J., A.W. SWEENEY, WRIGHT, RESNICK, F.E. SWEENEY and PFEIFER, JJ., concur.
DOUGLAS, J., dissents.