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Burden on Municipality To Prove Property No Longer Qualifies For Tax Exemption

The New York Court of Appeals held that a municipality has the burden of proving a tax exempt property no longer qualifies for tax exempt status. In Congregation Rabbinical College of Tartikov v.Town of Ramapo, the Court held “when a municipality seeks to revoke a previously granted tax exemption, it bears the burden of proving that the real property is now subject to taxation (Matter of New York Botanical Garden v Assessors of Town of Washington, 55 NY2d 328, 334 [1982]).”

The previous owner of the property at issue had used the property as a summer camp with a “religious curriculum.” The claim by the Town was that a contractor, hired to operate the property, not the owner was the “entity” exclusively using the property to operate a camp. However the Court, in upholding the Appellate Division decision finding the exemption should continue, concluded:

“The contract indicated that the contractor was managing the camp on behalf of the plaintiff and the Town stipulated to the fact that plaintiff retained general supervision and control over the camp’s operation, including the right to approve the hiring of camp personnel, the purveyors of kosher food for camp lunches, and the religious curriculum. Moreover, an economic profit made by a religious corporation “does not by itself extinguish a tax exemption” (Matter of Adult Home at Erie Sta., Inc. v Assessor & Bd. of Assessment Review of City of Middletown, 10 NY3d 205, 216 [2008]).”

-Steven Silverberg

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