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STATE OF MICHIGAN 

COURT OF APPEALS 

HARMONY MONTESSORI CENTER, 

 Petitioner-Appellant, 

UNPUBLISHED 

October 13, 2016 

v No. 326870 

Tax Tribunal 

CITY OF OAK PARK, LC No. 00-370214 

 Respondent-Appellee. 

Before: TALBOT, C.J., and O’CONNELL and OWENS, JJ. 

O’CONNELL, J. (dissenting). 

 I respectfully dissent. 

 The majority opinion and the tribunal both conclude that Harmony Montessori Center 

(Harmony) cannot be a charitable organization because it charges its students tuition and fees for 

services. I respectfully disagree. The majority’s conclusion is also directly contrary to Wexford 

Med Group v City of Cadillac, 474 Mich 192, 215; 713 NW2d 734 (2006). Because I conclude 

that Harmony is a charitable organization under MCL 211.7o, I would reverse and remand. 

 I agree with the majority in its statement of the standard of review and application of 

MCL 211.7n. My disagreement lies with its application of MCL 211.7o, the charitable 

institution exception. 

 MCL 211.7o(1) provides an exemption for property owned by a charitable institution: 

Real or personal property owned and occupied by a nonprofit charitable 

institution while occupied by that nonprofit charitable institution solely for the 

purposes for which that nonprofit charitable institution was incorporated is 

exempt from the collection of taxes under this act. 

To qualify as a charitable institution, “it is the overall nature of the institution, as opposed to its 

specific activities, that should be evaluated.” Wexford, 474 Mich at 213. The Tribunal should 

consider the following factors when evaluating the charitable nature of an institution: 

 (1) A “charitable institution” must be a nonprofit institution. 
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 (2) A “charitable institution” is one that is organized chiefly, if not solely, 

for charity. 

 (3) A “charitable institution” does not offer its charity on a discriminatory 

basis by choosing who, among the group it purports to serve, deserves the 

services. Rather, a “charitable institution” serves any person who needs the 

particular type of charity being offered. 

 (4) A “charitable institution” brings people’s minds or hearts under the 

influence of education or religion; relieves people’s bodies from disease, 

suffering, or constraint; assists people to establish themselves for life; erects or 

maintains public buildings or works; or otherwise lessens the burdens of 

government. 

 (5) A “charitable institution” can charge for its services as long as the 

charges are not more than what is needed for its successful maintenance. 

 (6) A “charitable institution” need not meet any monetary threshold of 

charity to merit the charitable institution exemption; rather, if the overall nature of 

the institution is charitable, it is a “charitable institution” regardless of how much 

money it devotes to charitable activities in a particular year. [Id. at 215.] 

The Tribunal may not focus solely on the amount of free services an organization provides when 

determining whether the organization is charitable in nature. Id. at 213. 

 Most of the Wexford factors are not in issue because Oak Park has stipulated to them. 

Harmony Montessori Ctr v City of Oak Park, unpublished opinion per curiam of the Court of 

Appeals, issued February 18, 2014 (Docket No. 312856); slip op at 4. Considering only the 

second factor, similar to the petitioner in Wexford, Harmony established that it does offer 

reduced rates of tuition to children in financial need. The Tribunal found that such rates existed, 

though only a few students received them. The record does not establish that Harmony gives any 

preferential treatment to those students who can pay full-price tuition or discriminates in any 

manner against children seeking a Montessori education. See Wexford, 474 Mich at 216-217. 

And similar to the petitioner in Wexford, Harmony established that its costs are not fully

subsidized by tuition. Instead, Harmony also holds fundraisers and accepts donations. See 

Wexford, 474 Mich at 217. 

 Under the majority’s conclusion, any educational charity that collects tuition for its 

services is not a charity under Wexford, as any amount of tuition will go to partially making up 

financial deficits. This is directly contrary to Wexford, in which the Michigan Supreme Court 

stated that the Tribunal may not focus solely on the amount of free services an organization 

provides. Id. at 213. Instead, a charitable organization “need not meet any monetary threshold 

of charity to merit the charitable institution exemption” and “if the overall nature of the 

institution is charitable, it is a ‘charitable institution’ regardless of how much money it devotes to 

charitable activities in a particular year.” Id. at 215. 

 In this case, Harmony is a nonprofit organization that provides nondiscriminatory 

educational services to children and does not charge more than it needs for its successful 
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maintenance. I would conclude that the Tribunal in this case adopted a wrong principle when it 

based its decision regarding Harmony’s charitable nature solely on the fact that Harmony 

charges tuition and fees. 

 I would reverse the decision of the tribunal. 

/s/ Peter D. O’Connell