                              NO. COA13-1447

                      NORTH CAROLINA COURT OF APPEALS

                          Filed: 19 August 2014


IN THE MATTER OF THE APPEAL OF:        Property Tax Commission sitting
                                       as the State Board of
GRANDFATHER MOUNTAIN STEWARDSHIP       Equalization and Review
FOUNDATION, INC., from the             11 PTC 068
Decision of the Avery County Board
of Equalization and Review
Concerning the Valuation of Real
Property for Tax Year 2011.



    Appeal by Avery County from orders entered 21 February and

24 June 2013    by    the North Carolina Property Tax Commission.

Heard in the Court of Appeals 22 April 2014.


    Poyner Spruill LLP, by Chad W. Essick and Andrew H.
    Erteschik, and Harrison & Poore, PA, by Michaelle Poore,
    for appellant Avery County.

    Tuggle Duggins, P.A., by Martha R. Sacrinty and Michael S.
    Fox,   for   appellee  Grandfather   Mountain  Stewardship
    Foundation.


    BRYANT, Judge.


    Where the property was not wholly and exclusively used for

educational or scientific purposes pursuant to North Carolina

General   Statutes,    sections   105-275(12)   and   105-278.7(a),   we

reverse the order of the North Carolina Property Tax Commission
                                       -2-
granting Grandfather Mountain Stewardship Foundation exemption

from property taxes.

      Grandfather Mountain Stewardship Foundation, Inc. (GMSF),

filed an application for exemption from property taxes in Avery

County   listing   three     parcels    of   real   property   (the   subject

property).   In its 24 December 2010 application, GMSF indicated

that the tax exemption was sought due to GMSF’s status as a

charitable or educational foundation pursuant to N.C. Gen. Stat.

'   105-278.7.     The    Avery County Tax Assessor’s Office           denied

GMSF’s application due to the belief “that Grandfather Mountain

is not ‘Wholly and exclusively used by its owner for nonprofit

educational, scientific, literary purposes’ as defined by NCGS '

105-278.7(a)(1).”        GMSF appealed to the Avery County 2011 Board

of Equalization and Review, stating “[t]he property qualifies as

tax exempt under N.C. Gen. Stat. ' 105-278.7 and N.C. Gen. Stat.

' 105-275(12) . . . .”         The Equalization and Review Board also

denied the request for tax exempt status.             GMSF filed a notice

of appeal and application for hearing with the North Carolina

Property Tax Commission (the Commission).

      On 24 June 2013, following a 10 April 2013 hearing, the

Commission entered an order in which it concluded that GMSF was

a charitable association; that the revenue GMSF collected from
                                         -3-
the operation of the real property funded the educational and

scientific uses of the property; any structures on the real

property     that    were   not    used        directly    for    scientific    or

educational      purposes   were    incidental        to   the   scientific    and

educational uses of the property; and the subject property1 was

“wholly    and    exclusively     used    for      scientific    and    educational

purposes.”       The Commission concluded that “[e]ach of the tracts

[was] eligible as exempt under both [General Statutes, sections

105-275(12) and 105-278.7] . . . .”                   Avery County appeals to

this Court.

                      __________________________________

       On appeal, Avery County raises the following issues: the

Commission erred by (I) exempting the property from taxation;

(II)    holding     that    the    property         satisfied     the    ownership

requirements for an exemption; and (III) holding that the vacant

lot is exempt from taxation.

                                               I




1
  GMSF notified the Commission that it abandoned its appeal from
the denial of tax exempt status with regard to one of the three
parcels of real property listed on its original application for
tax exemption.   Therefore, only the remaining two land parcels
comprised the subject property on review before the Commission.
On Parcel Two, GMSF operated the Grandfather Mountain tourist
attraction and Parcel Three served “as a buffer tract to
preserve the natural area and prevent encroaching development.”
                                             -4-
       Avery County argues that the Commission erred by exempting

the    property      from     taxation      because          the    property         is    a    self-

described tourist attraction that is not “wholly and exclusively

used   for    educational        or    scientific            purposes.”         Specifically,

Avery County contends the Commission erred in concluding GMSF

was eligible for a tax exemption under both N.C. Gen. Stat. ''

105-275(12)         and    105-278.7     because         (A)       the    property         was    not

“wholly      and    exclusively”       used       for    educational           and    scientific

purposes; (B) the conclusion should have been predicated on how

the property was used rather than how the income generated from

the property was spent; and (C) the income generated from the

property is more than incidental income.                           For the most part, we

agree.

       “Statutes          exempting    property         from       taxation      due       to     the

purposes     for     which     such    property         is    held       and   used       must,    of

course, be strictly construed against exemption and in favor of

taxation.”         In re Forestry Found., 35 N.C. App. 414, 428—29, 242

S.E.2d 492, 501 (1978) (citations omitted), aff'd, 296 N.C. 330,

250    S.E.2d      236     (1979);    see     also      In     re    Appeal      of       Totsland

Preschool, Inc., 180 N.C. App. 160, 164, 636 S.E.2d 292, 295

(2006)    (“[A]ll         ambiguities       are    to    be        resolved     in        favor   of

taxation.”         (citations    omitted)).             “[T]he       taxpayer         bears       the
                                         -5-
burden of proving that its property is entitled to an exemption

under the law.”         In re Appeal of Eagle's Nest Found., 194 N.C.

App. 770, 773, 671 S.E.2d 366, 368 (2009) (citation omitted).

       Appeal    from     an   order    or    decision    of   the   Property   Tax

Commission shall lie to the Court of Appeals.                        See N.C. Gen.

Stat. § 105-345(d) (2013).              “Questions of law receive de novo

review, while issues such as sufficiency of the evidence to

support the Commission's decision are reviewed under the whole-

record test.”       In re Appeal of Greens of Pine Glen Ltd. P’ship,

356 N.C. 642, 647, 576 S.E.2d 316, 319 (2003) (citing N.C.G.S. §

105-345.2(b)).       This Court “may affirm or reverse the decision

of the Commission, declare the same null and void, or remand the

case    for     further    proceedings[.]”          N.C.G.S.     §    105-345.2(b)

(2013).

                                               A.

       Avery County contends the Commission erred by concluding

GMSF’s use of the property was “wholly and exclusively . . .

educational and scientific.”            We agree.

       GMSF   acknowledges       that    it    seeks     tax   exemption   on   the

grounds that it is a charitable association or institution and

the subject property is “exclusively held and used by its owners

for educational and scientific purposes as a protected natural
                                      -6-
area . . . .”        GMSF submitted its application for property tax

exemption in December 2010.           In its application, GMSF stated

that it sought tax exempt status pursuant to General Statutes,

section 105-278.7.          Following the Avery County Tax Assessor’s

denial of GMSF’s application due to the tax assessor’s belief

“that Grandfather Mountain is not ‘Wholly and exclusively used

by   its   owner   for   nonprofit   educational,      scientific,   literary

purposes’ as defined by NCGS ' 105-278.7(a)(1),” GMSF filed an

application for hearing before the Board of Equalization and

Review.     In its application for hearing, GMSF maintained that

the tax assessor’s appraisal should be adjusted because “[t]he

property qualifies as tax exempt under N.C. Gen. Stat. ' 105-

278.7 and N.C. Gen. Stat. ' 105-275(12) . . . .”                 However, as

noted herein, Avery County appeals the decision of the Property

Tax Commission which concluded, inter alia, that the subject

property    was    wholly   and   exclusively   used    for   scientific   and

educational purposes.

      We review this dispositive issue on appeal de novo as there

does not appear to be a conflict in the evidence as to the use

of the property; rather, Avery County challenges whether the

legal conclusion is correct as a matter of law.                   See In re

Appeal of Totsland Preschool, Inc., 180 N.C. App. at 162—63, 636
                                   -7-
S.E.2d at 295 (This Court reviews questions of law de novo, and

“considers   the   matter   anew   and   freely   substitutes   its   own

judgment for that of the Commission.”).

     Pursuant to General Statutes, section 105-275, as effective

at the time GMSF filed its initial application for exemption in

2011, property meeting the following description may be excluded

from taxation:

          Real    property  owned    by  a    nonprofit
          corporation or association exclusively held
          and used by its owner for educational and
          scientific purposes as a protected natural
          area. (For purposes of this subdivision, the
          term "protected natural area" means a nature
          reserve or park in which all types of wild
          nature,    flora  and   fauna,   and   biotic
          communities are preserved for observation
          and study.)

N.C. Gen. Stat. ' 105-275(12) (2011)2.



2
  N.C.G.S. ' 105-275(12) was amended by 2011 N.C. Sess. Laws 274
(effective for taxes imposed for taxable years beginning after 1
July 2011). In pertinent part, the amended subdivision reads as
follows:

          Real property that (i) is owned by a
          nonprofit    corporation    or   association
          organized to receive and administer lands
          for    conservation   purposes,    (ii)   is
          exclusively held and used for one or more of
          the purposes listed in this subdivision, and
          (iii) produces no income or produces income
          that is incidental to and not inconsistent
          with the purpose or purposes for which the
          land   is  held   and  used.   .  .   .    A
          disqualifying event occurs when the property
                                   -8-
    Pursuant to North Carolina General Statutes, section 105-

278.7,

           [b]uildings, the land they actually occupy,
           and additional adjacent land necessary for
           the convenient use of any such building
           shall be exempted from taxation if wholly
           owned   by  [a   charitable association  or
           institution], and if:

           (1)   Wholly and exclusively used by its owner
           for   nonprofit educational [or] scientific, .
           . .   purposes as defined in subsection (f) .
           . .   .

Id. § 105-278.7(a) (2013).

    In In re Forestry Found., 296 N.C. 330, 250 S.E.2d 236, the

petitioner sought a tax exemption for 49,455 acres of forest in

Onslow   County.     The   petitioner    was   a   nonprofit   organization


           (i) is no longer exclusively held and used
           for one or more of the purposes listed in
           this subdivision, [or] (ii) produces income
           that is not incidental to and consistent
           with the purpose or purposes for which the
           land is held and used . . . . The purposes
           allowed under this subdivision are any of
           the following:

           a. Used for an educational or scientific
           purpose as a nature reserve or park in which
           wild nature, flora and fauna, and biotic
           communities are preserved for observation
           and study. For purposes of this sub-
           subdivision, the terms “educational purpose”
           and “scientific purpose” are defined in G.S.
           105-278.7(f).

N.C.G.S. § 105-275(12)(a) (2011) (Effective for taxes imposed
for taxable years beginning on or after July 1, 2011).
                                              -9-
whose objective was “to promote the development and practice of

improved    forestry       methods       and      to    promote          the   production         and

preservation of growing timber for experimental, demonstration,

educational, park and protection purposes.”                                Id. at 331, 250

S.E.2d   at   237—38.           In    1934,       the    Attorney         General          of   North

Carolina    expressed          his    opinion      that       the    forest       property        was

exempt from ad valorem taxes “because of the public nature of

the ([petitioner]) and the purpose for which these lands [were]

held.”      Id.    at    331—32,       250     S.E.2d         at    238.         In    1945,      the

petitioner    signed       a    ninety-nine            year    lease       with    the      Halifax

Paper Company, Inc.              Id. at 332, 250 S.E.2d at 238.                             Halifax

Paper    Company’s       successor           in     interest         was       Hoerner-Waldorf

Corporation,       which       held    the     lease      at       the    time    of       the    tax

exemption hearing.             The lease, as amended in 1951, afforded the

Hoerner-Waldorf         Corporation          the        right       to     construct            roads,

maintain drainage ditches and fire lanes, and cut timber and

pulpwood.      Id.       “Students and study groups interested in the

operation     of   the     Forest       [were]         allowed       to    tour       or    conduct

research in the Forest . . . subject to the contract provision

that ‘such study groups or students will do nothing whatsoever

to interfere with any program undertaken or in progress by Paper

Company in or on [the] Forest.’”                    Id. at 333, 250 S.E.2d at 238—
                                                -10-
39.     In    1975,     the    petitioner          filed     an    application           for   tax

exemption      with      the       Onslow        County     Tax     Supervisors.               The

application was denied.                  Arguing before our Supreme Court, the

petitioner contended that the forest property was exempt from ad

valorem taxes pursuant to four statutes, including N.C.G.S. '

105-275(12),      exempting         “[r]eal       property        owned      by   a   nonprofit

corporation       or   association             exclusively      held    and       used    by   its

owner for educational and scientific purposes as a protected

natural      area.”          Id.    at     335,    250     S.E.2d       at    240     (emphasis

omitted).      The Court noted that according to Webster’s Third New

International Dictionary,                 the word        “exclusive”        was synonymous

with the words “sole” and “single” and the Century Dictionary

defined      the word as           “appertaining to the subject alone; not

including,       admitting,         or    pertaining       to     any   other       or   others;

undivided; sole; as, an exclusive right or privilege; exclusive

jurisdiction.”         Id. at 337, 250 S.E.2d at 241.                        The Court held

that because the petitioner’s lease agreement, as amended in

1951,     gave     Hoerner-Waldorf               Corporation        virtually            complete

operational control of the forest property and Hoerner-Waldorf

Corporation’s          use     of        the     forest     property         was      primarily

commercial, the property was not exclusively used for scientific
                                            -11-
and educational purposes.            Id. at 338—39, 250 S.E.2d                241—42.3

       In   the     instant      case,      in     concluding     that       the    subject

property    was     wholly    and    exclusively        used    for     scientific         and

educational purposes, the Commission made several findings of

fact detailing the purposes for which the property was used.

GMSF    engages     in   a   number      of      educational    activities          such    as

teaching visitors about the animals housed on the property, the

native flora and fauna,              and leading guided hikes, hosting a

nature museum, and educating visitors about stewardship.                                   The

Commission        also   found      that      GMSF   provided         both   formal        and

informal programs to educate visitors from a range of age groups

about the property.           It found that GMSF engages in scientific

research on the property, such as taking weather measurements

and researching air quality, birds, rare plants, well cores,

bats,    and   salamanders.           The     Commission       also    found       that    the

property has been designated a United Nations Biosphere Reserve.

       Avery County does not dispute that there are educational

3
  Prior to petitioner’s appeal to our Supreme Court, this Court
reasoned that the actual use of property, rather than a goal or
objective for its use, determines whether it is to be excluded
from the tax base. “Use, rather than ownership or objective, is
the primary exempting characteristic of the Machinery Act, G.S.
105-271 through G.S. 105-395, which includes the statute[] under
consideration. H. Lewis, Annotated Machinery Act of 1971,
(Supp.1973, Comment, p. 55).”    In re Forestry Found., 35 N.C.
App. at 426, 242 S.E.2d at 499-500.
                                                -12-
and    scientific         activities           that    occur    on       the        property     but

contends there are substantial retail, commercial, recreational,

lodging,       and    office        uses       that   also    occur      on      the    property.

Several    of    the      Commission’s           findings      support         Avery       County’s

contention of substantial retail and commercial activity on the

property, including profit from retail sales in excess of one

million    dollars.            Avery       County      also    contends         that       the   vast

majority of retail sales on the property are classified by GMSF

as    “non-mission.”               We    note     with    interest         the       Commission’s

finding that GMSF collects revenue from admission tickets, food

sales, souvenir sales, and special programs.                                    The deposition

testimony of Emerson Penn Dameron, Jr., President of GMSF, is

illuminating         as   to       the    activities      and       uses       on    the    subject

property.

       President Dameron testified that prior to 1950, Grandfather

Mountain       was     not     a    travel        attraction;        individuals            visited

Grandfather Mountain to hike and explore.                                  Subsequently, the

owner of Grandfather Mountain “set about converting it into a

more   formalized,           accessible         attraction      .    .     .    and    began     the

process of expanding access to the general public rather than

just      to         explorers           and      naturalists            and         scientists.”

“[E]ssentially all of the improvements that are on the property
                                         -13-
subject to this appeal are located on one parcel.”                                     Of the

improvements         constructed,      President      Dameron       noted       a    swinging

bridge,     a    small       woodcarving    shop,          two     guest      cottages,       a

visitor’s center, an animal habitats center, a museum, a fudge

shop, and an administrative offices building.                           In 2010, 244,215

guests visited Grandfather Mountain.                   Gift shops located in the

museum    and    the    visitor’s      center    sold       retail      items,       such    as

hiking equipment, souvenirs, and snacks.                         Honey, jelly, fruit,

woodcarvings, and books on woodcarving were also sold on the

property.        Within the nature museum, visitors could purchase

food and beverages from an on-site restaurant; nearby, treats

could be purchased from a free-standing fudge shop.                                 President

Dameron also noted that in 2010, GMSF recognized $1,108,971.00

in profit from retail sales.

    Though not always a source of revenue, the property is also

used for annual events such as the Grandfather Mountain Highland

Games    (which      celebrates     Scottish     heritage          as   its     relates      to

Western North Carolina), Singing on the Mountain, a Klondike

Derby for the boy scouts, a Girl Scout Roundup, a family camping

weekend,    and      corporate    picnics.           The    facility       is       also   made

available       to   local    groups    such    as    the        Audubon   Society,         the

animal shelter, and Habitat for Humanity.
                                        -14-
    The land parcels comprising Grandfather Mountain are also

subject to a conservation easement with the Nature Conservatory,

and have been honored with conservation awards and designated a

United Nations Biosphere Reserve.               The record supports that the

attraction       of    Grandfather     Mountain       offers     educational       and

scientific    presentations       about      birds,    reptiles,       animals,    and

native flora and fauna; and that revenue from the operations on

the property is used to further educational and scientific uses

on the property.

    However,           notwithstanding       that      such      educational       and

scientific endeavors might be the primary uses of GMSF’s subject

property,    we       cannot   hold   that     the    property    is    wholly     and

exclusively      used    for   educational     and    scientific       endeavors    as

defined by our Supreme Court in In re Forestry Found., 296 N.C.

330, 250 S.E.2d 236.           The observations of the president of the

GMSF confirm this.

            Q.        . . . [O]n June 4, 2009, Grandfather
                      Mountain, Inc., conveyed a conservation
                      easement to the State of North Carolina
                      limiting property owner to using the
                      property for conservation and education
                      activities.

                      It is true that there are commercial
                      and retail activities that take place
                      on the site. Is that correct?

            A.        That’s correct.
                                            -15-


            Q.        So it not entirely accurate to say that
                      it’s   limited  for   conservation   and
                      education activities. Is that correct?

            A.        . . . It does – as we’ve already noted,
                      it   would   permit   us   to  continue
                      activities that were already taking
                      place on the mountain above and beyond
                      conservation and education.

       There is support in the record that GMSF charges market-

rate admission fees and operates to some extent as a for-profit

tourist attraction.         Located on the property are administrative

offices from which GMSF manages Grandfather Mountain’s retail

and commercial services.              Based on the President’s comments and

the events described in the record, it is clear GMSF operated

under the proposition that a change to                        its Internal Revenue

Service 501(c)(3) nonprofit status along with the conveyance of

a conservation easement would also exempt the subject property

from   Avery     County    property         taxes.      The   record    owner     of   the

property commonly known as Grandfather Mountain is Grandfather

Mountain,      Inc.    (GMI),    a    for-profit       corporation.         GMSF    is   a

501(c)(3) nonprofit corporation which is the sole shareholder of

GMI and holds the property subject to a triple net lease.                              The

Commission       found    that       this     lease     places    the    burdens       and

obligations      of    ownership       of     the     subject    property    on    GMSF,

including      responsibility        for     paying    all    real   property      taxes.
                                       -16-
Prior to leasing the property to GMSF in 2009, GMI engaged in

transactions and granted conservation easements to the Nature

Conservatory and the State of North Carolina for the purpose of

preserving the property for educational and scientific purposes.

It appears, based on the observation of GMSF’s President, that

GMSF   was   under    the   impression    the    conservation       easement,         by

limiting     the     use    of   the    property      for     conservation           and

educational activities, would also allow for the continuance of

commercial activities.           While that assumption may be valid for

purposes of the easement and maintaining the 501(c)(3) status,

it is not sufficient to withstand the requirements of N.C.G.S.

'' 105-275(12) and 105-278.7(a).                Despite GMSF’s status as a

501(c)(3)     nonprofit      corporation      and    the      conveyance        of     a

conservation easement, the use of the property must still come

within the scope and meaning of “wholly and exclusively used for

educational    and    scientific       purposes.”       See    In   re    Forestry

Found., 296 N.C. at 337—38, 250 S.E.2d at 241 (where the Court

considered    and    rejected     petitioner’s      argument    that     “the    term

‘exclusively’ is not to be construed literally and that . . .

the word refers to the primary and inherent activity and does

not preclude incidental activities . . . .”).                 Here, the subject

property does not meet the statutory requirements necessary to
                                    -17-
receive tax exempt status.

    Accordingly, we must reverse the Commission’s                   conclusion

that the real property subject to GMSF’s stewardship is “used

wholly and exclusively for scientific and educational purposes.”

                                  B and C

    Avery     County    further   contends       the   Commission   erred    in

basing its decision to grant GMSF’s request for tax exemption on

how the income from the property was spent, instead of how the

property was used.

    GMSF applied for an exemption from property taxes pursuant

to General Statutes, sections 105-275(12) and 105-278.7(a).                  As

discussed in subpart A, both statutes require that the property

be used wholly and exclusively for educational and scientific

purposes.     See N.C.G.S. '' 105-275(12), 105-278.7(a).                As we

have determined that the subject property is not wholly and

exclusively   used     for   educational   and    scientific   purposes,     we

need not further address this issue.

    For the aforementioned reasons, we reverse the Commission’s

order granting GMSF an exemption from property taxes pursuant to

General Statutes, sections 105-275(12) and 105-278.7(a).

                                     II

    Next,     Avery    County   argues    that   the   Commission    erred   by
                                          -18-
holding    GMSF    satisfied      the    ownership      requirements          imposed       by

General    Statutes,         sections    105-275(12)       and    105-287.7,         to     be

eligible for property tax exemption.                 We note that because the

relevant    statutes         require    ownership    to    rest     in    a   charitable

association or institution and be wholly and exclusively used

for    scientific     or      educational    purposes,       and    because         of     our

holding in Issue I, we need not reach this argument.                             However,

were we to address it, it is not clear that GMSF would satisfy

the    statutory    ownership      requirements.           See     In    re     Appeal      of

Eagle's Nest Found., 194 N.C. App. at 778, 671 S.E.2d at 371

(considering       the    daily    $150.00    “market       rate”       charged      summer

campers     and     the        $15,000.00     rate        charged        each       student

participating      in    a    semester-long      high     school     course         load    in

comparison to the two percent of revenue used for financial aid

in concluding the nonprofit 501(c)(3) corporation running the

camp did not satisfy the meaning of “charitable association or

institution” as considered in N.C. Gen. Stat. ' 105-278.7); see

also Rockingham Cnty. v. Elon Coll., 219 N.C. 342, 346—47, 13

S.E.2d 618, 621          (1941) (Holding         the buildings owned by                  Elon

college and rented for business purposes were taxable despite

the college’s use of all the profits for educational purposes.

“The    fact   that      a    commercial     enterprise      devotes          its    entire
                                        -19-
profits    to   a   charitable     or    other    laudable      purpose    does   not

change the character of its business nor the purpose for which

it is held. It is still a commercial enterprise, and is held as

such.”).

                                         III

    Lastly, Avery County argues that the Commission erred by

holding    that     the   vacant   lot    (Parcel      Three)    is    exempt     from

taxation.       Specifically, Avery County contends the Commission

failed to find the lot was “necessary for the convenient use of

any buildings” as required for exemption pursuant to General

Statutes,       section     105-278.7.            We   briefly        address     the

Commission’s ruling as to this separate parcel.

    General Statutes, section                 105-278.7, allows       property tax

exemption for “[b]uildings, the land they actually occupy, and

additional adjacent land necessary for the convenient use of any

such building . . . if: (1) Wholly and exclusively used by its

owner     for   nonprofit     educational,         scientific,        literary,    or

charitable purposes . . . .”            N.C.G.S. § 105-278.7(a).

    In an unchallenged finding of fact, the Commission stated

“[t]he    Foundation      operates      the    Grandfather      Mountain    tourist

attraction on Parcel Two and uses Parcel Three as a buffer track
                                             -20-
to    preserve          the     natural          area   and        prevent        encroaching

development.”

      In     In    re    Appeal       of   the     Master’s        Mission,       this   Court

reviewed the Graham County Board of Equalization’s denial of an

application to extend the tax exemption granted to 100 acres by

more than 1,200 acres as property used for educational purposes.

152   N.C.    App.      640,    647,       568    S.E.2d     208,     213     (2002).       The

original 100 acres had been granted tax-exempt status “in order

to provide a ‘buffer zone’ around the buildings and areas used

‘wholly and exclusively’ for educational purposes.”                               Id. at 648,

568 S.E.2d at 213.             Though it affirmed the Board’s denial of an

application to extend the buffer, the Master’s Mission Court

noted “[a] ‘buffer zone’ is additional land around an exempt

building or portion of land that is reasonably necessary for the

convenient use of any such land or building. We have held that

buffering is an appropriate consideration in determining whether

an [] exemption applies to a particular parcel.”                              Id. at      648—

49, 568 S.E.2d at 213 (citations and quotations omitted).

      Here,       Parcel      Three    was   found      to    be    “a   buffer     track    to

preserve the natural area and prevent encroaching development”

upon Parcel Two which accommodates Grandfather Mountain tourist

park,   and       as    such,     Parcel     Three’s         status      as   a    tax-exempt
                                 -21-
property is dependent upon the status of the main tract, Parcel

Two.    See generally id.     As we have determined that the real

property encompassing Grandfather Mountain tourist park is not

eligible for exemption pursuant to N.C.G.S. ' 105-278.7, due to

its dependent status, Parcel Three must also be ineligible for

such exemption.     For these reasons, we hold the Commission erred

in concluding that the property was eligible for tax exemption

pursuant to N.C.G.S. ' 105-278.7, as it applies to Parcel Three,

the buffer tract.

       For the foregoing reasons, we reverse the        order of the

Commission.

       Reversed.

       Judges HUNTER, Robert C., and STEELMAN concur.
