894 N.W.2d 535
Mich.2017Background
- SBC Health Midwest, Inc., a Delaware for-profit corporation, operated Sanford‑Brown College in Kentwood and sought a personal‑property tax exemption for 2011–2013 under MCL 211.9(1)(a).
- Kentwood denied the exemption; SBC Health appealed to the Michigan Tax Tribunal, which denied relief, concluding MCL 211.9(1)(a) applied only to nonprofit educational institutions.
- The Court of Appeals reversed, holding the plain language of MCL 211.9(1)(a) exempts personal property of educational institutions regardless of nonprofit status, and remanded to the Tax Tribunal to determine statutory eligibility.
- The Michigan Supreme Court granted leave to address whether MCL 211.9(1)(a) requires nonprofit status and reviewed statutory interpretation de novo.
- The Supreme Court held MCL 211.9(1)(a) is plain and unambiguous, contains no nonprofit requirement, and therefore may apply to for‑profit educational institutions that meet the statute’s criteria.
- The Court affirmed the Court of Appeals and remanded to the Tax Tribunal to determine whether SBC Health satisfies MCL 211.9(1)(a).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether MCL 211.9(1)(a) personal‑property exemption requires nonprofit status | SBC Health: statute exempts personal property of educational institutions as written; no nonprofit requirement | Kentwood: reading MCL 211.9(1)(a) with MCL 211.7n and the Constitution shows legislature intended exemptions only for nonprofits | Held: MCL 211.9(1)(a) is unambiguous and contains no nonprofit requirement; applies to for‑profit or nonprofit educational institutions that meet its terms |
| Whether MCL 211.7n’s nonprofit language limits MCL 211.9(1)(a) | SBC Health: two statutes can coexist; MCL 211.7n applies to one path for nonprofits but does not restrict MCL 211.9(1)(a) | Kentwood: in pari materia requires importing nonprofit requirement into MCL 211.9(1)(a) to avoid conflict | Held: statutes can be read harmoniously; omission of “nonprofit” in MCL 211.9(1)(a) is intentional and not overridden by MCL 211.7n |
| Whether Wexford controls to bar for‑profit exemptions | SBC Health: Wexford addressed charitable institutions and did not establish a rule that educational exemptions require nonprofit status | Kentwood: Wexford’s factors imply nonprofit requirement for tax exemptions | Held: Wexford is distinguishable (addressed charity, not “educational”); it does not control here |
| Whether applying MCL 211.9(1)(a) to for‑profit entities conflicts with Const 1963, art 9, §4 | SBC Health: constitutional exemption for nonprofits does not prohibit Legislature from granting other statutory exemptions | Kentwood: constitutional language implies exemptions should be limited to nonprofits | Held: No constitutional conflict; Legislature may create exemptions that benefit other entities |
Key Cases Cited
- Wexford Med Group v. City of Cadillac, 474 Mich 192 (distinguishing charitable‑institution analysis from "educational" category)
- People v. Stone, 463 Mich 558 (statutory interpretation starts with plain meaning)
- Omne Financial, Inc. v. Shacks, Inc., 460 Mich 305 (court may not read into an unambiguous statute language omitted by Legislature)
- Byker v. Mannes, 465 Mich 637 (rule against adding words to statute)