Judicial District of Windham


Taxation; Whether Plaintiff's Property Qualified for Tax Exemption Under General Statutes 12-81 (7) Based on its Charitable Use; Whether Chapel on Plaintiff's Property was Exempt From Property Tax under General Statutes 12-81 (13). The plaintiff, an affiliate of the Roman Catholic Diocese of Norwich, is a non-profit corporation whose property is used to operate a skilled nursing facility that provides both long-term chronic care and short-term rehabilitative services. The plaintiff holds title to its property, which also contains a large chapel, by virtue of a quitclaim deed from the diocese. It derives its revenue from payments made by medicare, medicaid and private pay patients, and it covers the unreimbursed costs attributed to medicaid patients by charging private pay patients not only for the actual cost of care but for an additional amount to cover the losses incurred from medicaid patient care. In 2003, the plaintiff applied to the defendant for a property tax exemption under General Statutes 12-81 (7), (12) and (13). These subsections of 12-81 provide tax exemptions for property used for charitable purposes, personal property of religious organizations devoted to religious or charitable use and houses of religious worship. The defendant denied the application, and the trial court upheld the defendant's decision. In so ruling, the trial court first found that although the subject property contains a chapel, the plaintiff is not a religion or church and that the use of the chapel is merely an adjunct to the main use of the property as a skilled nursing home facility. It thus determined that the key issue was whether the nursing home facility was organized and used exclusively for charitable purposes within the context of 12-81 (7). The plaintiff claimed that the delivery of health care to the elderly is a charitable purpose and that it was organized exclusively to serve this purpose. In support of this claim, the plaintiff relied primarily on the case of Isaiah 61:1 v. Bridgeport, 270 Conn. 69 (2004), which set forth several criteria for determining whether property used for a charitable purpose qualifies for a tax exemption under 12-81 (7). In rejecting the plaintiff's claim, the trial court concluded that the plaintiff's original purpose was not charitable and that because the plaintiff provided rehabilitative service to patients regardless of their age, it did not provide services exclusively to the elderly. It also took note of the fact that the plaintiff received a substantial amount of money from private pay patients and generated revenues that exceeded its costs in the tax years in question. In addition, it found that since the plaintiff received compensation for its services, its services did not lessen any burden that the elderly might have on society or taxpayers. The court thus concluded that the plaintiff's services to private pay patients and its rehabilitative services were not charitable services and were not the type of services that meet the criteria set forth Isaiah 61:1 for obtaining a tax exemption under 12-81 (7). In this appeal, the Supreme Court will review the trial court's ruling and determine whether it properly upheld the defendant's decision.