IN THE COURT OF APPEALS OF NORTH CAROLINA
No. COA23-728
Filed 19 March 2024
Property Tax Commission, No. 22 PTC 40
IN THE MATTER OF THE APPEAL OF:
OAK MEADOWS COMMUNITY ASSOCIATION, Appellant
From the decision of the Randolph County Board of Equalization and Review concerning the exemption of certain real property.
Appeal by taxpayer-appellant from final decision entered 28 February 2023 by
the North Carolina Property Tax Commission sitting as the State Board of
Equalization and Review. Heard in the Court of Appeals 23 January 2024.
Robinson, Bradshaw & Hinson, P.A., by Emily J. Schultz, H. Hunter Bruton, Emma W. Perry, Curtis C. Strubinger, and Timothy P. Misner, for taxpayer- appellant.
Poyner Spruill LLP, by Emily M. Meeker and N. Cosmo Zinkow, for appellee Randolph County.
ZACHARY, Judge.
This appeal raises a single issue of law: the definition of the phrase “providing
housing” as used in the property tax exemption provided for “[r]eal and personal
property owned by . . . [a] nonprofit organization providing housing for individuals or
families with low or moderate incomes[.]” N.C. Gen. Stat. § 105-278.6(a)(8) (2023)
(emphasis added). Oak Meadows Community Association (“Oak Meadows”) applied
for this exemption, which the Randolph County Board of Equalization and Review IN RE: OAK MEADOWS CMTY. ASS’N
Opinion of the Court
(“Randolph County”) denied. Oak Meadows now appeals from the final decision of the
North Carolina Property Tax Commission (“the Commission”), which affirmed
Randolph County’s denial of Oak Meadows’s request. After careful review, we affirm.
I. Background
Oak Meadows is a North Carolina nonprofit organization, and its purpose is
“to own and maintain land as a manufactured home community with the goal of a
permanently affordable, safe, and stable environment in which its current and future
members shall live as residents[.]” Oak Meadows owns approximately 3.74 acres of
land (“the Property”) in Asheboro, North Carolina. The Property has the
infrastructure to operate as a manufactured home community (“MHC”)
accommodating 60 manufactured homes.
Oak Meadows is structured as a leased-land housing cooperative, in which its
members are residents on the Property. Oak Meadows’s members own their
manufactured homes individually, and Oak Meadows has no ownership interest in
any of the homes. No individual obtains a financial return on investment through
membership in Oak Meadows.
On 9 February 2022, Oak Meadows requested a property tax exemption
pursuant to § 105-278.6(a)(8) for the Property. On 16 February 2022, Randolph
County denied Oak Meadows’s request, concluding that “housing is not being
provided for individuals or families with low or moderate incomes.” Oak Meadows
timely appealed to the Commission, before which the matter came on for hearing on
-2- IN RE: OAK MEADOWS CMTY. ASS’N
9 November 2022.
On 28 February 2023, the Commission issued its final decision, affirming the
denial of Oak Meadows’s request. The Commission found as fact:
2. There appears to be no dispute that the manufactured homes situated in the MHC on the [Property] are individually owned, and that [Oak Meadows] has no ownership interest in the manufactured homes. Accordingly, we find that [Oak Meadows] owns only the underlying land within the MHC and does not own any of the homes themselves.
3. Although [Oak Meadows] owns the MHC land, we note that land alone is insufficient to house an individual or family. [Oak Meadows] facilitates manufactured home lot rentals for its members, but since individual homeowners must secure their own manufactured housing separately from leasing lots within the MHC, we find that [Oak Meadows] does not “provid[e] housing for individuals or families.”
Based on these findings of fact, the Commission concluded:
2. The plain language of N.C. Gen. Stat. §105-278.6 provides that a property owner must be engaged in “providing housing for individuals or families with low or moderate incomes” in order to receive the benefit offered by the statute. [Oak Meadows] does not provide housing by solely owning the rental lots in a MHC, and the individual homeowners are responsible for securing their own homes to place upon the rental lots. Accordingly, [Oak Meadows] does not qualify for the benefit offered by N.C. Gen. Stat. §105-278.6.
3. Although [Oak Meadows] contends that granting the requested exemption is consistent with the policy of the State in promoting the creation of housing for
-3- IN RE: OAK MEADOWS CMTY. ASS’N
low and moderate income households, we find there to be no ambiguity in the language of the statute that would allow for the requested exemption under the facts of this case, and note further that the Commission has no authority to override the stated intent of the General Assembly.
Consequently, the Commission affirmed Randolph County’s denial of Oak
Meadows’s request. Oak Meadows timely filed notice of appeal.
II. Discussion
Oak Meadows argues that the Commission erred as a matter of law by denying
its request for a property tax exemption because the Commission’s “atextual
interpretation cannot be squared with [N.C. Gen. Stat. § 105-278.6(a)(8)]’s plain
meaning, or [its] statutory structure and purpose.” We disagree.
A. Standard of Review
On appeal from a decision of the Commission, this Court “shall decide all
relevant questions of law, interpret constitutional and statutory provisions, and
determine the meaning and applicability of the terms of any Commission action.”
N.C. Gen. Stat. § 105-345.2(b). This Court
may affirm or reverse the decision of the Commission, declare the decision null and void, or remand the case for further proceedings; or it may reverse or modify the decision if the substantial rights of the appellants have been prejudiced because the Commission’s findings, inferences, conclusions, or decisions are any of the following:
(1) In violation of constitutional provisions.
(2) In excess of statutory authority or jurisdiction of
-4- IN RE: OAK MEADOWS CMTY. ASS’N
the Commission.
(3) Made upon unlawful proceedings.
(4) Affected by other errors of law.
(5) Unsupported by competent, material, and substantial evidence in view of the entire record as submitted.
(6) Arbitrary or capricious.
Id. “In making these determinations, the court shall review the whole record or the
portions of it that are cited by any party, and due account shall be taken of the rule
of prejudicial error.” Id. § 105-345.2(c).
“The taxpayer bears the burden of proving that its property meets the
requirements of an ad valorem taxation exemption.” In re Blue Ridge Hous. of
Bakersville LLC, 226 N.C. App. 42, 49, 738 S.E.2d 802, 807 (2013) (cleaned up), disc.
review improvidently allowed, 367 N.C. 199, 753 S.E.2d 152 (2014). “Issues of
statutory construction are questions of law, reviewed de novo on appeal.” Id. (cleaned
up). When conducting de novo review, the appellate court “considers the matter anew
and freely substitutes its own judgment for that of the Commission.” Id. (citation
omitted).
B. Analysis
Free access — add to your briefcase to read the full text and ask questions with AI
IN THE COURT OF APPEALS OF NORTH CAROLINA
No. COA23-728
Filed 19 March 2024
Property Tax Commission, No. 22 PTC 40
IN THE MATTER OF THE APPEAL OF:
OAK MEADOWS COMMUNITY ASSOCIATION, Appellant
From the decision of the Randolph County Board of Equalization and Review concerning the exemption of certain real property.
Appeal by taxpayer-appellant from final decision entered 28 February 2023 by
the North Carolina Property Tax Commission sitting as the State Board of
Equalization and Review. Heard in the Court of Appeals 23 January 2024.
Robinson, Bradshaw & Hinson, P.A., by Emily J. Schultz, H. Hunter Bruton, Emma W. Perry, Curtis C. Strubinger, and Timothy P. Misner, for taxpayer- appellant.
Poyner Spruill LLP, by Emily M. Meeker and N. Cosmo Zinkow, for appellee Randolph County.
ZACHARY, Judge.
This appeal raises a single issue of law: the definition of the phrase “providing
housing” as used in the property tax exemption provided for “[r]eal and personal
property owned by . . . [a] nonprofit organization providing housing for individuals or
families with low or moderate incomes[.]” N.C. Gen. Stat. § 105-278.6(a)(8) (2023)
(emphasis added). Oak Meadows Community Association (“Oak Meadows”) applied
for this exemption, which the Randolph County Board of Equalization and Review IN RE: OAK MEADOWS CMTY. ASS’N
Opinion of the Court
(“Randolph County”) denied. Oak Meadows now appeals from the final decision of the
North Carolina Property Tax Commission (“the Commission”), which affirmed
Randolph County’s denial of Oak Meadows’s request. After careful review, we affirm.
I. Background
Oak Meadows is a North Carolina nonprofit organization, and its purpose is
“to own and maintain land as a manufactured home community with the goal of a
permanently affordable, safe, and stable environment in which its current and future
members shall live as residents[.]” Oak Meadows owns approximately 3.74 acres of
land (“the Property”) in Asheboro, North Carolina. The Property has the
infrastructure to operate as a manufactured home community (“MHC”)
accommodating 60 manufactured homes.
Oak Meadows is structured as a leased-land housing cooperative, in which its
members are residents on the Property. Oak Meadows’s members own their
manufactured homes individually, and Oak Meadows has no ownership interest in
any of the homes. No individual obtains a financial return on investment through
membership in Oak Meadows.
On 9 February 2022, Oak Meadows requested a property tax exemption
pursuant to § 105-278.6(a)(8) for the Property. On 16 February 2022, Randolph
County denied Oak Meadows’s request, concluding that “housing is not being
provided for individuals or families with low or moderate incomes.” Oak Meadows
timely appealed to the Commission, before which the matter came on for hearing on
-2- IN RE: OAK MEADOWS CMTY. ASS’N
9 November 2022.
On 28 February 2023, the Commission issued its final decision, affirming the
denial of Oak Meadows’s request. The Commission found as fact:
2. There appears to be no dispute that the manufactured homes situated in the MHC on the [Property] are individually owned, and that [Oak Meadows] has no ownership interest in the manufactured homes. Accordingly, we find that [Oak Meadows] owns only the underlying land within the MHC and does not own any of the homes themselves.
3. Although [Oak Meadows] owns the MHC land, we note that land alone is insufficient to house an individual or family. [Oak Meadows] facilitates manufactured home lot rentals for its members, but since individual homeowners must secure their own manufactured housing separately from leasing lots within the MHC, we find that [Oak Meadows] does not “provid[e] housing for individuals or families.”
Based on these findings of fact, the Commission concluded:
2. The plain language of N.C. Gen. Stat. §105-278.6 provides that a property owner must be engaged in “providing housing for individuals or families with low or moderate incomes” in order to receive the benefit offered by the statute. [Oak Meadows] does not provide housing by solely owning the rental lots in a MHC, and the individual homeowners are responsible for securing their own homes to place upon the rental lots. Accordingly, [Oak Meadows] does not qualify for the benefit offered by N.C. Gen. Stat. §105-278.6.
3. Although [Oak Meadows] contends that granting the requested exemption is consistent with the policy of the State in promoting the creation of housing for
-3- IN RE: OAK MEADOWS CMTY. ASS’N
low and moderate income households, we find there to be no ambiguity in the language of the statute that would allow for the requested exemption under the facts of this case, and note further that the Commission has no authority to override the stated intent of the General Assembly.
Consequently, the Commission affirmed Randolph County’s denial of Oak
Meadows’s request. Oak Meadows timely filed notice of appeal.
II. Discussion
Oak Meadows argues that the Commission erred as a matter of law by denying
its request for a property tax exemption because the Commission’s “atextual
interpretation cannot be squared with [N.C. Gen. Stat. § 105-278.6(a)(8)]’s plain
meaning, or [its] statutory structure and purpose.” We disagree.
A. Standard of Review
On appeal from a decision of the Commission, this Court “shall decide all
relevant questions of law, interpret constitutional and statutory provisions, and
determine the meaning and applicability of the terms of any Commission action.”
N.C. Gen. Stat. § 105-345.2(b). This Court
may affirm or reverse the decision of the Commission, declare the decision null and void, or remand the case for further proceedings; or it may reverse or modify the decision if the substantial rights of the appellants have been prejudiced because the Commission’s findings, inferences, conclusions, or decisions are any of the following:
(1) In violation of constitutional provisions.
(2) In excess of statutory authority or jurisdiction of
-4- IN RE: OAK MEADOWS CMTY. ASS’N
the Commission.
(3) Made upon unlawful proceedings.
(4) Affected by other errors of law.
(5) Unsupported by competent, material, and substantial evidence in view of the entire record as submitted.
(6) Arbitrary or capricious.
Id. “In making these determinations, the court shall review the whole record or the
portions of it that are cited by any party, and due account shall be taken of the rule
of prejudicial error.” Id. § 105-345.2(c).
“The taxpayer bears the burden of proving that its property meets the
requirements of an ad valorem taxation exemption.” In re Blue Ridge Hous. of
Bakersville LLC, 226 N.C. App. 42, 49, 738 S.E.2d 802, 807 (2013) (cleaned up), disc.
review improvidently allowed, 367 N.C. 199, 753 S.E.2d 152 (2014). “Issues of
statutory construction are questions of law, reviewed de novo on appeal.” Id. (cleaned
up). When conducting de novo review, the appellate court “considers the matter anew
and freely substitutes its own judgment for that of the Commission.” Id. (citation
omitted).
B. Analysis
“In appeals to the Commission, the taxpayer bears the burden of proving that
its property is entitled to an exemption under the law.” In re Eagle’s Nest Found., 194
N.C. App. 770, 773, 671 S.E.2d 366, 368 (2009). “This burden is substantial and often
-5- IN RE: OAK MEADOWS CMTY. ASS’N
difficult to meet because all property is subject to taxation unless exempted by a
statute of statewide origin.” Id. (citation omitted). “[W]here a statute provides for an
exemption from taxation, the statute is construed strictly against the taxpayer and
in favor of the State. The underlying premise when interpreting taxing statutes is:
Taxation is the rule; exemption the exception.” Broadwell Realty Corp. v. Coble, 291
N.C. 608, 611, 231 S.E.2d 656, 658 (1977) (cleaned up).
When interpreting tax statutes, as with any other statute, it is a “well-
recognized rule that the words used in a statute must be given their natural or
ordinary meaning.” In re N.C. Forestry Found., Inc., 296 N.C. 330, 337, 250 S.E.2d
236, 241 (1979). “Where the statutory language is clear and unambiguous, the Court
does not engage in judicial construction but must apply the statute to give effect to
the plain and definite meaning of the language.” In re POP Capitol Towers, LP, 282
N.C. App. 491, 497, 872 S.E.2d 338, 342 (2022) (citation omitted).
Here, the parties agree that this case may be resolved upon review of the plain
language of N.C. Gen. Stat. § 105-278.6(a)(8), although they disagree as to the effect
of that language. The term “provide housing” as used in § 105-278.6(a)(8) “has not
been defined by statute or judicial decision; therefore, we look to its natural, approved
and recognized meaning.” In re R.W. Moore Equip. Co., 115 N.C. App. 129, 132, 443
S.E.2d 734, 736, disc. review denied, 337 N.C. 693, 448 S.E.2d 533 (1994). When
interpreting undefined words or phrases, “courts may look to dictionaries to
determine the ordinary meaning of words within a statute.” Parkdale Am., LLC v.
-6- IN RE: OAK MEADOWS CMTY. ASS’N
Hinton, 200 N.C. App. 275, 279, 684 S.E.2d 458, 461 (2009).
In its appellate brief, Oak Meadows provides a dictionary definition of the word
“provide” as meaning to “supply” or “make available.” Oak Meadows thus contends
that it “is ‘providing housing’ by supplying real property and making it available to
use for housing.” Oak Meadows further explains that it “provides individuals and
families with a place to live—namely legal home sites in a safe and affordable
community” and that “a home site, like the manufactured home itself, is an essential
element of manufactured housing.”
Be that as it may, providing “an essential element of manufactured housing”
is not the same as “providing housing.” It strains credulity to suggest that the natural
or ordinary meaning of the phrase “providing housing” would be “providing [the real
property for] housing[.]” N.C. Gen. Stat. § 105-278.6(a)(8).
Notably, Oak Meadows offers a dictionary definition of “provide” in its
appellate brief, but fails to include a dictionary definition of “housing.” “Housing” is
defined as: “Structures built as dwellings for people, such as houses, apartments, and
condominiums.” Housing, Black’s Law Dictionary (11th ed. 2019). This definition is
consistent with the natural or ordinary meaning of “housing” and also contradicts
Oak Meadows’s argument that it “is ‘providing housing’ by supplying real property
and making it available to use for housing.” As the Commission aptly noted, “land
alone is insufficient to house an individual or family.” Thus, the Commission did not
err in rejecting Oak Meadows’s argument.
-7- IN RE: OAK MEADOWS CMTY. ASS’N
Because the “statutory language is clear and unambiguous,” we are without
authority to “engage in judicial construction but must apply the statute to give effect
to the plain and definite meaning of the language.” POP Capitol Towers, 282 N.C.
App. at 497, 872 S.E.2d at 342 (citation omitted). We therefore affirm the
Commission’s final decision, which affirmed Randolph County’s denial of Oak
Meadows’s request for a property tax exemption pursuant to N.C. Gen. Stat. § 105-
278.6(a)(8).
III. Conclusion
For the foregoing reasons, the Commission’s final decision is affirmed.
AFFIRMED.
Judges COLLINS and WOOD concur.
-8-