Opinion
2002-0595.
Decided December 20, 2006.
Segel, Goldman, Mazzotta Siegel, P. C., Attorneys for Petitioner, Albany, New York.
Daniel G. Vincelette, P. C., Attorney for Respondents, Albany, New York.
Girvin Ferlazzo, P. C., Attorneys for Intervenor Greater Amsterdam School District (2004 proceeding), Albany, New York.
The following papers were considered: (1) Notice of Motion dated September 7, 2006; Affidavit of Gerald Brown sworn to September 3, 2006; Affidavit of Paul J. Goldman, Esq., sworn to September 3, 2006; Exhibits "A" — "GG"; (2) Memorandum in Opposition submitted by Daniel G. Vincelette, Esq.; (3) Reply Affidavit of Paul J. Goldman, Esq., sworn to October 23, 2006; Reply Affidavit of Gerald Brown sworn to October 23, 2006; Exhibits "HH"" — "SS."
In these combined RPTL Article 7 and CPLR Article 78 proceeding, Petitioner, Baldwin Research Institute, Inc. ("BRI"), seeks an order pursuant to CPLR 3212 for summary judgment granting the relief requested in the petitions, striking each of the properties from the taxable portion of the assessment rolls for each of the years in question, and directing respondents to pay refunds to the Petitioner for the amount of the real property taxes that have been paid on the erroneous assessments.
Petitioner for the 2002, 2003, and 2004, assessment rolls owned three parcels of real property in the Town of Amsterdam known as 5 Church Street, 9 Church Street and 7 Church Street. In 2004 Petitioner purchased 1 Church Street, 3 Church Street and 15 Church Street resulting in the ownership of six parcels of real property in the Town of Amsterdam which were included on the 2005 assessment roll. Petitioner contends that these parcels for each of the assessment years in question were used exclusively in furtherance of the provision of charitable, educational and moral or mental improvement of men, women, or children and that pursuant to RPTL § 420-a (1) the real property owned by it is exempt from real property taxes.
In August 1999, Supreme Court Justice Robert P. Best signed a judgment granting Petitioner's application for exemption from real property taxes pursuant to RPTL § 420-a for the 1997 and 1998 tax years. Beginning with the 2002 assessment roll, Respondent began assessing Petitioner's property without the exemption. Petitioner commenced these proceedings seeking to have its property exempted from real property taxes and the assessments be declared illegal and stricken from the assessment roll. In January 2004, Petitioner moved for summary judgment with respect to the 2002 and 2003 proceedings. Respondents at that time moved for an order dismissing the 2002 proceedings. In May 2004, Justice Best denied the motions on the basis that neither party had satisfied its burden of establishing its right to a judgment as a matter of law. In denying Petitioner's motion Justice Best stated that "Petitioner has not presented any proof with regard to the second prong of the analysis, whether the property for which the exemption is sought is itself primarily used for an exempt purpose."
Petitioner has brought this summary judgment motion with respect to each of the years in dispute. Although successive motions for summary judgment are disfavored, the court may consider such motions where warranted by the facts ( see, Robbins v. K-Mart Corp., 248 AD2d 867 [3rd Dept., 1998]). Petitioner's earlier application was based on the ground that the 1999 judgment was law of the case and the parcels located at 5 Church Street, 9 Church Street and 17 Church Street should be declared exempt. In recognition that each tax year is different, the motion was denied. Here, Petitioner seeks summary judgment based on the facts of the use of each parcel.
BRI was organized as a type B not-for-profit corporation and was recognized as a public charitable organization and entity described under Internal Revenue Code § 501 (c)(3). As a recognized public charity, it is eligible to receive donations of cash and property which may be used by the donor as a charitable donation tax deduction under the Internal Revenue Code. BRI has also been recognized by the New York State Department of Taxation as exempt from New York State sales and use taxes.
BRI's Certificate of Incorporation lists its purposes as "a) To conduct research in all areas and aspects of substance abuse; b) To do any other act or thing incidental to or connected with the foregoing purposes or in advancement thereof, but not for the pecuniary profit or financial gain of its members, directors or officers, except as permitted under Article 5 of the Not-for-Profit Law."
In furtherance of these purposes BRI has instituted a residential/social educational program for student guests seeking abstinence from drugs and alcohol. There are two programs offered, the Jude Thaddeus Program, which is a six week social/educational program based in the Retreat House at 9 Church Street, and the Continuing Education Program, which is a two week to three month program depending on the needs of the student. The residents of these programs are housed at 3, 15, and 17 Church Street. It is averred that 5 Church Street is a garden that is used for outdoor class discussions and class instruction, as weather permits. In February 2004, BRI purchased 1 Main Street with the intent to convert the single family structure located on the property into a facility for staff training classrooms. Because of the advanced disrepair of the building, the current plans are to demolish the building and donate the land to the Village of Hagaman to use as a park for the residents of the Village.
BRI contends that each of the properties is exclusively used for the provision of their charitable, educational and moral and mental improvement of men, women and children that enroll in their addiction education program and in furtherance of its mission. BRI further contends that its officers and directors do not receive compensation in excess of the reasonable value of the services they provide to BRI and is below that paid to officers of comparable addiction treatment facilities. Since BRI has been confirmed by the IRS as a public charity, BRI maintains that its activities are no guise for a profit making operation.In a memorandum of law in opposition to the motion for summary judgment, the Respondent Town of Amsterdam contends that triable issues of fact exist based on the Petitioner's own papers, that Petitioner has failed to show its entitlement to judgment as a matter of law, that Petitioner has failed to show how it meets the statutory exemption requirements, that Petitioner's program does not fall within the purposes set forth in RPTL § 420-a(1), and that Petitioner's own papers admits that 1 Main Street is not used in furtherance of its purpose and there is no proof the garden at 5 Church Street meets the requirements for an exemption.
RPTL § 420-a(1)(a) provides that "Real property owned by a corporation or association organized or conducted exclusively for religious, charitable, hospital, educational or moral or mental improvement of men, women or children purposes, or for two or more such purposes, and used exclusively for carrying out thereupon one or more of such purposes either by the owning corporation or association or by another such corporation or association as hereinafter provided shall be exempt from taxation as provided in this section." In order for an entity to be entitled to this mandatory exemption it must meet the following criteria, "(1) the entity must be organized exclusively for purposes enumerated in the statute, (2) the property in question must be used primarily for the furtherance of such purposes, (3) no pecuniary profit, apart from reasonable compensation, may inure to the benefit of any officers, members, or employees, and (4) the entity may not be simply used as a guise for profit-making operations" ( Matter of Miriam Osborn Memorial Home Association v. Assessor of the City of Rye, 275 AD2d 714, 715 [2nd Dept., 2000]).
There is no requirement in the statute that any entity seeking an exemption as a drug and/or alcohol and/or substance abuse treatment facility be licensed.
It has been held that a not-for-profit corporation organized for the purpose of rehabilitating young adults and youths from drug use and other related activities fits within the exemption of RPTL § 420-a is exempt and the land, as so used, is not subject to the property tax ( Matter of Dynamite Youth Center Foundation Inc. v. Assessor of the Town of Fallsburg, 207 AD2d 34 [3rd Dept., 1994]).
It is well settled that "the proponent of a summary judgment motion must establish a cause of action or defense by making a prima facie showing of entitlement to judgment as a matter of law tendering sufficient evidence to eliminate any material issues of fact from the case" ( Way v. Grantling, 289 AD2d 790, 791 [3rd Dept., 2001]). In those instances where a party seeks to withdraw an existing exemption, the respondent has the burden of establishing that the property was subject to taxation ( see, Matter of New York Botanical Garden v. Assessors of the Town of Washington, 55 NY2d 328, 334-335).
In this matter, the property at 5, 9, and 17 Church Street had been granted tax exempt status until the 2002 assessment roll. Petitioner has set forth the use of the property and that it is still being used in the furtherance of its exempt purposes. No affidavit by a person with personal knowledge has been submitted by the Respondents raising a genuine issue of fact with respect to any change in the use of these properties. With respect to 5 Church Street, it is, weather permitting, being used for exempt purposes. "In any event, purposes which are merely auxiliary or incidental to the main and exempt purpose and use will not defeat the exemption" ( Matter of Storm King Art Center v. Tiffany, 280 AD2d 606 [2nd Dept., 2001}
In view of the prior grant of tax exempt status, Petitioner's uncontroverted affidavits that the property is still being used for exempt purposes, Petitioner's submission of records, and the Respondent's failure to raise a genuine issue of fact with respect to these submissions, the Court is granting summary judgment with respect to 5, 9, and 17 Church Street.
Property at 3 and 15 Church Street are also entitled to be exempt. Each of the properties are used as residences for those in the addiction education programs and are integral to the program by keeping the residents in a place safe from outside influences.
The Court is denying the motion for summary judgment with respect to 1 Main Street. There is no proof in the record that at the time of the assessment of this parcel there were any concrete plans to place the property in an exempt status within the foreseeable future. Absent such plans the property is not entitled to an exemption ( Matter of Inward House Corporation v. Frey, 227 AD2d 845 [3rd Dept., 1996]).
Accordingly, for the foregoing reasons, it is
ORDERED AND DECREED that the Petitioner's motion to strike properties located at 3, 5, 9,15, and 17 Church Street in the Town of Amsterdam from the taxable portion of the assessment rolls is granted and these properties are declared exempt from real property taxation pursuant to RPTL § 420-a, and it is further
ORDERED AND DECREED that Petitioner's motion with respect to the property located at 1 Main Street, Town of Amsterdam is denied.
THIS DECISION SHALL CONSTITUTE THE ORDER OF THE COURT. THE ATTORNEY FOR THE PETITIONER SHALL ENTER THIS ORIGINAL DECISION/ORDER WITHIN 20 DAYS OF ITS DATE AND PROVIDE A COPY WITH PROOF OF ITS ENTRY ON THE OPPOSING ATTORNEY.