Princeton Ballet Society tripped up in the Tax Court
This past January we wrote about the denial of a property owner’s motion to dismiss a complaint filed by a municipality in Twp. of Cranbury v. Princeton Ballet Society, which alleged a property was not exempt from local property taxation. Defendant, Princeton Ballet Society (“PBS”), moved to dismiss the complaint filed by Cranbury, claiming that it was filed out of time. The court denied PBS’ motion. A copy of that post may be found here.
In an opinion handed down last week, the Tax Court again tripped up PBS when it reversed the judgment of the Middlesex County Board of Taxation that had granted PBS a property tax exemption.
PBS, which operates a dance school, claimed that it is tax exempt because its programs are for the “moral and mental improvement of men, women, and children” as provided under the exemption statute, N.J.S.A. 54:4-3.6. PBS claimed also that because it teaches ballet, which standing alone, is an activity entitled to an education exemption under the statute.
The court rejected PBS’ claims and found that the subject property is not actually used for any theater or community entertainment/educational activities which may qualify it for an exemption under the moral and mental improvement clause of the statute. Simply put, the school is not serving the general public. The courted noted that the “general public” as envisioned under the statute “was never meant to be parents dropping children to and from their dance lessons.” In dismissing PBS’ education claim the court found to accept such an argument would provide eligibility for a property tax exemption to “any learning center or entity which offers instruction in any particular discipline (such as, for instance, gymnastics, tennis, soccer, lacrosse, martial arts, tango, cheerleading….).”
The court found that the subject property is a dance studio, used and operated by PBS “in a commercially competitive manner, no different from any other commercially run for profit non-academic learning/training/teaching school or center.”
We understand that in ballet, there are five basic positions of the feet, numbered one through five. So far, PBS has taken three out of five possible steps in an effort to secure a property tax exemption. While it was successful with step one before the County Tax Board, it was tripped up on steps two and three in the Tax Court. Step four could be a performance in the Appellate Division, with a command performance before the Supreme Court as Step five. But given the facts of this case, perhaps PBS should stick with dance and stay out of the court room.
A copy of the tax Court’s opinion may be found here.
Other exemptions posts: