Hazelden Foundation v. Yamhill County Assessor

No. 32 August 30, 2013 245

IN THE OREGON TAX COURT

REGULAR DIVISION

HAZELDEN FOUNDATION,

Plaintiff,

v.

YAMHILL COUNTY ASSESSOR

and Department of Revenue,

Defendants.

(TC 5030)

Plaintiff (taxpayer) appealed from a decision of Defendant Yamhill County

Assessor (the county) as to the tax exemption status of its property in Yamhill

County. Taxpayer argued that its property was exempt due to the fact it was used

in taxpayer’s activities, which it considered to be charitable under ORS 307.130.

The county asserted that taxpayer did not meet the criteria of a charitable insti-

tution under the requirements of the statute, specifically because taxpayer’s work

did not incorporate the required component of “gift or giving” recognized in the

case law of Oregon courts concerning exemption for property owned by charitable

institutions. Following trial the court found that while taxpayer’s activities met

some of the factors of a qualifying charitable institution, other crucial factors,

particularly taxpayer’s tiered payment structure and taxpayer’s decision to not

accept payment from government insurance programs, meant that taxpayer’s

doors could not be considered open to rich and poor alike, therefore taxpayer

could not be considered a charitable institution pursuant to the requirements of

ORS 307.130.

Trial was held June 25, 2012, in the courtroom of the

Oregon Tax Court, Salem.

Dan Eller, Schwabe Williamson & Wyatt PC, Portland,

argued the cause for Plaintiff (taxpayer).

Darren Weirnick, Assistant Attorney General, Depart-

ment of Justice, Salem, and Christian F. Boenisch, Yamhill

County Counsel, McMinnville, argued the cause for Defen-

dants Department of Revenue (the department) and Yamhill

County Assessor (the county).

Decision for Defendants rendered August 30, 2013.

HENRY C. BREITHAUPT, Judge.

I. INTRODUCTION

This case comes before the court for decision fol-

lowing a trial in the Regular Division. Plaintiff (taxpayer)

246 Hazelden Foundation v. Yamhill County Assessor

contends that certain real property and certain personal

property owned by taxpayer and located in Yamhill County

was exempt under ORS 307.130 during the 2010-11 tax

year.1 Taxpayer argues that it was, and is, a charitable insti-

tution and the property in question was actually and exclu-

sively used in the charitable work of taxpayer. Defendants

Yamhill County Assessor and the Department of Revenue

(collectively referred to in this opinion as “the county”) con-

cede that taxpayer met some of the characteristics of a char-

itable institution, but that its activities lacked the required

element of “gift or giving” found in Oregon case law concern-

ing ORS 307.130. The county also contends that taxpayer

has failed to carry the burden of proving by a preponderance

of the evidence that some of the real property at issue in

this case was actually and exclusively used in the charitable

work of taxpayer during the tax year at issue. The tax year

at issue is 2010-11.

This opinion should be read in context with this

court’s decision in Serenity Lane, Inc. v. Lane County

Assessor, 21 OTR 229 (2013).

II. FACTS

Taxpayer is an IRC section 501(c)(3) nonprofit cor-

poration organized under the laws of the state of Minnesota.2

For many years a wholly-owned subsidiary of taxpayer oper-

ated an addiction treatment facility in the city of Newberg in

Yamhill County. In 2010, taxpayer merged with its subsidi-

ary and assumed direct ownership of the treatment facility.

Taxpayer’s bylaws state that it is organized to

provide “high quality, affordable rehabilitation, education,

prevention and professional services and publications in

chemical dependency and related disorders.” Taxpayer oper-

ates the facility as part of that mission. Taxpayer is known

for serving individuals who are employed as professionals,

such as doctors and lawyers. During the 2010-11 tax year,

about 50 percent of taxpayer’s patients were profession-

als; the remaining 50 percent came from non-professional

backgrounds.

1

All references to the Oregon Revised Statutes (ORS) are to the 2009 edition.

2

All references to the Internal Revenue Code (IRC) are to the 2008 edition.

Cite as 21 OTR 245 (2013) 247

Taxpayer’s primary focus is on inpatient residential

treatment of individuals recovering from substance addic-

tion. Taxpayer also has a publishing subsidiary and a grad-

uate school that offers a master’s degree in addiction coun-

seling, though it is not clear from the record to what extent

the operations of those entities interacted with the opera-

tions of taxpayer’s treatment facility during the tax year at

issue.

Taxpayer maintains in its briefing that it charges

the market rate for the treatment that it provides. The

record indicates that this can be a very substantial sum:

stipulated exhibits suggest that $27,000 is representative of

what taxpayer would charge an average patient for 28-day

residential treatment. Taxpayer has a “patient aid” program

in place to assist patients who do not have the resources to

pay the full price of treatment. Taxpayer’s patient aid pro-

gram has two primary components. First, taxpayer provides

need-based discounts on the price of treatment to help cali-

brate the amount taxpayer charges any given patient to the

financial resources available to the patient. This calibration

works on the basis of 10 “tiers,” with each tier representing

an additional 10 percent discount on the nominal price of

treatment. The tiers correspond with a scale of point scores

on a worksheet that is used by taxpayer’s employees to eval-

uate the financial resources available to a given individual.

This worksheet includes factors such as household income,

number of dependents, net worth, and debt-to-income ratio.

In each category, more points are allocated to those whose

circumstances suggest a greater need for assistance. The

higher an individual’s overall score, the greater the discount

on treatment offered to that individual. In its response to

a request for admissions from the county, taxpayer stated

that it normally caps the discount offered at 60 percent off

its normal rates but approves additional discounts—in some

instances up to 100 percent—on a case-by-case basis. The

record does not contain detailed information regarding the

criteria used in evaluating patients that would require a

greater than 60 percent discount to afford treatment.

In addition, during the tax years at issue taxpayer

accepted a limited number of patients that had been referred

to taxpayer by the Yamhill County Department of Health

248 Hazelden Foundation v. Yamhill County Assessor

and Human Services (Yamhill County HHS) free of charge.

Taxpayer formalized this arrangement with Yamhill County

HHS in September of 2010 by agreeing to treat one patient

from Yamhill County’s chemical dependency program per

calendar quarter (four per calendar year). In actual prac-

tice taxpayer treated one such patient in 2009, three such

patients in 2010, and five in 2011. As was mentioned above,

taxpayer accepted other patients free of charge during the

tax years at issue in addition to those referred by Yamhill

County HHS. However, the Yamhill County HHS patients

made up the large majority of the patients in either resi-

dential or extended treatment that were given free care by

taxpayer.3

During the tax years at issue taxpayer did not

admit any patients for whom federal or state government

insurance was used to pay for service in whole or in part.

On or about April 1, 2010, taxpayer submitted to

the county five separate applications for exemption from

property tax for the 2010-11 tax year. The applications

covered real property accounts 33207, 33216, 33742, and

33840, and personal property account number 480018. The

applications specified that taxpayer was seeking exemption

under ORS 307.130. There followed an exchange of letters

between taxpayer and the county as the county sought to

determine whether taxpayer’s operations were charitable.

Ultimately, the county decided that taxpayer was not a

charitable institution and denied taxpayer’s application for

exemption. Taxpayer appealed the decision of the county to

the Magistrate Division of the Oregon Tax Court. This mat-

ter was then specially designated to the Regular Division of

the court.

III. ISSUE

The issue in this case is whether the facility is

exempt from ad valorem property tax under ORS 307.130(2).

3

Documents provided by the parties appear to show that the patient referred

by Yamhill County HHS was the only patient to receive free inpatient residential

or extended treatment in 2009, that two non-HHS-referred patients received free

extended treatment in 2010, and that one non-HHS-referred patient received free

extended treatment and one received residential treatment in 2011.

Cite as 21 OTR 245 (2013) 249

IV. ANALYSIS

ORS 307.130(2) reads, in pertinent part:

“[T]he following property owned or being purchased by * * *

incorporated literary, benevolent, charitable and scientific

institutions shall be exempt from taxation:

“(a) Except as provided in ORS 748.414, only such real

or personal property, or proportion thereof, as is actually

and exclusively occupied or used in the literary, benevolent,

charitable or scientific work carried on by such institutions.”

Taxpayer argues that it is an incorporated chari-

table institution, as that term is used in the statute, and

that the five property tax accounts comprising the facility

are actually and exclusively used in the charitable work

carried on by taxpayer—specifically, providing treatment to

those suffering from the disease of substance addiction. The

county does not appear to dispute that taxpayer has some

of the salient features of a charitable institution, but argues

that taxpayer’s work does not incorporate the required com-

ponent of “gift or giving” recognized in the case law of this

court and of the Supreme Court concerning exemption for

property owned by charitable institutions.

The county also argues that taxpayer has not met

the burden of proving by a preponderance of the evidence

that some of the parcels at issue in this case are exclusively

used or occupied by taxpayer.

A charitable institution, for purposes of ORS

307.130, must have the following three features:

(1) Charity as the organization’s “primary, if not sole,

object”;

(2) The organization’s operations must serve the charita-

ble mission of the organization;

(3) The presence of an element of “gift or giving” in the

activities of the organization.

SW Oregon Pub. Def. Services v. Dept. of Rev., 312 Or 82, 89,

817 P2d 1292 (1991). In its briefing the county does not dis-

pute, and in some places implicitly concedes, that taxpayer

has the first two required features. However, the county

250 Hazelden Foundation v. Yamhill County Assessor

disputes that taxpayer’s activities meet the “gift or giving”

requirement.

Taxpayer approaches the question of “gift or giving”

from two different perspectives, derived from decisions of

this court and of the Supreme Court. One of taxpayer’s per-

spectives can be styled a “quantitative” approach; the other

might be styled a “qualitative” approach. Taxpayer argues

that it satisfied the “gift or giving” requirement under both

approaches.

A. Taxpayer’s Quantitative Approach

Taxpayer derives its quantitative approach from

the Supreme Court’s opinion in YMCA v. Dept. of Rev., 308

Or 644, 784 P2d 1086 (1989) (YMCA II). In that case, the

Supreme Court found that there was a lack of “gift or giv-

ing” involved in the operations of two fitness centers owned

by the YMCA where the “scholarship giving” provided by

the YMCA—essentially a need-based discount on the cost

of YMCA memberships—amounted to “less than four per-

cent” of the YMCA’s total annual revenue. Id. at 653-654.

Taxpayer argues that it meets the “gift or giving” require-

ment because the amounts it gives in patient aid substan-

tially exceeded four percent—amounting to about seven

percent of annual revenues during the two calendar years

included in the 2010-11 tax year.

Taxpayer further points out that the YMCA II court

also justified its decision in that case on the ground that

only eight percent of the members at the relevant YMCA

facilities had benefitted from the discount policy, whereas

between 25-30 percent of taxpayer’s patients received some

reduction of charges through taxpayer’s patient aid program

during the 2010-11 tax year.

In other words, taxpayer takes the Supreme Court’s

use of the phrases “less than four percent” and “less than

eight percent” as establishing “floors.” Under taxpayer’s

quantitative approach, taxpayer would satisfy the “gift or

giving” requirement because the revenues devoted to its

patient aid program and the distribution of that aid among

taxpayer’s patients exceeded both of the “floors” taxpayer

Cite as 21 OTR 245 (2013) 251

asserts that the YMCA II court established during the tax

year at issue.

This court is of the opinion that taxpayer’s quanti-

tative approach asks the phrasing of the Supreme Court to

do more work than the context of those statements justifies.

YMCA II does not state whether four percent and eight per-

cent are floors, or deep in the basement (to extend the meta-

phor). Nothing in the Supreme Court’s decision compels this

court to rule that the “gift or giving” requirement is met

simply because taxpayer’s patient aid exceeds four percent of

annual revenues and more than eight percent of taxpayer’s

patients receive such aid.

B. Taxpayer’s Qualitative Approach

Taxpayer’s qualitative approach is more in keeping

with the cases of this court and of the Supreme Court on

the subject of exemption for charitable institutions. Under

taxpayer’s qualitative approach, taxpayer argues that it

satisfies the “gift or giving” requirement because it satis-

fies qualitative criteria for a charitable institution that have

been adopted by the Supreme Court and used by this court

in past cases:

“(1) Whether the receipts are applied to the upkeep, main-

tenance and equipment of the institution or are otherwise

employed;

“(2) Whether patients or patrons receive the same treat-

ment irrespective of their ability to pay;

“(3) Whether the doors are open to rich and poor alike

and without discrimination as to race, color or creed;

“(4) Whether charges are made to all and, if made, are

lesser charges made to the poor or are any charges made to

the indigent.”

SW Oregon Public Def. Services, 312 Or at 82, (quoting

Oregon Administrative Rule (OAR) 150-307.130-A(4)(d)(C)).

In keeping with these prior cases, not all of the factors listed

above have to be present for a given organization to meet the

“gift or giving” requirement, nor are these the only factors

that a court could rely on to determine that sufficient “gift

or giving” is present in the activities of a given organization.

252 Hazelden Foundation v. Yamhill County Assessor

Methodist Homes, Inc. v. Tax Com., 226 Or 298, 310, 360

P2d 293 (1961). However, these factors have been specifi-

cally identified as probative of the presence or absence of

“gift or giving.”

The court observes at the outset that the county

does not allege any discrimination on the basis of race, skin

color, or religious identification on the part of taxpayer. The

court therefore considers that part of the third “gift or giv-

ing” factor satisfied. However, whether taxpayer’s “doors are

open to rich and poor alike” will be established at length in

the following analysis.

With regard to the first factor, taxpayer’s Assistant

Controller testified at trial that the revenues taxpayer

derives from the facility are reinvested into the operations

of taxpayer. The county appears to argue that this is insuf-

ficient to satisfy the first “gift or giving” factor, because rev-

enues from the facility are used to “subsidize” taxpayer’s

activities in other jurisdictions, rather than simply being

reinvested in the facility itself.

The county’s argument is not well taken. The

court does not understand the first “gift or giving” factor as

requiring that receipts derived from one operation by a pur-

portedly charitable institution remain forever segregated

and used only in maintaining or expanding that one opera-

tion. Nor does the court read the first factor to require that

such receipts not be used to subsidize other activities of the

institution, at least as long as those activities contribute to

the charitable goal of the institution and are not undertaken

for private profit. The first “gift or giving” factor deals with

the revenues of a purportedly charitable institution at the

level of the institution; hence the word “institution” in the

material quoted above from the Supreme Court’s decision

in SW Oregon Public Def. Services. The point of the factor

is that revenues received by an institution organized for a

charitable purpose must be used in furtherance of the char-

itable purpose of the institution rather than, for instance,

the enrichment of the private individuals that control the

institution. Cf. Methodist Homes, Inc., 226 Or at 315-16. As

long as no such ulterior use of revenues is present, this first

factor is met regardless of whether a purportedly charitable

Cite as 21 OTR 245 (2013) 253

institution’s component parts are self-sustaining or must be

supported by excess revenues of other parts of the institu-

tion’s overall operation. The county has not alleged any such

ulterior use and so, in light of the testimony of taxpayer’s

Assistant Controller, this factor leans in taxpayer’s favor.

Taxpayer argues that it meets the second fac-

tor because it provides the same treatment to its patients

regardless of their ability to pay. Based on the testimony

at trial, the court understands that what taxpayer means

by this is that there is no differentiation in the treatment

that is given to taxpayer’s patients based on their ability to

pay once they are actually admitted to the facility. The court

agrees that equal treatment of patients irrespective of abil-

ity to pay after the decision to admit the patient has been

made is an indicator, at least at the margins, of the pres-

ence of “gift or giving.” However, equal treatment of patients

after they have been admitted is a hollow sort of charity if

the ability of a patient to pay for treatment instead simply

acts as a bar to admission in the first place.

That question appears to be part of what the third

factor is driving at when it looks to “[w]hether the doors

are open to rich and poor alike and without discrimination

as to race, color or creed.” Taxpayer argues that it meets

this requirement because it “makes the facility available

to patients regardless of race, color, or creed.” As the court

stated above, the county does not allege any such discrimi-

nation and its absence does weigh in taxpayer’s favor. That

being said, the presence of an “and” in between “open to

rich and poor alike” and “without discrimination as to race,

color or creed” shows that these are two separate items for

consideration. Taxpayer does not address the first of these

two items in its briefing, and a failure by taxpayer to show

that its doors are indeed “open to rich and poor alike” would

severely undermine the case for the presence of “gift or giv-

ing.” For the reason discussed in the paragraph preceding

this one, this would, in turn, jeopardize taxpayer’s case for

treatment as a charitable institution. It is to that question

that the court now turns.

However, in addressing the third factor the court

must first make a necessary detour to address the fourth

254 Hazelden Foundation v. Yamhill County Assessor

factor. The fourth factor addresses the fact that taxpayer’s

services, like those of many healthcare providers, do not come

cheaply. The fact that taxpayer charges for its services does

not necessarily lead the court to find a lack of “gift or giv-

ing.” OAR 150-307.130-(A)(3)(d)(C). Likewise, that taxpayer

expects patients who are capable of paying the full price for

treatment to pay the going rate for treatment is also not a

problem. Gregory v. Salem General Hospital, 175 Or 464,

469-70, 153 P2d 837 (1944). However, a high price tag alone

can amount to a de facto ban on patients who lack either suf-

ficient personal assets or sufficient insurance to pay for the

treatment if those prices are insisted upon in all cases and

if those who cannot afford to pay are denied treatment for

no other reason than their inability to pay. A similar effect

might also arise where, as here, taxpayer does not insist on

charging all of its patients full price, if the criteria used by

taxpayer to determine who is to be given discounted care,

and how much of a discount to provide, results in the sub-

stantial exclusion of the poor and indigent from treatment.

Taxpayer can, and does, remove some of the sting

that might arise from the high cost of its treatment through

its “patient aid” program. Under that program, the price

that taxpayer actually bills its patients for treatment varies

depending on criteria chosen by taxpayer that seek to deter-

mine the financial resources available to the patient. So to

that extent, taxpayer satisfies the fourth “gift or giving” fac-

tor described above.

The exact contours of taxpayer’s patient aid pro-

gram during the tax years at issue are, however, of great

importance in considering whether taxpayer’s doors were

truly open to rich and poor alike. As the court understands

it, taxpayer’s patient aid program has two main components.

First, as was mentioned above, taxpayer calibrated the

amount that it charged patients to the financial resources

available to any given patient. Second, taxpayer accepted

roughly one patient per quarter at no charge on referral

from the Yamhill County HHS.

The court finds taxpayer’s system of need-based

reductions in prices charged for treatment especially pro-

bative of this issue. The court understands that taxpayer’s

Cite as 21 OTR 245 (2013) 255

system of graduated discounts works on the basis of ten tiers.

However, the parties have provided to the court a copy of the

worksheet used by taxpayer’s employees to determine the

level of discount that any individual qualifies for. The court

notes that this worksheet only appears to account for six

tiers of discount. That is not to say that the discounts offered

by taxpayer necessarily “max out” at a 60 percent reduction

on charges for treatment, but it does appear that taxpayer’s

frontline intake staff can apparently only qualify a patient

for a 60 percent discount on what that patient would other-

wise be charged for treatment. The court understands, from

statements contained in taxpayer’s response to discovery

requests made by the county, that taxpayer granted patient

aid at tiers 7 or above in a “few” instances “when an indi-

vidual patient experiences extreme hardship.” However, the

record does not contain any indication of the criteria used

by taxpayer to determine just when such a hardship had

presented itself.

The record does, however, bear out that these

exceptions are indeed “few.” The county has placed in the

record data showing the number and type of charges made

to patients at each tier of taxpayer’s patient aid program

during the tax years at issue in this case. For each of the

years at issue in this case, the numbers of patients receiv-

ing either residential or extended care at a level of patient

aid above tier 6 are very small, relative to taxpayer’s overall

patient load for that year: 1 out of 274 patients in 2009; 6 out

of 309 patients in 2010; and 5 out of 334 patients in 2011.

Other patients received discounts at 70 percent or above, but

as the court understands the exhibits submitted by the par-

ties, these individuals were not themselves receiving treat-

ment for their own substance addiction, but were instead

participants in the family treatment component of another

patient’s treatment for substance addiction. In any event,

the amounts that taxpayer bills such patients is so small,

relative to the price of its residential and extended treat-

ment, that the fact taxpayer extended greater-than-normal

discounts in those instances is of limited significance.

In viewing these numbers, the court is cognizant

of taxpayer’s agreement with Yamhill County HHS to treat

one patient per calendar quarter free of charge on referral

256 Hazelden Foundation v. Yamhill County Assessor

from the county. This agreement helps taxpayer’s case in

that it clearly illustrates an intention by taxpayer to make

its services available, at least under the right circumstances,

to some number of individuals who needed their services but

would not be able to pay. It also helps taxpayer’s case that

taxpayer accepted patients on referral from Yamhill County

HHS before entering into a formal arrangement to do so in

September of 2010, and accepted more than were called for

in the agreement after entering into it.

However, while these patients stand in evidence of

considerable generosity on the part of taxpayer, the problem

remains that they are very few in number. Furthermore, the

distribution of taxpayer’s grants of patient aid among the

varying tiers on taxpayer’s patient aid scale during 2009,

2010, and 2011 calendar years suggests a marked tendency

on the part of taxpayer to grant relatively modest discounts

off the nominal price of treatment to larger numbers of

patients, rather than granting larger discounts to less afflu-

ent patients or reducing the list prices for its services. The

court understands, of course, that the resources taxpayer is

able to devote to patient aid are limited and that taxpayer

must make what it considers the best use of those resources.

However, the distribution pattern chosen by taxpayer sug-

gests a distinct preference on the part of taxpayer for rela-

tively affluent patients.

The court is particularly concerned with the effect

of taxpayer’s policy of capping patient aid at 60 percent of

the cost of treatment. As the court has noted above, this was

a “soft” limit subject to exceptions both for a small number of

patients referred to taxpayer by Yamhill County HHS and

to exceptions for an even smaller number of individuals that

taxpayer determined, by criteria not disclosed to this court,

to admit at levels of patient aid above 60 percent. In materi-

als submitted to the court as stipulated exhibits, taxpayer’s

staff justifies the existence of the soft 60 percent cap on

the ground that there is a therapeutic benefit to having its

patients make an investment in their recovery from addic-

tion. The court is sympathetic to this view, but in light of

taxpayer’s high charges for treatment taxpayer’s decision to

place a soft cap at 60 percent leaves the costs of taxpayer’s

services out of reach of many people legitimately needing the

Cite as 21 OTR 245 (2013) 257

types of services that taxpayer provides. To most indigent,

and indeed, to most working class individuals, 40 percent of

$28,000 is a large sum that could only be acquired, if at all,

with a great deal of difficulty and at risk of future financial

distress. Placing an across-the-board (albeit porous) cap at

60 percent patient aid suggests some measure of disregard

for the needs or circumstances of medium- and low-income

individuals.

The fact that taxpayer does not accept payment

from Medicare or Medicaid only reinforces that impression,

inasmuch as it excludes from taxpayer’s pool of potential

patients virtually all indigent patients, unless allowed in

using criteria not found in the evidence presented to the

court regarding taxpayer’s patient aid program. Taxpayer

readily accepted payment from private insurers, and nothing

in the record suggests that taxpayer required out-of-pocket

payment from patients whose insurance covered the costs

of taxpayer’s services, so taxpayer’s decision to not accept

payment from government insurance programs cannot be

ascribed to a desire to ensure that its patients had sufficient

“skin in the game” to motivate their recovery.

This is a crucial distinction between taxpayer and

other similar institutions that this court has found to be

charitable. The court sees parallels between taxpayer’s sit-

uation and that presented in Ev. Lutheran Good Samaritan

Society v. Department of Revenue, 5 OTR 14 (1972). In that

case, this court explicitly noted a hospital’s acceptance of

patients paying for treatment through government spon-

sored welfare programs for the poor as indicative of the char-

itable nature of that hospital precisely because it showed

that the hospital’s doors were open to rich and poor alike.

Id. at 22-23. As has been noted, taxpayer does not accept

payment from such welfare programs.

Taxpayer’s policy of not accepting payment from

welfare programs for the poor also distinguishes this case

from the court’s decision regarding a somewhat similarly

situated addiction treatment provider in Serenity Lane, Inc.

v. Lane County Assessor, 21 OTR 229 (2013). The amount

of money set aside for patient aid in that case was actually

less, as a percentage of the revenue of the institution at issue

258 Hazelden Foundation v. Yamhill County Assessor

in that case, than what taxpayer sets aside as a percentage

of its own revenue in this case. However, that institution

has made significant, long term investments in making its

services widely available to the working poor and indigent,

as well as to the middle class individuals that made up the

bulk of its patients. To make those services available to the

poor while also remaining financially viable, the taxpayer

in Serenity Lane accepted payment from public insurance

programs for the poor.

The taxpayer in this case does not accept payment

for treatment from government insurance programs, and has

instead put policies in place to limit the costs it incurs by treat-

ing patients who cannot afford to pay the full price of treat-

ment. These policies, as a practical matter, severely restrict

access to taxpayer’s services by the indigent, the working

poor, and most probably the lower middle class as well. In that

sense, taxpayer’s doors are not “open to rich and poor alike” in

the same way as are those of other institutions that this court

has found “charitable” for purposes of ORS 307.130.

On review of the stipulations of the parties, and of

the testimony and exhibits adduced at trial, the court does

not find that taxpayer has carried the burden of showing

that its doors are “open to rich and poor alike.” While this

need not be dispositive in every case of the presence of “gift

or giving” so as to deprive an institution of a finding that

it is charitable, the court is of the opinion that it is disposi-

tive here. Taxpayer is clearly an institution that has a noble

purpose: it seeks to counter a dreadful blight on our society,

and the evidence clearly shows it is prone to generosity in

pursuing that mission. However, taxpayer’s high prices for

treatment, combined with taxpayer’s evident priorities in

granting relief from the burden of those high prices and tax-

payer’s refusal to accept payment from government insur-

ance programs aimed at expanding medical access for the

poor, suggest that taxpayer’s services are specifically tar-

geted at the more affluent segments of our society. An insti-

tution with such priorities may be, as here, admirable; but it

is not a charity for purposes of ORS 307.130.

Having concluded that taxpayer is not a charitable

institution for purposes of ORS 307.130, the court does not

Cite as 21 OTR 245 (2013) 259

reach the question of whether taxpayer actually and exclu-

sively uses the property at issue in this case in pursuit of a

charitable mission.

V. CONCLUSION

Now, therefore,

IT IS THE DECISION OF THIS COURT that tax-

payer is not a charitable institution for the purposes of ORS

307.130, and is therefore not exempt from ad valorem prop-

erty tax under that statute.