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Connecticut Supreme Court Clarifies Application of Property Tax Exemption for Charitable Organizations
On March 24, 2009, the Connecticut Supreme Court issued a landmark property tax decision in St. Joseph's Living Center, Inc. v. Town of Windham — a case litigated on behalf of St. Joseph's by Wiggin and Dana. The decision provides a detailed analysis of the requirements for property tax exemption as a charitable organization under §12-81(7) of the Connecticut General Statutes. We summarize below the Court's most significant holdings.
St. Joseph's involved a non-profit nursing home that provided, on a first-come, first-served basis, regardless of patients' ability to pay, both long-term care of the elderly and short-term rehabilitative care for all ages. The trial court had found that St. Joseph's was not entitlted to exemption for a host of reasons, relying primarily on the fact that the nursing home (1) accepted private-pay patients in addition to its larger roll of Medicaid and Medicare recipients, and (2) ran an operating surplus for the tax years at issue. On appeal, the Supreme Court squarely rejected the trial court's holdings on these two issues, but nonethelss upheld the denial of St. Joseph's tax exemption on the ground that rehabilitative care was not identified in St. Joseph's Certificate of Incorporation as one of its charitable purposes.
