Nature Preserve, Inc. v. Board of Assessors of the Town of Pembroke (September 25, 2000)

COMMONWEALTH OF MASSACHUSETTS

APPELLATE TAX BOARD




NATURE PRESERVE, INC.		v.		BOARD OF ASSESSORS 
								OF THE TOWN OF 
PEMBROKE

Docket No. F246663				 	Promulgated:
								September 25, 2000


	
	This is an appeal under the formal procedure pursuant to G.L. c. 62C, § 39, from the refusal of the Board of Assessors of Pembroke to abate real estate taxes assessed to Nature Preserve, Inc. for fiscal year 1998.
	Commissioner Gorton heard the appeal and was joined in the decision for the appellee by Chairman Burns and Commissioners Scharaffa and Egan.
	These findings of fact and report are made pursuant to a request by the appellant under G.L. c. 58A, § 13 and 831 CMR 1.32.
	Richard Iacobucci, Esq., for the appellant.
	Ellen M. Hutchinson, Esq., for the appellee.

FINDINGS OF FACT AND REPORT
	Based on the evidence submitted at the hearing, the Appellate Tax Board ("Board") made the following findings of fact.  As of January 1, 1997, Nature Preserve, Inc. ("appellant") was the assessed owner of approximately seventy acres of land located at 172 Washington Street, Pembroke.  For fiscal year 1998, the Pembroke Board of Assessors ("Assessors") valued the subject property at $67,722, and assessed a tax at a rate of $15.35 per $1,000, in the amount of $1,039.53.  Approximately sixty-five acres of the property were subject to a forest management plan and qualified for taxation under G.L. c. 61B.  
The appellant timely paid the taxes assessed without incurring interest.  On October 31, 1997, the appellant filed its application for abatement with the Assessors, which was denied on January 26, 1997.  Subsequently, on April 27, 1997, the appellant timely filed its appeal with the Board.  On this basis, the Board found that it had jurisdiction over this appeal.
Nature Preserve was founded in 1978 by Dr. Richard Iacobucci.  Pursuant to the Articles of Organization, the organization was formed to:
conserve open space; 
protect wildlife and its habitat;
provide horticultural displays, lectures, etc.;
provide religious meditation areas, religious 
services, to promote a communion between man and 
his inner nature, between man and the environmental nature;
promote the performing arts;
provide social services;
provide educational programs;
promote outdoor recreation, mental and physical health; [and]
protect watershed from pollution and provide 
breeding grounds.

	In support of its contention that the subject property was exempt from taxation, appellant offered the testimony of Dr. Iacobucci and Ms. Laura DaSilva. As of the date of assessment, Dr. Iacobucci was the president, treasurer and a member of the board of directors and Ms. DaSilva was the clerk and remaining member of the board of directors.  Ms. DaSilva was first elected to the board of directors in 1995 by the organization's eight voting members, including Dr. Iacobucci.  She was then appointed, by Dr. Iacobucci the only other director, to the position of clerk.  
According to Ms. DaSilva, appellant maintained approximately two miles of "nature" trails along which there are located a few benches and small statues.  These trails were maintained by Ms. DaSilva and the other members, removing limbs and clearing obstacles when necessary.  Several birdhouses have been placed on the property, which were maintained by a third party.  Appellant has created a dam and resultantly a pond.  Appellant also allowed third parties to deposit certain bio-degradable debris on the property, similar to a compost pile.
At all relevant times, the main entrance, located on Route 53, was cordoned off with a chain.  On the perimeter and throughout the subject property, signs were posted, which indicated that this property was private.  The signs read "Do Not Enter - until calling for a permit.  Violators subject up to $1,000 fine and 30 days in jail."
Ms. DaSilva testified that she walked through the property on almost a daily basis.  When she would come in contact with people who she did not recognize, she would ask if they were members of the appellant's organization.  If not, she would inform them that they must obtain a permit to access the property, and that they could do so by becoming a member.  
Individuals interested in becoming members were directed to the lobby of the house where they completed the membership application.  The application delineated the organization's goals as well as its rules.  At that time, individuals were also given a copy of the Church of Nature Philosophy, the Richardson Report, and the site map. 
	The Board found that although there may be an incidental educational benefit from the existence of nature trails, appellant did not, as purported in its articles of organization, offer any educational programs.  Appellant did not offer horticultural displays, religious services, social services or any performing arts events.  Other than allowing the accumulation and dumping of degradable debris, appellant offered no evidence to demonstrate that it afforded wildlife a habitat.  Appellant also failed to offer any evidence, beyond the existence of a pond, that it protected the watershed.  
On this basis, and to the extent it is a finding of fact, the Board found that appellant did not occupy the subject property primarily for its stated charitable purposes to "conserve open space . . . [t]o protect wildlife and its habitat . . . [t]o provide educational programs . . . [t]o protect watershed from pollution."  Instead, the Board found that the appellant's occupation of the premises was primarily for the benefits of its members and that its occupation for charitable purposes, if any, was merely incidental.  Accordingly, the Board issued a decision for the appellee. 

OPINION

	All property, real and personal, situated within the Commonwealth is subject to a local tax, unless expressly exempt.  G.L. c. 59, § 2.  G.L. c. 59, § 5 lists the numerous classes of property which shall be exempt from taxation.  Specifically, § 5, Third, exempts from taxation all "personal property of a charitable organization, . . . and real estate owned by . . . and occupied by it or its officers for the purposes for which it is organized . . . ." G.L. c. 59, § 5(3) (emphasis added).
	A charitable organization which owns and occupies real estate is "'not entitled to tax exemption if the property is occupied by it for a purpose other than that for which it is organized.'"  Lynn Hospital v. Board of Assessors of Lynn, 383 Mass. 14, 18 (1981), quoting Milton Hospital & Convalescent Home V. Assessors Of Milton, 360 Mass. 63, 69 (1971).  Therefore, to qualify for the charitable exemption the taxpayer must (1) be a charitable organization and (2) occupy the property for its charitable purpose.
	The Supreme Judicial Court has consistently held that "the term 'charitable' includes more than almsgiving and assistance to the needy."  Harvard Community Health Plan v. Assessors of Cambridge, 384 Mass. 536, 543 (1981).  See also New England Sanitarium v. Stoneham, 205 Mass. 335 (1910); Assessors of Boston v. The Vincent Club, 355 Mass. 10, 12 (1966).  A traditionally accepted definition of a charity is that it is a "gift, to be applied consistently with existing laws, for the benefit of an indefinite number of persons, either by bringing their minds or hearts under the influence of education or religion, by relieving their bodies from disease, suffering or constraint, by erecting or maintaining public buildings or works or otherwise lessening the burdens of government."  Boston Symphony Orchestra v. Board of Assessors of Boston, 294 Mass. 248, 254-255 (1936) (emphasis added).  As the Supreme Judicial Court has explained, 
[C]lassification as a charitable organization "depends upon 'the language of its charter or articles of association, constitution and by-laws, and upon the object which it serves and the method of its administration.'" 

The Vincent Club, 355 Mass. at 12 quoting Little v. Newburyport, 210 Mass. 414, 415 (1912).  The assessors conceded that several of the purposes listed in appellant's articles of organization are charitable in nature.	
Stated charitable purposes alone, however, will not suffice to establish the property tax exemption.  The appellant must also prove that "it is in fact so conducted that in actual operation it is a public charity," not a mere pleasure, recreation or social club or mutual benefit society.  Jacob's Pillow Dance Festival, Inc. v. Assessors of Becket, 320 Mass. 311, 313 (1946), citing Little v. Newburyport, 210 Mass. at 415.  See also Hairenich Association v. Boston, 313 Mass. 274 (1943); Assessors of Boston v. Boston Pilots' Relief Society, 311 Mass. 232, 236-37 (1942).
	"An institution will be classed as charitable if the dominant purpose of its work is for the public good and the work done for its members is but the means adopted for this purpose."  Massachusetts Medical Society v. Assessors of Boston, 340 Mass. 327, 332 (1960).  If, however, the dominant purpose of its work is to benefit the members, such organization will not be classified as "charitable" even though the public will derive an incidental benefit.  Id.  
The Board found that the property, contrary to the appellant's contention, was not open to the general public.  Posted throughout the property were signs warning the public that they were not to enter until they received a permit and that if they entered without a permit they would be fined.  Moreover, the chain across the main gate indicated that the dominant use of the property was for the benefit of appellant's members. 
In this respect, the present appeal is similar to Marshfield Rod & Gun Club v. Assessors of Marshfield, 1998 ATB Adv. Sh. 1130, 1143 (November 20, 1998)("Marshfield R & G") where the Board found that property open only to its members for recreational purposes did not qualify for exemption.  The Board found that although the taxpayer, 
may be a charitable organization it did not occupy the subject property primarily for its stated charitable purposes to 'educate the sportsmen of tomorrow . . . to educate the public on the subject of gun control . . . to  conduct youth activities for the education and enjoyment of the youth in the region and for the community in general.' 

Marshfield R & G, 1998 ATB Adv. Sh. at 1137.    
The taxpayer in Marshfield R & G argued that its dominant purpose was to "educate society on the proper, safe and constitutional use of firearms and archery, as well as the preservation and conservation of natural resources."  By providing firearms safety courses; an archery course; a stocked pond; an annual fishing derby; public skeet shooting; sponsorship of Cub Scout troops; awarding a $1,000 scholarship; and by allowing public access for jogging, walking, hiking, fishing and self-reflection, the taxpayer claimed to be serving its stated charitable purposes.  Marshfield R & G, 1998 ATB Adv. Sh. at 1142.
The Board found that the taxpayer in Marshfield R & G offered "only a limited number of educational programs for gun safety" and offered "no evidence" demonstrating how teaching conservation was accomplished.  Id. at 1136.  The Board also found, contrary to the taxpayer's suggestion, that the property was not accessible to the general public, as in the present appeal.  Id. at 1143.  Evidence presented indicated that there were "No Trespassing" signs and a locked gate.  Id. at 1135.  Furthermore, as in the present appeal, only members and their guests could access the majority of the facilities.  Id. at 1135.  
Consequently, based on the evidence presented in Marshfield R & G, the Board found that the "primary purpose of the club was to offer a place for its members to go."  Id. at 1136.  "The fact that parts of the property were physically accessible by the public does little to detract from the reality that the property . . .  was primarily used by the Appellant's members and their guests."  Id.  Thus, the Board concluded that the "premises was . . . operated primarily for the benefit of its members and that occupation for charitable purposes was merely incidental."  Id. at 1137.  This conclusion fits the present matter with dispositive application.
The appellant must also prove that the property is occupied "directly for the fulfillment of its charitable purposes."  Boston Symphony, 294 Mass. at 255, citing Burr v. Boston, 208 Mass. 537, 543 (1911).  See also Brockton Knights of Columbus v. Assessors of Brockton, 321 Mass. 110, 114 (1946).  Such occupancy means,
Something more than that which results from simple ownership and possession.  It signifies an active appropriation to the immediate uses of the charitable cause for which the owner was organized . . . . [t]he nature of the occupation must be such as to contribute immediately to the promotion of the charity and physically to participate in the forwarding of its beneficent object. (Emphasis added.)

Board of Assessors of Boston v. The Vincent Club, 351 Mass. at 14, quoting Babcock v. Leopold Morse Home for Infirm Hebrew & Orphanage, 225 Mass. 418, 421 (1917).
	Use of the property need not be exclusively for charitable purposes.  "If the principal occupation is . . . for [its] purposes, occasional and incidental use for other purposes might not render it liable to taxation . . . ."  Salem Lyceum v. City of Salem, 154 Mass. 15, 17 (1891)(emphasis added).  "It is the dominant use of the property which is controlling."  Brockton Knights of Columbus, 321 Mass. at 114, citing Phi Beta Epsilon Corp. v. Boston, 182 Mass. 457 (1902).  See also Assessors of Boston v. Garland School of Home Making, 296 Mass. 378 (1937).
In the appeal at bar, appellant has not proven that the use of its property has been in furtherance of charitable purposes, even if it is considered a charitable organization.  In arguing that it occupies the property in furtherance of its charitable purpose "to conserve open space," appellant cites to the American Heritage Dictionary definition of "conserve."  The term is defined as "to keep in perfect or unaltered condition; maintain in an unchanged form" yet, by its own admission appellant has made changes to the subject property placing it definitionally outside of the purpose of "conserv[ing] open space."  Among other things, appellant has developed and maintained nature trails; removed fallen tree limbs from the ponds; invited individuals to dump their organic debris on the land; placed benches on the property, to be used by its members; and created a dam.  Appellant allowed on its property  walking, jogging, horseback riding and cross-country skiing.  Consequently, by its own definition, appellant does not "conserve" the subject property.
Appellant further suggested that by offering an area for animals to live, it satisfied the stated purpose of "to protect wildlife and its habitat."  As discussed in Animal Rescue League v. Assessors of Boston, 2000 ATB Adv. Sh. 96 (February 25, 2000), simply keeping the land open and allowing the possibility of animals living there is not enough to satisfy the requirement of "occupying" the property within the meaning of the statute.  There must be an active appropriation to the charitable purpose.  Id. at 102.
The Board found that the appellant Nature Preserve offered no educational programs, horticultural displays, religious services, social services or performing arts events.  Appellant argued that the maintenance of the trails and providing copies of the Church of Nature philosophy and a naturalist's report provided an educational benefit and satisfied appellant's charitable purposes.  The Board, however, disagreed.  In Boston Symphony, the court concluded that it was "doubtful whether the method of instruction through the rendering of concerts, . . . is such that the property is used primarily for educational purposes, rather than for the purposes of entertainment of listeners."  Boston Symphony, 294 Mass. at 256, citing Boston Lodge Order of Elks v. Boston, 217 Mass. 176, 178.  Moreover, the Board found that the maintenance of the nature trails, benches and pond was more for the benefit and enjoyment of the members than for any educational purposes.  Similarly, the availability of the naturalist's report and the Church's philosophical statement benefited members rather than educated the public.
Lastly, appellant suggested that the mere existence of the property satisfied its charitable purposes in that "it all benefits society."  Appellant maintained that it actively managed the land for the benefit of "mankind."  The Board found, however, that the mere existence of the property was not enough to satisfy the statutory requisites.  There must be an "active appropriation" of the property to the stated charitable purposes, which was not found to exist in the present appeal.  See Boston Symphony, 294 Mass. at 255.  
In its decision-making, "the board [is] not required to believe the testimony of any particular witness but [can] accept such portions of the evidence as appeared to have the more convincing weight."  Assessors of Quincy v. Boston Consol. Gas Co., 309 Mass. 60, 72 (1941); see also New Boston Garden Corp. v. Assessors of Boston, 383 Mass. 456, 473 (1981).  The Board found that the appellant failed to offer programs in furtherance of its stated purposes.  The Board also found that the appellant did not actively appropriate the use of the land to satisfy its stated purposes but relied on a largely passive ownership.  Lastly, the Board found that the property was used primarily for the benefit of its members.
Finally, the appellant erred in maintaining that the Assessors have a duty to determine whether the property is actively being managed to achieve the corporate purposes.  The burden of proof lies squarely with the appellant.  It is a well-established rule that a "party claiming exemption bears a grave burden of proving the claim."  Harvard Community Health Plan, Inc. v. Assessors of Cambridge, 384 Mass. 536, 543 (1981).  See Boston Lodge Order of Elks v. Boston, 217 Mass. 176, 177 (1914).  Contrary to the appellant's suggestion, entitlement to the charitable exemption is not for the Assessors to disprove.  Furthermore, "any doubt must operate against the one claiming a tax exemption."  Boston Symphony, 294 Mass. at 257, citing Springfield Young Men's Christian Association v. Board of Assessors, 284 Mass. 1, 5 (1933).



On this basis, the Board found that the appellant did not meet its burden of proving that the dominant use of the property was in furtherance of charitable purposes.  Accordingly, the Board issued a decision for the appellee.

						   APPELLATE TAX BOARD

						By:					____
						   Abigail A. Burns, Chairman




A true copy,


Attest:					
	    Clerk of the Board

 Pursuant to G.L. c. 4, § 9, when the last day for filing a petition falls on a Sunday, the taxpayer may timely file on the next business day.
 Both Dr. Iacobucci and Ms. DaSilva reside in the house also located at 172 Washington Street.  This house is leased by the appellant to the Foundation for Humanity.
 The "Richardson Report" a document generated by a consulting naturalist, John Richardson, setting forth his findings after his visit to the Nature Preserve.

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