HOUSING WAS INCIDENTAL TO ITS EDUCATIONAL PURPOSE
Founded in 1869, Rye Country Day School -- a registered not-for-profit college preparatory school situated in Westchester County – has used several tax-exempt, single-family homes to house some of its faculty and administrators.
In 2015, after it purchased an additional piece of property in Rye that contained six townhouses which were to be used by faculty and administrators, the school applied to the local tax assessor for a tax exemption. After its request was denied -- because the institution purportedly failed to show the property was “an integral part of the educational process” -- an administrative appeal was pursued and that was also rebuffed by City of Rye's Board of Assessment Review.
The school then filed a special proceeding with the Westchester County Supreme Court [pursuant to CPLR Article 78], and a judge concurred with the administrative agencies and dismissed that part of the school’s case.
But on appeal, the Appellate Division, Second Department, was of the view that all of the underlying determinations were in error. Among other things, given that New York law has “long recognized that residential property used for housing an educational institution's faculty and staff is entitled to a tax exemption under RPTL 420-a or similar statute,” the AD2 thought that the school clearly satisfied the governing statutory elements and was entitled to the requested relief.
Now that had to be very taxing.
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DECISION