April 15, 1971 

Honorable Jules Damiani, Jr. 

Criminal District Attorney 

405 County Courthouse 

Galveston, Texas 77550 

Dear Mr. Damiani: 

Opinion No. M-837 

Re: Liability of medical 

fraternities at University of Texas Medical 

School at Galveston for 

” ad valorem taxes. 

You reqiie,st,odr ol&iion a6 lo 

‘1. . . ðer the msdical fraternities at 

the University of Texas Medical ‘sirhbol at Galveston 

. . i I, 

are exempt i&m ‘ad ‘valorkm taxes by reason of ‘either or both of the 

following grounds authoiited in Articie VIII, Section i of the Texas Con- 

. etltutioti. 

(1) ‘1. . . buiidings used exclusively and owned 

by persons or associations of $ersons for 

school puipoees . : . ;I’ 

(2);. ,ya.,:,. .;, institutions .~ ,of purely ,public charity; 

.:. **, 

School bu’ildings,‘art exe&i@ by Sectibn 1 of Article ‘7150, veernon’s Civil Statutes*, which in its reietiant p6rtiob reads: 

“The foIloWing property &I\ be exempt from 

taxation, to-wit: 

‘* All references to ‘statutes are to Vernon’b Civil Statutes unless 

otherwise stated. 

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Honorable Jules Damiani, Jr., Page 2 (M-837) 

“1. Schools and Churches - Public school 

houses. . . All public colleges, public 

academies, . . . and all such buildings 

used exclusively and owned by persons 

or associations of persons for school 

~purposes; . . .‘I 

Also, you cite Section 22 of Article 7150 (Acts 1967, 60th Leg., 

R. S., p.. 319, ch. 152) which exempts the property of all fraternal organizations, as therein described, when used for certain purposes; this Section 

22 reads as follows: 

“The property of all fraternal organizations 

shall be exempt from taxation for so long as the property is owned and used for charitable, benevolent, re'- 

ligious, and educational purposes, and is not in whole 

or in part leased out to others,’ or otherwise used with 

a view to profit. 

“The term ‘Fraternal Organization’ as used in 

this’ Act shall mean, ‘A lodge, or lodges, engaged in 

charitable,’ benevolent, religious, and educational work, ’ 

-~However; thie Act -shall note apply to any frs - 

ternal organization or lodge which pays to its members, 

either directly or indirectly, any type of insurance benefit, be it life, health, accident or death benefit, or any 

other type of insurance; neither shall any organization 

which shall dir~ectly or indiredtly participate or engage 

in any political activity, either in support of or in opposition to any c,andidate seeking any public office, have 

or be entitled to benefits as provided under this Act. ” 

Our opinion is that the evidence submitted by you is not sufficient 

to exempt the properties of these medical fraternities under any of the foregoing constitutional or statutory grounds. 

1. 

We first consider whether these properties are exempt as school 

buildings under either of the above quoted provisions of the Constitution and 

of Article 7150, Section 1. 

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Honorable Jules Damiani, Jr., Page 3 (M-837) 

In this connection you request that we reconsider our former 

Attorney General’s Opinion No. M-12 (1967). in view of the holding of 

our Texas Supreme Court in the case of San Antonio Conservation Society, 

Inc. v. City of San Antonio, 455 S. W. 2d 743 (Tex. Sup. 1970) and the case 

of City of Memphis v. Alpha Beta Welfare Ass’n., 126 S. W. 2d 323 (Term. 

Sup. 1939. ) The San Antonio case was decided subsequently to our Opinion 

M-12, and the City of Memphis case was decided prior to our Opinion and 

was not cited nor referred to in our Opinion. 

We quote the entire statement of facts which you submit in support 

of your claims for exemption: 

“It should be noted from the outset that there 

is not sufficient dormitory space for male medical students attending the University of Texas Medical Branch. 

While some students live in private residences, the 

great majority of single male students live at fraternity 

houses which are normally operated as non-profit corporations and charitable associations adjacent to the campus. 

The fraternity programs are integrated with the University 

of Texas Medical Branch and each fraternity maintains a 

supervised study program and a medical library for students. Such an arrangement gives each medical fraternity 

access to medical journals, textbooks, and specimens. In 

addition, each of the fraternities furnish the following educational benefits to the medical students as an assist to the 

Medical Branch: 

“1. Maintenance of a library in each fraternity 

with access to medical journals, textbooks, 

and specimens (osteological, CNS, Histological, etc. ) 

“2. Provisions of textbooks and study aids to 

most of the members of fraternities in 

Years I and II. These aids frequently include microscopes. 

“3. Lecture sessions with faculty and private 

physicians in the fraternities. These occur 

at the rate of about one/month. Not only do 

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Honorable Jules Damiani, Jr., Page 4 (M-837) 

.individual fraternities sponsor those 

sessions, but the Inter-fraternity Council and the Sophomore Class have had 

regular ‘Fireside Chats’ in the fraternities featuring visiting dignitaries, 

faculty and administration. 

“4. Tutorial sessions are frequently held in 

the fraternities by course instructors at 

student’s request. Attempts to review, 

clarify and emphasize material are made 

during these sessions. 

“5. Orientation of new students to medical 

school and of each class to its’ ensuing 

years and to new assignments is a constant, ongoing procedure. 

“6. Study sessions and review sessions of 

students and upperclassmen. 

“7. ‘Mormal gatherings of students discussing clinical cases, management, and 

philosophy ‘and ethics of medicine occur 

continuously. 

“8. Provide professional contacts and guidance in the evolving professional behavior. 

Social functions form a small part of medical fraternities activity. 

“9. These are not ‘typical Greek Letter fraternities’ but unique both as fraternities and as 

medical fraternities. They play a large part 

in the culture, heritage and attractiveness of 

UTMB. 

“10. Provision of housing and preparation of meals 

for single students near the campus is of estimable value. 

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Honorable Jules Damiani, Jr., Page 5 (M-837) 

“11. Hospital cafeteria and surrounding 

facilities could not support the number 

of people who would depend on them if 

not for fraternities. 

!‘12. Availability of fraternities to hospital is 

of great importance when students are on 

call and must come to the hospital to give 

medications, evaluate patients, work up 

new patients or’go to surgery. 

“13. There is no ‘school’ organized recreational/ 

social program. All activities stem from 

organization by the individual fraternities 

and the Inter-fraternity Council. 

“14. ‘Patients being cared for by students are 

state patienta. ‘, Without the student’% help 

~andavailab ility in many areas, more administrative and nursing personnel would 

be required. 

i: 

..,~ 

“15. Fraternities have no reason for existences 

except to serve the University and its student body. The Univereity,depends upon 

the fraternities to provide essential services 

” ,andto nurture the professional growth of 

.medical students. 

.“16. .;Services provided by the fraternities cost 

~the University nothing. ‘In- their absence, 

considerable expenee might have to be incurred to provide these benefits. ” 

:Our careful comparison of these facts with those set forth in our 

prior Opinion M-12 shows no new facts that would warrant holding the properties in question to be exempt. We consider the present facts to be only repetitive of those considered in Opinion M-12, without adding any new reason for 

holding the properties inquestion to be exempt. We refrain from considering 

here again all the reasoning and authorities presented in our former Opinion, 

i4053- 
Honorable Jules Damiani, Jr., Page 6 (M-837) 

but rather we refer to, it as the basis both in fact and in the legal authorities there cited for our holding in this present opinion. See also Attorney 

General’s Opinion No. M-778 (1971. ) 

In the City of Memphis case, supra, the court construed a Constitutional exemption of property ‘I. . . held and used for purposes . . . educational . . .’ ‘I The Texas Constitutional provision exempts property used 

for “school purposes” and also ,institutions of “purely public charity . ” 

These provisions are different in wording and cannot be construed to be 

the same in all situations. The rule was well stated in the case of Little 

Theater of Dallas v. City of Dallas, 124 S. W. 2d 863 (Tex. Civ. App. 1939, 

no writ): 

~“Appellant cites a number of decisions from the 

courts of other states, tending to show that . . . debating 

clubs, . . professor’s houses, dormitories and music 

associations were exempt from taxation, but these decisions 

were based upon and controlled by constitutional and statutory provisions ,peculiar to the respective states, hence are 

not controlling as authorities~here. I’ 

We note that in the City of Memphis case the only issue presented 

was whether the,real, estate of a general welfare corpo.ration was used by 

it exclusively;for 1’educational purposes, ” a constitutional and statutory 

ground fortax exemption. The Court noted: 

“The specific purpose for which Alpha Beta 

Welfare Association was created, as stated in its charter, 

is the ‘promoting and providing for medical and scientific 

education-of young men, and for the purpose of, owning 

property, both real and personal,. to be used exclusively 

in furthering the aforesaid purposes; . . . ’ 

“The only witnesses who testified on the trial 

of the. case were three physicians introduced by the Association. Thus the facts of the case are not in controversy. ” 

(126 S. W. 2d 324. ) 

In its concluding paragraph, the Court concluded that under the great weight 

of authority tax exemptions have not been granted to college Greek letter 

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Honorable Jules Damiani, Jr. , Page 7 (M-837) 

fraternities, except under express statutory authority, and further said: 

“In our opinion no blanket .rule can be laid 

down and made applicable to all fraternities. Whether 

or not the property of a fraternity is exempt from taxation is dependent, as in all other cases, on the use made 

of the property. Each case must be determined on its 

own facts . . .I’ (126,s. W. 2d 326. ) 

We are in agreement with this reasoning; however, aside from the 

distinguishing legal and factual. aspects noted above from the factual situation presented, the holding was made in the City of Memphis case only after 

trial and upon undisputed and non-controversial.testimony. Likewise, in 

the San Antonio Conservation Society.case, supra, the trial court, upon 

stipulations of the parties and a non-controversial fact situation, had held, 

and the Supreme Court affirmed, that the Conservation Society had assumed, 

to a material extent, that which otherwise might become the obligation or 

duty of the -community or state,, the statutory and constitutional test for tax 

exemption. The’Court said: 

“The City concedes that the whole public receives the benefits of the Navarro House. ” (455 S. W. 2d 

746.), ,’ 

Under the facts presented, no city, county or state taxing authorities have 

stipulated or conceded anything. We are presented only with .a partial statement of miscellaneous facts concerning educational benefits to the medical 

students who were fortunate ,enough to be accepted into the fraternity houses. 

Then amount of-charity dispensed, the confinement to public charitable purposes of-the-fraternityand.its perpetual dedicatioxiof the property to,public 

charity in the charter, the conditions of admission or rejection to,all on a 

;non-discriminatory.public charitable basis,. are all additional matters which 

must be considered not shown here. In this connection, the general evidentiary 

and legal guidelines have been noted in Attorney General Opinion No. C-697 

(1966) and in Hilltop Village, Incs v. Kerrville Independent School Dist. , 426 

S. W. 2d 943 (Tex. Sup. 1968). to which you are referred. In view thereof, 

we are unable to say as a matter of law that the fraternities are entitled to ad 

valorem tax exemption. We do not say, however, that in a specific case such 

a fraternity is precluded from the legal possibility of showing its property is 

owned and used~for school purposes or as an institution of purely public charity. 

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. 

Honorable Jules Damiani, Jr. , Page 8 (M-837) 

We now consider whether the properties of the fraternities may be 

comprehended within Article 7150, Section 22 (Acts 1967, 60th Leg., R. S., 

p. 319, ch. 152) which exempts from taxation property of 

‘I. . . all fraternal organizations . . . for 

so long as the property is owned and used for charitable, benevolent, religious, and educational purposes, 

and is not in whole or in part leased out to others, or 

otherwise used with a view to profit. ” (Emphasis added. ) 

The Legislature therein defined the term “Fraternal Organization” to mean, 

“A lodge, or lodges, engaged in charitable, 

benevolent, religious, and educational work. ” 

Assuming without deciding, that the above statute contemplates the 

exemption of the property of medical fraternities, nevertheless that statute, 

to be constitutional and in harmony with Section 2, Article VIII of the Constitution of Texas, must be construed to provide an exemption for such property 

only if owned and primarily used as an “actual place of religious worship, ” 

or “for school purposes, ” or as “institutions of purely public charity. ” Unless the medical fraternities can bring themselves clearly within one of those 

enumerated exceptions, they are not exempt. The Legislature is powerless 

to grant an exemption that does not meet this constitutional concept and test. 

The City of Waco v. Texas Retired Teacher Residence Corporation, NO. 

B-2179. Feb. 17. 1971. Tex. Sun. _ Ct . : Attornev General Oninion Nos. M-778 

(1971) and M-517 (1969), and authorities therein cited; City of San Antonio v. 

Young Men’s Christian Association, 285 S. W. 844 (Tex. Civ. App. 1926, error 

ref. ) Thus, in the case of fraternal associations granted such a tax exemption by a general statute,, it has been held that such a statute was violative 

of the implied limitations of a constitutional provision authorieing the Legislature to exempt property used exclusively for charitable purposes. Supreme 

Lodge, M.A.F.O. V. Board of Review, 223 Ill. 54, 79 NE 23, (Ill.Sup., 1906.) 

In the above case, the Supreme Court of Illinois pertinently observed: 

‘1. . . Obviously, then, if the fraternal beneficiary societies which are relieved from taxation by 

the statute under consideration do not fall within one of 

the classes whose property the Constitution provides 

-4056- 
. . 

Honorable Jules Damiani, Jr., Page 9 (M-837) 

may be exempted from taxation by general law, 

any act of the Legislature purporting to exempt 

their property from taxation is unconstitutional. 

The Legislature has no power to exempt from 

taxation any property other than that enumerated 

in Section 3 of Article 9 of the Constitution. Such 

enumeration is an exclusion of all other subjects 

of exemption. . . ” (at p. 24. ) 

In view of our conclusion that college fraternities or sororities, including the medical fraternities, are generally held to be not exempt ~from 

taxation because they do not exist primarily for charitable or educational and 

benevolent purposes, we must necessarily likewise conclude that as a general 

rule the property of such organizations is not exempt under Section 22, Article 7150, when harmonized with Section 2, Article VIII of the Texas Consti- 

” tution. As observed in Beta Xi Chapter of Beta Theta Pi v. City of New Orleans, 137 So. 204 (La. Ct. of App., 1931) while the practice of a fraternity 

in performing certain ch aritable work is commendable, tax exemption cannot be shown unless the character of the work undertaken is one of the principal 

objects of the organization, the doing of such work as relieves the State of 

some of its burdens, and that the property itself, and not only the organization, 

must be devoted to such undertakings. This is the well-settled rule in Texas. 

Hilltop Village, Inc. v. Kerrville Ind. Sch. Dist., 426 S. W. 2d 943 (Tex. Sup. 

1968); River Oaks Garden Club v. City of Houston, 370 S. W. 2d 851 (Tex. Sup. 

1963. ) The case of San Antonio Conservation Society, Inc. v. City of San 

Antonio, 455 S.,W. 2d 743 (Tex. Sup. 1970) is not controling under the facts we 

have under consideration. 

We are unable to say as’ a’matter of law that the medical fraternities 

in question constitute “lodges engaged in charitable, benevolent, religious, 

and educational work. ” Whenharmonized with Article VIII, Section 2, Constitution of Texas, ’ as stated in 51 ‘American Jurisprudence 602, Taxation, 

Section 627, this determination is ordinarily and most often a question of fact 

in the light of all the facts and circumstances involved, and further: 

‘1. . . Although there are holdings to the contrary, 

the prevailing rule seems to be that such (fraternal) associations are not institutions of ‘purely public charity’ within 

the meaning of such a phrase in a tax exemption provision. 

In this connection, it has been pointed out that the word ‘purely’ 

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Honorable Jules Damiani, Jr., Page 10 (M-837) 

as thus used is intended to modify the word ‘charity’ 

and not the word ‘public’, so as to require the institution to have a wholly altruistic quality and exclude 

from it every private or selfish interest or profit or 

corporate gain. (Parenthesis ours. ) 

It is held that it is not enough to exempt property from taxation that 

one of several purposes or results of its use is charity. It is required to 

be the chief, if not the sole, object. 51 Am. Jur. 605, Taxation, Sec. 631; 

Benevolent & Protective Order of Elks v. Houston, 44 S. W. 2d 488 (Tex. Civ. 

App. 1931, error ref. ), citing R. C.L. 

It is therefore our conclusion that the facts and circumstances submitted are insufficient to present a case for tax exemption as a matter of 

law, the taxpayers having failed to discharge fully their burden of clear proof 

and any doubt being resolved against the exemption and in favor of the taxing 

power. 

SUMMARY 

The properties of the medical fraternities at 

the University of Texas Medical School at Galveston, 

Texas, are not shown to be entitled to ad valorem tax 

exemption as a matter of law under the facts and circumstances presented under either Section 1 or Section 

22 of Article 7150, Vernon’s Civil Statutes, as amended, 

and Article VIII, Section 2, Texas Constitution. 

Yours very truly, 

CRAWFORD C. MARTIN 

Attorney General of Texas 

NOLA WHITE 

First Assistant 

Prepared by W. E. Allen 

Assistant Attorney General 

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. 

Honorable Jules Damiani, Jr. , Page 11 

APPROVED: 

OPINION COMMITTEE 

Kerns Taylor, Chairman 

Arthur Sandlin 

John Reeves 

Ralph Rash 

Jack Goodman 

MEADE F. GRIFFIN 

Staff Legal Assistant 

ALFRED WALKER 

Executive Assistant 

(M-837) 

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