State Codes and Statutes

Statutes > Nebraska > Chapter77 > 77-202

77-202. Property taxable;exemptions enumerated.(1) The following propertyshall be exempt from property taxes:(a) Property of the state and its governmental subdivisionsto the extent used or being developed for use by the state or governmentalsubdivision for a public purpose. For purposes of this subdivision, publicpurpose means use of the property (i) to provide public services with or withoutcost to the recipient, including the general operation of government, publiceducation, public safety, transportation, public works, civil and criminaljustice, public health and welfare, developments by a public housing authority,parks, culture, recreation, community development, and cemetery purposes,or (ii) to carry out the duties and responsibilities conferred by law withor without consideration. Public purpose does not include leasing of propertyto a private party unless the lease of the property is at fair market valuefor a public purpose. Leases of property by a public housing authority tolow-income individuals as a place of residence are for the authority's publicpurpose;(b) Unleased property of the state or its governmental subdivisionswhich is not being used or developed for use for a public purpose but uponwhich a payment in lieu of taxes is paid for public safety, rescue, and emergencyservices and road or street construction or maintenance services to all governmentalunits providing such services to the property. Except as provided in ArticleVIII, section 11, of the Constitution of Nebraska, the payment in lieu oftaxes shall be based on the proportionate share of the cost of providing publicsafety, rescue, or emergency services and road or street construction or maintenanceservices unless a general policy is adopted by the governing body of the governmentalsubdivision providing such services which provides for a different methodof determining the amount of the payment in lieu of taxes. The governing bodymay adopt a general policy by ordinance or resolution for determining theamount of payment in lieu of taxes by majority vote after a hearing on theordinance or resolution. Such ordinance or resolution shall nevertheless resultin an equitable contribution for the cost of providing such services to theexempt property;(c) Property owned by and used exclusively for agriculturaland horticultural societies;(d) Property owned by educational, religious, charitable,or cemetery organizations, or any organization for the exclusive benefit ofany such educational, religious, charitable, or cemetery organization, andused exclusively for educational, religious, charitable, or cemetery purposes,when such property is not (i) owned or used for financial gain or profit toeither the owner or user, (ii) used for the sale of alcoholic liquors formore than twenty hours per week, or (iii) owned or used by an organizationwhich discriminates in membership or employment based on race, color, or nationalorigin. For purposes of this subdivision, educational organization means (A)an institution operated exclusively for the purpose of offering regular courseswith systematic instruction in academic, vocational, or technical subjectsor assisting students through services relating to the origination, processing,or guarantying of federally reinsured student loans for higher education or(B) a museum or historical society operated exclusively for the benefit andeducation of the public. For purposes of this subdivision, charitable organizationmeans an organization operated exclusively for the purpose of the mental,social, or physical benefit of the public or an indefinite number of persons;and(e) Household goods and personal effects not owned or usedfor financial gain or profit to either the owner or user.(2) The increased value of land by reason of shade and ornamentaltrees planted along the highway shall not be taken into account in the valuationof land.(3) Tangible personal property which is not depreciable tangiblepersonal property as defined in section 77-119 shall be exempt from propertytax.(4) Motor vehicles required to be registered for operationon the highways of this state shall be exempt from payment of property taxes.(5) Business and agricultural inventory shall be exempt fromthe personal property tax. For purposes of this subsection, business inventoryincludes personal property owned for purposes of leasing or renting such propertyto others for financial gain only if the personal property is of a type whichin the ordinary course of business is leased or rented thirty days or lessand may be returned at the option of the lessee or renter at any time andthe personal property is of a type which would be considered household goodsor personal effects if owned by an individual. All other personal propertyowned for purposes of leasing or renting such property to others for financialgain shall not be considered business inventory.(6) Any personal property exempt pursuant to subsection (2)of section 77-4105 or section 77-5209.02 shall be exempt from the personalproperty tax.(7) Livestock shall be exempt from the personal propertytax.(8) Any personal property exempt pursuant to the NebraskaAdvantage Act shall be exempt from the personal property tax.(9) Any propertyused directly in the generation of electricity using wind as the fuel sourceshall be exempt from the property tax. Personal property used directly inthe generation of electricity using wind as the fuel source includes, butis not limited to, wind turbines, rotors and blades, towers, trackers, generatingequipment, transmission components, substations, supporting structures orracks, inverters, and other system components such as wiring, control systems,switchgears, and generator step-up transformers. SourceLaws 1903, c. 73, § 13, p. 390; R.S.1913, § 6301; Laws 1921, c. 133, art. II, § 2, p. 547; C.S.1922, § 5821; C.S.1929, § 77-202; R.S.1943, § 77-202; Laws 1955, c. 290, § 1, p. 921; Laws 1965, c. 468, § 1, p. 1514; Laws 1965, c. 469, § 1, p. 1516; Laws 1967, c. 494, § 1, p. 1685; Laws 1967, c. 495, § 1, p. 1686; Laws 1971, LB 945, § 2; Laws 1975, LB 530, § 3; Laws 1980, LB 882, § 1; Laws 1980, LB 913, § 1; Laws 1982, LB 383, § 5; Laws 1984, LB 891, § 1; Laws 1985, LB 268, § 1; Laws 1986, LB 732, § 1; Laws 1987, LB 775, § 13; Laws 1988, LB 855, § 3; Laws 1989, Spec. Sess., LB 7, § 2; Laws 1991, LB 829, § 7; Laws 1992, LB 1063, § 53; Laws 1992, Second Spec. Sess., LB 1, § 51; Laws 1994, LB 961, § 7; Laws 1997, LB 271, § 39; Laws 1999, LB 271, § 4; Laws 2002, LB 994, § 10; Laws 2005, LB 312, § 4; Laws 2008, LB1027, § 1; Laws 2010, LB1048, § 11.Effective Date: July 15, 2010 Cross ReferencesNebraska Advantage Act, see section 77-5701. Annotations1. Constitutionality2. Use and ownership of property3. Procedures4. Exemption granted5. Exemption not granted6. Effect of exemption7. Miscellaneous1. ConstitutionalitySubsections (6) through (9) of this section are unconstitutional under Neb. Const. art. VIII, section 1. MAPCO Ammonia Pipeline v. State Bd. of Equal., 238 Neb. 565, 471 N.W.2d 734 (1991).The provision including major appliances either attached or detached to real property is unconstitutional. State ex rel. Meyer v. Peters, 191 Neb. 330, 215 N.W.2d 520 (1974).2. Use and ownership of propertyIn reference to subsection (1)(c) of this section, exclusive use means the primary or dominant use of property, as opposed to incidental use. A parsonage which is furnished to a member of the clergy, which is an essential part of a church, and which is used primarily to promote the objects and purposes of a faith is property used exclusively for religious purposes and is exempt from taxation. Neb. Unit. Meth. Ch. v. Scotts Bluff Cty. Bd. of Equal., 243 Neb. 412, 499 N.W.2d 543 (1993).Subsection (1)(c) of this section contains a two-tier approach to property tax exemption: the first tier involves the nature, character, or status of a property owner, and the second tier concerns the use of the property. Nebraska State Bar Found. v. Lancaster Cty. Bd. of Equal., 237 Neb. 1, 465 N.W.2d 111 (1991).To be tax exempt, property must (1) be owned by an organization designated in subsection (1)(c) of this section; (2) be used exclusively for at least one of the purposes specified in subsection (1)(c); and (3) not be (a) owned or used for financial gain to the property owner or user, (b) used more than 20 hours per week for sale of alcoholic liquors, or (c) owned or used by an organization which discriminates in membership or employment based on race, color, or national origin. Nebraska State Bar Found. v. Lancaster Cty. Bd. of Equal., 237 Neb. 1, 465 N.W.2d 111 (1991).Under subsection (1)(c) of this section, if a property owner is not of a type entitled to property tax exemption, considering the property's use is unnecessary. Nebraska State Bar Found. v. Lancaster Cty. Bd. of Equal., 237 Neb. 1, 465 N.W.2d 111 (1991).Property is not used for financial gain or profit to either the owner or the user if no part of the income from the property is distributed to the owner's or user's members, directors, or officers, or to private individuals. United Way v. Douglas Co. Bd. of Equal., 215 Neb. 1, 337 N.W.2d 103 (1983).The constitution and statute require that the property be owned for an exempt purpose, but there is no requirement that the ownership and use must be by the same entity. United Way v. Douglas Co. Bd. of Equal., 215 Neb. 1, 337 N.W.2d 103 (1983).Vacant space in property owned by a charitable organization is exempt from taxation if it is intended for a charitable use, the dominant use of the property as a whole is for exempt purposes, and the conditions under which it is held preclude its use for commercial purposes. United Way v. Douglas Co. Bd. of Equal., 215 Neb. 1, 337 N.W.2d 103 (1983).Legislature has used the same language as appears in the Constitution in exempting from taxation property owned and used for educational, religious, or charitable purposes. Lincoln Woman's Club v. City of Lincoln, 178 Neb. 357, 133 N.W.2d 455 (1965).The primary or dominant use, and not an incidental use, is controlling in determining whether property is exempt from taxation. Doane College v. County of Saline, 173 Neb. 8, 112 N.W.2d 248 (1961).It is the exclusive use of property for religious or educational purposes that determines exemption from taxation. Nebraska Conf. Assn. Seventh Day Adventists v. County of Hall, 166 Neb. 588, 90 N.W.2d 50 (1958).Use of property is test to right to exemption. Central Union Conference Assn. v. Lancaster County, 109 Neb. 106, 189 N.W. 982 (1922); St. Elizabeth Hospital v. Lancaster County, 109 Neb. 104, 189 N.W. 981 (1922).Exemption is based solely on use of premises and not on ownership. Scott v. Society of Russian Israelites, 59 Neb. 571, 81 N.W. 624 (1900); First Christian Church of Beatrice v. City of Beatrice, 39 Neb. 432, 58 N.W. 166 (1894).3. ProceduresIn its appellate review of a question whether property is exempt from taxation pursuant to subsection (1)(c) of this section, the Supreme Court determines tax exemption in an equitable trial of factual questions de novo on the record. Immanuel, Inc. v. Board of Equal., 222 Neb. 405, 384 N.W.2d 266 (1986).Statutes exempting property from taxation are to be strictly construed, property must come clearly within the statutory provisions granting such exemption, and the burden of proving the right to the exemption is upon the claimant. United Way v. Douglas Co. Bd. of Equal., 215 Neb. 1, 337 N.W.2d 103 (1983).The burden of proof is upon one claiming property to be exempt from taxation to establish that its predominant use is for one of the purposes set out in this section. OEA Senior Citizens, Inc. v. County of Douglas, 186 Neb. 593, 185 N.W.2d 464 (1971); Berean Fundamental Church Council, Inc. v. Board of Equalization, 186 Neb. 431, 183 N.W.2d 750 (1971).Party claiming property to be exempt from taxation has the burden of proof of establishing such exemption. Nebraska Conf. Assn. Seventh Day Adventists v. Board of Equalization of Hall County, 179 Neb. 326, 138 N.W.2d 455 (1965).4. Exemption grantedThe lease of property from one exempt organization to another exempt organization does not create a taxable use, so long as the property is used exclusively for exempt purposes. Fort Calhoun Baptist Ch. v. Washington Cty. Bd. of Equal., 277 Neb. 25, 759 N.W.2d 475 (2009).An industrial park which is created by a city council acting as a community redevelopment authority may serve the purpose of community development, and thus be exempt from taxation as property which serves a public purpose. City of York v. York Cty. Bd. of Equal., 266 Neb. 311, 664 N.W.2d 456 (2003).The statutes governing airports were not expressly or impliedly repealed by the passage of the 1998 constitutional amendment to Neb. Const. art. VIII, sec. 2, or subsection (1)(a) of this section. Airports owned and operated by municipalities are exempt from taxation. City of York v. York Cty. Bd. of Equal., 266 Neb. 297, 664 N.W.2d 445 (2003).Pursuant to subsection (1)(a) of this section, real property acquired by the city through enforcement of special assessment liens and offered for sale to the public at a price which does not exceed delinquent special assessments and accrued interest, is used "for a public purpose" and is therefore exempt from real estate taxation. City of Alliance v. Box Butte Cty. Bd. of Equal., 265 Neb. 262, 656 N.W.2d 439 (2003).Pursuant to the former subsection (1)(c) of this section, an assisted living facility owned and used exclusively for charitable purposes, that is, the primary or dominant use of the property is for charitable purposes, is entitled to a property tax exemption. Bethesda Found. v. Buffalo Cty. Bd. of Equal., 263 Neb. 454, 640 N.W.2d 398 (2002).Lease of property to a charitable organization by a charitable organization for substantially less than its fair rental value is a use of property for charitable purpose. United Way v. Douglas Co. Bd. of Equal., 215 Neb. 1, 337 N.W.2d 103 (1983).Where a nursing home's association with two other companies did not result in financial gain or profit to either the owner or user, and the primary or dominant use of the nursing home continued to be for religious or charitable purposes, the property remains exempt from taxation. Bethesda Foundation v. County of Saunders, 200 Neb. 574, 264 N.W.2d 664 (1978).Property of rest home was exempt from taxation under this section. Evangelical Lutheran Good Samaritan Soc. v. County of Gage, 181 Neb. 831, 151 N.W.2d 446 (1967).Operation of ranch for boys was such as to require entire ranch to be exempt from taxation. Lariat Boys Ranch v. Board of Equalization of Logan County, 181 Neb. 198, 147 N.W.2d 515 (1966).Building used by Young Women's Christian Association for low-rent housing was exempt from taxation. Young Women's Christian Assn. v. City of Lincoln, 177 Neb. 136, 128 N.W.2d 600 (1964).Legislature has exempted from taxation hospitals owned and used exclusively for charitable purposes. Muller v. Nebraska Methodist Hospital, 160 Neb. 279, 70 N.W.2d 86 (1955).Property of school district is exempt from taxation. Madison County v. School Dist. No. 2, 148 Neb. 218, 27 N.W.2d 172 (1947).Scottish Rite temple and grounds are exempted from taxation as property used exclusively for educational, religious or charitable purposes. Scottish Rite of Freemasonry v. Lancaster County Board of Commissioners, 122 Neb. 586, 241 N.W. 93 (1932), 81 A.L.R. 1166 (1932), overruling Scottish Rite Building Co. v. Lancaster County, 106 Neb. 95, 182 N.W. 574 (1921), and Mt. Moriah Lodge No. 57, A.F. & A.M. v. Otoe County, 101 Neb. 274, 162 N.W. 639 (1917).Laundry owned and used by charitable institution in carrying on its work is exempt. House of the Good Shepherd of Omaha v. Board of Equalization of Douglas County, 113 Neb. 489, 203 N.W. 632 (1925).Farm and dairy property used for school purposes are exempt. Central Union Conference Assn. v. Lancaster County, 109 Neb. 106, 189 N.W. 982 (1922).Hospital used exclusively for religious and charitable purposes is exempt. St. Elizabeth Hospital v. Lancaster County, 109 Neb. 104, 189 N.W. 981 (1922).City of Omaha waterworks is exempt. City of Omaha v. Douglas County, 96 Neb. 865, 148 N.W. 938 (1914).Property of Masonic lodge was exempt. Plattsmouth Lodge No. 6, A.F. & A.M. v. Cass County, 79 Neb. 463, 113 N.W. 167 (1907).A contested area within a community hall located on the county fairgrounds, which is used primarily for county fair purposes, is exempt under this section. Brown Cty. Ag. Socy. v. Brown Cty. Bd. of Equal., 11 Neb. App. 642, 660 N.W.2d 518 (2003).5. Exemption not grantedThe intention to use property in the future for an exempt purpose is not a use of the property for exempt purposes under this section. St. Monica's v. Lancaster Cty. Bd. of Equal., 275 Neb. 999, 751 N.W.2d 604 (2008).The Nebraska State Bar Foundation is not entitled to a tax exemption under subsection (1)(c) of this section as a charitable or educational organization. Nebraska State Bar Found. v. Lancaster Cty. Bd. of Equal., 237 Neb. 1, 465 N.W.2d 111 (1991).Property owned and used primarily for furnishing low-rent housing not entitled to exemption as property owned and used exclusively for charitable purposes. Christian Retirement Homes, Inc. v. Board of Equalization of Lancaster County, 186 Neb. 11, 180 N.W.2d 136 (1970); County of Douglas v. OEA Senior Citizens, Inc., 172 Neb. 696, 111 N.W.2d 719 (1961).Industries operated and maintained primarily for purpose of providing student employment are an incidental and not a direct use of property for educational purposes and do not qualify for tax exemption. Union College v. Board of Equalization of Lancaster County, 183 Neb. 579, 162 N.W.2d 772 (1968).Property of college fraternity was not used exclusively for educational purposes. Iota Benefit Assn. v. County of Douglas, 165 Neb. 330, 85 N.W.2d 726 (1957).Household goods of the value of $200 exempt from taxation are not exempt from sale for payment of taxes properly assessed on other property of debtor. Ryder, Sheriff v. Livingston, 145 Neb. 862, 18 N.W.2d 507 (1945).Lodge property encumbered by unpaid real estate mortgages is not owned exclusively for charitable purposes. North Platte Lodge 985, B.P.O.E. v. Board of Equalization of Lincoln County, 125 Neb. 841, 252 N.W. 313 (1934).Portion of building of charitable institution used for business purposes was not exempt. Y.M.C.A. v. Lancaster County, 106 Neb. 105, 182 N.W. 593 (1921); Y.M.C.A. of Omaha v. Douglas County, 60 Neb. 642, 83 N.W. 924 (1900).A fraternal beneficiary association is not a charitable association within meaning of section. Royal Highlanders v. State, 77 Neb. 18, 108 N.W. 183 (1906).Commercial college is a school and part of property not used exclusively for school is liable to taxation. Rohrbough v. Douglas County, 76 Neb. 679, 107 N.W. 1000 (1906).If building is used at same time for school purposes and as a family residence, it is not exempt. Watson v. Cowles, 61 Neb. 216, 85 N.W. 35 (1901).6. Effect of exemptionExempt from taxes means not subject to taxation. Hanson v. City of Omaha, 154 Neb. 72, 46 N.W.2d 896 (1951).Where a tax is levied upon property as a whole, and a part is exempt under the Constitution and statutes, the assessment, if inseparable, is unauthorized, and the whole tax is void. McDonald v. Masonic Temple Craft, 135 Neb. 48, 280 N.W. 275 (1938)Tax levied on property that is exempt is void and collection thereof may be enjoined. East Lincoln Lodge No. 210, A. F. & A. M. v. City of Lincoln, 131 Neb. 379, 268 N.W. 91 (1936).Where two lower floors of building were rented for commercial purposes and two upper floors were used exclusively for religious, charitable and educational purposes, part of the taxable value of the lot could be considered in determining total taxable value of property. Masonic Temple Craft v. Board of Equalization of Lincoln County, 129 Neb. 293, 261 N.W. 569 (1935); modified on rehearing 129 Neb. 827, 263 N.W. 150 (1935).Section does not exempt from special assessments for improvements. City of Beatrice v. Brethren Church, 41 Neb. 358, 59 N.W. 932 (1894).Only increased value for tree culture can be exempted. Burlington & M. R. R.R. Co. v. Board of County Commissioners of Seward County, 10 Neb. 211, 4 N.W. 1016 (1880).7. MiscellaneousA solid waste landfill operated pursuant to the Integrated Solid Waste Management Act serves a public purpose and may be exempt from property taxation. City of York v. York Cty. Bd. of Equal., 266 Neb. 311, 664 N.W.2d 456 (2003).Regarding "mental" benefit of the public in subsection (1)(c) of this section as one of the requisite purposes of a charitable organization, "mental" means "intellectual," which means, among other things, engaged in creative literary, artistic, or scientific labor. Nebraska State Bar Found. v. Lancaster Cty. Bd. of Equal., 237 Neb. 1, 465 N.W.2d 111 (1991).Relative to a charitable organization, "an indefinite number of persons" in subsection (1)(c) of this section means a group of persons with a common characteristic, that is, a class, uncertain in number and composed from the public at large or a community. Nebraska State Bar Found. v. Lancaster Cty. Bd. of Equal., 237 Neb. 1, 465 N.W.2d 111 (1991).Under subsection (1)(c) of this section, a property owner's exemption from federal income taxation does not determine whether the owner's property is tax exempt under state law. Nebraska State Bar Found. v. Lancaster Cty. Bd. of Equal., 237 Neb. 1, 465 N.W.2d 111 (1991).Under subsection (1)(c) of this section, "operated exclusively," in reference to a charitable organization, means an organization's primary or predominant activity. Nebraska State Bar Found. v. Lancaster Cty. Bd. of Equal., 237 Neb. 1, 465 N.W.2d 111 (1991).Property, abandoned for religious purposes, is liable to taxation from time of abandonment. Holthaus v. Adams County, 74 Neb. 861, 105 N.W. 632 (1905).

State Codes and Statutes

Statutes > Nebraska > Chapter77 > 77-202

77-202. Property taxable;exemptions enumerated.(1) The following propertyshall be exempt from property taxes:(a) Property of the state and its governmental subdivisionsto the extent used or being developed for use by the state or governmentalsubdivision for a public purpose. For purposes of this subdivision, publicpurpose means use of the property (i) to provide public services with or withoutcost to the recipient, including the general operation of government, publiceducation, public safety, transportation, public works, civil and criminaljustice, public health and welfare, developments by a public housing authority,parks, culture, recreation, community development, and cemetery purposes,or (ii) to carry out the duties and responsibilities conferred by law withor without consideration. Public purpose does not include leasing of propertyto a private party unless the lease of the property is at fair market valuefor a public purpose. Leases of property by a public housing authority tolow-income individuals as a place of residence are for the authority's publicpurpose;(b) Unleased property of the state or its governmental subdivisionswhich is not being used or developed for use for a public purpose but uponwhich a payment in lieu of taxes is paid for public safety, rescue, and emergencyservices and road or street construction or maintenance services to all governmentalunits providing such services to the property. Except as provided in ArticleVIII, section 11, of the Constitution of Nebraska, the payment in lieu oftaxes shall be based on the proportionate share of the cost of providing publicsafety, rescue, or emergency services and road or street construction or maintenanceservices unless a general policy is adopted by the governing body of the governmentalsubdivision providing such services which provides for a different methodof determining the amount of the payment in lieu of taxes. The governing bodymay adopt a general policy by ordinance or resolution for determining theamount of payment in lieu of taxes by majority vote after a hearing on theordinance or resolution. Such ordinance or resolution shall nevertheless resultin an equitable contribution for the cost of providing such services to theexempt property;(c) Property owned by and used exclusively for agriculturaland horticultural societies;(d) Property owned by educational, religious, charitable,or cemetery organizations, or any organization for the exclusive benefit ofany such educational, religious, charitable, or cemetery organization, andused exclusively for educational, religious, charitable, or cemetery purposes,when such property is not (i) owned or used for financial gain or profit toeither the owner or user, (ii) used for the sale of alcoholic liquors formore than twenty hours per week, or (iii) owned or used by an organizationwhich discriminates in membership or employment based on race, color, or nationalorigin. For purposes of this subdivision, educational organization means (A)an institution operated exclusively for the purpose of offering regular courseswith systematic instruction in academic, vocational, or technical subjectsor assisting students through services relating to the origination, processing,or guarantying of federally reinsured student loans for higher education or(B) a museum or historical society operated exclusively for the benefit andeducation of the public. For purposes of this subdivision, charitable organizationmeans an organization operated exclusively for the purpose of the mental,social, or physical benefit of the public or an indefinite number of persons;and(e) Household goods and personal effects not owned or usedfor financial gain or profit to either the owner or user.(2) The increased value of land by reason of shade and ornamentaltrees planted along the highway shall not be taken into account in the valuationof land.(3) Tangible personal property which is not depreciable tangiblepersonal property as defined in section 77-119 shall be exempt from propertytax.(4) Motor vehicles required to be registered for operationon the highways of this state shall be exempt from payment of property taxes.(5) Business and agricultural inventory shall be exempt fromthe personal property tax. For purposes of this subsection, business inventoryincludes personal property owned for purposes of leasing or renting such propertyto others for financial gain only if the personal property is of a type whichin the ordinary course of business is leased or rented thirty days or lessand may be returned at the option of the lessee or renter at any time andthe personal property is of a type which would be considered household goodsor personal effects if owned by an individual. All other personal propertyowned for purposes of leasing or renting such property to others for financialgain shall not be considered business inventory.(6) Any personal property exempt pursuant to subsection (2)of section 77-4105 or section 77-5209.02 shall be exempt from the personalproperty tax.(7) Livestock shall be exempt from the personal propertytax.(8) Any personal property exempt pursuant to the NebraskaAdvantage Act shall be exempt from the personal property tax.(9) Any propertyused directly in the generation of electricity using wind as the fuel sourceshall be exempt from the property tax. Personal property used directly inthe generation of electricity using wind as the fuel source includes, butis not limited to, wind turbines, rotors and blades, towers, trackers, generatingequipment, transmission components, substations, supporting structures orracks, inverters, and other system components such as wiring, control systems,switchgears, and generator step-up transformers. SourceLaws 1903, c. 73, § 13, p. 390; R.S.1913, § 6301; Laws 1921, c. 133, art. II, § 2, p. 547; C.S.1922, § 5821; C.S.1929, § 77-202; R.S.1943, § 77-202; Laws 1955, c. 290, § 1, p. 921; Laws 1965, c. 468, § 1, p. 1514; Laws 1965, c. 469, § 1, p. 1516; Laws 1967, c. 494, § 1, p. 1685; Laws 1967, c. 495, § 1, p. 1686; Laws 1971, LB 945, § 2; Laws 1975, LB 530, § 3; Laws 1980, LB 882, § 1; Laws 1980, LB 913, § 1; Laws 1982, LB 383, § 5; Laws 1984, LB 891, § 1; Laws 1985, LB 268, § 1; Laws 1986, LB 732, § 1; Laws 1987, LB 775, § 13; Laws 1988, LB 855, § 3; Laws 1989, Spec. Sess., LB 7, § 2; Laws 1991, LB 829, § 7; Laws 1992, LB 1063, § 53; Laws 1992, Second Spec. Sess., LB 1, § 51; Laws 1994, LB 961, § 7; Laws 1997, LB 271, § 39; Laws 1999, LB 271, § 4; Laws 2002, LB 994, § 10; Laws 2005, LB 312, § 4; Laws 2008, LB1027, § 1; Laws 2010, LB1048, § 11.Effective Date: July 15, 2010 Cross ReferencesNebraska Advantage Act, see section 77-5701. Annotations1. Constitutionality2. Use and ownership of property3. Procedures4. Exemption granted5. Exemption not granted6. Effect of exemption7. Miscellaneous1. ConstitutionalitySubsections (6) through (9) of this section are unconstitutional under Neb. Const. art. VIII, section 1. MAPCO Ammonia Pipeline v. State Bd. of Equal., 238 Neb. 565, 471 N.W.2d 734 (1991).The provision including major appliances either attached or detached to real property is unconstitutional. State ex rel. Meyer v. Peters, 191 Neb. 330, 215 N.W.2d 520 (1974).2. Use and ownership of propertyIn reference to subsection (1)(c) of this section, exclusive use means the primary or dominant use of property, as opposed to incidental use. A parsonage which is furnished to a member of the clergy, which is an essential part of a church, and which is used primarily to promote the objects and purposes of a faith is property used exclusively for religious purposes and is exempt from taxation. Neb. Unit. Meth. Ch. v. Scotts Bluff Cty. Bd. of Equal., 243 Neb. 412, 499 N.W.2d 543 (1993).Subsection (1)(c) of this section contains a two-tier approach to property tax exemption: the first tier involves the nature, character, or status of a property owner, and the second tier concerns the use of the property. Nebraska State Bar Found. v. Lancaster Cty. Bd. of Equal., 237 Neb. 1, 465 N.W.2d 111 (1991).To be tax exempt, property must (1) be owned by an organization designated in subsection (1)(c) of this section; (2) be used exclusively for at least one of the purposes specified in subsection (1)(c); and (3) not be (a) owned or used for financial gain to the property owner or user, (b) used more than 20 hours per week for sale of alcoholic liquors, or (c) owned or used by an organization which discriminates in membership or employment based on race, color, or national origin. Nebraska State Bar Found. v. Lancaster Cty. Bd. of Equal., 237 Neb. 1, 465 N.W.2d 111 (1991).Under subsection (1)(c) of this section, if a property owner is not of a type entitled to property tax exemption, considering the property's use is unnecessary. Nebraska State Bar Found. v. Lancaster Cty. Bd. of Equal., 237 Neb. 1, 465 N.W.2d 111 (1991).Property is not used for financial gain or profit to either the owner or the user if no part of the income from the property is distributed to the owner's or user's members, directors, or officers, or to private individuals. United Way v. Douglas Co. Bd. of Equal., 215 Neb. 1, 337 N.W.2d 103 (1983).The constitution and statute require that the property be owned for an exempt purpose, but there is no requirement that the ownership and use must be by the same entity. United Way v. Douglas Co. Bd. of Equal., 215 Neb. 1, 337 N.W.2d 103 (1983).Vacant space in property owned by a charitable organization is exempt from taxation if it is intended for a charitable use, the dominant use of the property as a whole is for exempt purposes, and the conditions under which it is held preclude its use for commercial purposes. United Way v. Douglas Co. Bd. of Equal., 215 Neb. 1, 337 N.W.2d 103 (1983).Legislature has used the same language as appears in the Constitution in exempting from taxation property owned and used for educational, religious, or charitable purposes. Lincoln Woman's Club v. City of Lincoln, 178 Neb. 357, 133 N.W.2d 455 (1965).The primary or dominant use, and not an incidental use, is controlling in determining whether property is exempt from taxation. Doane College v. County of Saline, 173 Neb. 8, 112 N.W.2d 248 (1961).It is the exclusive use of property for religious or educational purposes that determines exemption from taxation. Nebraska Conf. Assn. Seventh Day Adventists v. County of Hall, 166 Neb. 588, 90 N.W.2d 50 (1958).Use of property is test to right to exemption. Central Union Conference Assn. v. Lancaster County, 109 Neb. 106, 189 N.W. 982 (1922); St. Elizabeth Hospital v. Lancaster County, 109 Neb. 104, 189 N.W. 981 (1922).Exemption is based solely on use of premises and not on ownership. Scott v. Society of Russian Israelites, 59 Neb. 571, 81 N.W. 624 (1900); First Christian Church of Beatrice v. City of Beatrice, 39 Neb. 432, 58 N.W. 166 (1894).3. ProceduresIn its appellate review of a question whether property is exempt from taxation pursuant to subsection (1)(c) of this section, the Supreme Court determines tax exemption in an equitable trial of factual questions de novo on the record. Immanuel, Inc. v. Board of Equal., 222 Neb. 405, 384 N.W.2d 266 (1986).Statutes exempting property from taxation are to be strictly construed, property must come clearly within the statutory provisions granting such exemption, and the burden of proving the right to the exemption is upon the claimant. United Way v. Douglas Co. Bd. of Equal., 215 Neb. 1, 337 N.W.2d 103 (1983).The burden of proof is upon one claiming property to be exempt from taxation to establish that its predominant use is for one of the purposes set out in this section. OEA Senior Citizens, Inc. v. County of Douglas, 186 Neb. 593, 185 N.W.2d 464 (1971); Berean Fundamental Church Council, Inc. v. Board of Equalization, 186 Neb. 431, 183 N.W.2d 750 (1971).Party claiming property to be exempt from taxation has the burden of proof of establishing such exemption. Nebraska Conf. Assn. Seventh Day Adventists v. Board of Equalization of Hall County, 179 Neb. 326, 138 N.W.2d 455 (1965).4. Exemption grantedThe lease of property from one exempt organization to another exempt organization does not create a taxable use, so long as the property is used exclusively for exempt purposes. Fort Calhoun Baptist Ch. v. Washington Cty. Bd. of Equal., 277 Neb. 25, 759 N.W.2d 475 (2009).An industrial park which is created by a city council acting as a community redevelopment authority may serve the purpose of community development, and thus be exempt from taxation as property which serves a public purpose. City of York v. York Cty. Bd. of Equal., 266 Neb. 311, 664 N.W.2d 456 (2003).The statutes governing airports were not expressly or impliedly repealed by the passage of the 1998 constitutional amendment to Neb. Const. art. VIII, sec. 2, or subsection (1)(a) of this section. Airports owned and operated by municipalities are exempt from taxation. City of York v. York Cty. Bd. of Equal., 266 Neb. 297, 664 N.W.2d 445 (2003).Pursuant to subsection (1)(a) of this section, real property acquired by the city through enforcement of special assessment liens and offered for sale to the public at a price which does not exceed delinquent special assessments and accrued interest, is used "for a public purpose" and is therefore exempt from real estate taxation. City of Alliance v. Box Butte Cty. Bd. of Equal., 265 Neb. 262, 656 N.W.2d 439 (2003).Pursuant to the former subsection (1)(c) of this section, an assisted living facility owned and used exclusively for charitable purposes, that is, the primary or dominant use of the property is for charitable purposes, is entitled to a property tax exemption. Bethesda Found. v. Buffalo Cty. Bd. of Equal., 263 Neb. 454, 640 N.W.2d 398 (2002).Lease of property to a charitable organization by a charitable organization for substantially less than its fair rental value is a use of property for charitable purpose. United Way v. Douglas Co. Bd. of Equal., 215 Neb. 1, 337 N.W.2d 103 (1983).Where a nursing home's association with two other companies did not result in financial gain or profit to either the owner or user, and the primary or dominant use of the nursing home continued to be for religious or charitable purposes, the property remains exempt from taxation. Bethesda Foundation v. County of Saunders, 200 Neb. 574, 264 N.W.2d 664 (1978).Property of rest home was exempt from taxation under this section. Evangelical Lutheran Good Samaritan Soc. v. County of Gage, 181 Neb. 831, 151 N.W.2d 446 (1967).Operation of ranch for boys was such as to require entire ranch to be exempt from taxation. Lariat Boys Ranch v. Board of Equalization of Logan County, 181 Neb. 198, 147 N.W.2d 515 (1966).Building used by Young Women's Christian Association for low-rent housing was exempt from taxation. Young Women's Christian Assn. v. City of Lincoln, 177 Neb. 136, 128 N.W.2d 600 (1964).Legislature has exempted from taxation hospitals owned and used exclusively for charitable purposes. Muller v. Nebraska Methodist Hospital, 160 Neb. 279, 70 N.W.2d 86 (1955).Property of school district is exempt from taxation. Madison County v. School Dist. No. 2, 148 Neb. 218, 27 N.W.2d 172 (1947).Scottish Rite temple and grounds are exempted from taxation as property used exclusively for educational, religious or charitable purposes. Scottish Rite of Freemasonry v. Lancaster County Board of Commissioners, 122 Neb. 586, 241 N.W. 93 (1932), 81 A.L.R. 1166 (1932), overruling Scottish Rite Building Co. v. Lancaster County, 106 Neb. 95, 182 N.W. 574 (1921), and Mt. Moriah Lodge No. 57, A.F. & A.M. v. Otoe County, 101 Neb. 274, 162 N.W. 639 (1917).Laundry owned and used by charitable institution in carrying on its work is exempt. House of the Good Shepherd of Omaha v. Board of Equalization of Douglas County, 113 Neb. 489, 203 N.W. 632 (1925).Farm and dairy property used for school purposes are exempt. Central Union Conference Assn. v. Lancaster County, 109 Neb. 106, 189 N.W. 982 (1922).Hospital used exclusively for religious and charitable purposes is exempt. St. Elizabeth Hospital v. Lancaster County, 109 Neb. 104, 189 N.W. 981 (1922).City of Omaha waterworks is exempt. City of Omaha v. Douglas County, 96 Neb. 865, 148 N.W. 938 (1914).Property of Masonic lodge was exempt. Plattsmouth Lodge No. 6, A.F. & A.M. v. Cass County, 79 Neb. 463, 113 N.W. 167 (1907).A contested area within a community hall located on the county fairgrounds, which is used primarily for county fair purposes, is exempt under this section. Brown Cty. Ag. Socy. v. Brown Cty. Bd. of Equal., 11 Neb. App. 642, 660 N.W.2d 518 (2003).5. Exemption not grantedThe intention to use property in the future for an exempt purpose is not a use of the property for exempt purposes under this section. St. Monica's v. Lancaster Cty. Bd. of Equal., 275 Neb. 999, 751 N.W.2d 604 (2008).The Nebraska State Bar Foundation is not entitled to a tax exemption under subsection (1)(c) of this section as a charitable or educational organization. Nebraska State Bar Found. v. Lancaster Cty. Bd. of Equal., 237 Neb. 1, 465 N.W.2d 111 (1991).Property owned and used primarily for furnishing low-rent housing not entitled to exemption as property owned and used exclusively for charitable purposes. Christian Retirement Homes, Inc. v. Board of Equalization of Lancaster County, 186 Neb. 11, 180 N.W.2d 136 (1970); County of Douglas v. OEA Senior Citizens, Inc., 172 Neb. 696, 111 N.W.2d 719 (1961).Industries operated and maintained primarily for purpose of providing student employment are an incidental and not a direct use of property for educational purposes and do not qualify for tax exemption. Union College v. Board of Equalization of Lancaster County, 183 Neb. 579, 162 N.W.2d 772 (1968).Property of college fraternity was not used exclusively for educational purposes. Iota Benefit Assn. v. County of Douglas, 165 Neb. 330, 85 N.W.2d 726 (1957).Household goods of the value of $200 exempt from taxation are not exempt from sale for payment of taxes properly assessed on other property of debtor. Ryder, Sheriff v. Livingston, 145 Neb. 862, 18 N.W.2d 507 (1945).Lodge property encumbered by unpaid real estate mortgages is not owned exclusively for charitable purposes. North Platte Lodge 985, B.P.O.E. v. Board of Equalization of Lincoln County, 125 Neb. 841, 252 N.W. 313 (1934).Portion of building of charitable institution used for business purposes was not exempt. Y.M.C.A. v. Lancaster County, 106 Neb. 105, 182 N.W. 593 (1921); Y.M.C.A. of Omaha v. Douglas County, 60 Neb. 642, 83 N.W. 924 (1900).A fraternal beneficiary association is not a charitable association within meaning of section. Royal Highlanders v. State, 77 Neb. 18, 108 N.W. 183 (1906).Commercial college is a school and part of property not used exclusively for school is liable to taxation. Rohrbough v. Douglas County, 76 Neb. 679, 107 N.W. 1000 (1906).If building is used at same time for school purposes and as a family residence, it is not exempt. Watson v. Cowles, 61 Neb. 216, 85 N.W. 35 (1901).6. Effect of exemptionExempt from taxes means not subject to taxation. Hanson v. City of Omaha, 154 Neb. 72, 46 N.W.2d 896 (1951).Where a tax is levied upon property as a whole, and a part is exempt under the Constitution and statutes, the assessment, if inseparable, is unauthorized, and the whole tax is void. McDonald v. Masonic Temple Craft, 135 Neb. 48, 280 N.W. 275 (1938)Tax levied on property that is exempt is void and collection thereof may be enjoined. East Lincoln Lodge No. 210, A. F. & A. M. v. City of Lincoln, 131 Neb. 379, 268 N.W. 91 (1936).Where two lower floors of building were rented for commercial purposes and two upper floors were used exclusively for religious, charitable and educational purposes, part of the taxable value of the lot could be considered in determining total taxable value of property. Masonic Temple Craft v. Board of Equalization of Lincoln County, 129 Neb. 293, 261 N.W. 569 (1935); modified on rehearing 129 Neb. 827, 263 N.W. 150 (1935).Section does not exempt from special assessments for improvements. City of Beatrice v. Brethren Church, 41 Neb. 358, 59 N.W. 932 (1894).Only increased value for tree culture can be exempted. Burlington & M. R. R.R. Co. v. Board of County Commissioners of Seward County, 10 Neb. 211, 4 N.W. 1016 (1880).7. MiscellaneousA solid waste landfill operated pursuant to the Integrated Solid Waste Management Act serves a public purpose and may be exempt from property taxation. City of York v. York Cty. Bd. of Equal., 266 Neb. 311, 664 N.W.2d 456 (2003).Regarding "mental" benefit of the public in subsection (1)(c) of this section as one of the requisite purposes of a charitable organization, "mental" means "intellectual," which means, among other things, engaged in creative literary, artistic, or scientific labor. Nebraska State Bar Found. v. Lancaster Cty. Bd. of Equal., 237 Neb. 1, 465 N.W.2d 111 (1991).Relative to a charitable organization, "an indefinite number of persons" in subsection (1)(c) of this section means a group of persons with a common characteristic, that is, a class, uncertain in number and composed from the public at large or a community. Nebraska State Bar Found. v. Lancaster Cty. Bd. of Equal., 237 Neb. 1, 465 N.W.2d 111 (1991).Under subsection (1)(c) of this section, a property owner's exemption from federal income taxation does not determine whether the owner's property is tax exempt under state law. Nebraska State Bar Found. v. Lancaster Cty. Bd. of Equal., 237 Neb. 1, 465 N.W.2d 111 (1991).Under subsection (1)(c) of this section, "operated exclusively," in reference to a charitable organization, means an organization's primary or predominant activity. Nebraska State Bar Found. v. Lancaster Cty. Bd. of Equal., 237 Neb. 1, 465 N.W.2d 111 (1991).Property, abandoned for religious purposes, is liable to taxation from time of abandonment. Holthaus v. Adams County, 74 Neb. 861, 105 N.W. 632 (1905).

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State Codes and Statutes

Statutes > Nebraska > Chapter77 > 77-202

77-202. Property taxable;exemptions enumerated.(1) The following propertyshall be exempt from property taxes:(a) Property of the state and its governmental subdivisionsto the extent used or being developed for use by the state or governmentalsubdivision for a public purpose. For purposes of this subdivision, publicpurpose means use of the property (i) to provide public services with or withoutcost to the recipient, including the general operation of government, publiceducation, public safety, transportation, public works, civil and criminaljustice, public health and welfare, developments by a public housing authority,parks, culture, recreation, community development, and cemetery purposes,or (ii) to carry out the duties and responsibilities conferred by law withor without consideration. Public purpose does not include leasing of propertyto a private party unless the lease of the property is at fair market valuefor a public purpose. Leases of property by a public housing authority tolow-income individuals as a place of residence are for the authority's publicpurpose;(b) Unleased property of the state or its governmental subdivisionswhich is not being used or developed for use for a public purpose but uponwhich a payment in lieu of taxes is paid for public safety, rescue, and emergencyservices and road or street construction or maintenance services to all governmentalunits providing such services to the property. Except as provided in ArticleVIII, section 11, of the Constitution of Nebraska, the payment in lieu oftaxes shall be based on the proportionate share of the cost of providing publicsafety, rescue, or emergency services and road or street construction or maintenanceservices unless a general policy is adopted by the governing body of the governmentalsubdivision providing such services which provides for a different methodof determining the amount of the payment in lieu of taxes. The governing bodymay adopt a general policy by ordinance or resolution for determining theamount of payment in lieu of taxes by majority vote after a hearing on theordinance or resolution. Such ordinance or resolution shall nevertheless resultin an equitable contribution for the cost of providing such services to theexempt property;(c) Property owned by and used exclusively for agriculturaland horticultural societies;(d) Property owned by educational, religious, charitable,or cemetery organizations, or any organization for the exclusive benefit ofany such educational, religious, charitable, or cemetery organization, andused exclusively for educational, religious, charitable, or cemetery purposes,when such property is not (i) owned or used for financial gain or profit toeither the owner or user, (ii) used for the sale of alcoholic liquors formore than twenty hours per week, or (iii) owned or used by an organizationwhich discriminates in membership or employment based on race, color, or nationalorigin. For purposes of this subdivision, educational organization means (A)an institution operated exclusively for the purpose of offering regular courseswith systematic instruction in academic, vocational, or technical subjectsor assisting students through services relating to the origination, processing,or guarantying of federally reinsured student loans for higher education or(B) a museum or historical society operated exclusively for the benefit andeducation of the public. For purposes of this subdivision, charitable organizationmeans an organization operated exclusively for the purpose of the mental,social, or physical benefit of the public or an indefinite number of persons;and(e) Household goods and personal effects not owned or usedfor financial gain or profit to either the owner or user.(2) The increased value of land by reason of shade and ornamentaltrees planted along the highway shall not be taken into account in the valuationof land.(3) Tangible personal property which is not depreciable tangiblepersonal property as defined in section 77-119 shall be exempt from propertytax.(4) Motor vehicles required to be registered for operationon the highways of this state shall be exempt from payment of property taxes.(5) Business and agricultural inventory shall be exempt fromthe personal property tax. For purposes of this subsection, business inventoryincludes personal property owned for purposes of leasing or renting such propertyto others for financial gain only if the personal property is of a type whichin the ordinary course of business is leased or rented thirty days or lessand may be returned at the option of the lessee or renter at any time andthe personal property is of a type which would be considered household goodsor personal effects if owned by an individual. All other personal propertyowned for purposes of leasing or renting such property to others for financialgain shall not be considered business inventory.(6) Any personal property exempt pursuant to subsection (2)of section 77-4105 or section 77-5209.02 shall be exempt from the personalproperty tax.(7) Livestock shall be exempt from the personal propertytax.(8) Any personal property exempt pursuant to the NebraskaAdvantage Act shall be exempt from the personal property tax.(9) Any propertyused directly in the generation of electricity using wind as the fuel sourceshall be exempt from the property tax. Personal property used directly inthe generation of electricity using wind as the fuel source includes, butis not limited to, wind turbines, rotors and blades, towers, trackers, generatingequipment, transmission components, substations, supporting structures orracks, inverters, and other system components such as wiring, control systems,switchgears, and generator step-up transformers. SourceLaws 1903, c. 73, § 13, p. 390; R.S.1913, § 6301; Laws 1921, c. 133, art. II, § 2, p. 547; C.S.1922, § 5821; C.S.1929, § 77-202; R.S.1943, § 77-202; Laws 1955, c. 290, § 1, p. 921; Laws 1965, c. 468, § 1, p. 1514; Laws 1965, c. 469, § 1, p. 1516; Laws 1967, c. 494, § 1, p. 1685; Laws 1967, c. 495, § 1, p. 1686; Laws 1971, LB 945, § 2; Laws 1975, LB 530, § 3; Laws 1980, LB 882, § 1; Laws 1980, LB 913, § 1; Laws 1982, LB 383, § 5; Laws 1984, LB 891, § 1; Laws 1985, LB 268, § 1; Laws 1986, LB 732, § 1; Laws 1987, LB 775, § 13; Laws 1988, LB 855, § 3; Laws 1989, Spec. Sess., LB 7, § 2; Laws 1991, LB 829, § 7; Laws 1992, LB 1063, § 53; Laws 1992, Second Spec. Sess., LB 1, § 51; Laws 1994, LB 961, § 7; Laws 1997, LB 271, § 39; Laws 1999, LB 271, § 4; Laws 2002, LB 994, § 10; Laws 2005, LB 312, § 4; Laws 2008, LB1027, § 1; Laws 2010, LB1048, § 11.Effective Date: July 15, 2010 Cross ReferencesNebraska Advantage Act, see section 77-5701. Annotations1. Constitutionality2. Use and ownership of property3. Procedures4. Exemption granted5. Exemption not granted6. Effect of exemption7. Miscellaneous1. ConstitutionalitySubsections (6) through (9) of this section are unconstitutional under Neb. Const. art. VIII, section 1. MAPCO Ammonia Pipeline v. State Bd. of Equal., 238 Neb. 565, 471 N.W.2d 734 (1991).The provision including major appliances either attached or detached to real property is unconstitutional. State ex rel. Meyer v. Peters, 191 Neb. 330, 215 N.W.2d 520 (1974).2. Use and ownership of propertyIn reference to subsection (1)(c) of this section, exclusive use means the primary or dominant use of property, as opposed to incidental use. A parsonage which is furnished to a member of the clergy, which is an essential part of a church, and which is used primarily to promote the objects and purposes of a faith is property used exclusively for religious purposes and is exempt from taxation. Neb. Unit. Meth. Ch. v. Scotts Bluff Cty. Bd. of Equal., 243 Neb. 412, 499 N.W.2d 543 (1993).Subsection (1)(c) of this section contains a two-tier approach to property tax exemption: the first tier involves the nature, character, or status of a property owner, and the second tier concerns the use of the property. Nebraska State Bar Found. v. Lancaster Cty. Bd. of Equal., 237 Neb. 1, 465 N.W.2d 111 (1991).To be tax exempt, property must (1) be owned by an organization designated in subsection (1)(c) of this section; (2) be used exclusively for at least one of the purposes specified in subsection (1)(c); and (3) not be (a) owned or used for financial gain to the property owner or user, (b) used more than 20 hours per week for sale of alcoholic liquors, or (c) owned or used by an organization which discriminates in membership or employment based on race, color, or national origin. Nebraska State Bar Found. v. Lancaster Cty. Bd. of Equal., 237 Neb. 1, 465 N.W.2d 111 (1991).Under subsection (1)(c) of this section, if a property owner is not of a type entitled to property tax exemption, considering the property's use is unnecessary. Nebraska State Bar Found. v. Lancaster Cty. Bd. of Equal., 237 Neb. 1, 465 N.W.2d 111 (1991).Property is not used for financial gain or profit to either the owner or the user if no part of the income from the property is distributed to the owner's or user's members, directors, or officers, or to private individuals. United Way v. Douglas Co. Bd. of Equal., 215 Neb. 1, 337 N.W.2d 103 (1983).The constitution and statute require that the property be owned for an exempt purpose, but there is no requirement that the ownership and use must be by the same entity. United Way v. Douglas Co. Bd. of Equal., 215 Neb. 1, 337 N.W.2d 103 (1983).Vacant space in property owned by a charitable organization is exempt from taxation if it is intended for a charitable use, the dominant use of the property as a whole is for exempt purposes, and the conditions under which it is held preclude its use for commercial purposes. United Way v. Douglas Co. Bd. of Equal., 215 Neb. 1, 337 N.W.2d 103 (1983).Legislature has used the same language as appears in the Constitution in exempting from taxation property owned and used for educational, religious, or charitable purposes. Lincoln Woman's Club v. City of Lincoln, 178 Neb. 357, 133 N.W.2d 455 (1965).The primary or dominant use, and not an incidental use, is controlling in determining whether property is exempt from taxation. Doane College v. County of Saline, 173 Neb. 8, 112 N.W.2d 248 (1961).It is the exclusive use of property for religious or educational purposes that determines exemption from taxation. Nebraska Conf. Assn. Seventh Day Adventists v. County of Hall, 166 Neb. 588, 90 N.W.2d 50 (1958).Use of property is test to right to exemption. Central Union Conference Assn. v. Lancaster County, 109 Neb. 106, 189 N.W. 982 (1922); St. Elizabeth Hospital v. Lancaster County, 109 Neb. 104, 189 N.W. 981 (1922).Exemption is based solely on use of premises and not on ownership. Scott v. Society of Russian Israelites, 59 Neb. 571, 81 N.W. 624 (1900); First Christian Church of Beatrice v. City of Beatrice, 39 Neb. 432, 58 N.W. 166 (1894).3. ProceduresIn its appellate review of a question whether property is exempt from taxation pursuant to subsection (1)(c) of this section, the Supreme Court determines tax exemption in an equitable trial of factual questions de novo on the record. Immanuel, Inc. v. Board of Equal., 222 Neb. 405, 384 N.W.2d 266 (1986).Statutes exempting property from taxation are to be strictly construed, property must come clearly within the statutory provisions granting such exemption, and the burden of proving the right to the exemption is upon the claimant. United Way v. Douglas Co. Bd. of Equal., 215 Neb. 1, 337 N.W.2d 103 (1983).The burden of proof is upon one claiming property to be exempt from taxation to establish that its predominant use is for one of the purposes set out in this section. OEA Senior Citizens, Inc. v. County of Douglas, 186 Neb. 593, 185 N.W.2d 464 (1971); Berean Fundamental Church Council, Inc. v. Board of Equalization, 186 Neb. 431, 183 N.W.2d 750 (1971).Party claiming property to be exempt from taxation has the burden of proof of establishing such exemption. Nebraska Conf. Assn. Seventh Day Adventists v. Board of Equalization of Hall County, 179 Neb. 326, 138 N.W.2d 455 (1965).4. Exemption grantedThe lease of property from one exempt organization to another exempt organization does not create a taxable use, so long as the property is used exclusively for exempt purposes. Fort Calhoun Baptist Ch. v. Washington Cty. Bd. of Equal., 277 Neb. 25, 759 N.W.2d 475 (2009).An industrial park which is created by a city council acting as a community redevelopment authority may serve the purpose of community development, and thus be exempt from taxation as property which serves a public purpose. City of York v. York Cty. Bd. of Equal., 266 Neb. 311, 664 N.W.2d 456 (2003).The statutes governing airports were not expressly or impliedly repealed by the passage of the 1998 constitutional amendment to Neb. Const. art. VIII, sec. 2, or subsection (1)(a) of this section. Airports owned and operated by municipalities are exempt from taxation. City of York v. York Cty. Bd. of Equal., 266 Neb. 297, 664 N.W.2d 445 (2003).Pursuant to subsection (1)(a) of this section, real property acquired by the city through enforcement of special assessment liens and offered for sale to the public at a price which does not exceed delinquent special assessments and accrued interest, is used "for a public purpose" and is therefore exempt from real estate taxation. City of Alliance v. Box Butte Cty. Bd. of Equal., 265 Neb. 262, 656 N.W.2d 439 (2003).Pursuant to the former subsection (1)(c) of this section, an assisted living facility owned and used exclusively for charitable purposes, that is, the primary or dominant use of the property is for charitable purposes, is entitled to a property tax exemption. Bethesda Found. v. Buffalo Cty. Bd. of Equal., 263 Neb. 454, 640 N.W.2d 398 (2002).Lease of property to a charitable organization by a charitable organization for substantially less than its fair rental value is a use of property for charitable purpose. United Way v. Douglas Co. Bd. of Equal., 215 Neb. 1, 337 N.W.2d 103 (1983).Where a nursing home's association with two other companies did not result in financial gain or profit to either the owner or user, and the primary or dominant use of the nursing home continued to be for religious or charitable purposes, the property remains exempt from taxation. Bethesda Foundation v. County of Saunders, 200 Neb. 574, 264 N.W.2d 664 (1978).Property of rest home was exempt from taxation under this section. Evangelical Lutheran Good Samaritan Soc. v. County of Gage, 181 Neb. 831, 151 N.W.2d 446 (1967).Operation of ranch for boys was such as to require entire ranch to be exempt from taxation. Lariat Boys Ranch v. Board of Equalization of Logan County, 181 Neb. 198, 147 N.W.2d 515 (1966).Building used by Young Women's Christian Association for low-rent housing was exempt from taxation. Young Women's Christian Assn. v. City of Lincoln, 177 Neb. 136, 128 N.W.2d 600 (1964).Legislature has exempted from taxation hospitals owned and used exclusively for charitable purposes. Muller v. Nebraska Methodist Hospital, 160 Neb. 279, 70 N.W.2d 86 (1955).Property of school district is exempt from taxation. Madison County v. School Dist. No. 2, 148 Neb. 218, 27 N.W.2d 172 (1947).Scottish Rite temple and grounds are exempted from taxation as property used exclusively for educational, religious or charitable purposes. Scottish Rite of Freemasonry v. Lancaster County Board of Commissioners, 122 Neb. 586, 241 N.W. 93 (1932), 81 A.L.R. 1166 (1932), overruling Scottish Rite Building Co. v. Lancaster County, 106 Neb. 95, 182 N.W. 574 (1921), and Mt. Moriah Lodge No. 57, A.F. & A.M. v. Otoe County, 101 Neb. 274, 162 N.W. 639 (1917).Laundry owned and used by charitable institution in carrying on its work is exempt. House of the Good Shepherd of Omaha v. Board of Equalization of Douglas County, 113 Neb. 489, 203 N.W. 632 (1925).Farm and dairy property used for school purposes are exempt. Central Union Conference Assn. v. Lancaster County, 109 Neb. 106, 189 N.W. 982 (1922).Hospital used exclusively for religious and charitable purposes is exempt. St. Elizabeth Hospital v. Lancaster County, 109 Neb. 104, 189 N.W. 981 (1922).City of Omaha waterworks is exempt. City of Omaha v. Douglas County, 96 Neb. 865, 148 N.W. 938 (1914).Property of Masonic lodge was exempt. Plattsmouth Lodge No. 6, A.F. & A.M. v. Cass County, 79 Neb. 463, 113 N.W. 167 (1907).A contested area within a community hall located on the county fairgrounds, which is used primarily for county fair purposes, is exempt under this section. Brown Cty. Ag. Socy. v. Brown Cty. Bd. of Equal., 11 Neb. App. 642, 660 N.W.2d 518 (2003).5. Exemption not grantedThe intention to use property in the future for an exempt purpose is not a use of the property for exempt purposes under this section. St. Monica's v. Lancaster Cty. Bd. of Equal., 275 Neb. 999, 751 N.W.2d 604 (2008).The Nebraska State Bar Foundation is not entitled to a tax exemption under subsection (1)(c) of this section as a charitable or educational organization. Nebraska State Bar Found. v. Lancaster Cty. Bd. of Equal., 237 Neb. 1, 465 N.W.2d 111 (1991).Property owned and used primarily for furnishing low-rent housing not entitled to exemption as property owned and used exclusively for charitable purposes. Christian Retirement Homes, Inc. v. Board of Equalization of Lancaster County, 186 Neb. 11, 180 N.W.2d 136 (1970); County of Douglas v. OEA Senior Citizens, Inc., 172 Neb. 696, 111 N.W.2d 719 (1961).Industries operated and maintained primarily for purpose of providing student employment are an incidental and not a direct use of property for educational purposes and do not qualify for tax exemption. Union College v. Board of Equalization of Lancaster County, 183 Neb. 579, 162 N.W.2d 772 (1968).Property of college fraternity was not used exclusively for educational purposes. Iota Benefit Assn. v. County of Douglas, 165 Neb. 330, 85 N.W.2d 726 (1957).Household goods of the value of $200 exempt from taxation are not exempt from sale for payment of taxes properly assessed on other property of debtor. Ryder, Sheriff v. Livingston, 145 Neb. 862, 18 N.W.2d 507 (1945).Lodge property encumbered by unpaid real estate mortgages is not owned exclusively for charitable purposes. North Platte Lodge 985, B.P.O.E. v. Board of Equalization of Lincoln County, 125 Neb. 841, 252 N.W. 313 (1934).Portion of building of charitable institution used for business purposes was not exempt. Y.M.C.A. v. Lancaster County, 106 Neb. 105, 182 N.W. 593 (1921); Y.M.C.A. of Omaha v. Douglas County, 60 Neb. 642, 83 N.W. 924 (1900).A fraternal beneficiary association is not a charitable association within meaning of section. Royal Highlanders v. State, 77 Neb. 18, 108 N.W. 183 (1906).Commercial college is a school and part of property not used exclusively for school is liable to taxation. Rohrbough v. Douglas County, 76 Neb. 679, 107 N.W. 1000 (1906).If building is used at same time for school purposes and as a family residence, it is not exempt. Watson v. Cowles, 61 Neb. 216, 85 N.W. 35 (1901).6. Effect of exemptionExempt from taxes means not subject to taxation. Hanson v. City of Omaha, 154 Neb. 72, 46 N.W.2d 896 (1951).Where a tax is levied upon property as a whole, and a part is exempt under the Constitution and statutes, the assessment, if inseparable, is unauthorized, and the whole tax is void. McDonald v. Masonic Temple Craft, 135 Neb. 48, 280 N.W. 275 (1938)Tax levied on property that is exempt is void and collection thereof may be enjoined. East Lincoln Lodge No. 210, A. F. & A. M. v. City of Lincoln, 131 Neb. 379, 268 N.W. 91 (1936).Where two lower floors of building were rented for commercial purposes and two upper floors were used exclusively for religious, charitable and educational purposes, part of the taxable value of the lot could be considered in determining total taxable value of property. Masonic Temple Craft v. Board of Equalization of Lincoln County, 129 Neb. 293, 261 N.W. 569 (1935); modified on rehearing 129 Neb. 827, 263 N.W. 150 (1935).Section does not exempt from special assessments for improvements. City of Beatrice v. Brethren Church, 41 Neb. 358, 59 N.W. 932 (1894).Only increased value for tree culture can be exempted. Burlington & M. R. R.R. Co. v. Board of County Commissioners of Seward County, 10 Neb. 211, 4 N.W. 1016 (1880).7. MiscellaneousA solid waste landfill operated pursuant to the Integrated Solid Waste Management Act serves a public purpose and may be exempt from property taxation. City of York v. York Cty. Bd. of Equal., 266 Neb. 311, 664 N.W.2d 456 (2003).Regarding "mental" benefit of the public in subsection (1)(c) of this section as one of the requisite purposes of a charitable organization, "mental" means "intellectual," which means, among other things, engaged in creative literary, artistic, or scientific labor. Nebraska State Bar Found. v. Lancaster Cty. Bd. of Equal., 237 Neb. 1, 465 N.W.2d 111 (1991).Relative to a charitable organization, "an indefinite number of persons" in subsection (1)(c) of this section means a group of persons with a common characteristic, that is, a class, uncertain in number and composed from the public at large or a community. Nebraska State Bar Found. v. Lancaster Cty. Bd. of Equal., 237 Neb. 1, 465 N.W.2d 111 (1991).Under subsection (1)(c) of this section, a property owner's exemption from federal income taxation does not determine whether the owner's property is tax exempt under state law. Nebraska State Bar Found. v. Lancaster Cty. Bd. of Equal., 237 Neb. 1, 465 N.W.2d 111 (1991).Under subsection (1)(c) of this section, "operated exclusively," in reference to a charitable organization, means an organization's primary or predominant activity. Nebraska State Bar Found. v. Lancaster Cty. Bd. of Equal., 237 Neb. 1, 465 N.W.2d 111 (1991).Property, abandoned for religious purposes, is liable to taxation from time of abandonment. Holthaus v. Adams County, 74 Neb. 861, 105 N.W. 632 (1905).

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