§246-32  Charitable, etc., purposes. (a)  There shall be exempt from real property taxes real property designated insubsection (b) or (c) and meeting the requirements stated therein, actually and(except as otherwise specifically provided) exclusively used for nonprofitpurposes.  If an exemption is claimed under one of these subsections (b) or(c), an exemption for the same property may not also be claimed under the otherof these subsections.

(b)  This subsection applies to property ownedin fee simple, leased, or rented for a period of one year or more, by theperson using the property for the exempt purposes, hereinafter referred to asthe person claiming the exemption.  If the property for which exemption isclaimed is leased or rented, the lease or rental agreement shall be in forceand recorded in the bureau of conveyances.

Exemption is allowed by this subsection to thefollowing property:

(1)  Property used for school purposes including:

(A)  Kindergartens, grade schools, junior highschools, and high schools, which carry on a program of instruction meeting therequirements of the compulsory school attendance law, section 302A-1132, orwhich are for preschool children who have attained or will attain the age offive years before January 1 of the school year; provided that any claimfor exemption based on any of the foregoing uses shall be accompanied by acertificate issued by or under the authority of the department of educationstating that the foregoing requirements are met;

(B)  Junior colleges or colleges carrying on ageneral program of instruction of college level.  The property exempt fromtaxation under this paragraph is limited to buildings used for educationalpurposes (including dormitories), housing owned by the school or college and usedas residence for personnel employed at the school or college, campus andathletic grounds, and realty used for vocational purposes incident to theschool or college.

(2)  Property used for hospital and nursing homepurposes, including housing for personnel employed at the hospital.  In orderto qualify under this paragraph the person claiming the exemption shall presentwith the claim a certificate issued by or under the authority of the departmentof health that the property for which the exemption is claimed consists of, oris a part of, hospital or nursing home facilities that are properly constitutedunder the law and maintained to serve, and that do serve the public.

(3)  Property used for church purposes, includingincidental activities, parsonages, and church grounds, the property exempt fromtaxation being limited to realty exclusive of burying grounds (exemption forwhich may be claimed under paragraph (4)).

(4)  Property used as cemeteries (excluding propertyused for cremation purposes) maintained by a religious society, or by acorporation, association, or trust organized for this purpose.

(5)  Property dedicated to public use by the owner,which dedication has been accepted by the State or any county, reduced towriting, and recorded in the bureau of conveyances; and property which has beenset aside for public use and actually used therefor for a period not less thanfive years after enactment of this section.

(6)  Property owned by any nonprofit corporation,admission to membership of which is restricted by the corporate charter tomembers of a labor union; property owned by any government employees'association or organization, one of the primary purposes of which is to improveemployment conditions of its members; property owned by any trust, thebeneficiaries of which are restricted to members of a labor union; and propertyowned by any association or league of federal credit unions chartered by theUnited States, the sole purpose of which is to promote the development offederal credit unions in the State.  Notwithstanding any provision in thissection to the contrary, the exemption shall apply to property or any portionthereof that is leased, rented, or otherwise let to another, if the leasing,renting, or letting is to a nonprofit association, organization, orcorporation.

(c)  This subsection shall apply to propertyowned in fee simple or leased or rented for a period of one year or more, thelease or rental agreement being in force and recorded in the bureau ofconveyances at the time the exemption is claimed, by either:

(1)  A corporation, society, association, or trusthaving a charter or other enabling act or governing instrument which contains aprovision or has been construed by a court of competent jurisdiction asproviding that in the event of dissolution or termination of the corporation,society, association, or trust, or other cessation of use of the property forthe exempt purpose, the real property shall be applied for another charitablepurpose or shall be dedicated to the public, or

(2)  A corporation chartered by the United Statesunder Title 36, United States Code, as a patriotic society.  Exemption isallowed by this subsection for property used for charitable purposes which areof a community, character building, social service, or educational nature,including museums, libraries, art academies, and senior citizens housingfacilities qualifying for a loan under the laws of the United States asauthorized by Section 202 of the Housing Act of 1959 as amended by the Housing Actof 1961, the Senior Citizens Housing Act of 1962, the Housing Act of 1964, andthe Housing and Urban Development Act of 1965.

(d)  If any portion of the property which mightotherwise be exempted under this section is used for commercial or other purposesnot within the conditions necessary for exemption (including any use theprimary purpose of which is to produce income even though such income is to beused for or in furtherance of the exempt purposes) that portion of the premisesshall not be exempt but the remaining portion of the premises shall not bedeprived of the exemption if the remaining portion is used exclusively forpurposes within the conditions necessary for exemption.  In the event of anexemption of a portion of a building, the tax shall be assessed upon so much ofthe value of the building (including the land thereunder and the appurtenantpremises) as the proportion of the floor space of the nonexempt portion bearsto the total floor space of the building.

(e)  The term "for nonprofitpurposes", as used in this section requires that no monetary gain oreconomic benefit inure to the person claiming the exemption, or any privateshareholder, member, or trust beneficiary.  "Monetary gain" includeswithout limitation any gain in the form of money or money's worth. "Economic benefit" includes without limitation any benefit to aperson in the course of the person's business, trade, occupation, oremployment. [L 1961, c 60, §1; am L 1962, c 7, §1; am L 1963, c 32, §1, c 67,§1, and c 96, §2; am L 1965, c 201, §§9, 10; Supp, §128-18; am L 1967, c 46, §1and c 225, §1; HRS §246-32; am L 1969, c 192, §1; am L 1972, c 200, §3; gen ch1985; am L 1996, c 89, §11]

 

Note

 

  In subsection (b)(5),L 1961, c 60, from which this section is derived, was approved by the governorMay 17, 1961 and took effect January 1, 1962.

 

Law Journals and Reviews

 

  Real Property TaxLitigation in Hawaii.  III HBJ No. 13, at pg. 57.

 

Case Notes

 

  Church purposes: Under prior law, property held in trust for use and benefit of Roman CatholicChurch did not come under any exemptions listed.  3 H. 320.  Court discussestype of religious activity which qualifies for tax exemption under prior law. 6 H. 245.

  What property ofprivate schools exempt under prior law.  7 H. 627.

  Cited:  13 H. 590,619.