Appeal from the Order of the Court of Common Pleas of Berks County in case of In Re: Assessment of One-Story Brick and Aluminum Cottage with Attached Garage off Kern Drive, Lot 5, Block A, Longswamp Township, Berks County, Pennsylvania, No. 221, October Term, 1969.
H. Ober Hess, with him Benjamin R. Neilson and Ballard, Spahr, Andrews & Ingersoll, for appellant.
Frederick G. McGavin, County Solicitor, with him Leonard J. Gajewski, Assistant County Solicitor, for appellee.
Judges Crumlish, Jr., Kramer, Wilkinson, Jr., Mencer, Rogers and Blatt. President Judge Bowman did not participate. Opinion by Judge Rogers. Dissenting Opinion by Judge Wilkinson.
The Lutheran Home at Topton, Pennsylvania, (Home) here appeals from an order of the Court of Common Pleas of Berks County dismissing its appeal from an assessment of part of its properties in that County. The properties in question are dwelling houses located on the Home's campus. The appeals are from the assessment of three such in 1967 and of 25 in 1970. However, there are in fact 36 dwellings on the appellant's property and it is understood that the order finally entered herein will determine the status, whether of exemption or taxability, of all such units under the arrangements described below.
The Home, a nonprofit corporation, contends, and the Board of Assessment and Revision of Berks County concedes, that it is a purely public charity. Its charter purpose declares it to be a charitable and benevolent home providing for poor and destitute children and the aged of both sexes. Its membership consists apparently for the most part of ministers and lay people of the Lutheran Church in America. It maintains a children's home and ambulatory, self-care dormitories and infirmaries for the aged upon clearly charitable terms. Its real estate so used qualifies for exemption from taxation. We are not, however, concerned with these operations or with the properties devoted to them.
In 1962, the Home embarked upon a so-called "cottage program." At a location on its grounds described as being a five minutes' walk from the Administration Building it constructed streets, installed sewage facilities and did what was otherwise necessary to develop a portion of its land in residential building lots. On these lots it erected 36 buildings, of which 28 are single homes, six, duplex dwellings and two, three-unit apartment houses. One of the single homes was described as consisting of living room, dining room, kitchen, two
bedrooms, basement and attached garage. Thirty-six of the residences are occupied by 66 patrons.
These accommodations are available to qualifying persons upon the following terms contained in a written agreement with the occupants in which the following quoted language appears: One of the residents of each unit must be at least 65 years old. Every person seeking occupancy must be in, and have a history of, a condition of health which in the judgment of the Home will fit them for the "cottage plan living." This means that they and each of them must be able to care for themselves in their own home. Each applicant must submit a statement of his financial resources and the Home will accept only persons who can demonstrate that they have sufficient means, in the words of the Superintendent, "to carry on an independent living."
Having met the foregoing requirements; and admission being otherwise approved, the applicant will then be required to pay the Home an admission fee. This fee is in the amount of the basic cost of constructing the residence desired, plus an "intelligent, arbitrary"*fn1 amount for "ground development" decided upon by the Home. The ground development cost item generally has been $3600. The residence costs incurred and charged occupants since the inception of the program have ranged from $8200 to $20,888.50. The fee is for the dwelling unit, not the person or persons occupying it. The admission fees charged and collected for the 41 occupancies arranged by the time of hearing have been as low as $9000 and as high as $24,488.50, with most being in the $17,000 to $22,000 bracket.
The occupants pay for all utilities and other living expenses. They furnish their residence and such furnishings remain their property. They provide and prepare their food, they have automobiles in which they come ...