Court Opinion

ID: 5598062
Source: CourtListenerOpinion
Date Created: 2022-01-11 02:47:46.711405+00
Date Added: 2024-06-11T08:36:39.480008
License: Public Domain

Gregory, Justice,
concurring specially.
I agree with the majority opinion that under the 1976 Constitution the General Assembly was authorized to exempt intangible property from ad valorem taxation in certain circumstances “provided that such donations of property [to a qualified charity] shall not be predicated upon an agreement, contract or otherwise that the donor or donors shall receive or retain any part of the net or gross income of the property.” Constitution of the State of Georgia, Art. VII, Sec. I, Par. IV. Pursuant to this grant of authority the legislature enacted what is now OCGA § 48-6-22 (3) exempting from ad valorem taxation “intangible personal property owned by or irrevocably held in trust for the exclusive benefit of a religious, educational or charitable institution, no part of the net profit from the operation of which inures to the benefit of any private person.” The 1976 Constitutional requirement that there be no contract or agreement by which the donor retains an income interest in the property was not made part of the statutory qualification for exemption. The 1983 Constitution contains no qualifying requirements for exemption from taxation, but states only that “[t]hose types of exemptions from ad valorem taxation provided for by law on June 30, 1983, are hereby continued in effect as statutory law until otherwise provided for by law.” (Emphasis supplied.) While I agree with the majority that the statutory exemption under OCGA § 48-6-22 (3) is carried forward by the 1983 Constitution, I cannot agree that requirements contained in the 1976 Constitution which were not made part of the statute are carried forward by the 1983 Constitution.
However, I would reach the same result as the majority because it cannot be said that this property is held in trust for the exclusive benefit of the Salvation Army. OCGA § 48-6-22 (3). The charitable remainder annuity trusts and unitrusts involved here have been drawn to comply with federal requirements permitting tax deductions for certain charitable contributions. 26 USC § 664; Fed. Tax. Reg. §§ 1.664.1 and 1.664.2. Under the terms of the trust agreements, and to comply with § 664, the donor must annually receive no less than 5% of the fair market value of trust assets at the time of creation in the case of an annuity trust and no less than 5% of the annual fair market value of trust assets in the case of a unitrust. If the trust income *761is insufficient to satisfy these amounts, encroachment is necessary. Therefore as the trial court found, the property, whether that be the income interest or the remainder, is not for the exclusive benefit of the Salvation Army. I would affirm the trial court on this basis.