Columbus City School District Board of Education v. Testa

Summary

The Supreme Court of Ohio held that property owned for the use and benefit of a state university is not exempt from real property taxation under R.C. 3345.17 merely because rental income from the property supports university purposes. The property itself must be used in a manner that bears an operational relationship to university activities. Because the building was used solely as income-producing commercial and residential rental property, the court reversed the Board of Tax Appeals’ decision granting the exemption.

Holdings

1. Property qualifies for exemption under R.C. 3345.17 only when the property itself is used, currently or prospectively, in a manner that bears an operational relationship to university activities; using rental income to support the university, standing alone, is insufficient.
2. The property was not entitled to exemption because it had no current or prospective use operationally related to Ohio State University's activities.

Questions Presented

1. Whether income-producing property owned by the state for the use and benefit of a state university qualifies for exemption from real-property taxation under R.C. 3345.17 when the property is used solely to generate rental income that is devoted to university purposes.
2. Whether the property's proximity to Ohio State University and its status as a bequest intended to fund university scholarships independently establish entitlement to the exemption.

Disposition

reversed