Opinion ID: 1268867
Heading Depth: 2
Heading Rank: 9

Heading: support properties

Text: Having determined the categories of exempt property uses, we now consider exempt support properties. Section 29.53.020(b)(3) exempts: lots supporting and adjacent to a structure or residence ... [used exclusively for nonprofit religious purposes] which are necessary to convenient use... . If the main property is not exempt under either AS 29.53.020(b)(1) or (b)(2), then section (b)(3) bars exemptions for property supporting the nonexempt property. [46] Section (b)(3) requires that the support property be adjacent to the structure it supports. The statute does not define adjacent. We agree with the superior court's use of the common law definition provided in Black's Law Dictionary 38 (Rev. 5th Ed. 1979): Adjacent. Lying near or close to; sometimes, contiguous; neighboring. Adjacent implies that the two objects are not widely separated, though they may not actually touch, Harrison v. Guilford County, 218 N.C. 718, 12 S.E.2d 269, while adjoining imports that they are so joined or united to each other that no third object intervenes. Wolfe v. Hurley, D.C.La., 46 F.2d 515, 521.
The Catholics unsuccessfully sought to exempt several properties used with the KNOM Radio Station: (1) Radio Station Office (tax years 1979-82); (2) KNOM Heating Plant (tax years 1979-82); (3) Radio Station Storage (tax years 1979-82); (4) 21' X 137.5' Access Strip (tax years 1979-82); and (5) Radio Tower (tax years 1979-82). The superior court reversed the City's denials of these exemptions. It found that they support the exempt KNOM Radio Station. See supra section VII, C. We affirm the superior court. Although labeled here for convenience as support properties, the station office and tower are integral parts of the radio station. They are thus exempt under AS 29.53.020(b)(2) without reference to the support property exemption. The KNOM heating plant, the radio station storage and the access strip all qualify as support properties. The heating plant included an electrical generator; both are necessary to convenient use of the radio station and the other buildings on the Catholic Bishop's properties. The buildings in the complex are mostly exempt under this opinion; the heat or electricity provided to the nonexempt parts of the complex was de minimus. The use of both the station storage and the access strip are necessary to convenient use of the building housing the radio station. We thus agree with the superior court that the City erroneously denied a tax exemption to the KNOM-related properties for the designated tax years.
The Catholics sought to exempt a Garage and Heating Plant. During tax years 1979-82, the building housed both a garage, workshop and tool storage for St. Joseph's Church and KNOM Radio Station and a heating plant used by St. Joseph's Church, St. Joseph's Rectory and the Girls' Dorm. It sits on a lot adjoining the Church and the Rectory. The use of property for garage space, workshop, tool storage and heat are proper support functions under AS 29.53.020(b)(3). Both the KNOM Radio Station and the Church were exempt under AS 29.53.020(b)(2) during tax years 1979-82. In addition, most of the Rectory was exempt under AS 29.53.020(b)(1). Some of the property serviced by the Garage and Heating Plant was not exempt during the tax years 1979-82  e.g., portions of St. Joseph's rectory used as a dining area for KNOM volunteers (tax year 1981-82) and the Girls' Dorm (tax years 1979-82). We cannot determine from the record whether use of the Garage and Heating Plant for nonexempt property is de minimus or can be spatially apportioned from exempt uses. Accordingly, we remand with instructions that the property receive an exemption for each year that its use as support of nonexempt property was nonexistent, de minimus or spatially apportionable.
For tax years 1979-82 the Lutherans sought to exempt a Quonset Hut. The Hut sits on property adjacent to the Lutheran Parsonage on one side and Our Savior's Lutheran Church on the other. Both the Parsonage and Church were exempt during tax years 1979-82. The Quonset Hut housed a standby generator for both the Parsonage and Church. It also contained a shop area and storage used by the Church and four village congregations. The superior court concluded that the Quonset Hut qualifies as support property under AS 29.53.020(b)(3). We agree and affirm the exemption of the Quonset Hut for tax years 1979-82. [47]
For tax years 1979-82, the Lutherans sought to exempt a garage that housed vehicles used by the Lutheran pastors. [48] The superior court found that the garage was adjacent to and supporting property for the pastors' exempt residencies. The court thus granted a tax exemption. We affirm.
The Methodists sought to exempt the KD Building for tax years 1979-82. The building adjoins the Community United Methodist Church Building property. During the disputed tax years it held storage for the Methodist Church, Nome Community Center, Inc., Methodist Thrift Shop, and nonprofit organizations such as the Boy Scouts. The superior court held that only that part of the KD Building used for storage by the Church and the Thrift Shop was exempt support property. The court remanded for apportionment. We affirm the superior court's remand but give different guidelines. Storage space may be exempt as supporting property for other exempt property, or as a charitable use of the property in itself. If on remand the City determines that the Thrift Shop or the Young Center [49] are exempt, then storage space used for those activities is also exempt. While provision of free storage is not in itself a charitable activity, it may be a charitable activity depending on the recipient, the motive and the terms of the storage. On remand, the City should determine whether the provision of storage to the nonprofit groups was a charitable use of the property. In addition, it should consider that use of the KD Building for storage by a particular group or individual may be a de minimus use. Finally, the City must apportion the exempt use of the KD Building. [50]
The Lutherans sought to exempt the Lutheran Apartment for tax year 1982. The 775 square-foot apartment is located in Our Savior's Lutheran Church Building. The superior court found that in tax year 1982 it was used for storage and reversed the exemption denial. The court held that if the Lutherans established on remand that it was used for church storage, then it was exempt as supporting property. The superior court erroneously overlooked the apartment's 1982 use as housing for visiting pastors and lay people. We have already established that the use of church property for housing visitors and volunteers is not an exempt religious purpose. See supra section V, D. If the apartment was more than occasionally used for such housing, the de minimus exception would not apply and the apartment would be nonexempt. This and the storage determination must be decided on remand. Accordingly, we affirm the superior court's remand order for the Lutheran Apartment (tax year 1982).
For tax years 1980-82, the Methodists sought to exempt property used as the Young Center Storage and Parking area. The Methodists also sought to exempt the Methodist Office Building and Garage for tax years 1979-82. The latter was used by the Nome Community Center, Inc. to store equipment and vehicles. The superior court denied the exemption for both of these properties because it denied the exemption for the Young Center and the Nome Community Center, Inc. Since we have reversed and remanded the superior court's judgment regarding the Young Center and the Nome Community Center, Inc., we do the same for the support properties. See supra section VIII. If the city exempts the Young Center or the Nome Community Center, Inc., then the Young Center Storage and Parking or the Methodist Office Building must also be exempt.
For tax year 1979, the Methodists sought to exempt a portion of the Seaview House as support property. That part of the property stored equipment during the construction of the Young Center. The Seaview House was not exempt unless the property it supported was exempt. [51] Since the Young Center was only built in 1980, the portion of the Seaview House was properly held nonexempt. We affirm the superior court's decision regarding this portion of the Seaview House.