Opinion ID: 1992198
Heading Depth: 1
Heading Rank: 3

Heading: MSBA's status as a charitable organization

Text: In Supervisor v. Group Health Ass'n, 308 Md. 151, 517 A.2d 1076 (1986), we declined to establish a hard-and-fast rule as to the meaning of charitable for purposes of interpreting Art. 81, § 9(e)(2), which grants an exemption from real property taxation for property owned by any nonprofit charitable organization when it is used for charitable purposes. We said that a determination of whether an institution is charitable must include a careful examination of the stated purposes of the organization, the actual work performed, the extent to which the work performed benefits the community and the public welfare in general, and the support provided by donations. Id. at 157, 517 A.2d 1076. This characterization of the term charitable is consistent with tests formulated by courts in other states in cases involving the propriety of awarding a tax exemption to an organization, claiming to be a charitable institution. See Gas Research Institute v. Dep't of Revenue, supra, 107 Ill.Dec. at 480, 507 N.E.2d at 144 (while noting that [t]he law recognizes as charitable those activities which benefit an indefinite number of persons through the exercise of specific educational or religious influences, engaging in public works or by otherwise lessening the burden upon the State to care for or advance the interests of its citizens, the court found that under Illinois law to qualify for a sales tax exemption as a charitable association, an organization must be organized and operated to benefit an indefinite number of people; there may be restrictions on the group benefited, but the service rendered to those eligible must act to relieve the public of an obligation, moral or economic, which it would otherwise have to such beneficiaries or it must confer some general benefit onto the public); South Dakota State Medical Association v. Jones, supra, 146 N.W.2d at 729, quoting, Massachusetts Medical Soc. v. Assessors of Boston, 340 Mass. 327, 164 N.E.2d 325 (`[a]n institution will be classed as charitable if the dominant purpose of its work is for the public good and the work done for its members is but the means adopted for this purpose. But if the dominant purpose of its work is to benefit its members or a limited class of persons it will not be so classed, even though the public will derive an incidental benefit from such work'); Intern. Foundation, etc. v. City of Brookfield, supra (adopting the test set forth in the South Dakota State Medical Association, case). The record indicates that the Tax Court considered the first of the four factors cited in Group Health when it reviewed the MSBA's articles of incorporation which set forth the purposes of the organization. The record also indicates that the parties presented the Tax Court with a wealth of evidence as to the work performed by the MSBA and the extent to which that work benefits the community and the public welfare in general, thus establishing that the Tax Court had before it the second and third Group Health factors. In addition, the Tax Court's opinion indicates that it considered these factors when it stated that [t]he bulk of the services provided by MSBA are provided to and for its members. It also considered the amount of support provided by donations, finding that the Association's income is derived almost exclusively from dues and fees. Thus, we think that the Tax Court understood the meaning of the word charitable in § 326(i) and properly applied it to the evidence in the case. Its factual determination that the MSBA was not primarily a charitable organization was supported by substantial evidence, i.e., by such relevant evidence as a reasonable mind might accept as adequate to support a conclusion. See Ramsay, Scarlett & Co. v. Comptroller, supra, 302 Md. at 835, 490 A.2d 1296. In so holding, we recognize that it is the province of the administrative agency to resolve conflicting evidence and where inconsistent inferences can be drawn from the same evidence, it is for the agency, not the court, to draw the inference. Id.