SUPREME COURT OF THE STATE OF NEW YORKCOUNTY OF ABC__________________________________________X
In the Matter of the Application for a Review
Under Article 7 of the Real Property Tax
Law of Tax Assessments by
FeRICH LAND TRUST, INC.,
Petitioner,-against-

INDEX NO. ______
R.J.I. No. __________THE ASSESSOR OF THE TOWN OF XYZ,ABC COUNTY, NEW YORK, and the
BOARD OF ASSESSMENT REVIEW FOR
THE TOWN OF XYZ,PETITIONER'S MEMORANDUM
OF LAW

Respondents.
__________________________________________X
TO THE SUPREME COURT OF THE STATE OF NEW YORK:COMES NOW Petitioner FeRich Land Trust, Inc., and submits the following
memorandum of law in support of its request for an order directing Respondents to declarecertain real property owned by Petitioner as exempt from taxation and/or to reassess suchproperty:

STATEMENT OF THE CASE
The facts of this case are accurately and adequately set forth in the Petition filed by
FeRich Land Trust, Inc. ("FeRLT"). Briefly stated, the Petition filed by FeRLT states that
FeRLT is a tax-exempt organization under § 501(c)(3) of the Internal Revenue Code. FeRLT
was organized as a charitable organization under New York State's Not-for-Profit

1Corporation Law. The purpose of FeRLT is to acquire undeveloped subdivided lots in the
Mountain Park area and subject them to use restrictions that preclude such lots from being
developed, improved with any structure of any type, logged, timbered, or stripped of any
natural growth, except as approved by the Department of Environmental Conservation of theState of New York or a similar state agency. The properties acquired by FeRLT are available
for free public access, use, and enjoyment.
The main issue in this case is whether the use to which the properties in question are
currently being put qualifies them as being "used" under RPTL 420-a. The properties exist
in their natural state as intended by FeRLT.

They are completely undeveloped andunimproved. They have been set aside by FeRLT for free public use and enjoyment in theirnatural state as sanctuaries of nature. The public can hike on the properties, enjoy nature, andso forth.

ARGUMENT
REAL PROPERTY HELD IN ITS NATURAL STATE IN ORDER TO
FURTHER THE PURPOSES OF A CHARITABLE ORGANIZATION
DEVOTED TO PRESERVING AND PROTECTING LAND FROMDEVELO PM ENT, LOGGING, TIM BERING , AND O TH ER
INTRUSIVE OR COMMERCIAL ACTIVITIES CAN BE DEEMED TO
BE "USED" FOR TAX-EXEMPT PURPOSES UNDER RPTL 420-a.
THEREFORE, IF REAL PROPERTY IS KEPT IN ITS NATURAL
STATE BY A CHARITABLE ORGANIZATION THAT IS DEVOTEDTO PRESERVING AND PROTECTING LAND IN ITS NATURAL
STATE, SUCH LAND IS EXEMPT FROM STATE AND LOCALPROPERTY TAXES.
Under New York law, "[r]eal property owned by a corporation or association
organized or conducted exclusively for . . . charitable . . . purposes . . . and used exclusively
2

for carrying out thereupon one or more of such purposes . . . shall be exempt from taxation
as provided in this section." RPTL 420-a(1)(a) (emphasis added). Section 420-a goes on to
say that "[s]uch real property from which no revenue is derived shall be exempt though notin actual use therefor by reason of the absence of suitable buildings or improvements thereon
if . . . the construction of such buildings or improvements is in progress or is in good faithcontemplated by such corporation or association." RPTL 420-a(3).
According to New York courts, RPTL 420-a must be strictly construed against a party
seeking to exempt his property from taxation but should not be construed so literally andnarrowly that it defeats the subtle purposes of the exemption. Canton Human Servs.
Initiatives, Inc. v. Town of Canton, 4 Misc. 3d 413 (Sup. Ct. 2004); Delancey St. Found. v.
Bd. of Assess. Review of Town of Se., 112 A.D.2d 132 (2d Dep't 1985). In other words, theprovisions of tax-exemption statutes like RPTL 420-a should not be interpreted so narrowly
and literally as to defeat the intentions of the state legislature in providing for property tax
exemptions. Application of N.Y. Conference of Ass'n of Seventh Day Adventists, 80 N.Y.S.2d
8 (Sup. Ct. 1948), rev'd on other grounds, 275 A.D. 742 (4th Dep't 1949). Thus, courts
should avoid overzealous adherence to the rule calling for strict construction of taxexemption statutes against taxpayers, so as to avoid thwarting the purposes of the legislaturein providing for exemptions from property taxes. N.Y. Catholic Protectory v. City of N.Y.,
175 Misc. 427 (Sup. Ct. 1940).
In the case at bar, the Assessor for ABC County seems to have construed the term
"used," as it appears in RPTL 420-a, as meaning that land that exists solely in its natural3

state, for public enjoyment and sanctuary, can never qualify for tax-exempt status, because
it is not being "used" for some tangible purpose such as generating income for its tax-exempt
owner. In other words, the Assessor seems to take the position that the term "used" in RPTL
420-a must be construed as meaning that the property in question must be "actively" rather
than "passively" used by its tax-exempt owner or the public in furtherance of the owner's taxexempt purposes.
Unfortunately, there appears to be no reported New York court decision thatspecifically addresses the narrow issue of whether the term "used" in RPTL 420-a connotes
only the "active" use of real property for some tangible purpose such as generating income
for the tax-exempt owner of the property. However, numerous reported New York court
decisions suggest that land existing in its natural state and set aside as a wildlife, nature, orsimilar sanctuary can be deemed to be "used" for tax-exempt purposes under RPTL 420-a.
For example, in a case where a nonprofit corporation devoted to the "preservation,
restoration or enhancement of the natural, ecological, environmental, cultural, scenic,
historical or recreational values of the Hudson River or the Hudson River Valley" sought an
exemption from real property taxation with respect to 850 acres of mountaintop realty in the
Town of Fishkill, a New York appellate court held that the land was "used" for tax-exempt
purposes and that such use was not vitiated when the tax-exempt owner leased it to the Statefor use as a state park. Scenic Hudson Land Trust, Inc. v. Sarvis, 234 A.D.2d 301 (2d Dep't
1996). In reaching its decision, the Scenic Hudson Land Trust court noted that under RPTL
420-a(1)(a), "[tax-]exempt purposes included uses of real property 'for environmental and4conservation purposes which are necessary to the public good and which are open to andenjoyed by the public.'" Id. at 303 (citing and quoting Mohonk Trust v. Bd. of Assessors of
Gardiner, 47 N.Y.2d 476 (1979)). The Scenic Hudson Land Trust court also noted that a
nonprofit corporation devoted to the "preservation, restoration or enhancement of the natural,
ecological, environmental, cultural, scenic, historical or recreational values of the Hudson
River or the Hudson River Valley" is a corporation organized for tax-exempt purposes. Id.
The Scenic Hudson Land Trust court expressly held that "as a matter of law," themountaintop land in question was "being used for [tax-]exempt purposes," even though trails
thereon were "overgrown and unused" and the property was "poorly marked." Id. (court'semphasis).
In another case involving the issue of whether undeveloped land in its natural state
can qualify for tax-exempt status under RPTL 420-a, the court held that undeveloped realty
designated as a sanctuary and open to the public for hiking was exempt from property tax.
Adirondack Land Trust, Inc. v. Town of Putnam, 203 A.D.2d 861 (3d Dep't), leave to appeal
denied, 84 N.Y.2d 809 (1994). The following facts and circumstances of the Adirondack
Land Trust case are worth review here:
Petitioner is a New York not-for-profit corporation organized for the
purpose of, inter alia, "conserv[ing], maintain[ing] and enhanc[ing] thephysical and aesthetic environment, natural resources and economy of the
Adirondack area". In August 1990, in furtherance of this objective, petitioner
purchased a single parcel of real property comprising approximately 168 acresof undeveloped land, with roughly 0.8 mile of shoreline on the east shore of
Lake George, in the Town of Putnam, Washington County. The parcel has no
reasonable means of overland access—although petitioner acquired, alongwith the property, a right-of-way across neighboring property, it has not yet

5developed a road or trail to take advantage of this right—but it is accessible byboat.
Shortly after completing the purchase, petitioner removed several "notrespassing" signs and posted new signs along the shoreline identifying theproperty as a nature sanctuary and advising that certain activities wereprohibited thereon. Petitioner also embarked upon an extensive publicity
campaign to inform the public of the purchase, and to promote the fact that theproperty would henceforth be open for hiking and other compatible activity.
Public gatherings were held, with over 600 invitations sent to area residents,
and a press release was issued to "all major newspapers in New York State",
as well as to all local papers.
Id. at 861-62 (alterations in original).
In reaching its final conclusion that lack of overland access to the subject realty did
not preclude it from being tax-exempt under RPTL 420-a, the Adirondack Land Trust court
expressly ruled that "[u]se of property as a wildlife or nature sanctuary is a use in keepingwith charitable purposes[.]" Id. at 862 (emphasis added) (citing N. Manursing Wildlife
Sanctuary v.City of Rye, 48 N.Y.2d 135 (1979)). The Adirondack Land Trust court went on
to say that as long as the restrictions on access to undeveloped land "are not inconsistent withmaintaining the habitat in its natural state and protecting the wildlife . . . from undue
interference," the access restrictions will not preclude the subject land from being exempt
from taxation. Id.
In a seminal case involving the issue of the tax-exempt status of undeveloped land inits natural state, the Court of Appeals of New York noted at the outset the argument bycounsel to one of the parties that "[t]he conservation by a charitable organization of its
undeveloped land for public use is a use for charitable and educational purposes within themeaning of [New York's real estate tax-exemption statutes,] and the tax-exempt status of6

such land is not forfeited by virtue of its recreational use." Mohonk Trust, 47 N.Y.2d at 478(emphasis added). Accordingly, the Mohonk Trust court held that "the use of real property
for environmental and conservation purposes as a wilderness area open to the publicconstitutes a charitable use exempt under the [property tax exemption] statute." Id. at 479.
The facts and circumstances of the Mohonk Trust case are instructive here:
The Trust owns some 5,000 acres of undeveloped wilderness land
located in the upper reaches of the Shawangunk Mountains. The land isheavily wooded with hardwood and evergreens and contains a variety ofgeological formations. It includes some of the most beautiful land in New
York State. Most of this property was originally owned by members of the
Smiley family, who sold the land to the Trust at considerably less than market
value. The Smiley's own a resort and hotel called Lake Mohonk, which issituated on some 2,500 acres adjacent to the Trust property. The creator of theTrust was a member of the Smiley family, as are several of the trustees.
....
The Trust lands are primarily used for a variety of environmental,
conservation, educational and compatible recreational purposes. The land ismaintained in its natural state in an attempt to preserve some part of our
natural heritage for the enjoyment and benefit of present and future
generations. The Trust has created a system of trails through the wilderness
areas, and provides guide and informational services while at the same time
maintaining and protecting the unique plant and animal life found on the Trust
lands. . . . The Trust itself maintains records on the development and growthof the plant and animal life in the area, and numerous scientific studies are
conducted on Trust property. In addition, members of the public are allowed
to use Trust land for activities such as rock climbing, backpacking, camping,birdwatching and nature hikes.
Id. at 480-81.
The Mohonk Trust court's reasoning in ruling that the wilderness land in question was
tax-exempt is also instructive here:7

[I]n this case the use of the lands reflects the primary purpose of theorganization. It is plain that the actual primary purpose of the Trust is thepreservation of wilderness areas for the benefit of the public. Incidental to thisuse and this purpose are a variety of related activities, many of which are
educational or scientific in nature. . . . We conclude that it is, however, usedprimarily for an assortment of "charitable * * * educational, [and] moral
improvement of men, women or children" purposes, for we see no reason why
these categories should not encompass lands used for environmental andconservation purposes which are necessary to the public good and which areopen to and enjoyed by the public.
It is, of course, within the power of the Legislature to establish and to
modify tax exemptions, subject only to constitutional limitations. . . . As it is,however, the Legislature has not seen fit to remove environmental andconservation purposes from the broad category of charitable, educational, or
mental or moral improvement of man purposes within which they so neatly fit.
Hence, we conclude that such purposes are exempt and thus land used for such
purposes by an exempt organization is not subject to the property tax.
Finally, we reject the suggestion that simply because the Smiley family
may receive some benefits by reason of the fact that their hotel is adjacent to
the Trust property, the Trust thereby is converted into a commercialorganization. The Trust itself is plainly a nonprofit organization which serves
an essential public need. Hence, in the absence of any indication that the Trustis merely a device used to shield a profit-seeking enterprise, which is not thecase here, the fact that nearby landowners in fact do benefit by the existence
and operation of the Trust is irrelevant to its tax-exempt status.
Id. at 484-85 (citation omitted).
In another case involving the tax-exempt status of wildlife sanctuary property, a New
York court said the following with respect to the desirability of keeping such land in its
natural state:
It would seem apparent that the principal elements in a wildlife
sanctuary are the natural habitat and the wildlife that it attracts, and that the
principal activities which make these features available for maximum use arethose which preserve the habitat as nearly as possible in its natural state, andprotect the wildlife from the depredation of the indiscriminate hunter and thevandal. Suitable trails giving access to all the areas of the sanctuary would
8

undoubtedly assist those availing themselves of its use. Unduly elaborate trails,on the other hand, might well prove self-defeating, by changing the characterof the habitat.
Wildlife Pres., Inc. v. Scopelliti, 66 Misc. 2d 611, 613-14 (Sup. Ct. 1971).
Finally, it should be noted that, in several New York cases involving unimproved land
owned by tax-exempt summer camps and not used for anything other than occasional hiking
activities, the courts recognized that even land used so infrequently as to be in a state of"non-use" is not necessarily precluded from being exempt from taxation under RPTL 420-a.
Hapletah v. Assessor of Fallsburg, 172 A.D.2d 950 (3d Dep't), aff'd, 79 N.Y.2d 244 (1992);
Nassau County Council of Boy Scouts v. Bd. of Assessors of Rockland, 84 A.D.2d 862 (3dDep't), leave to appeal denied, 55 N.Y.2d 607 (1982).
The authorities cited suggest that real property held in its natural state in order tofurther the purposes of a charitable organization devoted to preserving and protecting land
from development, logging, timbering, and other commercial activities can be deemed to be"used" for tax-exempt purposes under RPTL 420-a. If the term "used," as it appears in RPTL
420-a, were to be construed as meaning only the active use of real property, rather than thepassive use of holding land in its natural state, such a construction of the statute would be far
too literal and narrow. Such an overly literal reading of RPTL 420-a would operate to
deprive tax-exempt status for lands that are protected from development, commercial
enterprise, and other intrusive activities and discourage organizations like FeRLT fromsetting aside lands for ecological protection and preservation.

9

In sum, the real properties that are owned and used by FeRLT in its effort to preserveand protect land in its natural state are exempt from state and local property taxes as a matterof law.

10

RESEARCHER'S NOTE
1.

Counsel should know that a New York appellate court once ruled that "[t]hefact that an exempt organization has purchased lots with the purpose of utilizing that property
for tax-exempt purposes is not sufficient to entitle it to exemption under RPTL 420-a or 420b." Chautauqua Rails to Trails, Inc. v. Assessors of Chautauqua, 231 A.D.2d 878, 878 (4th
Dep't 1996) (mem.) (citing and quoting Congreg. K'Hal Torath Chaim v. Town of Ramapo,
72 A.D.2d 804, 804 (2d Dep't 1979)). The Chautauqua Rails to Trails court held that sinceabandoned railroad property that had been purchased by a tax-exempt organization with theintent of converting the land into a trail "was not in actual use for exempt purposes due tothe absence of suitable buildings or improvements thereon," the subject realty was notexempt from property taxes. Id. (emphasis added).
2.

New York courts follow the general rule that "[t]he mere ownership of realty

by a tax exempt organization does not ipso facto entitle it to remission of realty taxes on theproperty." Religious Educ. Ass'n v. City of N.Y., 123 Misc. 2d 786, 787 (Sup. Ct. 1983)(citations omitted).

According to the Religious Education Association court, "[t]hedeterminative factor is the use or non-use of the [subject] property." Id.