Opinion
No. 35861
Decided April 29, 1959.
Taxation — Exemptions — Real property owned by municipality and leased to United States — Used by lessee for public purpose.
Where real property owned by a city is leased to the United States and used by that lessee exclusively for public purposes, such real property should be exempted from taxation pursuant to Section 5709.08, Revised Code. ( City of Dayton v. Haines, Aud., 156 Ohio St. 366, overruled.)
APPEAL from the Board of Tax Appeals.
This proceeding originated with an application to the Board of Tax Appeals for exemption from taxation of certain real estate and the structures thereon.
The real estate involved is six acres owned by the city of Dayton and leased by it to the United States. The structures thereon are owned by the lessee. The property is used by the lessee as a reserve training area for the armed forces.
Section 5709.08, Revised Code, reads, so far as pertinent:
"Real or personal property belonging to the state or United States used exclusively for a public purpose, and public property used exclusively for a public purpose, shall be exempt from taxation."
The Board of Tax Appeals found and it is conceded "that the property * * * is being used exclusively for a public purpose," but held that, by reason of paragraph two of the syllabus and the decision of City of Dayton v. Haines, Aud., 156 Ohio St. 366, 102 N.E.2d 590 ("the use for a public purpose must be * * * by the one whose ownership constitutes the property public property"), the real property is "outside the purview of" the foregoing statutory provisions and not entitled to exemption from taxation. It held, however, that the structures thereon are exempt.
The cause is before this court on appeal from the part of the decision holding the real property not entitled to tax exemption.
Mr. Herbert S. Beane, city attorney, Mr. M.J. Gilbert and Mr. Joseph P. Duffy, for appellant.
Mr. William Saxbe and Mr. Mark McElroy, attorney general, Mr. John M. Tobin, Mr. John D. Herbert and Mr. Mathias H. Heck, prosecuting attorney, for appellees.
Although the elements of ownership of the real property in the instant case are partly vested in the lessor and partly in the lessee, no one else has any interest of ownership whatever in that real property. Hence, since both the lessor and lessee are public bodies, there is nothing but a public ownership of that property, and the property is, to use the words of Section 5709.08, Revised Code, "public property." The board found and it is conceded that this "public property" is "used exclusively for a public purpose," within the meaning of the words of that statute. The statute specifies that such property so used "shall be exempt from taxation." In order to hold otherwise, this court would have to revise that statute.
It is argued however and both parties concede that this court must hold otherwise unless it refuses to follow its decision in City of Dayton v. Haines, supra ( 156 Ohio St. 366).
In City of Toledo v. Jenkins et al., Board of Tax Appeals, 143 Ohio St. 141, 54 N.E.2d 656, and In re Application for Exemption of Real Property from Taxation, 167 Ohio St. 273, 147 N.E.2d 857, uses of parts of property by lessees thereof who were not public bodies were held not to prevent tax exemption under that statute. Certainly, some of the elements of ownership of the leased portions of the property were vested in those lessees. In view of the addition of the word "exclusively" to the statute, it would be particularly difficult to distinguish the latter case on any reasonable basis from the Haines case. See In re Application for Exemption from Taxation, supra, 277. See also Carney, Aud., v. Cleveland City School District Public Library, ante, 65. In order therefore to eliminate inconsistent holdings by this court, City of Dayton v. Haines, supra ( 156 Ohio St. 366), is overruled.
Decision reversed.
ZIMMERMAN, MATTHIAS, BELL and HERBERT, JJ., concur.
WEYGANDT, C.J., dissents.
PECK, J., not participating.