Court Opinion

ID: 9718453
Source: CourtListenerOpinion
Date Created: 2023-08-26 07:24:21.918457+00
Date Added: 2024-06-11T18:23:59.384658
License: Public Domain

DISSENTING
STRINGER, Justice
(dissenting).
I respectfully dissent. At the time this parking lease was entered into with Mall of America for November and December of 1994, the Met Center facility had largely been abandoned by the Metropolitan Sports Facilities Commission as a sports facility, the Minnesota North Stars had moved to Dallas, Texas, the arena was planned for demolition and the property was for sale on the public market. The property clearly no longer served any part of the purpose of the Commission — to meet the need for facilities to serve the public health, safety and general welfare by establishing “a procedure for the acquisition and betterment of sports facilities * * *.” Minn.Stat. § 473.552 (1996). The lease therefore fails to meet the legislative standard for tax exemption.
I start with the principle that all real property is presumed to be subject to tax and that exempt status is to be narrowly applied. See Minn.Stat. § 272.01, subd. 1 (1996); Color-Ad Packaging v. Commissioner of Revenue, 428 N.W.2d 806, 811 (Minn.1988) (Kelley, J., dissenting) (“[EJxemptions in tax statutes are exceptions and are, therefore, to be strictly construed.”). This principle is based on the fair and equitable notion that absent a clear expression of legislative policy creating an exemption, the burdens of the cost of public services should fall evenly on all real property that enjoys the benefits. See Camping & Education Foundation v. State, 282 Minn. 245, 250, 164 N.W.2d 369, 372 (1969) (citations omitted) (“The basis for all tax exemption is the accomplishment of some public purpose as opposed to favoring of particular persons or corporations at the expense of the taxpayers generally.”); De-Ponti Aviation, Inc. v. State, 280 Minn. 30, 34, 157 N.W.2d 742, 746 (1968) (citations omitted) (“The presumption against tax exemption can only be rebutted by ‘clear and express language.’ ”). Here, not only is there an absence of any indication the legislature intended a lease of the Met Center to the Mall of America for parking purposes under these circumstances to be exempt; the statutory framework clearly indicates the tax exempt status is lost.
Turning first to the statutory provision creating tax exempt status, Minn.Stat. § 473.556, subd. 4, provides tax exempt status to Commission owned, leased, controlled, used or occupied property, but significantly, that tax exemption is lost where the property is “leased by the commission for residential, business, or commercial development or other purposes different from those contemplated in sections 473.551 to 473.599.” No development is contemplated by this lease, so we must determine whether the lease is a “different purpose” than is contemplated by the statutory framework. We are assisted in this process by the fact that, in enacting subdivision 4, the legislature evinced a clear intent to eliminate the tax exemption in those instances in which the Commission engaged in traditionally commercial activities. The *518short term rental of the property to the Mall of America is just that; and for purposes here, it is analogous to a lease for commercial development — in both cases, the Commission is engaging in a business activity in competition with private non-tax exempt entities that could have provided land to the mall in the absence of the Commission. Such commercial activity is clearly a purpose different from the Commission’s basic mandate of providing sports facilities.
The statute grants the Commission a broad base of powers and authorities, including the power to acquire, lease or dispose of property, to operate the facilities, to enter into contracts, to employ personnel, to accept gifts, to procure insurance and a host of other functions. Minn.Stat. § 473,556, subd. 3-13 (1996). But these are the activities the Commission is authorized to engage in — they are not the purposes of the Commission. The question of whether the Commission has the power to enter into the Mall of America lease is not before us — we assume it does. Our concern is whether in entering into the lease, the Commission was engaging in a purpose for which it was created by the legislature. The only reference to purpose in the statutory framework is in section 473.552 — -“to establish a procedure for the acquisition and betterment of sports facilities” — a broadly stated objective that clearly has as its core the public use and enjoyment of a sports facility. The lease of the Met Center to the Mall of America for parking, under these circumstances, while certainly a fiscally responsible undertaking, clearly does not meet this purpose.
The Commission urges and the majority finds support in Minn.Stat. § 475.556, subd. 12, referencing a number of functions for which the facility may be used: to “provide athletic, educational, cultural, commercial or other entertainment, instruction, or activity for the citizens of the metropolitan area.” The Commission’s claim of tax exempt status can find no underpinning here, however, first, because again, it is only an authorized power, it is not a purpose. Second, this “use agreements” provision is obviously designed to facilitate very short term booking arrangements for events such as the Shrine Circus, Ice Follies, conventions and the like — not a two-month lease for shopping mall parking. The more compelling inference is that because these use agreements are specifically authorized, a lease to the Mall of America for November and December 1994 for parking purposes, after the property has been abandoned as a sports facility, would not be one of the purposes contemplated in the statutory framework.
Finally, turning again to Minn.Stat. § 473.552, “Legislative Policy; Purpose,” the legislature found that “the population in the metropolitan area has a need for sports facilities and that this need cannot be met adequately by the activities of individual municipalities, by agreements among municipalities, or by the private efforts of the people in the metropolitan area * * *.” There is a perversity in the majority’s conclusion that a purpose of the statutory framework is met by holding tax exempt property that is now being leased by the Commission in competition with private tax-paying enterprises engaged in offering parking facilities. Nothing in the statutory structure of sections 473.551 through 473.559 suggests that this is what the legislature intended.
I would affirm the tax court.
TOMLJANOVICH, Justice.
I join in the dissent of Justice Stringer.
BLATZ, Justice.
I join in the dissent of Justice Stringer.