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charitable in character for property tax exemption purposes. See Matter of Barham, 70 N.C. <br />App. 236, 319 S.E.2d 657 (1984) (nonprofit corporation which required that residents pay large <br />sums of money for the services rendered and which reserved the right to terminate any resident <br />for nonpayment of fees, was not entitled to a charitable purpose exemption from ad valorem <br />taxes.) <br />The Application for Property Tax Exemption states that the property is being used as a Head <br />Start child development day care center. However, it is not exclusively used for that purpose <br />and not exclusively funded by Head Start. The Assessor's understanding is that the property is <br />being used for custodial care to community children. Day care is a custodial service, which, <br />even with an educational component, is not wholly and exclusively related to education. See In <br />re Appeal of Chapel Hill Day Care Ctr., Inc. 144 N.C.App. 649, 552 S.E.2d 172 (2001) dsc. Rev. <br />denied, 355 N.C. 492, 563 S.E. 2d 564 (2002) (day care center at issue had a custodial <br />purpose and was not wholly and exclusively educational in nature). <br />The information provided by the applicant in support of its requested exemption does not <br />demonstrate or provide an alternative basis for property tax exemption. Based on what the <br />Assessor knows, it is Assessor's opinion that the CHTOP property is not exempt from property <br />taxes because either or both: (1) CHTOP is not a charitable organization for property tax <br />purposes, and (2) the property in question is not wholly and exclusively used to provide <br />education. <br />Reviews have also been made by the Orange County Attorney and the Ad Valorem Tax <br />Division of the N.C. Department of Revenue. It is the opinion of both entities that this property <br />does not qualify for exemption. <br />FINANCIAL IMPACT: Denial will have no financial impact. Approval will result in a reduction of <br />2002 taxes due to the County, municipalities, and special districts in the amount of $2,498.27. <br />RECOMMENDATION(S): The County Manager recommends that the application for 2002 <br />exemption be denied. <br />