THE COMMONWEALTH OF MASSACHUSETTS
APPELLATE TAX BOARD
DOCKET NO. F310589 and F310590
GIVE THEM SANCTUARY, INC.
Appellant
v.
BOARD OF ASSESSORS OF MONSON Appellees
BRIEF OF THE APPELLANT
1. Background
The Appellant, Give Them Sanctuary, Inc. is a Federally-recognized tax exempt corporation organized in Massachusetts as of January 1, 2008. The stated purpose of the corporation is to "provide shelter and healthy habitat for wild animals", "foster health and welfare of domestic animals" and "aid abused persons who are in need of sanctuary". Articles of Amendment were filed with the Secretary of State on April 23, 2009 amending the Articles of Organization so that, among other things, the corporation could make distributions to organizations that qualify as exempt organizations under IRC Sec. 501 (c) (3); to insure that no part of the net earnings of the corporation would inure or be distributable to or for the benefit of any member, trustee, officer or other private person; and to provide that in the event of dissolution, any assets remaining of the corporation would be distributed to a nonprofit fund, foundation or corporation. Following these changes to its' charter, GTSI was approved for designation as a tax-exempt organization by the Internal Revenue Service on June 26, 2009; it was thereafter recognized as tax-exempt by the Massachusetts Department of Revenue on July 6, 2009.
During 2009 the corporation set about to acquire land to further some of its' stated purposes, that is, to "provide shelter and healthy habitat for wild animals". By deed dated May 7, 2009 it acquired 15.8 acres located at Stafford Road in Monson and on November 2, 2009 it acquired 4.33 acres at Boston Road-West in Monson. Thereupon the corporation took affirmative steps to comply with its' stated purposes. Testimony offered at the hearing indicated that significant effort was put into removing trash and junk from the premises and also in removing invasive species and replacing with fruit and other types of trees which would provide a food source for wild animals. Both properties were posted to prevent hunters from utilizing the premises to kill wildlife and campsites were erected at the Stafford Road property in order to provide shelter for homeless persons. During the middle part of 2009 GTSI applied for real estate tax exemption status for fiscal year 2010 but that application was denied on the basis that GTSI was not a "proper applicant" for that year, because it was not the owner of record as of the assessment date, January 1, 2009.
That problem was non-existent for fiscal year 2011 and in October of 2010 GTSI again filed for exempt status for FY2011 real estate taxes. It submitted its' Articles of Organization and Articles of Amendment and also copies of its' tax status as determined by the IRS and DOR. Subsequent to a summary denial of tax exempt status, GTSI requested an explanation in writing to justify the denial. On December 21, 2010 the Assessors sent a letter to GTSI indicating that they had reviewed the applications and supporting documentation and also reviewed the Department of Revenues' definition of a "charitable organization". The letter stated that the organization must be "established for literary, benevolent, charitable or temperance purposes" (incorrectly or intentionally omitting any reference to "scientific" which would more aptly fit the
biological activities of the appellant); stated that the organization "must actually operate as a
public charity", whose dominant purposes must benefit "the public at large, not just a limited group of people"; and whose assets may not be distributed to officers, directors or shareholders upon dissolution. The Board decided that the qualifications were not met and denied the applications for exemption.
2. Activities of the Appellant in Furtherance of it's Charitable Purpose
There are traditionally two areas of examination involved in determining whether or not an organization is entitled to the real estate tax exemption provided by M.G.L. Chapter 59, Sec. 5, Third. The first is whether or not real estate is "occupied by … (the charitable organization) … for the purpose of such charitable organization". The premises must be occupied by the charitable organization itself or another charitable organization, and not utilized primarily by a non-exempt organization, Board of Assessors of Bridgewater v. Bridgewater State University Foundation, 79 Mass. App. Ct. 637 (2011); 948 N.E. 2d 903.
In the present matter, the taxpayer "occupies" the property for the traditional charitable purposes for which it is engaged, "providing shelter and healthy habitat for animals" and "providing aid for abused persons". The taxpayer testified at the hearing that it put substantial time, effort and funds into removing trash from each site and removing undesirable vegetation and replacing with more appropriate food sources; they also testified that they had created campsites on the Stafford Road premises for occupancy by homeless persons. Testimony indicated that neither property was fenced to allow for free access and egress for animals; and that although the premises at Stafford Road were posted "No Trespassing" subsequent to destructive activities by people on ATV's, each premises is now posted "No Hunting". The
taxpayer has conducted educational activities on the Stafford Road property, allowing local Boy
Scouts to camp there as part of environmental studies/activities projects.
The second focus of whether or not the applicant qualifies for tax exempt status looks towards the nature and extent that the taxpayer provides a "community benefit". The taxpayer in this case testified and provided documentary evidence of substantial fund-raising activities (per the Mass. Form 3 Charitable Returns submitted, $7650 in 2009 and $20,118.00 in 2010) and also testified and provided documentary evidence of substantial financial assistance provided to members of the general public for the care and comfort of domestic animals. In 2009 and 2010 the taxpayer disbursed substantial funds providing dog food to private citizens who were having financial problems and needed assistance caring for their animals; they expended several thousand dollars in kennel fees for emergency boarding and also paid several thousand dollars in veterinarian bill for emergency surgeries for domestic animals. The taxpayer testified that they were contacted for charitable services by referrals from local veterinarians and kennel operators and also contacted via their website and the handbills posted on the subject properties. The testimony revealed two significant factors:
(1) Charitable services were provided to anyone who requested same, without qualification, who appeared to be legitimately in need; there were no special criteria to be met as to either people or animals, except for need. The persons benefited were private citizens, not breeders, trainers or handlers; and the animals benefitted were traditional household pets, not "show dogs" or field trial champions or other specialized animals; and
(2) There is and was no charge for the charitable services provided. The beneficiaries were not required to pay any fees or reimburse the charity for the services and/or
benefits provided.
Thus, the focus is whether or not the organization which is seeking the exemption meets traditional standards of providing a public benefit sufficiently broad to justify the public support that tax exemption represents. "An organization operated primarily for the benefit of a limited class of persons, such that the public at large benefits only incidentally from its' activities, is not charitable" Cummington Sch. of the Arts, Inc. v. Assessors of Cummington, 373 Mass. 597, 600 (1977). There has been no formula in the case law requiring a "precise number" of persons served by the charitable organization in order to claim charitable status, and although "at any given moment an organization may service only a relatively small number of persons", membership in the class must be "fluid" and must be "drawn from a large segment of society or all walks of life", Western Mass. Lifecare Corp. v. Assessors of Springfield, 434 Mass. 96, 104 (2001); New England Legal Foundation v. Boston, 423 Mass. 602, 612 (1996). "Selection requirements, financial or otherwise, that limit the potential beneficiaries of a purported charity will defeat the claim for exemption", Western Mass. Lifecare, supra, at 104.
The most notable case involving this subject matter is New Habitat., Inc. v. Tax Collector of Cambridge, 451 Mass. 729 (2008). To determine whether an organization is charitable, it is necessary to weigh a number of factors, such as whether an the organization provides low-cost or free services to those unable to pay, New England Legal Found. v. Boston, supra at 610; whether it charges fees for its services and how much those fees are, Assessors of Boston v. Garland Sch. of Homemaking, 296 Mass. 378, 390 (1937); whether it offers its services to a large or "fluid" group of beneficiaries and how large and fluid that group is, New England Legal Foundation v. Boston, supra at 612, Cummington Sch. of the Arts Inc. v. Assessors of Cummington, op cit, at 601; whether the organization provides its services to those from all segments of society and from all walks of life, Harvard Community Health Plan, Inc. v. Assessors of Cambridge, 384 Mass. 536, 544 (1981); and whether the organization limits its services to those who fulfill certain qualifications and how those limitations help advance the organization's charitable purposes, Western Mass. Lifecare, supra at 103-104. The most recent case on point, Morse Healthcare v. Bd . of Assessors, 74 Mass. App. Ct. 701 (2009) reflects the importance of the factors established in New Habitat. "New Habitat provides an interpretive lens through which we now view Western Mass. Healthcare and its predecessors. Specifically, New Habitat emphatically conditions the importance of previously established factors on the extent to which "the dominant purposes and methods of the organization" are traditionally charitable", Morse Healthcare at 703.
3. Conclusion
When one examines the activities of the taxpayer in light of the various factors set forth in Western Mass. Lifecare, New Habitat and Morse Healthcare, it is obvious that these activities are traditionally charitable in nature and serve an important public purpose. The taxpayer expended considerable funds and effort to obtain and promote a wild area protecting wild animals and their habitat and also expended considerable time and energy in fundraising activities to promote the charitable purposes of the organization. At considerable expense and without fee or other compensation, the taxpayer provided significant charitable services to pet owners without qualification as to either the person or the animal. That the provision of care to domestic animals is a matter of particular social importance has recently been recognized by the Massachusetts General Court when it enacted Chapter 430 of the Acts of 2010, "An Act Relative to Trusts for the Care of Animals" allowing individuals to create a trust to provide for the care and comfort of their pets subsequent to the owners' death.
The purposes and activities of the taxpayer organization clearly show that it is an organization with a recognized charitable purpose which qualifies for exemption from tax pursuant to G.L. Chapter 59, Sec. 5, Third paragraph.
Dated: January 10, 2012 GIVE THEM SANCTUARY, INC.
By: _______________________________ Raymond A. Blanchette , Esq. Their Attorney
P.O. Box 256 Monson, MA 01057 BBO #045220 Tel. 413-267-5159 Fax 413-267-9714
rayblan@monsonlaw.com
