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Beth Medrash Govoha of New York v. Marlboro Township

A-4362-03T2 (N.J. Super. App. Div. 2004) (Unpublished)

TAXATION; EXEMPTION; SCHOOLS—A teaching facility that does not have strict admission requirements, holds many single session courses, grants no degrees, has no accreditation, and gives no grades, does not qualify as a “school” under the statute that grants real property tax exemption to schools.

A non-profit corporation sought real property tax exemptions for three of its residential properties, claiming that they were used in its operation of a local facility that taught adults about Judaism, its history, language, and culture. Each was a single-family residence within close proximity to the facility. Each was occupied by a rabbi who managed, directed, and taught courses at the facility. They lived in the houses with their families, free of charge. The corporation contended that the residences were an integral part of its teaching facility, which it claimed was an exempt school under N.J.S.A. 54:4-3.6. To qualify for an exemption under the statute, the corporation had to own the properties in question; neither the properties nor the corporation could be operated for profit; the corporation had to be authorized to carry out the purposes for which the exemption was claimed; and the subject properties had to be used for an exempted school, pursuant to the statute. The lower court concluded that the prime facility was not a “school” within the meaning of the statute. Accordingly, the lower court granted the municipality’s motion for summary judgment, affirming the tax assessments on the property.

The Appellate Division noted that the corporation’s teaching facility did not have strict admission requirements; some courses consisted of a single class; no academic degrees of any kind were offered; the facility was not accredited as an education institution; and students did not receive grades at the completion of the courses. Although the facility may have provided some general benefit to society, the Court concluded that the corporation did not prove that the public at large reaped a direct benefit to permit such an exemption as contemplated by the Legislature. For that reason, the Appellate Division affirmed the lower court’s decision, denying the corporation’s applications for tax exemptions.

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