
    Cincinnati College v. The State.
    The property of literary and scientific societies is only exempt from taxation when used exclusively for literary and scientific purposes. If used for other purposes it is liable to taxation, although the proceeds are in future to be applied for the promotion of literature and science.
    All laws exempting any of the property in the state from taxation, being in derogation of equal rights, should be construed strictly.
    This is an appeal ’ from the decision of the Auditor of State. ,
    
    The facts in the- ease are substantially as follows:
    The Cincinnati College was incorporated by an act of the legislature, passed in January, 1819. The first section of the charter declares the object to be, the erection and main tenance of a college.
    Sec. 6th provides that the funds of the institution shall not be applied to any use or for any purpose, not therein expressed or intended. The title of the ground was obtained, first by a perpetual lease from the First Presbyterian church in Cincinnati, for purposes of education solely, at a nominal rent, and with a stipulation to educate annually, _a certain number of children, designated by the lessors; and secondly, by a subsequent release in fee, which also confines the use of the property to the support of a college or institution of learning.
    
      A .few years since, the college building was destroyed by fire. The corporation had no funds to rebuild it, and to raise funds for that purpose, an agreement was made with a large number of individuals, that they should loan, severally, different sums of money to erect a college building, with store rooms on the ground floor, for rent, the proceeds of which were to first applied to pay the interest on the money loaned, and then, so far as not wanted for college purposes, to pay the principal of the loan, and after such payment, the income to stand as a perpetual endowment.
    The building thus erected contains three classes of apart ments:
    1st. A tier of stores on the ground floor designed solely-for rent. These rooms are now, and have been for several years, rented for stores and shops for ordinary business. Two of the eight stores which occupy the first half of the ground floor, are occupied under five year leases, the other six are verbally rented. The rear half of this floor is occupied by the city, under a five year lease, for its public purposes, and five or six of the remaining apartments are verbally rented, for miscella neous purposes; the residue are unoccupied.
    2d. A suit of rooms in the front of the second story, belonging to the Mercantile Library Association. This association is strictly literary and scientific- — its object being to cultivate such learning as is^more especially connected with" mercantile pursuits. It has a course of literary lectures in the college hall every winter, and its rooms are occupied, one for a library, one for a reading room, and one for transacting its business, and as a place of meeting for merchants to collect and communicate information. This association contributed ¡§10,000 to the expense of the building, in consideration of which, it has a perpetual right to the use of these rooms, with certain privileges in the college hall.
    3d. A great number of other apartments, designed for the Various uses of a college, such as a large hall, various recitation and lecture rooms, and private rooms for students.
    
      A law school is at present maintained in the building, and a primary school occupies one or more of the apartments. There are no other collegiate exercises in the building, it being understood that the board of trustees find it impossible to procure the requisite professors to maintain a perfect college organization, until their debt shall be so far reduced, that their principal income can be applied in paying the salaries of professors. It appears to be understood by all concerned, that no part of the income, after paying the debts, can ever be applied to any other purpose than the support of a college.
    The lot and building .of the Cincinnati college, were brought in the duplicate in .1848, and valued at $65,000, on which amount the taxes were $650. For 1849', the value was decreased, by the board of equalization, to $58,000. The taxes, interest, and penalty for 1848, and the single taxes for 1849, in all, amount to $1,626.62J.
    On this state of facts, application was made to the auditor of state, to remit the taxes, on the ground that this property was that of a literary institution, and therefore free from taxation. The auditor decided that the property was legally subject to taxation, and that the corporation was legally liable to the payment of the taxes, as assessed for 1848 and 1849, and therefore refused to remit the taxes. And from this decision the appeal was taken.
    
      N. Wright and William Green, for appellants
    
      H. Stanbery, (attorney general,) contra.
   Caldwell, J.

This case presents the single question, whether this property is the proper subject of taxation ? Does it come within the exemption of the tax law of March, 1848 ? The 3d section of that statute reads as follows: “ All property described in this section, to the extent herein limited, shall be exempt from taxation; that is to say, First, All buildings occupied or used exclusively as public school houses, or as places of public worship, or both, with the furniture and books therein used, exclusively for the accommodation of schools or religious meetings, together with the grounds, not exceeding, in any case, twenty acres, occupied thereby, if not leased or otherwise used with a view to profit. Second, All lands used exclusively as grave-yards or grounds for bury ing the dead. Third, All buildings belonging to scientific, literary, or benevolent societies, used exclusively for scientific, literary or benevolent societies, together with the land actually occupied by such institutions, not leased or otherwise used, with a view to profit, and all books, papers, furniture, apparatus, and instruments belonging to said societies, used solely for literary, scientific, or benevolent purposes. Fourth, All moneys and credits belonging exclusively to universities, colleges, academies or public schools, of whatsoever name, or to religious, scientific, literary or benevolent societies, and appropriated solely to sustaining such institutions or societies, not exceeding- in amount or in the income arising thereon, the'amount prescribed by the charter of such society.”

On the part of the Cincinnati college, it is contended, that although this property is not immediately used for literary or scientific purposes, yet the fact, that the fund is to be appropriated to such uses, brings it within the exceptions of this statute.

The language of the statute is very specific. The legislature appears to have been very careful to use as explicit terms as the language would afford. The buildings belonging to scientific and literary societies, are to be used “ exclusively ” for scientific and literary purposes, to bring them within the exemption.

' It would, we think, be rather a forced construction of language, to say 'that this building, with its eight stores, its merchant’s exchange, and its other rooms used for miscellaneous purposes, is used exclusively for literary and scientific purposes. But the legislature, not satisfied with the very explicit terms which chey had used, as if to place their meaning beyond all possibility of misapprehension, proceed to specify that it shall not be leased, or otherwise used with a view to profit. This property is most of it leased and used with a view to profit. We suppose the plain and palpable meaning of this statute is, that the houses and property which these different institutions need to use whilst engaged in the pursuit of their respective objects, shall be exempt from taxation. Such property,, when thus used, does not produce an increase. It is used for purposes other than making money; and as the objects for which it is used are beneficial to community, it is exempted from the burdens imposed upon other property.

But when any society, no matter of what kind, whether scientific, literary, or religious, enters the common business of life, and uses property for the purpose of accumulating money, the government should, and we think the statute does, treat it in the same way persons are dealt with, who are using property in a similar manner, and engaged in the same business. Government cannot discriminate between the uses which different societies or individuals will make of the proceeds of their business, and determine that this society or individual will make a more worthy disposition of the proceeds of his business than that, and therefore the one shall be taxed and the other not.

The legislature could not, without a flagrant violation of the principles of equality, on which our institutions are founded, make a distinction such as is contended for, between the store of the Cincinnati college and that of an individual. The legislature, in this instance, at least, appears to have been careful not to make any such improper discrimination.

The third enumeration of this section of the statute, relating to the buildings of such societies, is the only one that we think could be supposed to have any bearing on this case; the fourth, however, appears equally explicit to the same point; it refers to the money belonging to such institutions, and exempts such as is “ solely appropriated to sustaining such institutions.”

Whilst the money is in the fund of the institution, to be used solely to meet its expenditures, it is making nothing, it is withdrawn from the common business of life to be used solely to effect the object of such institution. But should the trustees of the society use such money in business, either investing it in property, or loaning it at interest, the property thus purchased, or the money thus loaned would be liable to taxation, as much as any other property or money at interest, no matter in whose hands it might be. As we have before intimated, the law applies to the property as it finds it in use, and not to what may be done with its accumulations in future.

It is said, in behalf of the appellants, that this law should* be liberally construed in favor of the institution, its object being to promote science and literature. We think, however, that all laws that exempt any of the property of the community from taxation should receive a strict construction. All such laws are in derogation of equal rights.

The money necessary to support government, has to be raised by a tax on the beneficial pursuits of community; it all is raised from the proceeds of industry. If property, employed in one kind of business, is exempted from taxation, the burden will necessarily fall more heavily on property employed in other pursuits. It is hard to discover why those employed in producing what feeds and "clothes humanity, should not be regarded as favorably by government as those engaged in the more elegant or intellectual arts.

There is no one source of oppression or injustice which has been productive of so much human misery all over the world, and in all ages of it, as the discrimination which government, in imposing their burdens, have made between the different occupations of life, encouraging one at the expense of another.

We think the auditor of state has decided in accordance with both the law and equity of the case, and therefore con firm his decision.  