Court Opinion

ID: 9665370
Source: CourtListenerOpinion
Date Created: 2023-08-24 00:46:16.513739+00
Date Added: 2024-06-11T18:15:15.125405
License: Public Domain

SNYDER, J.
¶ 30. (dissenting). The majority decision, in essence, holds the City hostage to the accounting practices of a benevolent association. Because a straightforward reading of the statutes requires a reversal of the trial court's decision, I respectfully dissent.
¶ 31. As the majority correctly noted, the taxation of property is the rule and exemption is the exception. Trustees of Ind. Univ. v. Town of Rhine, 170 Wis. 2d 293, 299, 488 N.W.2d 128 (Ct. App. 1992). Tax exemption statutes are matters of legislative grace and must be strictly construed against the granting of an exemption. St. Clare Hosp. of Monroe, Wis., Inc. v. City of Monroe, 209 Wis. 2d 364, 369, 563 N.W.2d 170 (Ct. App. 1997).
¶ 32. The majority inexplicably concludes that, despite the use of "property" in the singular, the statute is ambiguous as to whether the legislature intended its application to each individual property or all the property owned by the benevolent organization in the aggregate. Such a construction renders the application of the statute captive to the accounting methods utilized by the benevolent organization and would create inconsistent rules. A cardinal rule of statutory construction is that statutes must be construed to avoid an absurd or unreasonable result. State v. Mendoza, 96 Wis. 2d 106, 115, 291 N.W.2d 478 (1980). Subjecting a *337city's ability to tax an individual real estate parcel to a benevolent organization's overall accounting practices creates an absurd or unreasonable result. Furthermore, an ambiguous statute must be strictly construed against granting an exemption. DOR v. N. States Power Co., 212 Wis. 2d 300, 305, 571 N.W.2d 676 (Ct. App. 1997). If Wis. Stat. § 70.11 is ambiguous, it might be construed against Columbus Park in favor of the City.
¶ 33. In addition, in order to qualify for an exemption under Wis. Stat. § 70.11(4), an organization must demonstrate three factors: (1) that it is a benevolent organization; (2) that it owns and exclusively uses the property; and (3) that it uses the property for exempt purposes. Deutsches Land, Inc. v. City of Glendale, 225 Wis. 2d 70, 82, 591 N.W.2d 583 (1999). The last requirement, that the property be used for tax-exempt purposes, is met by demonstrating that (1) the exempt organization uses the leasehold income for maintenance of the property, construction debt retirement, or both and (2) the lessee would itself be entitled to an exemption if it owned the property. Id. at 93. The latter requirement has not been established here by Columbus Park.
¶ 34. Columbus Park directly leases its rehabilitated homes to low-income tenants. Columbus Park acknowledges that its low-income tenants are not tax-exempt organizations. However, the majority holds that the Kenosha Housing Authority's role in administering and subsidizing the tenants elevates it to lessee status sufficient to satisfy the above requirement that the lessee be entitled to a tax exemption if it owned the property. The majority cites no authority for such an assumption. The only names on the leases are those of the low-income tenants, not the Kenosha Housing Authority. The majority opinion acknowledges that the *338Kenosha Housing Authority is not the true lessee of the properties within the technical definition of the word. I fail to see how the Housing Authority's role in administering and subsidizing the tenants confers "lessee" status upon it.