E Y GENERAL 

OF XAS 

AUSTIN aa.TExas 

April 17, 1962 

Honorable R. E. Swift Ooinion NO. ~~-131.8 

County Attorney 

Anderson County 

Palestine, Texas 

Re : 

Dear Mr. Swift: 

Exemption from ad valorem 

taxes of property belonging 

to The Cartmell Home for Aged 

and Orphans. 

We quote the following excerpt from your letter requesting 

the opinion of this office on 

. _ the aoove captlonea matter: 

“Where a home for aged and orphans, 

which Is a public charity as set out in 

Article 7150, Section 7, is located on 

a 195 acre tract, and the buildings and 

the property actually used by the aged 

amounts to only about 5 acres, is the 

remaining 190 acres of this ssme tract 

subject to taxation?” 

In connection with your request you have supplied us with 

detailed facts concerning the Cartmell Home for Aged and Orphans, 

hereinafter referred to as the Home, which is Incorporated under 

the laws of this State as a charitable corporation pursuant to 

directives contained in the will of Sarah E. J. Cartmell of 

Anderson County, Texas3 who died in 1948. 

By the residuary clause of her will, Miss Cartmell devised 

and bequeathed all the resfdue of her estate to her Executors 

snd Trustees to be used by them for the establishment and maintenance of a home In and near Palestine, Texas, for the destitute 

aged and for the destitute orphans. The testatrix directed that 

her present “home place” be used for this home and that the home 

be maintained there with such changes and additions to be made 

and added as might from time to time be necessary. 

The Home obtained its charter in June of 1953, at which time 

the estate of Miss Cartmell was distributed to the Trustees named 

in the will and/or appointed by the court. The first unit of the 

Home was opened in 1956, the second unit in 1960, both units 

being located on the 195 acre tract in question which was the 

former home place of Miss Cartmell. The Rome is being operated 

at the top capacity for 56 persons with a wafting list of applicants who desire admission. 
Honorable R. E. Swift, Page 2 Opinion No. ~~-1318 

Residents pay $65 per month for all services Including room, 

board, laundry, nursing care8 drugs and routine doctor bills, 

the actual cost of which averages approximately $150 monthly. 

Comparable services in a private home for the aged or one operated 

for a profit have been estimated to run from $150 to $300 per 

month. 

The balance of all of the real property devised by Miss 

Cartmell to the Home (with the direction that the income therefrom 

be devoted,Lto the establishment and maintenance of the Home) has 

been sold or is being held for sale or Is rented or being held 

for rent. It has been rendered for taxation to the appropriate 

authorities. It is not controverted that these properties are 

subject to tax. 

You have correctly concluded under the facts stated that the 

Home is an "lnstltutlon of purely public charity" as that term 

is used in Section 2 of Article VIII of the Constitution of the 

State of Texas, pursuant tf which Section the Legislature enacted 

Section 7 of Article 7150, Vernon's Civil Statutes. As such an 

institution, it Is exempt from taxation, the sole questizn being 

the extent of that exemption. Although you have stated 

that the buildings and property actually used by the aged'and' 

orphans amounts to only about 5 acres,. . .'I, elsewhere in connection with your request, it Is stated that approximately eight 

to ten acres of land immediately surrounding the buildings are 

kept by mowing. It Is further stated that some two or three 

pear trees are located on another portion of the tract* and that 

the pears are preserved in the kitchen in the Home for consumption by the residents. The south portion of the tract Is described as beinghilly ax&rocky and very rough land, with no 

y Section 7 reads as follows: 

"All buildings and personal property belonging to institutions of purely public charity, 

together with the lands belonging to and 

occupied by such Institutions not leased or 

otherwise used with a view to profit, unless 

such rents and proffts and all moneys and 

credits are appropriated by such institutions 

solely to sustain such Institutions and for 

the benefit of the sick and disabled members 

and their famillea and the burial of the same, 

or for the maintenance of persons when unable 

to provide for themselves, whether such persona 

are members of such inst&utions OP not. An 

Institution of purely public charity under this 
Honorable R. E. Swift, Page 3 Opinion No. ~~-1318 

buildings located on any portion thereof, ncr any Income derived 

therefrom. The State Highway Department has advised the Home 

that It hopes to acquire approximately 22 acres of this tract 

as right-of-way for a Bypass around the City of Palestine. 

We quote the following excerpt from the letter of the 

manager of the Home: 

“The policy of the Board of Directors 

regarding this 195 acres has always been 

that thie fs the ‘Hometract’ referred to 

In the will of Miss Cartmell and that it 

is to be used for the charitable purpose> 

that fzlrther expansions are to take place 

on this tra-t as the years go by and as its 

assets grow and that no portion of this 

tract will be held for sale or for rent. ’ 

In Hedgecroft v. City of Houston, 150 Tax. 654, 244 S.W.2d 

632 (1952) the question was whether property in the City of 

Houston owned by The Hedgecroft ClPnic, a charitable corporation 

operating a charitable hospital, clinic and training school for 

the treatment of polfomyelitis and similar diseases, was exempt 

from ad valorem taxes of the Cfty &cd the Houston Independent 

School District for the year 1949. The City took the position 

that Hedgecroft had failed to show an actual, direct and exclusive use of the property for charitable purposes on January 1, 

1949, and asserted that such action did not ,ccmmer.ce until May 

13, 1949. 

The property ir, qdestlon had been given and conveyed to 

Hedgecroft on December 30, 1948. Prior to that time, it had 

been owned and occupied as a home, Long before Hedgecroft 

acquired title, ft had agreed with a construction company to 

make necessary alter%tfons and repairs of the property to fit it 

1 ConltJ 

article is one which dispenses its a%3 to its 

members and others in sickness or distress, or 

at death, without regard to poverty or riches 

of the recepient, also when the funds, property 

rd aosets of such institutions are placed and 

boc?d by its law to relfeve, aid an+ adminrstcr 

in ark ‘way to the relief of its members when in 

want > sickness and distress, and provide 

homes for its helpless and dependent members 

and to educate and maintafn the orphans of 

its deceased members or other persons.” 
Honorable R. B. Swift, Page 4 Opinion No. ~~-1318 

for the operation of a hospital, clinic and training school. Beginning with the week ending July 7, 1948, and continuing until 

December 29, 1948, the construction oosl~any had been reparlng 

plans for repairs and alterations. Form August 1, 19 t2 8through 

December 27, 1948, a blueprint company had furnished Hedgecroft 

with numerous blueprints for remodeling the premises. Prior to 

Hedgecroft Is acquisition of the property, ,..on,.the, days of acqulsltion and immediately thereafter, Hedgecroft was engaged in planning and making the necessary repairs and improvement for the 

clinic and hospital, and on May 13, 1949, these repairs had 

been completed sufficiently to allow Hedgecroft to move from its 

old premises to the premises which were the subject of this suit. 

On and since the date of acquisition, the premises had been used 

exclusively by Hedgecroft,whose representatives visited the premises, supervised removal of furniture, started work, on the yard, 

etc. The building permit for the remodeling was Issued December 

29, 1948. 

It was admitted by the City that Hedgecroft was an lnstitution of purely public charity within the meaning of that term as 

used In Section 2 of Article VIII of the Texas Constitution and 

that such use as it had made of the property since It became the 

owner thereof had been exclusive In the sense that no one else 

had occupied the property nor had it been leased or otherwise used 

for profit. 

It was argued that the use required by the Constitution for 

exemption must be actual, direct and exclusive and that Sedgecroft’s 

actions in relation to the property were merely evidence of future 

plans and intentions and did not constitute a present use on 

January 1, 1949, forits charitable purposes in that no patients 

were admitted for treatment on that day or prior thereto. In 

other words, it was argued that since the building was not then 

being actually operated and was not ready to be operated for the 

treatment of patients, it was not exempt. The court rejected 

this position and accorded exemption. 

The court reviewed decisions from other states holding, under 

similar exemption provisions, that when the subsequent use created 

a tax exempt status, then a use which was confined to readying 

property for such purpose likewise created a tax exempt status. 

We quote the following excerpt from page 636 of the opinion of 

the court: 

“In our opinion the rule announced and 

applied in the out-of-state decisions above 

discussed is sound and is appropriate to this 

case. We approve the position taken by 

petitioner as tfius stated in Its application 

for writ of error: ‘It is obvious that with- 
Honorable R. E. Swift, Page 5 Opinion No. W-1318 

out some preparation of the premises, there 

never could have been a polio clinic in opera-.. 

tion. To fulfill the charitable purpose of 

treating polio sufferers, Hedgecroft had first 

to remodel the property, then to operate 

the clinic Q Preparation for tied operation 

of the clinic are both Indispensable. Both 

took place on the premises. Both constituted 

a use by Hedgecroft of the premises. The 

constitutional clause which admittedly exempts 

the property during operation likewise exempts 

the property during bona fide necessary preparation.’ 

,I 

oplni&: 

The facts alleged show, In our 

in actual and direct use of the 

property on and prior to January 1, 1949, 

for the charitable purpose. 

“Respondent makes the valid argument that, 

ownership with mere Intentions, well-grounded 

plans and hopes cannot confer the exemption, 

in other words, that intention to use, without 

use, is not sufficient. But according to the 

allegations of the petition there was more 

tkan mere 3ntention to use. o * qn 

In view of the facts which have been furnished us, we cannot say that the Cartmeli Home is making an actu%l, direct use 

of the entire 195 acres for its charitable purposes. Just how 

much of 195 acres is being dfrectly used by the Rome Is a fact 

question which must be determined by you. But Insofar as the 

Board of Directors of the Rome contemplates further expansion 

on the tract “as the years $0 by”, in view of the Hedgecroft 

case, ownership with mere intentions, well-grounded plans and 

hopes is insufficient to confer exemption. Tht non-use of the 

property by other% or the fact it produces no revenue,18 not 

: sufficient to effectuate exemption, 

SUMMARY 

That portion of the 195 acre tract 

which is directly used by the Cartmell Home 

for the Aged and Orphans for its charitable 

purpose is exempt from ad valorem taxes. 

The rematifng portion of the acreage which 

is not presently being directly used by the 

charitable corporation for Its charitable 
Honorable R. E. Swift, Page 6 Opinion No. ~-1318 

purposes cannot be exempt from ad valorem 

taxation despite the fact that further 

expansions and ultimate direct use are 

contemplated at some uncertain future 

time. 

Yours very truly, 

WILL WILSON 

Attorney General of Texas 

Assistant 

MMP:cm 

APPROVED: 

OPINION COMMITTEE: 

W. V. Geppert, Chairman 

Jay Howell 

W. 0. Shultz 

Charles Lind 

John Hoffmann 

REVIEWED FOR THE ATTORNEY GENERAL 

By: Houghton Brownlee, Jr.