GENERAL ASSEMBLY OF NORTH CAROLINA
SESSION 2003
SESSION LAW 2004-173
SENATE BILL 277
AN ACT to exempt from property tax educational property held by a nonprofit entity FOR A PUBLIC OR PRIVATE UNIVERSITY OR COMMUNITY COLLEGE LOCATED IN NORTH CAROLINA.
The General Assembly of North Carolina enacts:
SECTION 1. G.S. 105-278.4 reads as rewritten:
"§ 105-278.4. Real and personal property used for educational purposes.
(a) Buildings. - Buildings,
the land they actually occupy, and additional land reasonably necessary for the
convenient use of any such building shall be exempted from taxation if: if
all of the following requirements are met:
(1) Owned by an educational
institution (including a university, college, school, seminary, academy,
industrial school, public library, museum, and similar institution);
either of the following:
a. An educational institution; or
b. A nonprofit entity for the sole benefit of a constituent or affiliated institution of The University of North Carolina, an institution as defined in G.S. 116-22, a North Carolina community college, or a combination of these;
(2) The owner is not organized or operated for profit and no officer, shareholder, member, or employee of the owner or any other person is entitled to receive pecuniary profit from the owner's operations except reasonable compensation for services;
(3) Of a kind commonly employed in the performance of those activities naturally and properly incident to the operation of an educational institution such as the owner; and
(4) Wholly and exclusively
used for educational purposes by the owner or occupied gratuitously by another
nonprofit educational institution (as defined herein) and wholly and
exclusively used by the occupant for nonprofit educational purposes.
(b) Land. - Land (exclusive of improvements); and improvements other than buildings, the land actually occupied by such improvements, and additional land reasonably necessary for the convenient use of any such improvement shall be exempted from taxation if:
(1) Owned by an educational institution that owns real property entitled to exemption under the provisions of subsection (a), above;
(2) Of a kind commonly employed in the performance of those activities naturally and properly incident to the operation of an educational institution such as the owner; and
(3) Wholly and exclusively used for educational purposes by the owner or occupied gratuitously by another nonprofit educational institution (as defined herein) and wholly and exclusively used by the occupant for nonprofit educational purposes.
(c) Partial Exemption. - Notwithstanding the exclusive-use requirements of subsections (a) and (b), above, if part of a property that otherwise meets the requirements of one of those subsections is used for a purpose that would require exemption if the entire property were so used, the valuation of the part so used shall be exempted from taxation.
(d) Public Use. - The
fact that a building or facility is incidentally available to and patronized by
the general public, so long as there is no material amount of business or
patronage with the general public, shall does not defeat the
exemption granted by this section.
(e) Personal Property.
- Personal property owned by a church, a religious body, or an educational
institution (including a university, college, school, seminary, academy,
industrial school, public library, museum, and similar institution) shall
be exempted from taxation if:
(1) The owner is not organized or operated for profit, and no officer, shareholder, member, or employee of the owner, or any other person is entitled to receive pecuniary profit from the owner's operations except reasonable compensation for services; and
(2) Used wholly and
exclusively for educational purposes by the owner or held gratuitously by a
church, religious body, or nonprofit educational institution (as defined
herein) other than the owner, and wholly and exclusively used for nonprofit
educational purposes by the possessor.
(f) Definitions. - The following definitions apply in this section:
(1) Educational institution. - The term includes a university, a college, a school, a seminary, an academy, an industrial school, a public library, a museum, and similar institutions.
(2) Educational
purpose. - A purpose An educational purpose within the meaning of this
section is one that has as its objective the education or instruction of
human beings; it comprehends the transmission of information and the training
or development of the knowledge or skills of individual persons. The operation
of a student housing facility, a student dining facility, a golf course,
a tennis court, a sports arena, a similar sport property, or a similar
recreational sport property for the use of students or faculty is also an
educational purpose, regardless of the extent to which the property is also
available to and patronized by the general public."
SECTION 2. This act is effective for taxes imposed for taxable years beginning on or after July 1, 2004.
In the General Assembly read three times and ratified this the 18th day of July, 2004.
s/ Marc Basnight
President Pro Tempore of the Senate
s/ Richard T. Morgan
Speaker of the House of Representatives
s/ Michael F. Easley
Governor
Approved 5:01 p.m. this 2nd day of August, 2004