0 GENERAL 

OF EXAS 

AUSTIN 11. TEXAS 

August 24, 1962 

Honorable Burney Walker 

Criminal District Attorney . 

Waco, Texas 

Dear Mr. Walker: 

Oplnlbn No. WW-1424 

Re: Whether the Stllwell 

Memorial Residence 1s 

exempt from ad valorem 

taxes under the stated 

facts 

You have requested an opinion from this office as to whether or not Stllwell Memorial Residence, which Is to be operated by 

the Texas Retired Teachers Residence Corporation, Is exempt from 

ad valorem taxes. 

In connection with, your letter you have attached Exhibit 

A, which 1s copied as follows: 

“STATEMENT OF POLICIES FOR STILWELL MEMORIAL RESIDENC,E 

OF LAKE AIR CENTER, WACO, TEXAS 

“Stllwell Memorial Is a residence designed 

Tor retirement living and providing sheltered 

care for retrred member8 of the teaching profession of the State of Texas. It 1s lncorporated under the Non-profit Corporation Act 

of the State of Texas for charitable and educational purposes. 

“The Stllwell Memoilal Resldenoe for retired teachers, hereinafter referred to as the 

Realdenoe, is a project of the Texas Retired 

Teachers Association who formed a Residence 

Corporatlon for the purpose of creating this 

Residence for the sheltered care of Its senior 

citizens. The Corporation Is entitled the 

Texas Retired Teachers Residence Corporation, 

the President of which is Henry L. Poster, Sr., 

Box 767, Longview, Texas. 

"The very foundation of the Residence has 

been based upon oonizlbutlons from teachers 

and others throughbut the State of 'Pexas. 
Honorable Burney Walker, Page 2 

. ..‘ 

Opinion No. Ww-1424 

Moreover, the site 1s being donated for the 

Residence through the Chamber of Commerce of 

the City of Waco. The Federal Housing Administration has given an Indication that 

they will approve a 100 

$ 

er cent loan In the 

amount of approximately 914,000.00 under 

Section 231 of the Federal Housing Act which 

provides for housing for the elderly on a nonprofit basis. The 144,640 square feet of land 

has been valued at $72,300.00 which is a contribution. 

“Various types of accomodatlons are provided In an effort to meet the retirement 

needs of a cross-section of our senior 

teachers. 

“The Bylaws provide for an admlsslon.Sce 

of $250 .oo . However, the Bylaws also provide that the Trustees shall~ admit eligible 

appllcahts to the Residence on such terms 

as the circumstances of any particular applicant may in their judgment warrant. 

Each case Is handled on-an individual 

basis and charity cases will be accepted. 

No one wlll be denied admlsslon because 

OS financial inability to pay the cost. 

“The Bylaws provide for a deposit of 

$250.00 to be held In a separate account 

for health purposes for the lndlv1dual 

with the residue to apply on the funeral 

expenses of said resident. The balance 

18 the property of the estate of the reeident. 

“Last illnesses and death8 OS the members will be paid for by the Residence. 

Should the lnltl6il $250.00 health deposit 

be available, this will be applied. However, from a practical standpoint, the 

Residence will have to absorb much of this 

expense. This Js particularly true of 

those residents who have minimum or no lncomes and the charitable cases where the 

4250.00 deposit was waived. 

“Those who are financially able to pay 

all,thelr cost are expected to do so on a 

basis to be determined by the type of 
. . 

Honorable Burney Walker, Page 3 Opinion No. W-1424 

accomodatlons they desire and the Admissions 

Committee of the Board of Directors. Bach 

case will be a matter of lndlvldual~evaluatlon, negotiation, and mutual agreement*and 

will be considered.on the basis of Its own 

merit. 

"The Dlrector&%ave proJected a budget 

which establlshe~ rates for a minimum of 

$140.00 for slngllFg to a few select accomodations for doubti! at $260.00 a month. 

"Provision8 will be made for those teachers who have the minimum retirement Income 

of $100.00 a month of which there are a 

substantial number in the upper age brackets 

where the need Is the greatest. These flgurea Include mea&s, administrative staff, 

medical and interim nursing care as lndlcated, and a rout&e sustaining health service. A small Infirmary area is provided 

for those who will require interim bed 

care e Whlle~thls type of community living 

for senior citizens Is not appropriate for 

every individual, there are large numbers 

of teachers who, because of low salary payments and Inadequate retirement programs of 

the past, desperately need this type of environment. It wi.$l provide friends, companionship, and sheltered care for many.)df 

those who have lived alone all their adult 

lives. 

"The Incomes of thls.'group are such that 

in a non-proflt situation a number can afford to pay &i! all their care. Of partlcular importance to th&s project are those 

who cannot afford;,to pay. Because of the 

mlnlmums for teadkier retirement or old 

age assistance, ~'lt Is not anticipated that 

there will be any requlrements:Lfor full 

charity; I.e.,, 100 per cent. However, substantial dlffCnnces will have to be made 

up from the other residents, from the aubsldy of the Home, and from continuing campaigns among teachers for supplementation 

of the Residence -:'not an individual. 

"The tieachers+f the State of Texas have 

made contrlbutibha to help underMete the 
. , 

Honorable Burney Walker, Page 4 Opinion No. WW-1424 

cost of thle facility and will continue to 

contribute to Its support.. Without this 

lnltlal subsidy and continuing assistance, 

the Residence cannot afford to operate as 

a number will be unable to pay the full 

cost for their care. 

“The entire three acres will be devoted 

to this cause of retirement living at a 

minimum of cost. ” 

You have given us further Information that the Waco Chamber of Commerce donated @pproxlmately three acres of land to 

this corporation on which a building, or buildings, will be constructed for the operation of this ,corporatlon. The tract of 

land atthls time Is vacant property. The deed was signed and 

delivered by the Chamber of Commerce to the Texas Retired Teachers Residence Corporation on May 3, 1962. 

We are In agreement with your conclusions as set forth In 

your letter that Stllwell, according to Exhibit A, Is to be operated In much the same manner as Morningside Manor, Inc. of San 

Antonio, which was the subject matter of Opinion No. WW-1277 

heretofore rendered by this department. You are advised that In 

compliance with Opinion No. WW-1277, this corporation, when It 

becomes operative, will meet the requirements of a purely public 

charity, and will be exempt from ad valorem taxes. 

As atated by you, the only question remaining is whether 

or not Stllwell Is, at this Instant, exempt from ad valorem taxAt the present time this property Is not being used as a 

iklc charity or for charitable purposes and Is subject to ad 

valorem taxes, so long a8 It Is just a vacant piece of land not 

being put to any use. 

In compliance with the rule laid down In Hedgecroft v. 

City of Houstbn, 150 Tex. 654, 244 S.W.2d 632, this property 

would become exempt for taxes as of January lot next after it 

Is put to use by the Texas Retired Teachers Residence Corporation. It Is our opinion that the property Is taxable as of January 1st. of each year, and since It was not owned by the corporation on January 1, 1962, then It Is subject to taxes for this 

year. If It Is still a vacant piece of property on January 1, 

1963 and not being used, then It will be taxable for the year 

1963, and so long thereafter, as It Is not ptit to a beneficial 

use. Ae soon as the exempt corporation start8 construction on 

the land, then It will become exempt from taxes beginning on the 

following January 1st. 

Quoting from the opinion of the Heduecroft case, supra, at 

page 636, the court had the following to say: 
I’ s 

Honorable Burney Walker, Page 5 Opininn No. VW-1424 

“Petitloner~s acts on and before January 1, 1949, an alleged in the petition, 

the substance of which has been set out at 

the beginning of this opinion, were part 

of the necessary preparation and remodeling 

of the building for operation a8 a hospital 

and clinic. The work proceeded until it was 

completed on May 13, 1949, and since that 

time the hospital and cllnEc have been oper%.. 

ated as a public charity. The facts alleged 

show, In our opinion, an actual and direct 

use of the property on and prior to January 1, 

1949, for the charitable puppose.” 

SUMMARY 

Under the stated facts, Stllwell Memorial Resldence , to be operated by Texas Retired Teachers Resldence ‘Corporation, will qualify as a purely public 

charity, and the property In question will be exempt 

from ad valorem taxes beginning on the January 1st 

after construction Is started, and the property la 

being used by the.corparatlon. 

Youra very t&y, 

WILL WILSON 

Assistant 

J=/@ 

APPROVED : 

OPINION COMMITTEE: 

Morgan Nesbltt, Chairman 

L. P. Lollar 

Fred D. Ward 

Robert Rowland 

RNVIEWFD FOR THE ATTORNEY OENh’RAL 

By: Leonard Pasamore