The opinion
FILMORE PARC * NO. 2024-CA-0475
APARTMENTS II
*
VERSUS COURT OF APPEAL
*
NORMAN WHITE, CHIEF FOURTH CIRCUIT
FINANCIAL OFFICER AND *
DIRECTOR OF FINANCE, STATE OF LOUISIANA
CITY OF NEW ORLEANS; *******
ERROLL WILLIAMS,
ASSESSOR, ORLEANS
PARISH; AND THE
CHAIRMAN, LOUISIANA TAX
COMMISSION
CONSOLIDATED WITH: CONSOLIDATED WITH:
MFLC PARTNERS, A LOUISIANA NO. 2024-CA-0476
PARTNERSHIP IN COMENDAM
VERSUS
NORMAN WHITE, CHIEF FINANCIAL
OFFICER AND DIRECTOR OF FINANCE,
CITY OF NEW ORLEANS; ERROLL
WILLIAMS, ASSESSOR, ORLEANS
PARISH; AND THE CHAIRMAN,
LOUISIANA TAX COMMISSION
APPEAL FROM
BOARD OF TAX APPEALS
NO. L01364 C/W L01365
Judge Cade R. Cole
******
Judge Dale N. Atkins
******
(Court composed of Judge Daniel L. Dysart, Judge Dale N. Atkins, Judge Karen K.
Herman)
DYSART, J., DISSENTS WITH REASONS
Cheryl M. Kornick
Robert S. Angelico
LISKOW & LEWIS, APLC
701 Poydras Street, Suite 5000
New Orleans, LA 70139-5099
COUNSEL FOR PLAINTIFFS/APPELLANTS, Filmore Parc Apartments II
and MFLC Partners
John J. Weiler
Reese F. Williamson
WEILER & REES, LLC
909 Poydras Street, Suite 1250
New Orleans, LA 70112
COUNSEL FOR DEFENDANT/APPELLEE, Errol G. Williams, Assessor,
Orleans Parish
AFFIRMED
FEBRUARY 14, 2025
DNA
KKH
This is a tax dispute concerning the denial of a request for an exemption
from ad valorem taxation. Appellants, Filmore Parc Apartments II (“Filmore”) and
MFLC Partners (collectively “Taxpayers”), seek review of the April 11, 2024
judgment rendered by the Board of Tax Appeals (“BTA”), which dismissed the
claims asserted in Taxpayers’ respective Petitions to Recover Taxes Paid under
Protest; ordered that Taxpayers are not entitled to claim the La. Const. art. VII, §
21(A) exemption from ad valorem taxation on the Filmore Parc I and Filmore Parc
II apartment complexes for the 2022 tax year; and authorized Appellee, Errol G.
Williams, in his official capacity as the assessor for Orleans Parish (“Assessor
Williams”), to retain and distribute the amounts paid by Taxpayers under protest in
response to their 2022 tax bills. For the following reasons, we affirm the BTA’s
judgment.
FACTUAL BACKGROUND AND PROCEDURAL HISTORY
2017 Filmore
These parties have previously been before this Court on appeal twice
regarding the 2014 tax bills assessed on the subject properties. Though the tax year
was different in the prior appeals (2014 as opposed to 2022 in the matter sub
1
judice), the parties, the properties, and the issues are the same. Thus, the prior
appeals offer factual background and procedural history relevant to the present
appeal.
In the first of those appeals, Filmore Parc Apartments II v. Foster (“2017
Filmore”), this Court outlined the following factual background and procedural
history:1
Michael Vales [(“Mr. Vales”)] formed Mirabeau Family
Learning Center, Inc. (“MFLC”), a Louisiana non-profit corporation,
as a vehicle to counteracting poverty. MFLC acquired the property
(“Property”) in question in 1995, “for the specific purpose of
constructing housing units to provide affordable housing to low and
very low income families.” MFLC entered into a Land Use
Restriction Agreement (“LURA”) with the requirement that the
Property be used “solely to provide housing to low- and very low-
income families.” Filmore Parc Apartments II (“Filmore”), a
partnership in commendam,[2] was formed by Mr. Vales with MFLC
as the general partner. The Housing Outreach Fund VII Limited
Partnership, a Fannie Mae entity, is the limited partner. MFLC’s
interest in the Property was then transferred to Filmore.
Filmore operated the Property as “affordable housing for low-
and very low-income families.” The Property operates 32 units as
Section 8 Project Based Voucher units [(“the 32 Units”)]. The
remaining units meet the requirements of § 42 of the Internal Revenue
Code. Filmore contends that the Property is operated pursuant to the
federal Hope VI program and La. R.S. § 40:600.1-600.24. However,
Filmore Parc was assessed ad valorem taxes for the Property for the
2014 tax year. Filmore paid $61,755.92 on January 24, 2014, and
contended that it was exempt pursuant to Louisiana Const. Art. VII, §
21(A).
1 In the trial court proceedings that led to 2017 Filmore, both Filmore and MFLC Partners
contested their 2014 tax bills; however, Filmore’s 2014 case was litigated, while MFLC
Partners’ 2014 case was held dormant awaiting resolution of Filmore’s case. Thus, this Court’s
2017 Filmore Opinion focused solely on Filmore.
2 Louisiana Civil Code Article 2837 defines a partnership in commendam as a
partnership “consist[ing] of one or more general partners who have the powers, rights, and
obligations of partners, and one or more partners in commendam, or limited partners, whose
powers, rights, and obligations are defined in” Chapter 7 (“Partnership in Commendam”) of Title
XI (“Partnership”) of Book III (“Of the Different Modes of Acquiring the Ownership of Things”)
of the Louisiana Civil Code.
2
Filmore then filed a Petition to Recover Taxes Paid Under
Protest against Norman Foster, Chief Financial Officer and Director
of Finance for the City of New Orleans; Erroll Williams, as the
Assessor of Orleans Parish; and the Louisiana Tax Commission. . . .
Mr. Williams also filed a Motion for Summary Judgment contending
that the housing units in the Property were not exempt from ad
valorem taxation. Filmore filed a Cross-Motion for Summary
Judgment alleging exemption. Following a hearing, the trial court
found that the Property was not exempt from ad valorem taxation for
2014. Accordingly, the trial court granted Mr. Williams’ Motion for
Summary Judgment and denied Filmore’s Cross-Motion for Summary
Judgment. Filmore’s Petition for Suspensive Appeal followed.
2016-0568, pp. 2-3 (La. App. 4 Cir. 2/15/17), 212 So.3d 621, 623-24 (footnotes
omitted).
Thereafter, this Court considered whether the trial court correctly found
Filmore was not entitled to the ad valorem tax exemption and granted Assessor
Williams’ Motion for Summary Judgment. This Court explained, “La. Const. art.
VII, § 21(A) exempts ‘public property used for public purposes’ from ad valorem
taxation.” Filmore Parc Apartments II, 2016-0568, p. 4, 212 So.3d at 624 (quoting
Slay v. La. Energy & Power Auth., 473 So.2d 51, 53 (La. 1985)). This Court then
stated the first consideration for determining whether property is exempt under that
constitutional provision is whether the property is public property; and the Court
stated the subject apartment complex did not qualify for the exemption on this
basis because “there [was] no question” that it was “privately owned.” Id. at p. 5,
212 So.3d at 624. Nonetheless, the Court ultimately reversed the trial court’s
judgment and remanded the matter, holding the trial court did not properly apply
the entire test for determining whether a property is entitled to an exemption from
ad valorem taxation. Id. at p. 9, 212 So.3d at 626-27. As this Court explained, the
second consideration “for ad valorem tax exemption is” whether the “property [is]
used for a public purpose” because ownership alone is not determinative as
3
“property can ‘vest’ in the public even though the ‘title be not in the public.’” Id. at
pp. 4-5, 212 So.3d at 624-25 (first quoting Slay, 473 So.2d at 54; and then quoting
Abundance Square Assocs., L.P. v. Williams, 2010-0324, p. 5 (La. App. 4 Cir.
3/23/11), 62 So.3d 261, 264). This Court explained that in ruling on the parties’
motions for summary judgment, the trial court legally erred in failing to “consider
the restrictions Filmore placed upon the Property in furtherance of the mission of
providing affordable housing for ‘low- and very low-income residents in New
Orleans.’” Id. at p. 8, 212 So.3d at 626. That is, after determining that the
apartment complex was privately owned, the trial court did not move beyond the
first prong of the test to the second prong to consider whether the restrictions
Filmore placed on the apartment complex meant the property was vested in the
public and used for a public purpose so as to exempt it from ad valorem taxation
despite its private ownership status.
2018 Filmore
After this Court remanded the matter, the trial court held a hearing on
Assessor Williams’ motion for summary judgment and Filmore’s cross-motion.
Filmore Parc Apartments II v. Foster, 2018-0359, p. 5 (La. App. 4 Cir. 11/7/18),
318 So.3d 718, 721 (“2018 Filmore”).3 In pertinent part, the trial court denied
Assessor Williams’ motion in part and granted Filmore’s cross-motion in part
regarding the amounts paid under protest for the 32 Units, finding those units were
entitled to the ad valorem tax exemption. Id. at p. 10, 318 So.3d at 724. The trial
court granted Assessor Williams’ motion for summary judgment and denied
Filmore’s cross-motion insofar as those motions pertained to the remaining units,
3 As with the 2017 Filmore Opinion, the 2018 Filmore Opinion focused on Filmore’s
apartment complex, not MFLC Partners’ apartment complex.
4
finding that the remaining units were not exempt from ad valorem taxes. Id.
Thereafter, Assessor Williams appealed to this Court.
In 2018 Filmore, this Court ultimately found there remained genuine issues
of material fact regarding (1) whether the 32 Units were “public housing” as
opposed to Section 8 Project Based Voucher (“PBV”) Units and (2) use of the
revenue generated by those 32 Units. Filmore Parc Apartments II, 2018-0359, pp.
20-23, 318 So.3d at 730-32. Regarding the former, as this Court summarized, the
summary judgment evidence included the affidavits of Nyssa A. Hackett (“Ms.
Hackett”), Manager of PBVs for the Housing Authority of New Orleans
(“HANO”); Mr. Vales; Assessor Williams; Ms. Magdalena Merrill (“Ms.
Merrill”), Director of Asset Management with HANO; and a Housing Assistance
Program (“HAP”) contract between Filmore and HANO regarding the 32 Units. Id.
at p. 20, 318 So.3d at 730. All of these documents referred to the 32 Units as
Section 8 PBV units; but Filmore’s attorney, at the hearing before the trial court,
urged the units were actually part of HANO’s inventory. Id. Counsel contended
HANO “completely own[ed] and control[led]” the 32 Units, which were
“HANO[’s] units in everything but title.” Id. In addition to the different
descriptions regarding the 32 Units provided between the affidavits and counsel for
Filmore, this Court observed the affidavits of the two HANO employees—Ms.
Hackett and Ms. Merrill—presented competing evidence. Id. at p. 21-22, 318
So.3d at 731. “Ms. Hackett attested, although not based on her personal
knowledge,” that the apartment complex “constitute[d] ‘part of the affordable
public housing inventory available in the City of New Orleans.’” Id. at p. 21, 318
So.3d at 731. “In contrast, Ms. Merrill attested that there were no ‘public housing’
units at” the apartment complex. Id. at pp. 21-22, 318 So.3d at 731. Ms. Merrill
5
further attested there were no contracts between Filmore and HANO other than the
HAP contract. Id. at p. 22, 318 So.3d at 731. Regarding the HAP contract, this
Court summarized:
Assessor Williams explained that [the] HAP contract is a standard
Housing and Urban Development (“HUD”) agreement “whereby
Section 8 tenant-based assistance under the housing choice voucher
program is offered to private business owners.” He attested that the
HAP agreement was the only agreement between HANO and Filmore
. . . and that Filmore did not offer any “public housing” on behalf of
HANO, HUD, or the City of New Orleans.
Id. at pp. 5-6, 318 So.3d at 721-22 (footnote omitted). Thus, this Court concluded
there were genuine issues of material fact as to whether the 32 Units were “public
housing,” such that they might be classified as “utilized in a way that is dedicated
and open to the public, or used in a way that benefits the general public,” or if they
were merely Section 8 PBV units. Id. at p. 22, 318 So.3d at 731.
As stated previously, this Court also found genuine issues of material fact
remained regarding the use of the revenue generated by the 32 Units. Id. In
particular, this Court noted Filmore’s counsel argued before the trial court that
certain agreements to which the apartment complex was subject (namely a Home
Regulatory Agreement and a Road Home Agreement) “through ‘Program Income,’
required the revenue generated from the [32 U]nits to go back into [those] units for
maintenance and operation.” Id. However, as this Court observed, “Mr. Vales
never referred to ‘Program Income’ in his affidavit, nor did he attest that the
monies derived from the [32 U]nits were mandated to be set aside for maintenance
and operation of the units.” Id. at pp. 22-23, 318 So.3d at 731-32 (footnote
omitted). Further, this Court noted Filmore presented no evidence demonstrating
that it “deposited revenue generated from the [32 U]nits into an escrow account, as
6
mandated, for the sole purpose of operation and maintenance of these units.” Id. at
p. 23, 318 So.3d at 732.
In sum, this Court found genuine issues of material fact in the above-two
respects precluded summary judgment. This Court reversed the trial court’s
judgment regarding the 32 Units; affirmed the judgment in every other respect (i.e.,
affirmed the other units in the complex besides the 32 Units were not entitled to an
exemption from ad valorem taxation); and remanded the matter for further
proceedings regarding the 32 Units. Id. at p. 24, 318 So.3d at 732. Filmore
subsequently filed a writ application which the Louisiana Supreme Court denied.
Filmore Parc Apartments II v. Foster, 2018-2050 (La. 2/11/19), 263 So.3d 1151.
According to the record in the present appeal, after the matter returned to the trial
court per this Court’s remand in 2018 Filmore, Assessor Williams obtained
additional discovery, and Filmore ultimately did not pursue the 2014 tax year
litigation any further.
March 2, 2022 Petitions to Recover Taxes Paid Under Protest
On March 2, 2022, Filmore filed a “Petition to Recover Taxes Paid Under
Protest” (“Filmore’s Petition”) with the BTA. Therein, Filmore explained it was a
Louisiana partnership in commendam formed by the Filmore Parc Partnership
Agreement, which consisted of the Mirabeau Family Learning Center, Inc., a
Louisiana non-profit corporation, as the general partner with a .01% interest and
The Housing Outreach Fund XIII Limited Partnership as the limited partner with a
99.99% interest.
Filmore explained on February 15, 2022, it timely made a payment of
$15,034.85 under protest in response to the 2022 Real Estate Tax Bill No.
37W517601 issued by Assessor Williams regarding property that Filmore owned
7
in Orleans Parish, “Filmore Parc II.” In the Petition, Filmore listed various
agreements and restrictions by which Filmore Parc II “has been dedicated to public
use, serving a public purpose, so as to attain tax exempt status,” thereby exempting
it from ad valorem taxation pursuant to La. Const. art. VII, § 21(A). Filmore
asserted that despite the property’s private ownership, case law supported a finding
that such agreements and restrictions meant Filmore had “translate[d] [the
property] into the domain of constitutional exemption by dedicating it to a public
use.”
Regarding the various agreements and restrictions, Filmore explained it
“acquired the Property subject to a Land Use Restriction Agreement (“LURA”)
that required the owner to maintain the property as multifamily rental housing for
Lower-Income Families and Very Low-Income Families as defined by the Housing
Act of 1937, 42 U.S.C. § 1437a(b)(2).” Filmore listed another as the Mirabeau
Family Learning Center, Inc., having “executed [a HAP] Contract with” HANO in
August 2002 through HANO’s PBV Program “that applies to 32 of the Units in the
Property.” According to Filmore, under the HAP Contract, “all contract units must
be leased to eligible families referred by the Public Housing Authority (“PHA”)
waiting list.” Additionally, Filmore explained that in March 2011, it executed Tax
Credit Regulatory Agreements with the Louisiana Housing Finance Agency
(“LHFA”), which encumbered the property. Further, Filmore stated the Mirabeau
Family Learning Center, Inc., entered into an agreement with the City of New
Orleans concerning rental housing activities under the HOME Investment
Partnerships Program and described this as “funds [that] are furnished to the City
through HUD and are governed by federal regulations.” Finally, Filmore stated,
“The State of Louisiana, Division of Administration, Office of Community
8
Development, as program administrator of the Road Home Program, made certain
Incentive Loans to the Project.” According to Filmore, “[a]s a condition to the
payment of” the Road Home proceeds, the Project had “to provide that 75% of the
units in designated buildings would be restricted by occupancy for tenants whose
incomes do not exceed 50% of Area Median Income as determined by HUD.” In
sum, Filmore listed the agreements and restrictions on the Property as: (1) LURA;
(2) Tax Credit Agreements; (3) the HOME Agreement; (4) the Road Home
Agreement; and (5) the HAP contract to provide Section 8 PBV housing specific to
the 32 Units only. Further, Filmore contended all revenue generated by the
property had to “go[] back into the public use of providing affordable housing” per
the terms of Filmore’s partnership agreement and other regulatory documents.
The same day Filmore filed its Petition, MFLC Partners, another Louisiana
partnership in commendam, also filed a “Petition to Recover Taxes Paid Under
Protest” (“MFLC Partners’ Petition”). Therein, MFLC Partners explained it
consisted of the Mirabeau Family Learning Center, Inc., as the general partner with
a .01% interest and The Housing Outreach Fund XIII Limited Partnership as the
limited partner with a 99.99% interest. Like Filmore, MFLC Partners explained
that on February 15, 2022, it timely made a payment of $29,008.77 under protest in
response to the 2022 Real Estate Tax Bill No. 37W517602 issued by Assessor
Williams regarding property it owns in Orleans Parish, “Filmore Parc I.” MFLC
Partners asserted the same agreements and restrictions that encumbered Filmore
Parc II—(1) LURA; (2) Tax Credit Agreements; (3) the HOME Agreement; (4) the
Road Home Agreement; and (5) a HAP contract to provide Section 8 PBV housing
specific to 71 units only—also encumbered Filmore Parc I. As Filmore contended
9
in its Petition, MFLC Partners contended Filmore Parc I had been dedicated to a
public use and should be exempt from ad valorem taxation.
In light of the foregoing, Filmore and MFLC Partners contended their
respective 2022 tax bills were null and void and they should receive refunds of the
amounts they paid under protest for their affordable housing complexes. Filmore
owns 56 of the units at the complexes, and MFLC Partners owns 108 of the units;
but the two entities are otherwise similarly situated in this case, such that the facts
applicable to one are applicable to the other. Accordingly, early on in the
proceedings, the BTA consolidated their separate actions.
April 11, 2024 Judgment
Ultimately the matter proceeded to a bench trial before the BTA on
September 13, 2023. On April 11, 2024, the BTA issued its judgment, which
states:
IT IS ORDERED, ADJUDGED, AND DECREED that
Judgment is hereby rendered in favor of the Assessor, the City, [the
Orleans Parish School Board], and the [Louisiana Tax Commission]
and against Filmore and MFLC [Partners] dismissing the Petitioners’
claims. Petitioners are not entitled to claim the 21(A) Exemption on
the Filmore I and Filmore II apartment complexes for the 2022 Tax
Year.
IT IS FURTHER ORDERED, ADJUDGED, AND
DECREED that there be Judgment in favor of the Respondents and
against the Petitioners authorizing the Respondents to retain and
distribute the amounts paid under protest in these consolidated
matters.
The BTA also issued reasons for judgment, which stated in pertinent part:
In this case, almost all of the units at the Property are PBV units
and “tax Credit” units. An appeal from the Board’s decision in this
case would lie with the Fourth Circuit. In Abundance Square, the
Fourth Circuit clearly held that PBV units are not subject to the 21(A)
Exemption. Further, since all of the units in Abundance Square were
stated to be tax credit units, it follows that a unit is not exempt by
virtue of being both a PBV unit and a tax credit unit. Thus, Petitioners
10
cannot qualify for the 21(A) Exemption, unless they show that they
undertook significantly greater restrictions on the Property than those
imposed by the HAP Contracts and the [Tax Credit Regulatory
Agreements].
....
Mirabeau and the Petitioners in this case have contracts with
public agencies and they operate for a charitable purpose, but they are
not so restricted as to become extensions of public entities. Their
claim depends on all of their contracts functioning as an integrated
financing plan. This includes their organizational documents, which
are essentially private contracts. Finally, it should be noted that the
Constitution provides a separate exemption for property owned by [a]
charitable non-profit entity that meets other particular criteria.
Accordingly, the Board holds that Petitioners are not entitled to
claim the 21(A) Exemption. PBV units and Tax Credit housing units
are not exempt under Abundance Square and [2018] Filmore . . . .
Petitioners are not restricted to operating as extensions of a public
entity, and their claim is inextricably intertwined with private
contracts. Therefore, Petitioners are not entitled to claim the 21(A)
Exemption on the Property for the 2022 Tax Year and Judgment will
be rendered in favor of the Assessor.
Thereafter, Taxpayers’ timely appeal of the BTA’s judgment followed.
ASSIGNMENTS OF ERROR
In their brief to this Court, the Taxpayers assert two assignments of error.
Specifically, they contend:
1. The [BTA] disregarded longstanding precedent and erroneously
held that, to be exempt pursuant to La. Const. art. VII, § 21(A),
the PBV units must operate as “extensions of a public entity.”
2. The [BTA] erroneously held that, for the § 21(A) exemption to
apply, the exemption cannot be too “inextricably intertwined
with private contracts.”
We begin our discussion of the issues presented herein with the standard of review
applicable to this matter.
11
DISCUSSION
Standard of Review
Louisiana Revised Statutes 47:1435 provides the courts of appeal with
exclusive jurisdiction to review the decisions or judgments of the BTA. When an
appellate court reviews a decision issued by the BTA, the review must be
“rendered upon the record as made before the BTA and is limited to facts on the
record and questions of law.” Ciervo v. Robinson, 2020-1106, p. 3 (La. App. 1 Cir.
4/16/21), 323 So.3d 893, 896. The Louisiana First Circuit Court of Appeal has
explained the appellate court should accept the BTA’s findings of fact if “there is
substantial evidence in the record to support them” and should not set aside the
findings of fact “unless they are manifestly erroneous in view of the evidence on
the entire record.” Id. (citing R & B Falcon Drilling USA, Inc. v. Sec’y, Dep’t of
Revenue, 2009-0256, pp. 3-4 (La. App. 1 Cir. 1/11/10), 31 So.3d 1083, 1085). See
also Barfield v. Bolotte, 2015-0847, p. 5 (La. App. 1 Cir. 12/23/15), 185 So.3d
781, 785 (citing Crawford v. Am. Nat’l Petroleum Co., 2000-1063, p. 6 (La. App. 1
Cir. 12/28/01), 805 So.2d 371, 377); Bridges v. Offshore Drilling Co., 2010-2214,
p. 7 (La. App. 1 Cir. 7/18/11), 69 So.3d 738, 742 (citation omitted). Per La. R.S.
47:1435(C), if the BTA’s judgment “is manifestly erroneous on the facts
considering the record as a whole,” then the appellate court has the power “to
modify, or to reverse the decision or judgment of the board, with or without
remanding the case for further proceedings.”
When “the assignments of error reflect that the main issue involves a purely
legal question regarding the proper interpretation of a statute” though, then the
appellate court reviews the matter de novo, thereby giving no deference to the
BTA’s factual findings or legal conclusions. Barfield, 2015-0847, p. 5, 185 So.3d
12
at 785. If the case presents a question of law and the BTA “has correctly applied
the law and has adhered to the correct procedural standards,” then the appellate
court should affirm the BTA’s judgment. Ciervo, 2020-1106, p. 3, 323 So.3d at
896. See also Barfield, 2015-0847, p. 6, 185 So.3d at 785 (citing Crawford, 2000-
1063, p. 6, 805 So.3d at 377); Bridges, 2010-2214, p. 7, 69 So.3d at 742 (citing
R&B Falcon Drilling USA, Inc., 2009-0256, p. 4, 31 So.3d at 1085). According to
La. R.S. 47:1435(C), however, “if the decision or judgment of the board is not in
accordance with law” then the appellate court has the power “to modify, or to
reverse the decision or judgment of the board, with or without remanding the case
for further proceedings.” See also Ciervo, 2020-1106, pp. 3-4, 323 So.3d at 896
(holding that if the BTA does not correctly apply the law, then the appellate court
may reverse or modify the judgment without the need for remand (citing Bannister
Props., Inc. v. State, 2018-0030, 0031, 0032, 0033, p. 8 (La. App. 1 Cir. 11/2/18),
265 So. 3d 778, 785)).
Review of the Judgment, Not the Reasons for Judgment
As quoted previously, in their assignments of error Taxpayers contend the
BTA erred by holding “that to be exempt pursuant to La. Const. art. VII, § 21(A),
the [Section 8] PBV units must operate as ‘extensions of a public entity’” and
“cannot be too ‘inextricably intertwined with private contracts.’” Both of these
phrases—“extensions of a public entity” and “inextricably intertwined with private
contracts”—come from the BTA’s written reasons for judgment.
As this Court has previously explained, “A judgment and reasons for
judgment are two separate and distinct documents.” Safford v. New Orleans Fire
Dep’t, 2023-0495, p. 28 (La. App. 4 Cir. 2/1/24), 384 So.3d 909, 930 (citing
McDuffie v. State Farm Mut. Auto. Co., 2019-344, p. 5 (La. App. 5 Cir. 12/30/19),
13
287 So.3d 899, 903). An appellant seeks an appeal of the trial court’s final
judgment, not the trial court’s written reasons for judgment. Id. Accordingly, if the
appellate court determines the “‘trial court’s reasons for judgment are flawed, but
the judgment is correct,’ then ‘the judgment controls.’” Id. at p. 29, 384 So.3d at
930 (citing McDuffie, 2019-344, pp. 5-6, 287 So.3d at 903-04). The reason for this
rule is that an appellate court’s inquiry and analysis focus on “the result of the
judgment rather than the reasons.” Id. (quoting Dileo v. Horn, 2015-684, p. 27 (La.
App. 5 Cir. 3/16/16), 189 So.3d 1189, 1208). The rationale behind this
longstanding principle is that when the trial court provides written reasons, these
simply “set forth the basis for the [trial] court’s holding and are not binding.” Id.
(citing McDuffie, 2019-344, p. 5, 287 So.3d at 903). Thus, the “reasons for
judgment are not controlling and do not constitute the judgment of the [trial]
court.” Id. (quoting Theresa Seafood, Inc. v. Berthelot, 2009-0814, p. 7 (La. App. 4
Cir. 3/10/10), 40 So.3d 132, 137).
In light of the foregoing, our focus in the rest of the discussion will not be on
the Taxpayers’ assertions the BTA incorrectly held the units in question must
operate as “extensions of a public entity” and “cannot be too inextricably
intertwined with private contracts.” Rather, we focus our inquiry more generally on
whether Taxpayers demonstrated the Section 8 PBV units are entitled to the
exemption.
Whether the Taxpayers Are Entitled to the Exemption
HUD recognizes three types of low-income housing units under three
different programs: public housing units; the Section 8 PBV program, where rental
14
assistance is tied to specific units in a property;4 and the Section 8 Housing Choice
Voucher (“HCV”) program, which is a tenant-based program (i.e., the voucher
moves with the tenant).5 These latter two programs—PBV and HCV—are both
sometimes referred to as Section 8, but they are distinct.6 As explained on HANO’s
website:7
Under the tenant-based housing choice voucher program, HANO
issues an eligible family a voucher and the family selects a unit of its
choice. If the family moves out of the unit, the contract with the
owner ends and the family can move with continued assistance to
another unit. Under the project-based voucher program, HANO enters
into an assistance contract with the owner for specified units and for a
specified term. HANO refers families from its PBV site waiting list to
the project owner to fill vacancies. Because the assistance is tied to
the unit, a family who moves from the project-based unit does not
have any right to continued housing assistance. However, they may be
eligible for a tenant based voucher when one becomes available.
On appeal to this Court, the Taxpayers challenge the BTA’s decision with respect
to their Section 8 PBV Units only (the dwelling units at the Property that are
covered by all five agreements) and do not challenge the BTA’s decision as to the
other units (the units at the Property that are covered by the LURA, Tax Credit
4 This Court can take judicial notice of government websites. Bankers Ins. Co. v. EMIII
Holdings, LLC, 2024-0386, p. 1 (La. App. 4 Cir. 12/16/24), ___ So.3d ___, ___, 2024 WL
5116650, at *1 n.1 (citation omitted). Accordingly, we take judicial notice of the description of
the Section 8 PBV program on HUD’s website. Rental Assistance Demonstration: Fact Sheet
#10: The Difference Between Project-Based Vouchers and Project-Based Rental Assistance,
U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT, hud.gov.
5 We take judicial notice of HUD’s website for this information about the HCV program.
See Housing Choice Vouchers Fact Sheet, U.S. DEPARTMENT OF HOUSING AND URBAN
DEVELOPMENT, https://www.hud.gov/topics/housing_choice_voucher_program_section_8.
6 We take judicial notice of a report prepared by the Congressional Research Service for
the information in the block quote. Maggie McCarty, An Overview of the Section 8 Housing
Programs: Housing Choice Vouchers and Project-Based Rental Assistance, CONGRESSIONAL
RESEARCH SERVICE, https://crsreports.congress.gov/product/pdf/RL/RL32284 (updated Feb. 7,
2014).
7 We take judicial notice of HANO’s website for the information in this block quote.
Affordable Housing: Project-Based Voucher Program, HOUSING AUTHORITY OF NEW ORLEANS,
https://www.hano.org/project-based-voucher-program/.
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Agreement, Road Home Agreement, and HOME Agreement, but not the HAP
Contract). As such, this appeal only concerns the Section 8 PBV Units. Thus, we
must determine whether Taxpayers proved the Section 8 PBV units, which are
encumbered by all five agreements, qualify for the ad valorem tax exemption.
As this Court has previously held, “[e]xemptions from taxation are strictly
construed” because “an exemption [is] an exceptional privilege” that must be
clearly, unequivocally, and affirmatively established. Filmore Parc Apartments II,
2016-0568, p. 4, 212 So.3d at 624 (quoting Abundance Square Assocs., L.P., 2010-
0324, p. 5, 62 So.3d at 263). Because an exemption is such an exceptional
privilege, the taxpayer seeking the exemption bears a “stringent burden . . . to
overcome the judicial fundamental principle that ‘to doubt is to deny the
exemption.’” S. Yacht Club v. Zeno, 2012-1309, p. 10 (La. App. 4 Cir. 3/27/13),
112 So.3d 942, 948 (quoting Sherwood Forest Country Club v. Litchfield, 2008-
0194, p. 6 (La. 12/19/08), 998 So.2d 56, 61). Moreover, for this reason,
“Louisiana jurisprudence has consistently held that constitutional and statutory
grants of exemption from taxation must be strictly construed in favor of the taxing
body and against the taxpayer desiring the exemption.” Id. (citing Metairie
Country Club v. La. Tax Comm’n, 2003-538, p. 5 (La. App. 5 Cir. 10/28/03), 860
So.2d 165, 167-68). Thus, in this case, the Taxpayers bore the burden of
establishing they were entitled to the ad valorem tax exemption found in La. Const.
art. VII, § 21(A).
The Taxpayers seek exemption from ad valorem taxation for the Section 8
PBV units under La. Const. art. VII, §21, which provides:
Section 21. In addition to the homestead exemption provided
for in Section 20 of this Article, the following property and no other
shall be exempt from ad valorem taxation:
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(A) Public lands and other public property used for public
purposes.
In interpreting this provision, this Court has outlined a two-pronged test for
determining whether the exemption from ad valorem taxation applies to a
particular property.
The first prong is a determination as to whether the property is publicly or
privately owned. Filmore Parc Apartments II, 2016-0568, pp. 4-5, 212 So.3d at
624. Even if the property is not publicly owned, one must move onto the second
prong of the test because “[t]he Louisiana Supreme Court [has] acknowledged that
property can ‘vest’ in the public even though the ‘title be not in the public.’” Id.
(quoting Abundance Square Assocs., L.P., 2010-0324, p. 5, 62 So.3d at 264). That
is, Louisiana jurisprudence has held that “ownership alone is not the determining
factor and that privately owned property may be dedicated to public use to attain
tax exempt status.” Id. at p. 5, 212 So.3d at 625 (quoting Abundance Square
Assocs., L.P., 2010-0324, p. 10, 62 So.3d at 266).
Accordingly, the second prong of the test requires a determination as to
whether the property is used for a public purpose. Id. (quoting Slay, 473 So.2d at
53). A property has a public purpose if it “is either (1) dedicated and open to the
public, or (2) used in a way that benefits the general public.” Bd. of Comm’rs of
Port of New Orleans v. City of New Orleans, 2015-0768, pp. 5-6 (La. App. 4 Cir.
3/16/16), 186 So.3d 1282, 1285-86 (citing St. Bernard I, LLC v. Williams, 2012-
0372, pp. 7-9 (La. App. 4 Cir. 3/13/13), 112 So.3d 922, 927-28). In the low income
housing context, a unit’s status as Section 8 PBV housing alone is insufficient to
meet the public purpose requirement of La. Const. art. VII, § 21. See Abundance
Square Assocs., L.P., 2010-0324, p. 12, 62 So.2d at 267 (affirming the trial court’s
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denial of the ad valorem tax exemption to Section 8 PBV units). However, where
there are additional “restrictions . . . placed upon [a] [p]roperty in furtherance of
the mission of providing affordable housing for ‘low- and very low-income
residents in New Orleans,’” then these restrictions may satisfy the second prong of
the test so as to render Section 8 PBV units exempt from ad valorem taxation.
Filmore Parc Apartments II, 2016-0568, p. 8, 212 So.3d at 626. Additionally, in
determining whether the property has a public purpose, the courts can consider
“[h]ow the revenue derived from private property is used.” Id. at p. 5, 212 So.3d at
625 (quoting Abundance Square Assocs., L.P., 2010-0324, p. 10, 62 So.3d at 266).
If a property, such as an housing complex, has both non-exempt and exempt units,
then revenue from the exempt units must be deposited into a separate escrow
account to ensure that it is used “for the sole purpose of operation and maintenance
of these units.” Filmore Parc Apartments II, 2018-0359, p. 23, 318 So.3d at 732
(emphasis added). See also Abundance Square, 2010-0324, p. 11, 62 So.3d at 267
(affirming the exemption for “public housing” units at the same housing complex
that had non-exempt units because the property owners maintained a separate
escrow to ensure that any profits generated by the rental of the public housing units
were used solely for the benefit of the public housing units and not also used for
the benefit of the non-exempt units).
Looking at the first prong of the test, there is no dispute in this matter that
the Property is privately owned via the partnerships in commendam. Also,
although 2017 Filmore concerned a different tax year—2014—the property is the
same, and Taxpayers correctly note in their brief that “this Court [previously] held
that the [Section 8] PBV units . . . are privately owned.” See Filmore Parc
Apartments II, 2016-0568, p. 5, 212 So.3d at 624. In their present appeal, the
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Taxpayers do not dispute this prior holding. Rather, they argue that despite the
property’s private ownership, they are still entitled to the ad valorem tax
exemption for the Section 8 PBV units because they have dedicated those to a
public use.
Next, we consider the second prong of the test and determine whether,
despite their private ownership, the Section 8 PBV units are entitled to the
exemption because they are dedicated to a public purpose. The disputed units’
status as Section 8 PBV alone is insufficient to qualify for the exemption per
Abundance Square. Assocs., L.P., 2010-0324, p. 12, 318 So.3d at 267. However,
Taxpayers argue their Section 8 PBV units are further encumbered than the Section
8 PBV units in Abundance Square Associates, L.P., such that they are analogous to
the exempt public housing units in Abundance Square Associates, L.P. instead.
That is, Taxpayers explain all of the units at their property have restrictions on how
earned income can be used because of Taxpayers’ receipt of a federal Community
Development Block Grant (“CDBG Program”) loan funded by HUD and a HOME
Investment Partnership Program (“HOME Program”) loan also funded by HUD.
Specifically, Taxpayers assert the CDBG Program requires that any revenue must
go toward “maintenance and operation of the Property,” while the HOME Program
requires them to report revenue to the City of New Orleans (with whom the HOME
Program agreement was made), which can then require return of the revenue or use
of the revenue only for eligible costs. Taxpayers are correct that this Court held in
2017 Filmore that additional “restrictions . . . placed upon [a] [p]roperty in
furtherance of the mission of providing affordable housing for ‘low- and very low-
income residents in New Orleans,’” may satisfy the second prong of the test so as
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to render Section 8 PBV units exempt from ad valorem taxation. Filmore Parc
Apartments II, 2016-0568, p. 8, 212 So.3d at 626.
Taxpayers also correctly state in their briefs that Abundance Square
Associates L.P. demonstrates how La. Const. art. VII, § 21(A) can be applied to
affordable housing: “[w]hen (1) the units are dedicated to use solely by HANO,
and (2) the revenue for those units is restricted to use solely for maintenance and
operation of those units, the units are exempt.” (Emphasis added.) Regarding this
latter holding, in 2018 Filmore, this Court similarly noted with regard to what it
found to be a genuine issue of material fact at that phase of the proceedings, that in
housing complexes with potentially exempt and definitely non-exempt units, it is
important to know whether the “revenue generated from [the potentially exempt]
units” was deposited “into an escrow account, as mandated, for the sole purpose of
operation and maintenance of these units.” 2018-0359, p. 23, 318 So.3d at 732
(emphasis added.) However, Taxpayers’ own briefs and admission specifically
show how they fail to adhere to that rule from Abundance Square Associates, L.P.
and 2018 Filmore. That is, Taxpayers admit in their briefs to this Court that they
do not have a separate escrow account for any revenue generated by the Section 8
PBV units. Instead, Taxpayers assert they need not have a separate escrow
account: Taxpayers write that “[they] have no separate accounts for any
unrestricted, unaudited revenue from the [Section 8] PBV units because all of [the
Property’s funds are subject to Program Income restrictions and thus dedicated to
the maintenance and operation of the Property.” In sum, Taxpayers’ argument is
that because all of the units at the Property—even the ones for which they do not
seek the ad valorem tax exemption—have these encumbrances from the CDBG
Program and the HOME Program thereby requiring all revenue to return to the
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Property for maintenance and operation, there is no need for a separate escrow
account for any revenue that comes from the Section 8 PBV units.
This argument is incorrect. In Abundance Square Associates, L.P., under
their regulatory and operating agreements, the property owners had to maintain a
separate escrow account for any profit they might earn from the exempt public
housing units to ensure that any profits generated by the public housing units were
used solely for the benefit of the public housing units and not also used for the
benefit of the non-exempt units. 2010-0324, p. 11, 62 So.3d at 267. By so doing,
this structural arrangement guaranteed that no profit from the exempt public
housing units inured to the benefit of the non-exempt units. Accordingly, the
property owners could not get the benefit of the exemption for the public housing
units while simultaneously using profits generated therefrom to help the non-
exempt units. In the matter sub judice, by contrast, Taxpayers have admitted that
they do not have a separate escrow account for any revenue generated by the
Section 8 PBV units, such that there is what amounts to a comingling of revenue
generated by the Section 8 PBV units with revenue generated by the other, non-
exempt units. As such, this structural arrangement means that revenue garnered by
the Section 8 PBV units can go to operation and maintenance of the non-Section 8
PBV/non-exempt units. Assuming arguendo that the Section 8 PBV units generate
10% of the overall revenue at the property, Taxpayers’ lack of a separate escrow
account means that the Taxpayers do not ensure that the 10% goes back
specifically to the Section 8 PBV units. Rather, the non-Section 8 PBV/non-
exempt units might receive back 99% of the overall revenue in operation and
maintenance, while the Section 8 PBV units only receive 1% back in operation and
maintenance even though they generated 9% more revenue than that. Essentially,
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the Section 8 PBV units might not receive their fair and proportional share of the
revenue. To grant the exemption to the Taxpayers in this case would allow them to
receive the benefit of the exemption and the ability to use profits generated
therefrom to help the non-exempt units at the Property, thereby diminishing the
public purpose of the Section 8 PBV units. Thus, while the Taxpayers correctly
state in their briefs that Abundance Square Associates, L.P. holds that revenue
from units must be restricted to use solely for maintenance and operation of those
units for the exemption, the Taxpayers do not actually adhere to that because
revenue from the Section 8 PBV units for which they seek the ad valorem tax
exemption is not restricted to use solely for these Section 8 PBV units.
By failing to separate the revenue earned by the Section 8 PBV units, the
Taxpayers have not established the Section 8 PBV units align with the exempt
public housing units in Abundance Square Associates, L.P. so as to bring them
under the purview of the exemption. Thus, we pretermit discussion on whether the
various agreements and encumbrances on the Section 8 PBV units mean these
units have a public purpose. We do so because even if were to so find, Taxpayers
did not meet their stringent burden of clearly and unequivocally establishing
entitlement to the ad valorem tax exemption for the Section 8 PBV units in
question because of their failure to establish a separate escrow account.
Accordingly, the BTA correctly concluded Taxpayers were not entitled to the ad
valorem exemption for the 2022 tax year.
CONCLUSION
For the foregoing reasons, we affirm the BTA’s April 11, 2024 judgment,
which dismissed the claims asserted in Taxpayers’ respective Petitions; ordered
that Taxpayers are not entitled to claim the La. Const. art. VII, § 21(A) exemption
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on the Filmore I and Filmore II apartment complexes for the 2022 tax year; and
authorized Assessor Williams to retain and distribute the amounts paid by
Taxpayers under protest in response to their 2022 tax bills.
AFFIRMED
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