CO Code § 39-3-108 (2021)
2021 Colorado Code|Title 39 - Taxation|Article 3 - Exemptions|Part 1 - Property Exempt From Taxation|§ 39-3-108. Property - Nonresidential - Health-Care Facility - Water Company - Charitable Purposes - Exemption - Limitations

  Property, real and personal, which is owned and used solely and exclusively for strictly charitable purposes and not for private gain or corporate profit shall be exempt from the levy and collection of property tax if:   Such property is nonresidential;    Such property is licensed by the state of Colorado as a health-care facility; or    Such property is used as an integral part of a nonprofit domestic water company.  (1.3) Nonresidential property that is owned and used solely and exclusively by a qualified amateur sports organization shall be presumed to be owned and used solely and exclusively for strictly charitable purposes. For purposes of this subsection (1.3), the term “qualified amateur sports organization” means any organization organized and operated exclusively to foster local, statewide, national, or international amateur sports competition if such organization is also organized and operated primarily to support and develop amateur athletes for national or international competition in sports; except that no part of the net earnings of such organization inure to the benefit of any private shareholder or individual. So long as a qualified amateur sports organization demonstrates that its membership is open to any individual who is an amateur athlete, coach, trainer, manager, administrator, or official active in such sport or to any amateur sports organization that conducts programs in such sport, or both, the organization shall be presumed to provide public benefits to an indefinite number of persons and to directly benefit the people of Colorado whether or not the right to benefit may depend upon voluntary membership in the organization.  (1.5) No requirement shall be imposed that use of property which is otherwise exempt pursuant to the provisions of this section shall benefit the people of Colorado in order to qualify for said exemption.       Any exemption claimed pursuant to the provisions of subsection (1) of this section shall comply with the provisions of section 39-2-117.      When any property of a health-care facility, real or personal, or any portion thereof, which is otherwise exempt from the levy and collection of property tax pursuant to the provisions of paragraph (b) of subsection (1) of this section, is used for any purpose other than the purposes specified in sections 39-3-106 to 39-3-113.5, such property or portion thereof shall be exempt from the levy and collection of property tax if the use of the property or portion thereof does not result in gross income derived from any unrelated trade or business to the owner which is in excess of fifteen percent of the total gross revenues derived from the operation of the property. Gross income derived from any unrelated trade or business shall be determined pursuant to the provisions of sections 511 through 513 of the federal “Internal Revenue Code of 1986”, as amended.    If the use of any property or portion thereof results in gross income derived from any unrelated trade or business in excess of fifteen percent of the total gross revenues to the owner derived from the operation of the property, the administrator shall determine the value of the nonexempt portion of the property for property tax purposes.         History. Source: L. 89: Entire article R&RE, p. 1471, § 1, effective April 23. L. 90: (1.3), (1.5), and (3) added, pp. 1711, 1702, §§ 2, 35, effective June 9. L. 2013: (3)(a) amended,(HB 13-1300), ch. 316, p. 1703, § 119, effective August 7.    Editor's note:   This section is similar to former § 39-3-101 (1)(g) as it existed prior to 1989.   ANNOTATION   Annotator's note. Since § 39-3-108 is similar to § 39-3-101 (1)(g) as it existed prior to the 1989 repeal and reenactment of this article, relevant cases construing that provision have been included in the annotations to this section.   One justification for exempting charitable enterprises from taxation is that they perform functions which tax-supported governmental entities would otherwise be required to perform. W. Brandt Found., Inc. v. Carper, 652 P.2d 564 (Colo. 1982); Bd. of Assessment Appeals v. AM/FM Int'l, 940 P.2d 338 (Colo. 1997).   Neither art. X, § 5 of the state constitution nor this section defines “strictly charitable purposes”. Therefore it is for the judiciary to construe their meaning on a case by case basis. Bd. of Assessment Appeals v. AM/FM Int'l, 940 P.2d 338 (Colo. 1997).   Court will not reverse a decision of board of assessment appeals supported by the record finding that an applicant's activities did not lessen a burden on government and that the applicant operates on a quid pro quo basis. Bd. of Assessment Appeals v. AM/FM Int'l, 940 P.2d 338 (Colo. 1997).   The sine qua non of lessening the burdens of government is that the charitable work being done by an entity, if not being done by that entity, must be undertaken at public expense. Children's Hosp. Colo. v. Prop. Tax Adm'r, , 439 P.3d 43 .   A child care center on a state university campus is not a primary responsibility of government, nor does it perform an activity for which government is responsible or that the government would be forced to assume in the absence of the center's activities. Since the child care center does not lessen the burdens of government, the exemption in this section does not apply. Children's Hosp. Colo. v. Prop. Tax Adm'r, , 439 P.3d 43 .   Claimant has burden of proof to establish that activity has a charitable purpose and is used solely for such purpose. Inst. for Research v. Bd. of Assessment Appeals, 748 P.2d 1346 (Colo. App. 1987).   Right to property tax exemption for charitable use has not been established until it is shown that property is nonresidential. Anderson Ranch Arts Found. v. Prop. Tax Adm'r, 729 P.2d 992 (Colo. 1986).   Nonresidential use not found and therefore charitable exemption not applicable. Anderson Ranch Arts Found. v. Prop. Tax Adm'r, 729 P.2d 992 (Colo. 1986).   The 15 percent provision found in subsection (3)(a) does not apply unless the property first qualifies as tax-exempt property under subsection (1)(b). Thus portions of offices that were neither part of a licensed health care facility nor owned by an entity that is a licensed health care facility were not exempt from property taxation. Jefferson County Bd. of County Comm'rs v. Prop. Tax Adm'r., 989 P.2d 227 (Colo. App. 1999).   Exempt status unaffected by receipt of money from beneficiaries. The fact that fees are charged for use of facilities is not fatal to a claim for exemption. W. Brandt Found., Inc. v. Carper, 652 P.2d 564 (Colo. 1982).   The national junior college athletic association met all the statutory criteria to constitute a “qualified amateur sports organization” under the provisions of subsection (1.3). Nat'l Jr. Coll. Athletic v. Huddleston, 939 P.2d 509 (Colo. App. 1997).   Gun club did not qualify for a tax exemption pursuant to subsection (1.3), because it did not meet the threshold requirement that it be “organized exclusively” to foster amateur sports competition. Cherry Creek Gun Club, Inc. v. Huddleston, 119 P.3d 592 (Colo. App. 2005).   Evidence insufficient to support claim for exemption. W. Brandt Found., Inc. v. Carper, 652 P.2d 564 (Colo. 1982).