Sisters of Providence a/k/a Sisters of Providence, Inc. v. Board of Assessors of the Town of West Springfield (July 17, 2013)

COMMONWEALTH OF MASSACHUSETTS

APPELLATE TAX BOARD


SISTERS OF PROVIDENCE          v.		BOARD OF ASSESSORS 	
a/k/a SISTERS OF 					OF THE TOWN OF
PROVIDENCE, INC.					WEST SPRINGFIELD

Docket No. F310872              	     Promulgated: 
								July 17, 2013

	This is an appeal filed under the formal procedure pursuant to G.L. c. 58A, § 7 and G.L. c. 59, §§ 64 and 65 from the refusal of the appellee, Board of Assessors of the Town of West Springfield ("assessors" or "appellee"), to abate taxes on certain real estate located in the Town of West Springfield owned by and assessed to the Sisters of Providence (a/k/a Sisters of Providence, Inc.) ("Sisters of Providence" or "appellant") for the fiscal year 2011 ("fiscal year at issue").
	Commissioner Rose heard the appeal.  Chairman Hammond and Commissioners Scharaffa and Chmielinski joined him in  a  Revised Decision for the appellant, promulgated simultaneously with Findings of Fact and Report.
 	These findings of fact and report are made pursuant to a request by the appellant under G.L. c. 58A, § 13 and 831 CMR 1.32.

	Robert L. Quinn, Esq. for the appellant.
	Christopher Keefe, assessor for the appellee.
FINDINGS OF FACT AND REPORT
	On the basis of the Joint Stipulation of Facts and evidence entered into the record, the Appellate Tax Board ("Board") made the following findings of fact.  
	On January 1, 2010, the appellant was the assessed owner of a 13,067 square-foot parcel of land, identified on the assessors' Map 86 as Block 8, Lot 2 and located at 686 Elm Street, West Springfield ("subject property").  For the fiscal year at issue, the assessors valued the subject property at $186,700 and assessed a tax thereon, at the residential real estate rate of $16.72 per thousand, in the total amount of $3,121.62, plus a Community Preservation Act surcharge of $14.50.  The appellant timely paid the tax due without any interest.  On January 21, 2011, the appellant timely filed an Application for Abatement with the assessors along with a copy of its Form 3-ABC for the tax year at issue.  On February 8, 2011, the assessors denied the appellant's abatement application.  On April 20, 2011, the appellant seasonably filed an appeal with the Board.  On the basis of these facts, the Board found and ruled that it had jurisdiction to hear and decide this
appeal.  
	The subject property is improved with a single-family, one-and-three-quarter-story, Cape Cod-style dwelling with wood shingles that was built in 1955 ("subject dwelling").  The subject dwelling has a living area of 1,836 square feet, including three bedrooms, as well as one full bathroom.  The subject property is owned by the Sisters of Providence, a religious order of vocational sisters ("Sisters") of the Roman Catholic religion.  The Sisters of Providence is a charitable religious organization incorporated under the laws of the Commonwealth of Massachusetts pursuant to G.L. c. 180, and it has been granted Internal Revenue Code Section 501(c)(3) status by the Internal Revenue Service.  The appellant purchased the subject property in 1980 and has used it as a convent to house its Sisters.  The appellant has also designated it as a Formation House for women interested in becoming members of the Sisters of Providence.  At all relevant times, there were four Sisters, members of the appellant, residing at the subject property.  Prior to the fiscal year at issue, the appellee had never assessed real estate taxes on the subject property.
	According to its Restated Articles of Organization, the purposes of the Sisters of Providence include, in relevant part: 
(a) To establish and maintain an apostolic religious order of women, to teach and prepare women for religious life, and to care for and support the members of the religious order of the Sisters of Providence, so as to serve as an integral part of the Roman Catholic Church to carry out the charism and mission of the religious order of the Sisters of Providence to communicate hope to those in need through ministries of healing attending particularly to the cry of the poor and the oppressed.

(b) In furtherance of its mission and charism to encourage, promote, support, sponsor, establish, maintain, organize, conduct, control, protect, preserve, plan, and/or own religious, educational, scientific and charitable ministries, institutions, and/or programs devoted to improving the health and welfare of all persons and providing access to resources aimed at promoting life and health, including, but not limited to . . . wellness programs, health and human service programs of all kinds, and other facilities or programs, incidental thereto.

The appellant also submitted a historical fact sheet, explaining that the Sisters of Providence sponsor or cosponsor a variety of ministries to carry out their stated mission, including: a long-term skilled nursing care facility called Mary's Meadow at Providence Place; an expansive healthcare system called Catholic Health East; Providence Ministries for the Needy; and a retreat center called Genesis Spiritual Life Center. 
	The appellant submitted affidavits from Sr. Kathleen Popko, SP, President; Sister Ann Horgan, SP; and Sr. Madeleine Joy, SP, who are members of the Sisters of Providence.  Sr. Popko's affidavit explains that Canon Law requires that a woman interested in becoming a member of a religious order must make her Novitiate in "a house properly designated for this purpose, called a Formation House," because Canon Law requires that the novice be guided by a designated director.  According to Sr. Popko, the subject property has served as the appellant's designated Formation House since 1999, with Sr. Ann Horgan living there as the designated Formation Director since that time.  Sr. Popko also attested that since the subject property was purchased in 1980, it has housed only members of the appellant. 
	The affidavits from Sr. Joy and Sr. Horan explained their individual ministries.  Sr. Joy's affidavit stated that she ministers from within the subject property in her role as full-time Chaplain at Mercy Medical Center.  Duties that she performs at the subject property include: providing cancer support for individuals and families approximately 15-20 hours a week; providing 24/7 over-the-phone spiritual care to individuals; and receiving individuals and families who come to the Sisters at the subject property for grief counseling.  Sr. Joy is also a sponsor for a group of recovering alcoholics, from whom she receives periodic telephone calls and for whom she is "on call 24 hours a day, seven days a week."  Sr. Horgan's affidavit stated that she performs administrative duties related to the operation of the Genesis Center from within the subject property, where she is on call "24 hours a day, seven days a week."  She also attested that she works approximately ten hours a week at the subject property on the duties specifically related to the appellant.  
	The appellee did not dispute any of the facts stated in the Sisters' affidavits.  The Board found the content of these affidavits to be consistent with the expectations and duties of the Sisters as stated in the Restated Articles of Organization of the Sisters of Providence and credible.
	On the basis of its subsidiary findings, the Board ultimately found and ruled that the Sisters of Providence, not merely the individual Sisters, occupied the subject property.  The service ministries of the Sisters of Providence were performed by the Sisters at the subject property.  The subject property was actively appropriated for the performance of ministry-related work, including space in which to receive visitors for in-person counseling and for over-the-phone counseling, both on a 24-hours-a-day, seven-days-a-week basis.  Sr. Horan additionally used the subject property to conduct her administrative duties related to the appellant.  As will be further explained in the Opinion, the Board thus found that, because the Sisters conducted work consistent with and in furtherance of the mission of the appellant at the subject property, the subject property was occupied by the appellant. 
	The Board further found that the appellant's occupation of the subject was for its charitable purposes.  The Sisters' ministries performed at the subject property included: assisting people with gaining and maintaining sobriety; providing comfort and support for individuals and families affected by cancer; grief counseling; spiritual counseling; and administrative tasks related to the operation and maintenance of a spiritual retreat home available for public use.  The Board found that these ministries were specifically designed to bring the hearts and minds of the beneficiaries under the influence of religion and to relieve their minds and bodies from illness, addiction and suffering.  The Board, therefore, found that these ministries were the kinds of activities that are recognized as traditionally charitable endeavors.  
	The Board thus found and ruled that the appellant occupied the subject property in furtherance of traditionally recognized charitable purposes.  Accordingly, the Board issued a revised decision for the appellant in the instant appeal and granted an abatement in the amount of $3,136.12.
OPINION
	All property, real and personal, situated within the Commonwealth is subject to local tax, unless expressly exempt.  G.L. c. 59, § 2.  The exemption applicable in this appeal is G. L. c. 59, § 5, Third ("Clause Third"), which exempts from taxation all "real estate owned by . . . a charitable organization and occupied by it or its officers for the purposes for which it is organized."  A taxpayer claiming exemption under Clause Third must prove that the property is owned by a charitable organization, and that the organization occupies it for its charitable purposes.  See Jewish Geriatric Services, Inc. v. Assessors of Longmeadow, Mass. ATB Findings of Fact and Reports 2002-337, 351, aff'd, 61 Mass. App. Ct. 73 (2004) (citing Assessors of Hamilton v. Iron Rail Fund of Girls Club of America, 367 Mass. 301, 306 (1975)).  The taxpayer bears the burden of proving that its ownership and occupation of the subject property comes within the express words of the exemption from taxation.  See, e.g., New Habitat, Inc. v. Tax Collector of Cambridge, 451 Mass. 729, 731 (2008); Springfield Young Men's Christian Ass'n v. Assessors of Springfield, 284 Mass. 1, 5 (1933); Lasell Village, Inc. v. Assessors of Newton, 67 Mass. App. Ct. 414, 419 (2006) (quoting Boston Chamber of Commerce v. Assessors of Boston, 315 Mass. 712, 716 (1944)).
1. The services provided by the appellant at the subject
   property were traditionally charitable in nature.

	For several decades, courts have been using several "nondeterminative" factors in analyzing whether an organization is operating as a public charity.  These include: whether the entity provides free or low-cost services to those unable to pay (New England Legal Found. v. Assessors of Boston, 423 Mass. 602, 610 (1996)); whether, and how much, it charges fees for its services (Assessors of Boston v. Garland Sch. of Home Making, 296 Mass. 378, 390, (1937)); whether it provides services to a large and "fluid" group of individuals (New England Legal Found., 423 Mass. at 612; Cummington Sch. of the Arts, Inc. v. Assessors of Cummington, 373 Mass. 597, 601, (1977)); whether its services are available to those from all walks of life (Harvard Community Health Plan, Inc. v. Assessors of Cambridge, 384 Mass. 536, 541 (1981)); and whether its services are limited to those who fulfill certain qualifications and, if so, how those limitations help advance the organization's charitable purposes (Western Mass. Lifecare Corp. v. Assessors of Springfield, 434 Mass. 96, 103-104 (2001); Boston Symphony Orchestra, Inc. v. Assessors of Boston, 294 Mass. 248, 256 (1936)).  
	In 2008, the Supreme Judicial Court clarified the weight to be given to the above factors in New Habitat, in which it considered whether a non-profit organization providing long-term housing for persons with acquired brain injury was a charitable organization for the purposes of Clause Third.  The court in New Habitat, quoting a long-standing charitable-exemption precedent, characterized the "traditional objects and methods" of a Clause Third charity as follows: 
"A charity in the legal sense, may be more fully defined as a gift, to be applied consistently with existing laws, for the benefit of an indefinite number of persons, either by bringing their minds or hearts under the influence of education or religion, by relieving their bodies from disease, suffering or constraint, by assisting them to establish themselves in life, or by erecting or maintaining public buildings or works or otherwise lessening the burdens of government."

New Habitat, 451 Mass. at 732 (quoting Jackson v. Phillips, 96 Mass. 539, 14 Allen 539, 556 (1867)) (emphasis added).  New Habitat's dominant purpose was the provision of housing and services to persons with acquired brain injury who could not care for themselves, and the Court ruled that this purpose was traditionally charitable.  Id. at 734 (internal citations omitted).  
	New Habitat made clear that, when an organization's purposes and methods were determined to be traditionally charitable, less significance should be placed on the factors traditionally employed in concluding that it qualified for the exemption.  Id. at 732.  For example, although New Habitat served only a small number of individuals and charged considerable fees, the Court held that those factors could not prevent it from being considered a charitable organization for purposes of Clause Third.  Compare Boston Symphony Orchestra, 294 Mass. at 256 (finding that organization which charged significant fees for admission to concerts that were not accessible to a large segment of the public was not a charitable organization for purposes of Clause Third). 
 	Viewing the instant appeal through this "interpretive lens," the Board found that the dominant purpose of the
Sisters of Providence was "[t]o establish and maintain an apostolic religious order of women," the ultimate goal of which was "to serve as an integral part of the Roman Catholic Church" specifically by "communicat[ing] hope to those in need through ministries of healing attending particularly to the cry of the poor and the oppressed" and by "improving the health and welfare of all persons."  The Board found that the individual Sisters residing at the subject property consistently carried out the charitable purpose of the Sisters of Providence at the subject property by performing their several ministries from there.  Through their duties to the appellant and their individual ministries that included counseling recovering alcoholics, grieving families, people affected by cancer, and the profoundly mentally ill, and operating a spiritual retreat center and otherwise tending to the ministries of the appellant, the Sisters' activities comported with the purposes listed in the appellant's Articles of Organization. The Board further found that these ministries were specifically designed to "reliev[e] . . . bodies from disease, suffering, or constraint," to "bring[] their minds or hearts under the influence of . . . religion," and to "assist[] [those they minister to] to establish themselves in life." New Habitat, 451 Mass. at 732; see also Straight Ahead Ministries, Inc. v. Assessors of Hubbardston, Mass. ATB Findings of Fact and Reports 2009-1, 13 (finding charitable purpose where organization worked with "wayward" juveniles to help assimilate them back into society).  
	The Board found and ruled that the services provided by the appellant were traditionally charitable in nature.  Therefore, the Board found and ruled that the appellant met its burden of proving that it was a charitable organization for purposes of Clause Third.
2.	The subject property was occupied by the appellant
     through the Sisters who resided there.

	The Sisters did not live at the subject home merely for their own convenience.  Their presence at the subject property was consistent with the service mission and purposes of the appellant, the charitable organization that owned the property.  The Board found credible the affidavits of the individual Sisters, which stated that they performed their various ministries at the subject property, on a 24-hours-a-day, seven-days-a-week basis.  The Board thus found that, because the subject property was appropriated by the Sisters for the conduct of the appellant's work, the subject property was occupied by the appellant.  See Bridgewater State University Foundation v. Assessors of Bridgewater, 463 Mass. 154, 158-9 (finding that appropriation of parcels at issue for the purpose for which the charitable organization was incorporated amounted to occupation by the charitable organization itself).  Contrast Jewish Geriatric Services, Mass. ATB Findings of Fact and Reports at 2002-352 (finding individual residents of assisted living facility to be occupants of the property because, among other reasons, "G.L. c. 19D affords elderly residents of assisted living residences the rights  and  protections enjoyed by traditional tenants"), aff'd, 61 Mass. App. Ct. 73 (2004).














Conclusion
	On the basis of its findings, the Board recognized that the dominant work done by the Sisters at the subject property was for the public good and constituted a traditionally charitable endeavor.  The Board also recognized that the occupation by the Sisters was in furtherance of the appellant's ministry and therefore amounted to occupation by the appellant itself.  Therefore, the Board found and ruled here that, at all relevant times, the appellant occupied the property in furtherance of its charitable purposes, and the subject property thus qualified for exemption under Clause Third. Accordingly, the Board issued a revised decision for the appellant and granted an abatement of $3,136.12 for the fiscal year at issue.

					THE APPELLATE TAX BOARD




				By: __________________________________
			    	    Thomas W. Hammond, Jr., Chairman

A true copy,

Attest: _________________________
		Clerk of the Board

 The parties agreed to waive the hearing and instead presented these appeals on documentary submissions.  
 Property held for religious purposes is exempt from the requirement to file a Form PC.  G.L. c. 12, § 8F.
 The facility at issue in New Habitat had a maximum capacity of four residents.  Since the time New Habitat began providing services, three individuals had applied to enter the program, and all three had been accepted.   At the time relevant to the appeal, New Habitat housed only two residents.  Further, the record reflected that New Habitat charged a $150,000 entrance fee and monthly fees of $17,000 to $18,000.  New Habitat, 451 Mass. at 730.  
 Mary Ann Morse Healthcare Corp. v. Assessors of Framingham, 74 Mass. App. Ct. 701, 703 (2009).

ATB 2013-769