{ "id": 4239509, "name": "CAVU CO., a Nebraska Corporation, Respondent-Petitioner, v. DOMINGO P. MARTINEZ, Santa Fe County Assessor, Petitioner-Respondent", "name_abbreviation": "CAVU Co. v. Martinez", "decision_date": "2014-08-04", "docket_number": "Docket No. 34,039", "first_page": "522", "last_page": "532", "citations": [ { "type": "official", "cite": "2014-NMSC-029" } ], "court": { "name_abbreviation": "N.M.", "id": 8835, "name": "Supreme Court of New Mexico" }, "jurisdiction": { "id": 52, "name_long": "New Mexico", "name": "N.M." }, "cites_to": [ { "cite": "2003-NMCA-003", "category": "reporters:neutral", "reporter": "NMCA", "case_ids": [ 15549 ], "weight": 11, "pin_cites": [ { "page": "\u00b6 32" }, { "page": "\u00b6 40" }, { "page": "\u00b6\u00b6 2, 55" }, { "page": "\u00b6 56" }, { "page": "\u00b6 41" }, { "page": "\u00b6 40" }, { "page": "\u00b6 46" }, { "page": "\u00b6 56" } ], "opinion_index": 0, "case_paths": [ "/nm/133/0297-01" ] }, { "cite": "106 N.M. 179", "category": "reporters:state", "reporter": "N.M.", "case_ids": [ 707088 ], "weight": 2, "opinion_index": 0, "case_paths": [ "/nm/106/0179-01" ] }, { "cite": "1987-NMCA-081", "category": "reporters:neutral", "reporter": "NMCA", "pin_cites": [ { "page": "\u00b6 17" } ], "opinion_index": 0 }, { "cite": "480 N.E.2d 781", "category": "reporters:state_regional", "reporter": "N.E.2d", "year": 1985, "pin_cites": [ { "page": "782", "parenthetical": "allowing a church's exemption for adjacent land planned for a school because the project was \"one of substance and not a mere dream\" (internal quotation marks and citation omitted)" } ], "opinion_index": 0 }, { "cite": "97 N.M. 260", "category": "reporters:state", "reporter": "N.M.", "case_ids": [ 1555115 ], "weight": 2, "opinion_index": 0, "case_paths": [ "/nm/97/0260-01" ] }, { "cite": "1981-NMCA-136", "category": "reporters:neutral", "reporter": "NMCA", "pin_cites": [ { "page": "\u00b6 3" } ], "opinion_index": 0 }, { "cite": "39 N.M. 135", "category": "reporters:state", "reporter": "N.M.", "case_ids": [ 1573431 ], "weight": 2, "opinion_index": 0, "case_paths": [ "/nm/39/0135-01" ] }, { "cite": "1935-NMSC-022", "category": "reporters:neutral", "reporter": "NMSC", "pin_cites": [ { "page": "\u00b6 29" } ], "opinion_index": 0 }, { "cite": "706 N.E.2d 1008", "category": "reporters:state_regional", "reporter": "N.E.2d", "year": 1998, "pin_cites": [ { "page": "1015", "parenthetical": "allowing an exemption for church property damaged by fire and caught up in a dispute over insurance coverage" } ], "opinion_index": 0 }, { "cite": "246 N.E.2d 660", "category": "reporters:state_regional", "reporter": "N.E.2d", "year": 1969, "pin_cites": [ { "page": "664", "parenthetical": "allowing an exemption for cemetery land awaiting further burials" } ], "opinion_index": 0 }, { "cite": "350 P.2d 1057", "category": "reporters:state_regional", "reporter": "P.2d", "case_ids": [ 73433 ], "year": 1960, "pin_cites": [ { "page": "1058-59", "parenthetical": "en banc" } ], "opinion_index": 0, "case_paths": [ "/colo/142/0347-01" ] }, { "cite": "3 A.D.3d 708", "category": "reporters:state", "reporter": "A.D.3d", "case_ids": [ 1239557 ], "year": 2004, "pin_cites": [ { "page": "710", "parenthetical": "concluding that the party seeking exemption \"submitted the requisite quantum of evidence to establish that its use of the property was in furtherance of its exempt purpose\"" } ], "opinion_index": 0, "case_paths": [ "/ad3d/3/0708-01" ] }, { "cite": "694 N.E.2d 816", "category": "reporters:state_regional", "reporter": "N.E.2d", "case_ids": [ 11830629 ], "weight": 2, "year": 1998, "pin_cites": [ { "page": "818", "parenthetical": "representing the source of authority for this proposition on which multiple Indiana cases have since relied" }, { "page": "818-19" } ], "opinion_index": 0, "case_paths": [ "/ne2d/694/0816-01" ] }, { "cite": "2013-NMCA-029", "category": "reporters:neutral", "reporter": "NMCA", "case_ids": [ 4191802 ], "weight": 2, "pin_cites": [ { "page": "\u00b6\u00b6 1-2" }, { "page": "\u00b6\u00b6 16-18, 22" } ], "opinion_index": 0, "case_paths": [ "/nm-app/3/0477-01" ] }, { "cite": "83 N.M. 445", "category": "reporters:state", "reporter": "N.M.", "case_ids": [ 5334437 ], "weight": 2, "opinion_index": 0, "case_paths": [ "/nm/83/0445-01" ] }, { "cite": "1972-NMSC-006", "category": "reporters:neutral", "reporter": "NMSC", "weight": 3, "pin_cites": [ { "page": "\u00b6 6" }, { "page": "\u00b6 3" }, { "page": "\u00b6 3" } ], "opinion_index": 0 }, { "cite": "37 N.M. 178", "category": "reporters:state", "reporter": "N.M.", "case_ids": [ 1575362 ], "weight": 2, "opinion_index": 0, "case_paths": [ "/nm/37/0178-01" ] }, { "cite": "1933-NMSC-013", "category": "reporters:neutral", "reporter": "NMSC", "weight": 6, "pin_cites": [ { "page": "\u00b6\u00b6 7, 9-12" }, { "page": "\u00b6\u00b6 31-32" }, { "page": "\u00b6 39" }, { "page": "\u00b6 39" }, { "page": "\u00b6 32" }, { "page": "\u00b6 39" } ], "opinion_index": 0 }, { "cite": "92 N.M. 541", "category": "reporters:state", "reporter": "N.M.", "case_ids": [ 1557047 ], "weight": 3, "opinion_index": 0, "case_paths": [ "/nm/92/0541-01" ] }, { "cite": "1978-NMCA-096", "category": "reporters:neutral", "reporter": "NMCA", "weight": 9, "pin_cites": [ { "page": "\u00b6 35" }, { "page": "\u00b6 35" }, { "page": "\u00b6 61" }, { "page": "\u00b635" }, { "page": "\u00b6 35" }, { "page": "\u00b6 26" }, { "page": "\u00b6 35" }, { "page": "\u00b6\u00b6 35-36" }, { "page": "\u00b6 38" } ], "opinion_index": 0 }, { "cite": "2003-NMSC-005", "category": "reporters:neutral", "reporter": "NMSC", "case_ids": [ 15945 ], "weight": 3, "pin_cites": [ { "page": "\u00b6 16" } ], "opinion_index": 0, "case_paths": [ "/nm/133/0097-01" ] }, { "cite": "319 P.3d 639", "category": "reporters:state_regional", "reporter": "P.3d", "opinion_index": 0 }, { "cite": "2014-NMSC-006", "category": "reporters:neutral", "reporter": "NMSC", "case_ids": [ 4077676 ], "weight": 2, "pin_cites": [ { "page": "\u00b6 15" }, { "page": "\u00b6 16" } ], "opinion_index": 0, "case_paths": [ "/nm-app/5/0492-01" ] }, { "cite": "2000-NMSC-007", "category": "reporters:neutral", "reporter": "NMSC", "case_ids": [ 106498 ], "weight": 3, "pin_cites": [ { "page": "\u00b6\u00b6 2-3" } ], "opinion_index": 0, "case_paths": [ "/nm/128/0686-01" ] }, { "cite": "2013-NMCERT-004", "category": "reporters:neutral", "reporter": "NMCERT", "opinion_index": 0 }, { "cite": "302 P.3d 126", "category": "reporters:state_regional", "reporter": "P.3d", "opinion_index": 0 }, { "cite": "2013-NMCA-050", "category": "reporters:neutral", "reporter": "NMCA", "case_ids": [ 4191928 ], "weight": 4, "pin_cites": [ { "page": "\u00b6\u00b6 1, 33" }, { "page": "\u00b6\u00b6 15, 17, 33" }, { "page": "\u00b6\u00b6 28, 33" }, { "page": "\u00b6 24" } ], "opinion_index": 0, "case_paths": [ "/nm-app/3/0753-01" ] } ], "analysis": { "cardinality": 1309, "char_count": 30868, "ocr_confidence": 0.771, "pagerank": { "raw": 5.4033266686372354e-08, "percentile": 0.339848964167409 }, "sha256": "55d1c4336e3761a67849bd6133060d336229a59f41b1e7de627ab8029fb20ff9", "simhash": "1:bb0db087a3252160", "word_count": 4859 }, "last_updated": "2023-07-14T17:19:17.637489+00:00", "provenance": { "date_added": "2019-08-29", "source": "Harvard", "batch": "2018" }, "casebody": { "judges": [ "CHARLES W. DANIELS, Justice", "WE CONCUR:", "BARBARA J. VIGIL, Chief Justice", "PETRA JIMENEZ MAES, Justice", "RICHARD C. BOSSON, Justice", "EDWARD L. CH\u00c1VEZ, Justice" ], "parties": [ "CAVU CO., a Nebraska Corporation, Respondent-Petitioner, v. DOMINGO P. MARTINEZ, Santa Fe County Assessor, Petitioner-Respondent." ], "opinions": [ { "text": "OPINION\nDANIELS, Justice.\n{1} In this property tax case, we hold that the appropriate inquiry into the validity of a property\u2019s educational exemption from taxation under the exemption provision of Article VIII, Section 3 of the New Mexico Constitution is whether use during the tax year furthers the exempt purpose. Because the taxpayer in this case had only used the property for educational purposes, had declined to use it for noneducational purposes, and was actively negotiating with schools capable of relocating to his campus property during the relevant tax year when the property was temporarily vacant, we reverse the conclusions of the lower courts that the property could not qualify for an educational use exemption and remand the case to the Santa Fe County Valuation Protests Board for further consideration.\nI. BACKGROUND\n{2} The relevant facts are undisputed. Petitioner CAVU Company (Taxpayer), a Nebraska corporation, was the owner of a twenty-six-acre school campus (the Property) in Santa Fe that was developed and improved beginning in 1997 solely for operation as a school. Since opening its doors over fifteen years ago, the Property has been used for educational purposes by several schools and has never been used for any other purpose. The following time line indicates the changes in occupancy of the Property since its development for use as a school.\nAugustl998to May 2008: New Mexico Academy for Science and Mathematics\nJune 2008 to January 2010: February 2010 to May 2010: (vacant) Clever Canines, L.L.C. (training school for dog owners)\nJune 2010: (vacant)\nJuly 2010 to May 2012: Santa Fe International Elementary School\nMay 2012 to Present: Desert Academy\n{3} Taxpayer purchased the Property in 2004, when the New Mexico Academy for Science and Mathematics (NMASM) was experiencing financial difficulties. Taxpayer leased the Property to NMASM for $ 1.00 per year for several academic years and supported the school with donations in an effort to help NMASM succeed. In August 2007, Taxpayer raised the rent to $ 10,000 per month, although by November 2007 it was clear that NMASM could not afford that rate. At this point, Taxpayer allowed the school to occupy the building rent free until June 2008, when it closed.\n{4} Throughout the remainder of2008 and all of 2009, Taxpayer actively sought to lease the Property to various other educational tenants, negotiating in particular with Desert Academy. Taxpayer listed the Property for sale on the residential or commercial market but refused to lease the building to anyone other than an educational tenant. According to Taxpayer\u2019s affidavit, a film company offered to lease the Property for $15,000 per month in November 2009, but Taxpayer turned down the offer, insisting on \u201cmaintain[ing] the property for educational uses only,\u201d \u201ccontinufing] in that category\u201d as long as Taxpayer owned it, and \u201c[passing up] any lease, however attractive, other than to an educational facility.\u201d\n{5} In March 2010, shortly after Taxpayer began temporarily leasing the Property to a training school for dogs and their owners, the Santa Fe County Assessor discovered the Property\u2019s sale listing. Although the Assessor was apparently aware that the Property had been vacant, it was the sale listing that motivated the Assessor to put the Property on the tax rolls and issue Taxpayer a notice of valuation for $6,689,750 for the 2010 tax year. Taxpayer filed an application for an educational use exemption for 2010, which the Assessor denied because \u201con January 1st of 2009 and 2010\u201d the property \u201cwas not used directly and immediately for educational purposes.\u201d\n{6} In July 2010, after protracted negotiations with Desert Academy ended without a deal, Taxpayer successfully entered into a lease with the Santa Fe International Elementary School (SFIES). In his affidavit, Taxpayer states that the lease to SFIES was \u201cfor a rental far below market value.\u201d\n{7} Following a March 2011 hearing before the S anta F e County V aluation Protests B o ard, the B oard reinstated Taxpayer\u2019 s exemption for 2010. The Board concluded that because Assessor had allowed a similar vacant school \u2014 the St. Francis Cathedral School \u2014 to remain exempt during the same tax year, Assessor was required to give Taxpayer\u2019s property equal treatment under Article VIII, Section 1(A) of the New Mexico Constitution.\n{8} Addressing the Property\u2019s educational use, the Board found that during the Property\u2019s vacancy, Taxpayer \u201cwas actively seeking a school tenant],]... negotiating with one or more potential tenantsf,] . . . committed] to an educational use of the subject property in the form of nominal or significantly reduced rents for such use[, and] . . . not putting the property to any commercially remunerative use \u2014 or even any non-educational use at all.\u201d Because of the Board\u2019s dispositive decision to grant the exemption based on Taxpayer\u2019s equal treatment constitutional claim, however, the Board declined to \u201cmake a formal decision\u201d on the Property\u2019s educational use. Nevertheless, the Board observed that \u201cthis case might present one of the rare instances in which temporary nonuse actually constitutes an exempt use of property.\u201d\n{9} On Assessor\u2019s appeal, the First Judicial District Court reversed the Board\u2019s decision and denied the exemption pursuant to NMSA 1978, Section 7-38-7 (1997) because the Property was not \u201ccurrently and actively used as an educational facility\u201d specifically on January 1, 2010, the Property had been listed for sale to residential or commercial buyers, and no showing of fraud or intentional discrimination entitled the Property to an exemption under Article VIII, Section 1(A). Soon after the district court\u2019s ruling, Taxpayer sold the Property to Desert Academy.\n{10} The Court of Appeals affirmed the district court\u2019s denial of the exemption but on different grounds. See CAVU Co. v. Martinez, 2013-NMCA-050, \u00b6\u00b6 1, 33, 302 P.3d 126, cert. granted, 2013-NMCERT-004. The Court held that (1) the district court erred in determining that Section 7-38-7 limited the qualification period for an exemption to January 1 alone because the appropriate qualification period was the previous calendar year and January 1 was simply \u201cthe cut-off date,\u201d see id. \u00b6\u00b6 18, 22 & n.2; (2) the Property did not qualify for an exemption because taxes are assessed annually and because the educational use was not \u2018\u201cprimary and substantial\u2019\u201d and \u201c\u2018present and actual\u2019\u201d during the previous (2009) calendar year, see id. \u00b6\u00b6 22 & n.2,24; and (3) Taxpayer\u2019s property was not entitled to an exemption under the constitutional equal treatment provision because the unequal taxation between the two \u201csimilarly situated properties]\u201d was not intentional, fraudulent, or discriminatory, see id. \u00b6\u00b6 25, 32.\n{11} We granted certiorari to determine whether Taxpayer\u2019s active negotiations with potential educational tenants and Taxpayer\u2019s rejection of a commercial lease during 2009 qualify as use eligible for exemption. We expressly affirm the other two Court of Appeals holdings as follows. First, the prior calendar year is the appropriate time period upon which to base a property\u2019s exemption status, and January 1 is the appropriate \u201ccutoff date\u201d under Article VIII, Section 3 of the New Mexico Constitution; the Property Tax Code, NMSA 1978, Sections 7-35-1 through -38-93 (1973, as amended through 2013); and the Property Taxes chapter of the New Mexico Administrative Code, 3.6 NMAC (03/30/1973, as amended through 04/15/2013). See CAVU Co., 2013-NMCA-050, \u00b6\u00b6 15, 17, 33. Second, a taxpayer is not entitled to an exemption under Article VIII, Section 1(A) of the New Mexico Constitution based on evidence that another taxpayer with similarly used property received such an exemption, absent a finding that the unequal taxation was intentional, fraudulent, or discriminatory. See CAVU Co., 2013-NMCA-050, \u00b6\u00b6 28, 33. Because the Court of Appeals provided a thorough analysis on these two holdings, we do not add to them. See State v. Ulibarri, 2000-NMSC-007, \u00b6\u00b6 2-3, 128 N.M. 686, 997 P.2d 818 (writing primarily to emphasize certain points of law and secondarily to affirm the Court of Appeals without \u201caddfing] anything further to the analysis contained in the opinion of the Court of Appeals\u201d).\nII. DISCUSSION\nA. Standard of Review\n{12} This Court reviews an administrative appeal under an administrative standard of review, seeking to determine if the decisions below are fraudulent, arbitrary, capricious, an abuse of discretion, not supported by substantial evidence in the record, or not in accordance with law. See NMSA 1978, \u00a7 39-3-1.1(D)-(E) (1999); Rayellen Res., Inc. v. N.M. Cultural Prop. Review Comm., 2014-NMSC-006, \u00b6 15, 319 P.3d 639; see also Rio Grande Chapter of Sierra Club v. N.M. Mining Comm'n, 2003-NMSC-005, \u00b6\u00b6 14 n.7, 15, 133 N.M. 97, 61 P.3d806 (explaining that authority to review for abuse of discretion is in the appellate court \u201csolely\u201d). In other words, we \u201cconduct the same review of an administrative order as the district court sitting in its appellate capacity, while at the same time determining whether the district court erred in the first appeal.\u201d Rio Grande Chapter of Sierra Club, 2003-NMSC-005, \u00b6 16. When an administrative decision is based on an issue of law, such as statutory or constitutional interpretation, our review is de novo. See Rayellen, 2014-NMSC-006, \u00b6 16.\nB. Determination of Eligibility for Educational Property Exemption\n{13} We begin our analysis with the recognized and potentially conflicting principles which must provide the boundaries of our decision. The first is that \u201c[property is presumed to be subject to taxation.\u201d Georgia O'Keeffe Museum v. Cnty. of Santa Fe, 2003-NMCA-003, \u00b6 32, 133 N.M. 297, 62 P.3d 754; see also 3.6.7.16(A) NMAC (\u201cReal property owned by a nongovernmental entity is presumed to be subject to taxation under ... the Property Tax Code unless an exemption [is] claimed and allowed [under] this section.\u201d). The second is the broad and brief constitutional command that \u201call property used for educational or charitable purposes . . . shall be exempt from taxation.\u201d N.M. Const. art. VIII, \u00a7 3. Use for educational purposes has been held to mean \u201cthe direct, immediate, primary and substantial use of property that embraces systematic instruction in any and all branches of learning from which a substantial public benefit is derived.\u201d NRA Special Contribution Fund v. Bd. of Cnty. Comm\u2019rs, 1978-NMCA-096, \u00b6 35, 92 N.M. 541, 591 P.2d 672 (internal quotation marks omitted). The corresponding NRA eligibility test consists of three parts: (1) use that is direct, immediate, primary, and substantial, (2) use that embraces systematic instruction in any and all branches of learning, and (3) use that imparts a substantial public benefit. See id. Because this three-pronged eligibility test accommodates a broad range of interpretations, we look next to the history of the exemption and the policy considerations our appellate courts have identified to guide our analysis.\nC. History and Policy\n{14} A 1933 exemption case involving Masonic lodge property surveyed exemption provisions in other jurisdictions and concluded \u201cthat few states have constitutional or statutory provisions more favorable to a claim of exemption . . . and that most states have less liberally provided.\u201d Temple Lodge No. 6, A. F. & A. M. v. Tierney, 1933-NMSC-013, \u00b6\u00b6 7, 9-12, 37 N.M. 178, 20 P.2d 280. This Court traced the New Mexico exemption provision back to our 1882 territorial laws, noting that the drafters of the New Mexico Constitution purposely chose to broaden the limited territorial exemption law to include any and all \u201ceducational purposes.\u201d See Temple Lodge, 1933-NMSC-013, \u00b6\u00b6 31-32 (\u201cThe conclusion is natural, and not readily to be avoided, that a purpose existed to extend the field or liberalize the policy of tax exemption.\u201d).\n{15} This Court advised applying a common sense construction to the drafters\u2019 \u201cdeliberate and studious\u201d determination of citizens\u2019 rights to an exemption:\nUnlike most constitutional exemptions, [the exemption provision] does not merely define a field of exemption, within which the legislative power may operate from time to time at its discretion. It is affirmative and self-executing. It creates exemptions. It invests citizens with constitutional rights, which administrative officers or Legislature may not impair, and which courts must protect. Generally, such rights are not to be frittered away by a construction so strict as to be unreasonable or harsh. Of course, they are not to be so enlarged as to create rights which the Constitution makers did not contemplate. In short, the canon of strict construction cannot afford a sure formula.\nId. \u00b6\u00b6 29, 32; see id. \u00b6 41 (indicating primary or substantial use as the basis of \u201ccommon sense construction\u201d); Benevolent & Protective Order of Elks, Lodge No. 461 v. N.M. Prop. Appraisal Dep\u2019t, 1972-NMSC-006, \u00b6 6, 83 N.M. 445, 493 P.2d 411 (\u201cThe rule in New Mexico is that of reasonable construction [of the constitutional exemption provision], without favor or prejudice to either the taxpayer or the State.\u201d) Meanwhile, the exemption provision makes no distinction between private nonprofit and for-profit organizations. See Georgia O \u2019KeeffeMuseum, 2003-NMCA-003, \u00b6 40.\n{16} Because there is no mechanical formula for determining eligibility for the constitutional exemption in our constitution, statutes, or administrative code, we have noted that the \u201cbroad expression \u2018used for educational or charitable purposes\u2019 necessarily imposes upon the courts a severe task of interpretation\u201d and that \u201c[t]he line of demarcation . . . can take shape only by the gradual process of adjudication].\u201d Temple Lodge, 1933-NMSC-013, \u00b6 39; see also Benevolent & Protective Order of Elks, 1972-NMSC-006, \u00b6 3 (\u201cExcept to the extent that the facts as to use [qualifying an exemption claim] are so nearly alike as to logically compel like results, no case can be said to constitute a controlling precedent for another case in this area.\u201d).\n{17} In the eighty-one years since Temple Lodge, our appellate courts\u2019 gradual course of adjudication has interpreted the boundaries of the exemption provision through dozens of opinions. In 1978, the Court of Appeals in NRA looked to caselaw for New Mexico and other jurisdictions to set out its three-pronged test. See 1978-NMCA-096, \u00b6 35; see also id. \u00b6\u00b6 20-45 (surveying and summarizing caselaw). There, the Court allowed a partial exemption for property partly used for education. Id. \u00b6\u00b6 62-63. The Court stated that an exemption may not be based on \u201cthe remote and consequential benefit derived from [the property\u2019s] use,\u201d id. \u00b6 25, and that \u201c[w]here the land is idle, unimproved and not in actual use, because of its present unsuitability to the actual activities of the use of the land, it will not qualify for tax exemption in the absence of legislation,\u201d id. \u00b6 61.\n{18} While NRA is useful for its general guidance, it is by no means inflexible. Over the years the Court of Appeals has seen fit to minimize its importance and depart from its language. Revisiting the NRA test in 2003, the Court of Appeals diverged from its interpretation in NRA to allow a museum to seek an exemption for educational use that took place off the property in question. See Georgia O\u2019Keeffe Museum, 2003-NMCA-003, \u00b6\u00b6 2, 55. Although the educational use was arguably remote and consequential \u2014 not present or immediately on the museum property \u2014 our Court of Appeals concluded that \u201csuch a unique circumstance requires a slight departure from the full NRA standard otherwise applicable, permitting consideration of whatever intrinsic educational value a museum has to the museum visitors and of off-site educational programs and activities closely related to and inextricably interconnected with the museum collection.\u201d Georgia O'Keeffe Museum, 2003-NMCA-003, \u00b6 56 (emphasis added). The Court of Appeals remanded the case to the Board with directions to take into consideration the museum\u2019s relationship to its offsite educational programs and the extent of any intrinsic educational value the museum provided to the public. Id. \u00b6 62.\n{19} More recently, in 2013, the Court of Appeals allowed an exemption on \u201cvacant, undeveloped, and unimproved land\u201d held for charitable conservation purposes. See Pecos River Open Spaces, Inc. v. Cnty. of San Miguel, 2013-NMCA-029, \u00b6\u00b6 1-2,_P.3d_. Although the Court of Appeals in NRA explicitly barred an educational exemption for land that was \u201cidle, unimproved and not in actual use, ... in the absence of legislation,\u201d 1978-NMCA-096, \u00b6 61, the Court distinguished the charitable conservation land in Pecos River because it provided a substantial public benefit in its idle state. See 2013-NMCA-029, \u00b6\u00b6 16-18, 22. The Court concluded that \u201c[wjhether the property is in use is completely dependent upon what the proposed use is.\u201d Id. \u00b6 22.\n{20} We agree with this last statement because we conclude that it reflects the flexibility the drafters granted to our administrative boards and courts for making fact-specific determinations concerning exempt use. Like Georgia O 'Keeffe Museum and Pecos River, this case presents a unique set of circumstances that does not fit neatly within the parameters of the NRA test. We see no reason to alter the Court of Appeals holding in NRA, Georgia O \u2019Keeffe Museum, or Pecos River, but we are reluctant to adhere to a mechanical test. See Temple Lodge, 1933-NMSC-013, \u00b6 39 (\u201cThe broad expression \u2018used for educational or charitable purposes\u2019 necessarily imposes upon the courts a severe task of interpretation. . . . The line of demarcation cannot be projected.\u201d); Benevolent & Protective Order of Elks, 1972-NMSC-006, \u00b6 3 (\u201c[N]o case can be said to constitute a controlling precedent for another case in this area.\u201d).\nD. The Appropriate Inquiry Is Whether the Property\u2019s Use Furthered the Exempt Purpose\n{21} Instead of adding a new fact-specific exception to the rule, we distill the various rules and exceptions governing exemptions to one overarching principle: \u201c[T]he proper focus of any inquiry into the propriety of an exemption is whether the use of the property furthers exempt purposes.\u201d Trinity Episcopal Church v. State Bd. of Tax Comm\u2019rs, 694 N.E.2d 816, 818 (Ind. Tax Ct. 1998) (representing the source of authority for this proposition on which multiple Indiana cases have since relied); see also Congregation Machne Chaim, Inc. v. Kwak, 3 A.D.3d 708, 710, (N.Y. App. Div. 2004) (concluding that the party seeking exemption \u201csubmitted the requisite quantum of evidence to establish that its use of the property was in furtherance of its exempt purpose\u201d). This clear and general guidance allows assessors, protests boards, and courts alike to reasonably and flexibly determine how property is actually being used, notwithstanding unique factual circumstances. Such flexibility is particularly important where the exempt use is hindered by some reasonable explanation, whether for expansion of the property; remodeling of a building due to fire, flood, or outdated infrastructure; or any of countless other potential setbacks. See City & Cnty. of Denver v. Spears Free Clinic & Hosp. for Poor Children, 350 P.2d 1057, 1058-59, (Colo. 1960) (en banc) (allowing an exemption for a hospital under construction with further work pending due to insufficient funds); Bd. of Assessors of Sharon v. Knollwood Cemetery, 246 N.E.2d 660, 664 (Mass. 1969) (allowing an exemption for cemetery land awaiting further burials); Mount Calvary Baptist Church, Inc. v. Zehnder, 706 N.E.2d 1008, 1015 (Ill. App. Ct. 1998) (allowing an exemption for church property damaged by fire and caught up in a dispute over insurance coverage).\n{22} Rather than supersede the rules found in NRA, Georgia O'Keeffe Museum, Pecos River, and others, our guidance in this case should instead inform any inquiry into the validity of an exemption \u2014 particularly where the facts are complex and equity and common sense demand flexibility in the applicable rule. Because the current case presents just such a scenario, we briefly apply the modified NRA analysis as a guide, keeping in mind the drafters\u2019 \u201cdeliberate\u201d intent to \u201cliberalize the policy of tax exemption,\u201d Temple Lodge, 1933-NMSC-013, \u00b6 32, andreserving the final determination for the Board on remand.\n1. The Use Must Be Direct, Immediate, Primary, and Substantial\n{23} \u201c[T]he phrase \u2018used for educational purposes\u2019. . . meanfs] \u2018the direct, immediate, primary and substantial use of property,\u201d\u2019 NRA, 1978-NMCA-096, \u00b635, \u201cnot the remote and consequential benefit derived from its use,\u201d id. \u00b6 25. Georgia O\u2019Keeffe Muesum departed from this rule, but New Mexico appellate courts generally agree that a declared exemption based solely on the unrealized intentions of the owner may be denied. See Albuquerque Lodge, No. 461, B.P.O.E. v. Tierney, 1935-NMSC-022, \u00b6 29, 39 N.M. 135, 42 P.2d 206 (concluding that \u201c[i]t is the use' of property, not the declared objects and purposes of its owner, which determines the right to exemption\u201d); Grace, Inc. v. Bd. of Cnty. Comm\u2019rs, Cnty. of Bernalillo, 1981-NMCA-136, \u00b6 3, 97 N.M. 260, 639 P.2d 69 (holding that property purchased by a church corporation was taxable despite the intent of the church to construct a new church there \u201csometime in the future\u201d).\n{24} Courts in other jurisdictions have interpreted limits such as these to mean that the use in question must be \u201cmore than a mere dream.\u201d See Peoples Faith Chapel, Inc. v. Limbach, 480 N.E.2d 781, 782 (Ohio 1985) (allowing a church\u2019s exemption for adjacent land planned for a school because the project was \u201cone of substance and not a mere dream\u201d (internal quotation marks and citation omitted)); Trinity Episcopal Church, 694 N.E.2d at 818-19 (holding that a church was entitled to an exemption for a building being remodeled as a community mental health center because the use \u201cwas more than a dream, and that [the taxpayer] did more than merely own the building ... [by having] taken concrete steps at great expense to prepare the building for use\u201d).\n{25} In the current case, the Court of Appeals refused to recognize Taxpayer\u2019s efforts to lease the building to a school as actual use. See CAVU Co., 2013-NMCA-050, \u00b6 24 (\u201cWe recognize that Taxpayer sought to negotiate with educational tenants during [the relevant] period. Nevertheless, because such negotiations reflect intent for future use of the property rather than \u2018present and actual\u2019 use, we conclude that the property did not qualify for an educational use exemption in 2010.\u201d).\n{26} Because the facts in this case reflect more than intent alone, we disagree. Active negotiations to continue the educational use of the building are clearly distinguishable from Taxpayer\u2019s \u201cmere dream\u201d or \u201cdeclared objects and purposes.\u201d The evidence demonstrates that Taxpayer actively sought out and engaged interested educational tenants during all of 2009, negotiating the terms of a lease with at least one \u2014 Desert Academy \u2014 and turning down a proposed commercial lease from a film company. By working with various potential tenants and negotiating a deal for the educational use of the Property, Taxpayer used the temporarily vacant property in a direct and immediate effort to further its educational use. Taxpayer\u2019s rejection of a commercial tenant also advanced the exempt purpose of the Property.\n2. The Use Must Embrace Systematic Instruction\n{27} The use must \u201cembrace}] systematic instruction in any and all branches of learning.\u201d NRA, 1978-NMCA-096, \u00b6 35. When our appellate courts have focused on what types of instruction qualify as educational, they have concluded that \u201ceducation is a broad and comprehensive term ... [that] must be taken in its broad sense.\u201d Id. \u00b6 26 (internal quotation marks and citation omitted); see also Temple Lodge, 1933-NMSC-013, \u00b6 39 (\u201cIn a broad sense, a golf professional, a riding master, or a boxing instructor, is engaged in education.\u201d). Even NRA declined to define the term too closely, stating that \u201cmatters of education are not restricted to academic curricula or to ivy covered halls.\u201d See 1978-NMCA-096, \u00b6 26 (internal quotation marks and citation omitted). In short, \u201cvirtually any aspect of the human experience can be considered educational.\u201d Georgia O'Keeffe Museum, 2003-NMCA-003, \u00b6 41.\n{28} Our focus here, however, is not on the type of educational instruction. Our concern is whether Taxpayer embraced educational instruction through use of the Property in 2009, and there is evidence that Taxpayer fulfilled this requirement in both the letter and the spirit of the law. Taxpayer embraced systematic instruction by negotiating to lease the Property to Desert Academy, an established college preparatory school that clearly practices \u2018\u201csystematic instruction in any and all branches of learning.\u2019\u201d See NRA, 1978-NMCA-096, \u00b6 35. Taxpayer not only pursued a lease with Desert Academy throughout 2009 butrefusedto lease the Property to a film company in November of that year, furthering the Property\u2019s exempt purpose and demonstrating Taxpayer\u2019s commitment to that purpose. Taxpayer reinforced these actions by expressly stating as part of its rejection of the film company that \u201cany lease, however attractive, other than to an educational facility will have to be passed up.\u201d While Taxpayer\u2019s own affidavit is the source of this evidence, other parties were engaged, and the Board remains free to ask Taxpayer to provide more evidence of these matters on remand.\n{29} The Board is also in a better position than this Court to weigh any evidence of Taxpayer\u2019s pursuit of an educational tenant during 2009 against evidence of Taxpayer\u2019s listing of the Property for sale to a commercial or residential tenant. We note that it is not clear from the record whether the Property was ever for sale in 2009, the relevant year in question. We also note that even if Taxpayer had succeeded in leasing or selling the Property to a noneducational tenant, this would not bar exemption if the direct, immediate, primary, and substantial use of the Property still embraced education. See Georgia O'Keeffe Museum, 2003-NMCA-003, \u00b6 40 (\u201c[T]he phrase \u2018all property used for educational or charitable purposes\u2019 is not limited, as are other phrases, by the words \u2018not used for commercial purposes\u2019 or by the words \u2018not used or held for private or corporate profit.\u2019\u201d); Grand Lodge of Ancient & Accepted Masons of N.M. v. Taxation & Revenue Dep\u2019t, 1987-NMCA-081, \u00b6 17, 106 N.M. 179, 740 P.2d 1163 (\u201cTo be exempt from property taxes, property need not be used exclusively for charitable or educational purposes, but those must be the primary or substantial uses.\u201d). A question before the Board is whether Taxpayer embraced education through use of the Property that ultimately furthered its educational purpose as a school campus.\n3. The Use Must Create a Substantial Public Benefit\n{30} A \u201csubstantial public benefit\u201d must be \u201cderived\u201d from the use. NRA, 1978-NMCA-096, \u00b6\u00b6 35-36. Considering the rationale for the exemption provision, courts have emphasized the significance of the implicit quid pro quo between the State and an exempt organization. See Georgia O\u2019Keeffe Museum, 2003-NMCA-003, \u00b6 46 (describing the purpose of the exemption as \u201cencourag[ing] private citizens to engage in educational pursuits from which the public derives a substantial benefit\u201d); see also 71 Am. Jur. 2d State and Local Taxation \u00a7 269 (2012) (\u201cThe fundamental ground upon which the exemption is based is the benefit conferred upon the public by such institutions and the consequent relief, to some extent, of the burden imposed on the State to care for and advance the interest of its citizens.\u201d). In other words, \u201call property should bear its share of the cost of government. Property which is exempt from taxation does not share in the burden. Therefore, in exchange for its exempt status, such property must confer a substitute substantial benefit on the public.\u201d NRA, 1978-NMCA-096, \u00b6 38.\n{31} NRA defined substantial public benefit to mean \u201c[a] benefit of real worth and importance to an indefinite class of persons who are a part of the public, which benefit comes to these persons from the use of property.\u201d Id. \u00b6 45. Here, we must consider whether Taxpayer\u2019s efforts to lease the building to an educational tenant \u2014 to the extent of rejecting a commercial tenant \u2014 resulted in a substantial public benefit. We conclude that they did. Taxpayer\u2019s twenty-six-acre school property is one of a limited number of large campuses in the county built and equipped to accommodate a student body of its size. Even while the Property was temporarily vacant between educational tenants, Taxpayer used it as an educational magnet, drawing potential school tenants into negotiations, all in furtherance of its educational purpose. In light of Taxpayer\u2019s efforts, the Property retained the type of \u201cintrinsic educational value\u201d to the community that the Court of Appeals identified in Georgia O\u2019Keeffe Museum. See 2003-NMCA-003, \u00b6 56. This intrinsic educational value was \u201cinextricably interconnected with the\u201d Property even while the classrooms were empty. See id. Because of Taxpayer\u2019s efforts, one school ultimately leased the Property and another later bought it and still occupies it today. Each year, between SFIES and Desert Academy, hundreds of students have been educated on the Property in part because Taxpayer persisted in seeking out an educational tenant to eventually lease and buy the building. It is for the Board to determine whether Taxpayer\u2019s efforts resulted in a substantial public benefit, but it is clear from the evidence that Taxpayer\u2019s efforts and use of the Property were applied towards its ultimate educational purpose.\nIII. CONCLUSION\n{32} The appropriate inquiry into the validity of a property\u2019s exemption from taxation under the exemption provision of Article VIII, Section 3 of the New Mexico Constitution must include a determination of whether the use furthers the exempt purpose. Because the Board never reached a formal decision regarding the Property\u2019s eligibility for exemption, we remand to the Board with directions to determine whether Taxpayer\u2019s use of the Property was in furtherance of its exempt purpose.\n{33} IT IS SO ORDERED.\nCHARLES W. DANIELS, Justice\nWE CONCUR:\nBARBARA J. VIGIL, Chief Justice\nPETRA JIMENEZ MAES, Justice\nRICHARD C. BOSSON, Justice\nEDWARD L. CH\u00c1VEZ, Justice", "type": "majority", "author": "DANIELS, Justice." } ], "attorneys": [ "Sommer, Udall, Sutin, Hardwick & Hyatt, P.A. Kurt A. Sommer Santa Fe, NM", "Francis P. Matthews Elkhorn, NE", "for Petitioner", "Bridget Ann Jacober Santa Fe, NM", "for Respondent" ], "corrections": "", "head_matter": "IN THE SUPREME COURT OF THE STATE OF NEW MEXICO\nOpinion Number: 2014-NMSC-029\nFiling Date: August 4, 2014\nDocket No. 34,039\nCAVU CO., a Nebraska Corporation, Respondent-Petitioner, v. DOMINGO P. MARTINEZ, Santa Fe County Assessor, Petitioner-Respondent.\nSommer, Udall, Sutin, Hardwick & Hyatt, P.A. Kurt A. Sommer Santa Fe, NM\nFrancis P. Matthews Elkhorn, NE\nfor Petitioner\nBridget Ann Jacober Santa Fe, NM\nfor Respondent" }, "file_name": "0522-01", "first_page_order": 538, "last_page_order": 548 }