Savage Mill Enterprises, LLC brought suit against the Borough of Little Silver, arguing that the subject property was entitled to a partial exemption for the portion being used by its 99–year ground lease tenant, which is an undisputed tax-exempt entity, and which owns and uses the building on that land for undisputed charitable purposes.
Borough sought to dismiss the complaint on grounds this court lacks subject-matter jurisdiction because Savage Mills, a for-profit entity, is contractually obligated to pay local property taxes on property, and thus could not seek a partial exemption for the same.
The Tax Court held that:
- Savage Mills, as fee owner of the subject property, had standing to challenge the amount and methodology underlying the subject property’s assessment, which can include a claim for exemption;
- However, this standing does not equate to a grant of the exemption sought because exemption statutes are strictly construed, thus, require full compliance with the statutorily imposed qualifications for an exemption;
- Savage Mills failed to meet the statutory qualifications for a partial exemption, since the plain language of the statute affords a partial exemption only when the landlord is the non-profit entity and the tenant is the for-profit entity.