Court Opinion

ID: 4135276
Source: CourtListenerOpinion
Date Created: 2017-02-18 02:00:21.041956+00
Date Added: 2024-06-11T14:35:09.693179
License: Public Domain

November 26, 1963

  Honorable Doug Crouch                   Opinion   No. C-184
  Criminal Dietrlct Attorney
  Tarrant County                          RE:    Whether the housing for'the
  Fort Worth, Texas                              elderly    known as Lake Crest
                                                 Efltates owned~ and operated
                                                 by Christian    Homes, Inc., a
                                                 non-profit    corporation  18
                                                 exempt. from ad valorem taxea.
   D&r   Mr. Crouch:
  .r
              You h&e requeeted'our      opinion on the above referenced
  subject,   and In connectlon,therewlth      have given us the following
  facts:
               Lake Crest    Estates   Is a housing development        compoaed.of
  343 tw&bedroom.housea,         together   wlth a community center and a
  Chapel.     Title to the.entlre      project   ia vested in 8 Texas non-
  proflt.corporat1on       known a8 Chrlstlaii     Homes,    Inc,  The ltiltlal
  directors    of the .corporatlon     were pa&ore        of five local churches
  who agreed:to      sponsor the project.       The.re are .no timbers of the
  corporation     and any vacancies      on the Board ape filled       by vote of
  the reinalnlng directors.
              . Funde.to construct    the proJect riere obtained       by a bank
   loan backed by a one hundred per cent guarantee          from the Federal
  ,Houalng Administration.       The corporation    has entered     into. a re-
   gulatoryagreement      with the Federal Houslng.Admlri1atratlon.
   Tenancy 18 not limited      to persons 62 years of age or over (aged
   person a8 defined by 12 USC 14019) but they a% ~to be given prl-
   ority of opportunity      to rent the units.     Basic rental      la $107,.50
   per month on a lease .@aals and la charged all tenants             under 62
   yeare of age and those over 62.who are able to pay.              Rent under
  the&V-law8 of the corporation         may be reduced by the Board of
   DIrectora    for aenlor citizens     in need    The only services       provided
_ by.the corporation      other~than    the housing unit la free use of the
   community center with It8 swimming ~001,~ recreation           and meeting
   rooms,    and chapel.   These fadllltles     are used free of charge by
   those over 62. Those tenants         under 62 may use these facilities
   by paying a charge of $5.00 per month.          The corporation       has no
   sources of Income other than the rental         from the housing units;
   Income, If any, from the community center,          and possible      con-
   tributions    from sptinsore or others.

                                         -892-
Honorable   Doug Crouch,      Page 2 (No. C-184            )

            AS of August 23, 1963,         only   twelve       of the 343 units   are
occupied,   as set out below:
                 (a)     Four (4) units are occupied by employees
                         of the corporation as part of their
                       . salary.
                 (b)    One (1) unit la occupied by a senior
                        citizen (over 62) at a reduced rental.

                 (c)    Seven (7) units are occupied by Indl-
                        viduala   under 62 years of age, who. are
                        not retired,   and who pay the full rental
                        of $107.50 per month.
            The Federal H&sing Admlnlstratlon      has, for the present,
waived the requirement   that priority    of opportunity   be given to
those 62 years of age or over and the’ project      Is leasing   without
regard to,age or financial    condition.    All tenants   must enter In-
to a written   lease with the corporation    for a minimum period of
six (6) months.
            You’have asked. the ,followlng         questions:
                        “Is ‘the housing for the elderly      ‘project
                 knotin as Lake. Crest Estates    owned and bperated
                 by Christian    Homes, Inc.,   a non-proflit    corpora-
                 tltin, exempt from ad valorem taxes as ‘an ,lnstl-.
                 tutlon bf public     charity?”
                         “Can port.loni    of a qualifying     project    thit
                 are vacantbecause         no aged peraon.has      applied
                 to occupy them be rented or leased to others
                 without the Institution        .losIng lts~ exemption;
                 and, can such an Institution          furnish    quarters
                 ~to Its employees and their families,            on the
                 premises,     83~ part ~of their compensation        or
                 salary,    without    losing, Its exempt status?”
              Article   VIII, Se&Ion. 2 o b the Constitution.           of the StaM
of Texas has empowered the Legislature              to ekempt f-m taxation
certain     enumerated properties       a&ng.whlch     are’ . . . lnatltutlons
of purely public       charity. ” In pursuance        to ,th ! a particular    con-
stltutlonal     grant,~the     Legislature     enacted Section 7. Article
7150, Vernon’s Civil         Statutes,    which effectuates      exempt1ofi.t.o ths
extent of the exemptive          powers conferred     by Article     VIII, Ssc-
tlon 2.
            We are of the o&Ion    that           under the %tated. facts In
th1.s case, Lake Crest Estates  cannot            qualify  ao as to be exempt
from ad valorem taxes.
                                 -89%
Honorable    Doug Crouch,     Page 3 (No. C- 184        )

            A building    la not exempt from taxation          unless it is both
owned and used exclusively         by an lnstltutlon      of purely public
charity.    City of Houston-vs:        Scottish   Rite Ekne%oleni Association,
111 Texas Dl,     230 s.w. 97811921).ve                                        cited
case, held that an Instltutldn          wai one of "purely public charity"
where first    It made no gain or profit;.        second, It accompllshed.ends
wholly benevolent;     and, third,      It beneflted.persons,       Indefinite     in
numbers and In personalltIes,by          preventing    them through absolulie
gratuity,   from becoming burdens to society           and the State.       The
Supreme Court also held that a non-profit             organization    whose actlvl-
ties were only partly       charitable    could not qualify       as an Institution
of purely public     charity.
            In the situation       before us here, the facts show that
thla property   does ,not meet the quallflcatlons     set forth In the
above cited case:     It la shown that the property      Is leased lndls-
crlmlnately   to persons of acy age Irrespective      of whether they are
in need of financial    assistalice.
           You are,.therefore,  advised that In our opinion the Lake
Crest Estates  owned and operated by Chrlstlan  Homes, Inc., la not
exempt from ad valorem taxes.

                                SUMMARY.
                                -------

                     Under the stated    facts the property
             Involved     In @la opinion la not at the
             present    time- be$ng used exolualtrely-.bg    an inatl-
             tutlon   of purely public charity,       and Is,
             therefore,     not exempt from ad valorem taxes.
                                          Yours very        truly,
                                          WAGGONER CARR
                                          Attorney General           of Texas

                                           Assletant    Attorney       General

APPROVED:
OPINIONCOMMItiEE
W. V. Geppert    Chairman
Arthur Sandlln
Ernest Fortenberry
Paul Phy
APPROVEDFOR THE ATTORNEYGENERAL
By: Stanton Stone
                                        -894