Thе Bogus Basin Recreational Association (BBRA) is a non-profit organization which has been incorporated since 1941 and which has operated the Bogus Basin Ski Area since 1953. The BBRA has a two-tiered governing structure which consists of a fifty-member community body selected *687 by the board of directors; the thirteen-mеmber board is in turn elected by the fifty community representatives. Neither body’s members are compensated in any way, with the exception of free skiing privileges for the board of directors.
The bylaws and articles of incorporation of the BBRA provide that any income from the corporation should be reinvested in the recreation facilities. No stock in the corporation is to be issued, nor are any members of the corporatiоn to have any vested interest in the property or assets of the corporation. If the corporation is dissolved, its property and assets аre to be transferred to any non-profit entity (or entities) organized to pursue recreational activities for the benefit of the public.
Fees аre charged for the use of BBRA facilities. In 1986, the price of an adult lift ticket was $18.50, which was comparable to the lift ticket prices of other cоmmercial ski areas in Idaho with similar facilities. Some discount tickets are offered to students and other special groups. The ski area also has educational programs/discounts offered in cooperation with Boise City recreation and with school districts in the Treasure Valley.
The BBRA reрorted a net income of $300,444 in 1986. Because it is a non-profit organization, the BBRA paid no tax on that income. In 1987, the association was assessed property taxes of $36,136.36 on property with an assessed market value of $4 million.
On June 11,1987, the BBRA filed a claim with the Boise County Board of Equalization (Board) for property tax exemption pursuant to I.C. § 63-105C. The Board denied the exemption at the initial hearing and again on reconsideration. The BBRA appealed to the district court, requesting a trial de novo.
While the appeal was pending, the court granted the Idaho State Tax Commission’s (Commission) motion for pеrmission to intervene. After hearing arguments on all parties’ motions for summary judgment, the district court granted the BBRA’s motion and permitted the exemption. The Boаrd and the Commission filed separate appeals. This Court ordered the appeals consolidated.
The trial court was correct in assеrting that this case is governed by the principles enunciated in
Appeal of Sunny Ridge Manor, Inc.,
However, not every non-profit organization that provides some serviсe to the public is entitled to claim that its property is exempt from taxation.
Appeal of Sunny Ridge Manor
and
Coeur d’Alene Golf Club
recognized that “charity” is not limited to religious and philanthropic activities, but it did not change the basic rules in tax exemption cases: Statutes granting tax exemptions must be strictly construed against the taxpayer and “cаnnot be extended by judicial construction so as to create an exemption not specifically authorized.” “Exemptions are never prеsumed. The burden is on a claimant to establish clearly a right to exemption.”
Upper Columbia Mission Soc’y v. Kootenai County,
The requirements set forth in
Appeal of Sunny Ridge Manor
and
Coeur d’Alene Golf Club
are themselves a matter of law, but whether the requirements have been met in a specific case is a question of fact.
Appeal of Sunny Ridge Manor,
The Board and the Commission have raised the question of whether BBRA property leased to commercial enterprises would also qualify for the exemption if the BBRA is ultimately determined to be a charitable organization for purposes of I.C. § 63-105C. Because this is a question which may arise again in the context of this case, we will address it. Idaho Code § 1-205.
Idaho Code § 63-105C provides in relevant part:
63-105C. Property exempt from taxation — Fraternal, benevolent, or charitable cоrporations or societies. — The following property is exempt from taxation: Property belonging to any fraternal, benevolent, or charitable corporation or society, the World War veteran organization buildings and memorials of this state, used exclusively for the purposes for which suсh corporation or society is organized; provided, that if any building or property belonging to any such corporation or society is leasеd by such owner or if such corporation or society uses such property for business purposes from which a revenue is derived which, in the case of a charitable organization, is not directly related to the charitable purposes for which such charitable organization exists, then the same shall be assessed and taxed as any other property, and if any such property is leased in part or used in part by such corporation or society for such purposes the assessor shall determine the value of the entire building [and the value of the part used or leased for commercial purposes. If the value of the part used for commercial purposes is determined to be three per cent (3%) or less than the value of the entirety, the whole of said property shall remain exempt. If the value of the part used for commercial purposes is determined to be more than three per cent (3%) of the value of the entirety, the assessor shall] assess such proportionate part of such building including the value of thе real estate as is so leased or used for such purposes, and shall assess all merchandise kept for sale, and the trade fixtures used in connеction with the sale of such merchandise____
(Emphasis added.) We find nothing ambiguous in this portion of the statute — if any building or property belonging to a charitable organization, or any part of such building or property, is leased, to anyone, then the building or property is subject to assessment and taxation unless it cоnstitutes less than 3 percent of the value of the entire building or property. BBRA does lease part of its Bogus Basin facilities to commercial enterprises. On remand, therefore, the question of whether the leased property exceeds the 3 percent de minimis exception of I.C. § 63-105C, and if so, how much of the BBRA property would still be subject to taxation even if the majority of the property is exempt, should be addressed.
Costs on appeal awarded to the Board.