                                      April       15,   1971


 Honorable Jules Damiani,   Jr.                                Opinion No.       M-837
 Criminal District Attorney
 405 County Courthouse                                         Re:      Liability of medical
 Galveston, Texas 77550                                                 fraternities at Uni-
                                                                        versity of Texas Medical
                                                                        School at Galveston for
 Dear   Mr.      Damiani:                               ”               ad valorem taxes.

          You reqiie,st,odr       ol&iion     a6 lo

                  ‘1. . . &ether              the msdical fraternities   at
         the University  of Texas             Medical ‘sirhbol at Galveston
         . . i I,


 are exempt i&m ‘ad ‘valorkm              taxes by reason of ‘either or both of the
 following grounds authoiited             in Articie VIII, Section i of the Texas Con-
    .
 etltutioti.

         (1)           ‘1. . . buiidings used exclusively   and owned
                       by persons or associations    of $ersons for
                       school puipoees    . : . ;I’

         (2);.        ,ya.,:,. .;, institutions
                                        .~          ,of purely       ,public charity;
               .:.     **,

         School bu’ildings,‘art exe&i@      by Sectibn 1 of Article                        ‘7150,   veer-
non’s   Civil Statutes*,  which in its reietiant p6rtiob reads:

                       “The foIloWing         property         &I\     be exempt    from
         taxation,      to-wit:




‘*       All references    to ‘statutes            are to Vernon’b Civil Statutes unless
         otherwise   stated.


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Honorable   Jules   Damiani,     Jr.,   Page     2            (M-837)




                    “1.    Schools and Churches        - Public school
                           houses.   . . All public colleges,    public
                           academies,    . . . and all such buildings
                           used exclusively     and owned by persons
                           or associations     of persons for school
                          ~purposes;   . . .‘I

         Also, you cite Section 22 of Article 7150 (Acts 1967, 60th Leg.,
R. S., p.. 319, ch. 152) which exempts the property of all fraternal organi-
zations,   as therein described, when used for certain purposes;  this Section
22 reads as follows:

                  “The property of all fraternal  organizations
        shall be exempt from taxation for so long as the prop-
        erty is owned and used for charitable,    benevolent,   re'-
        ligious, and educational purposes,    and is not in whole
        or in part leased out to others,’ or otherwise used with
        a view to profit.

                  “The term ‘Fraternal      Organization’   as used in
       this’ Act shall mean,    ‘A lodge,   or lodges,   engaged in
       charitable,’ benevolent,    religious,   and educational work,     ’

                 -~However; thie Act -shall note apply to any frs -
       ternal organization    or lodge which pays to its members,
       either directly or indirectly,     any type of insurance bene-
       fit, be it life, health, accident or death benefit,    or any
       other type of insurance;    neither shall any organization
       which shall dir~ectly or indiredtly participate     or engage
       in any political activity,   either in support of or in op-
       position to any c,andidate seeking any public office,     have
       or be entitled to benefits as provided under this Act. ”

        Our opinion is that the evidence submitted by you is not sufficient
to exempt the properties   of these medical fraternities under any of the fore-
going constitutional or statutory grounds.

                                            1.

         We first consider whether these properties   are exempt as school
buildings under either of the above quoted provisions   of the Constitution and
of Article 7150, Section 1.

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Honorable   Jules   Damiani,    Jr.,   Page   3                 (M-837)




        In this connection you request that we reconsider     our former
Attorney General’s   Opinion No. M-12 (1967).    in view of the holding of
our Texas Supreme Court in the case of San Antonio Conservation         Society,
Inc. v. City of San Antonio,  455 S. W. 2d 743 (Tex. Sup. 1970) and the case
of City of Memphis v. Alpha Beta Welfare Ass’n.,       126 S. W. 2d 323 (Term.
Sup. 1939. ) The San Antonio case was decided subsequently        to our Opinion
M-12,   and the City of Memphis case was decided prior to our Opinion and
was not cited nor referred to in our Opinion.

        We quote the entire statement            of facts   which you submit   in support
of your claims for exemption:

                 “It should be noted from the outset that there
       is not sufficient dormitory     space for male medical       stu-
       dents attending the University       of Texas Medical Branch.
       While some students live in private residences,          the
       great majority    of single male students live at fraternity
       houses which are normally        operated as non-profit    corpo-
       rations and charitable     associations    adjacent to the campus.
       The fraternity    programs    are integrated with the University
       of Texas Medical Branch and each fraternity          maintains a
       supervised    study program and a medical library for stu-
       dents.   Such an arrangement       gives each medical fraternity
       access to medical journals,       textbooks,    and specimens.    In
       addition, each of the fraternities      furnish the following edu-
       cational benefits to the medical students as an assist to the
       Medical Branch:

                    “1.   Maintenance   of a library in each fraternity
                          with access to medical journals,    textbooks,
                          and specimens    (osteological, CNS, Histo-
                          logical, etc. )

                    “2.   Provisions  of textbooks and study aids to
                          most of the members     of fraternities  in
                          Years I and II.    These aids frequently    in-
                          clude microscopes.

                    “3.   Lecture sessions    with faculty and private
                          physicians  in the fraternities.   These occur
                          at the rate of about one/month.     Not only do


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Honorable   Jules   Damiani,    Jr.,   Page 4                (M-837)




                          .individual fraternities   sponsor those
                           sessions,   but the Inter-fraternity   Coun-
                           cil and the Sophomore Class have had
                           regular ‘Fireside    Chats’ in the frater-
                           nities featuring visiting dignitaries,
                           faculty and administration.

                    “4.   Tutorial sessions   are frequently held in
                          the fraternities  by course instructors   at
                          student’s request.    Attempts to review,
                          clarify and emphasize    material  are made
                          during these sessions.

                    “5.   Orientation  of new students to medical
                          school and of each class to its’ ensuing
                          years and to new assignments    is a con-
                          stant, ongoing procedure.

                    “6.   Study sessions and review sessions       of
                          students and upperclassmen.

                    “7.   ‘Mormal     gatherings  of students discuss-
                           ing clinical cases,   management,    and
                           philosophy ‘and ethics of medicine occur
                           continuously.

                    “8.   Provide professional    contacts and guid-
                          ance in the evolving professional   behavior.
                          Social functions form a small part of medi-
                          cal fraternities activity.

                    “9.   These are not ‘typical Greek Letter fratern-
                          ities’ but unique both as fraternities   and as
                          medical fraternities.    They play a large part
                          in the culture,  heritage and attractiveness    of
                          UTMB.

                “10.      Provision  of housing and preparation of meals
                          for single students near the campus is of es-
                          timable value.



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Honorable      Jules     Damiani,      Jr.,   Page   5              (M-837)




                       “11.     Hospital cafeteria    and surrounding
                                facilities could not support the number
                                of people who would depend on them if
                                not for fraternities.

                       !‘12.    Availability of fraternities to hospital is
                                of great importance    when students are on
                                call and must come to the hospital to give
                                medications,   evaluate patients,  work up
                                new patients or’go to surgery.

                       “13.     There is no ‘school’ organized       recreational/
                                social program.      All activities  stem from
                                organization   by the individual fraternities
                                and the Inter-fraternity    Council.

                       “14.    ‘Patients being cared for by students are
                                state patienta.   ‘,Without the student’% help
                                ~andavailab ility in many areas,     more ad-
                                ministrative    and nursing personnel would
                                be required.

                       “15.     Fraternities    have no reason for existences
         i:                     except to serve the University      and its stu-
                                dent body.    The Univereity,depends    upon
                                the fraternities   to provide essential  services
                             ” ,andto nurture the professional      growth of
                               .medical students.
              ..,~
                     .“16.     .;Services   provided by the fraternities   cost
                                 ~the University   nothing. ‘In- their absence,
                                 considerable    expenee might have to be in-
                                 curred to provide these benefits. ”

        :Our careful comparison      of these facts with those set forth in our
prior Opinion M-12     shows no new facts that would warrant holding the proper-
ties in question to be exempt.      We consider the present facts to be only repeti-
tive of those considered    in Opinion M-12,     without adding any new reason for
holding the properties    inquestion    to be exempt.    We refrain from considering
here again all the reasoning and authorities       presented  in our former Opinion,



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Honorable   Jules   Damiani,   Jr.,   Page   6             (M-837)




but rather we refer to, it as the basis both in fact and in the legal authori-
ties there cited for our holding in this present opinion.    See also Attorney
General’s  Opinion No. M-778 (1971. )

          In the City of Memphis case,     supra, the court construed a Consti-
tutional exemption of property ‘I. . . held and used for purposes        . . . edu-
cational . . .’‘I The Texas Constitutional      provision exempts property used
for “school purposes”     and also ,institutions of “purely public charity . ”
These provisions     are different in wording and cannot be construed to be
the same in all situations.     The rule was well stated in the case of Little
Theater of Dallas v. City of Dallas,       124 S. W. 2d 863 (Tex. Civ. App. 1939,
no writ):

                   ~“Appellant cites a number of decisions        from the
        courts of other states,      tending to show that . . . debating
        clubs,   .    . professor’s    houses,  dormitories    and music
        associations    were exempt from taxation,       but these decisions
        were based upon and controlled by constitutional           and statu-
        tory provisions     ,peculiar to the respective   states,    hence are
        not controlling    as authorities~here.   I’

         We note that in the City of Memphis      case the only issue presented
was whether the,real, estate of a general welfare corpo.ration was used by
it exclusively;for    1’educational purposes, ” a constitutional   and statutory
ground fortax      exemption.    The Court noted:

                   “The specific purpose for which Alpha Beta
        Welfare Association     was created,   as stated in its charter,
        is the ‘promoting    and providing for medical and scientific
        education-of   young men, and for the purpose of, owning
        property,    both real and personal,.  to be used exclusively
        in furthering the aforesaid    purposes;   . . . ’

                   “The only witnesses  who testified on the trial
        of the. case were three physicians   introduced by the Asso-
        ciation.   Thus the facts of the case are not in controversy.        ”
        (126 S. W. 2d 324. )

In its concluding paragraph,     the Court concluded that under the great weight
of authority tax exemptions     have not been granted to college Greek letter



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 Honorable      Jules   Damiani,   Jr. , Page    7              (M-837)



fraternities,      except   under express     statutory   authority,   and further   said:

                   “In our opinion no blanket .rule can be laid
         down and made applicable to all fraternities.     Whether
         or not the property of a fraternity  is exempt from taxa-
         tion is dependent, as in all other cases,   on the use made
         of the property.   Each case must be determined     on its
         own facts . . .I’ (126,s. W. 2d 326. )

         We are in agreement with this reasoning;       however,    aside from the
distinguishing   legal and factual. aspects noted above from the factual situa-
tion presented,    the holding was made in the City of Memphis case only after
trial and upon undisputed and non-controversial.testimony.            Likewise,    in
the San Antonio Conservation      Society.case,   supra, the trial court, upon
stipulations of the parties and a non-controversial       fact situation,   had held,
and the Supreme Court affirmed,        that the Conservation   Society had assumed,
to a material   extent, that which otherwise might become the obligation or
duty of the -community or state,, the statutory and constitutional        test for tax
exemption.     The’Court   said:

                      “The City concedes that the whole public re-
         ceives    the benefits of the Navarro House. ” (455 S. W. 2d
         746.),      ,’

 Under the facts presented,       no city, county or state taxing       authorities  have
 stipulated or conceded anything.         We are presented only with .a partial state-
 ment of miscellaneous      facts concerning      educational benefits to the medical
 students who were fortunate ,enough to be accepted into the fraternity houses.
 Then amount of-charity     dispensed,    the confinement    to public charitable pur-
 poses of-the-fraternityand.its      perpetual dedicatioxiof      the property to,public
 charity in the charter,     the conditions of admission       or rejection to,all on a
;non-discriminatory.public       charitable basis,. are all additional matters which
 must be considered      not shown here.       In this connection,    the general evidentiary
 and legal guidelines have been noted in Attorney General Opinion No. C-697
 (1966) and in Hilltop Village,     Incs v. Kerrville     Independent School Dist. , 426
 S. W. 2d 943 (Tex. Sup. 1968). to which you are referred.              In view thereof,
 we are unable to say as a matter of law that the fraternities            are entitled to ad
 valorem tax exemption.         We do not say, however,       that in a specific case such
 a fraternity  is precluded from the legal possibility         of showing its property is
 owned and used~for school purposes          or as an institution of purely public charity.



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    Honorable    Jules   Damiani,     Jr. , Page    8                  (M-837)



            We now consider whether the properties   of the fraternities may be
    comprehended   within Article 7150, Section 22 (Acts 1967, 60th Leg.,   R. S.,
    p. 319, ch. 152) which exempts from taxation property of

                       ‘I. . . all fraternal organizations  . . . for
             so long as the property is owned and used for charit-
             able, benevolent,    religious, and educational purposes,
             and is not in whole or in part leased out to others,     or
             otherwise used with a view to profit. ” (Emphasis        added. )

    The Legislature      therein    defined   the term    “Fraternal     Organization”      to mean,

                       “A lodge, or lodges, engaged             in charitable,
             benevolent,  religious, and educational            work. ”

            Assuming     without deciding,   that the above statute contemplates           the
    exemption of the property of medical fraternities,            nevertheless     that statute,
    to be constitutional   and in harmony with Section 2, Article VIII of the Consti-
    tution of Texas,   must be construed to provide an exemption for such property
    only if owned and primarily      used as an “actual place of religious worship, ”
    or “for school purposes,     ” or as “institutions     of purely public charity. ” Un-
    less the medical fraternities     can bring themselves         clearly within one of those
    enumerated    exceptions,   they are not exempt.         The Legislature     is powerless
    to grant an exemption that does not meet this constitutional             concept and test.
    The City of Waco v. Texas Retired Teacher             Residence     Corporation,     NO.
    B-2179.   Feb. 17. 1971. Tex. Sun.   _ Ct . : Attornev    General Oninion Nos. M-778
    (1971) and M-517 (1969),      and authorities    therein cited; City of San Antonio v.
    Young Men’s Christian Association,         285 S. W. 844 (Tex. Civ. App. 1926, error
    ref. ) Thus, in the case of fraternal      associations      granted such a tax exemp-
    tion by a general statute,, it has been held that such a statute was violative
    of the implied limitations    of a constitutional     provision    authorieing    the Legis-
    lature to exempt property used exclusively          for charitable     purposes.     Supreme
    Lodge,   M.A.F.O.     V. Board of Review,       223 Ill. 54, 79 NE 23, (Ill.Sup.,         1906.)

             In the above   case,    the Supreme        Court   of Illinois   pertinently   observed:

                        ‘1. . . Obviously, then, if the fraternal  bene-
             ficiary societies    which are relieved from taxation by
             the statute under consideration     do not fall within one of
             the classes    whose property the Constitution     provides



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       Honorable    Jules   Damiani,    Jr.,    Page 9                  (M-837)




                may be exempted        from    taxation    by general   law,
                any act of the Legislature   purporting to exempt
                their property from taxation is unconstitutional.
                The Legislature   has no power to exempt from
                taxation any property other than that enumerated
                in Section 3 of Article 9 of the Constitution.   Such
                enumeration   is an exclusion of all other subjects
                of exemption.   . . ” (at p. 24. )

                 In view of our conclusion that college fraternities        or sororities,  in-
        cluding the medical fraternities,     are generally held to be not exempt ~from
        taxation because they do not exist primarily        for charitable or educational and
        benevolent purposes,     we must necessarily      likewise conclude that as a general
        rule the property of such organizations       is not exempt under Section 22, Ar-
        ticle 7150, when harmonized      with Section 2, Article VIII of the Texas Consti-
      ” tution.   As observed in Beta Xi Chapter of Beta Theta Pi v. City of New Or-
        leans,   137 So. 204 (La. Ct. of App.,    1931) while the practice of a fraternity
        in performing    certain ch aritable work is commendable,          tax exemption can-
        not be shown unless the character      of the work undertaken is one of the principal
        objects of the organization,    the doing of such work as relieves        the State of
         some of its burdens,    and that the property itself,     and not only the organization,
        must be devoted to such undertakings.         This is the well-settled     rule in Texas.
        Hilltop Village,   Inc. v. Kerrville   Ind. Sch. Dist.,     426 S. W. 2d 943 (Tex. Sup.
        1968); River Oaks Garden Club v. City of Houston,            370 S. W. 2d 851 (Tex. Sup.
        1963. ) The case of San Antonio Conservation          Society,  Inc. v. City of San
        Antonio,   455 S.,W. 2d 743 (Tex. Sup. 1970) is not controling under the facts we
        have under consideration.

                We are unable to say as’ a’matter    of law that the medical fraternities
       in question constitute “lodges engaged in charitable,        benevolent,   religious,
       and educational work. ”     Whenharmonized      with  Article  VIII,  Section   2, Con-
       stitution of Texas, ’as stated in 51 ‘American     Jurisprudence     602, Taxation,
       Section 627, this determination    is ordinarily   and most often a question of fact
       in the light of all the facts and circumstances     involved,   and further:

                          ‘1. . . Although there are holdings to the contrary,
                the prevailing   rule seems to be that such (fraternal)    asso-
                ciations are not institutions    of ‘purely public charity’ within
                the meaning of such a phrase in a tax exemption provision.
                In this connection,    it has been pointed out that the word ‘purely’



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Honorable   Jules   Damiani,     Jr.,    Page    10                (M-837)



       as thus used is intended to modify the word ‘charity’
       and not the word ‘public’,   so as to require the insti-
       tution to have a wholly altruistic quality and exclude
       from it every private or selfish interest or profit or
       corporate   gain. (Parenthesis    ours. )

        It is held that it is not enough to exempt property from taxation that
one of several purposes or results of its use is charity.    It is required to
be the chief, if not the sole, object.    51 Am. Jur. 605, Taxation,   Sec. 631;
Benevolent    & Protective   Order of Elks v. Houston, 44 S. W. 2d 488 (Tex. Civ.
App. 1931, error ref. ), citing R. C.L.

        It is therefore our conclusion that the facts and circumstances  sub-
mitted are insufficient to present a case for tax exemption as a matter of
law, the taxpayers having failed to discharge fully their burden of clear proof
and any doubt being resolved against the exemption and in favor of the taxing
power.

                                        SUMMARY

                 The properties  of the medical fraternities  at
       the University   of Texas Medical School at Galveston,
       Texas,  are not shown to be entitled to ad valorem tax
       exemption as a matter of law under the facts and cir-
       cumstances    presented under either Section 1 or Section
       22 of Article  7150, Vernon’s   Civil Statutes, as amended,
       and Article VIII, Section 2, Texas Constitution.

                                                Yours   very   truly,

                                                CRAWFORD    C. MARTIN
                                                Attorney General of Texas




                                                        NOLA WHITE
                                                        First Assistant

Prepared    by W. E.   Allen
Assistant   Attorney   General


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    Honorable   Jules   Damiani,   Jr. , Page   11   (M-837)



    APPROVED:
    OPINION COMMITTEE

    Kerns Taylor,  Chairman
    Arthur Sandlin
    John Reeves
    Ralph Rash
    Jack Goodman

    MEADE F. GRIFFIN
    Staff Legal Assistant

    ALFRED    WALKER
    Executive Assistant




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