Property Tax Exemption Not Dependent Upon Frequency of Use

by: Anthony F. Della Pelle
21 Feb 2017

Recently, the plaintiff in Holy Trinity Baptist Church v. Trenton successfully voided an added assessment imposed by the City and also retained its property’s tax exemption for the entire property.  The property at issue was two-story building in Trenton being used for charitable and religious purposes.  The first floor was used for services, prayer meetings, and choir rehearsals.  The second floor was comprised of three apartment units with each having a kitchen, bedroom, and bathroom.  The plaintiff converted these bedrooms for various church uses.

In 2014, the City’s assessor imposed an added assessment for the second floor of the property for 12 months beginning Oct. 1, 2013.  The City’s rationale for the added assessment was based on plaintiff’s purchase of a new property in another township and plaintiff’s complete lack of use of the second floor.  The City determined that since the second floor was vacant and unused from the assessment date of Oct. 1, 2013, an added assessment was warranted.  Following the County Board’s affirmance of the added assessment, plaintiff appealed to the Tax Court.

Based on the evidence presented at trial, the Tax Court found that plaintiff had in fact acquired another building on Oct. 23, 2013 and the subject’s second floor was being used less frequently due to the new acquisition.  However, there was no evidence which suggested church activities on the second floor entirely ceased.   Evidence showed that the second floor remained available and had scheduled weekly meetings in connection with its religious/charitable purposes.  The court recognized that there was a diminished use of the second floor but this does not automatically destroy the tax exemption.  Given the continued use for tax exempt purposes, the Tax Court held the second floor was not in a state of non-use as of the relevant period for which the added assessment was imposed and reversed the judgment of the County Board.

A copy of the court’s opinion can be read here.