The Ohio Supreme Court ruled last week that a Summit County corporation that qualifies as a nonprofit under federal tax law does not qualify for a state real estate tax exemption for part of its building leased to a charitable group. The 6-1 opinion upheld decisions of the Ohio Board of Tax Appeals (BTA) and the State Tax Commissioner to deny a tax break to the Northeast Ohio Psychiatric Institute. The nonprofit corporation wanted an exemption for 68 percent of a building and grounds that it leases to Portage Path, which provides behavioral health psychiatric services to residents who otherwise would not be able to afford them. The panel concluded the institute could not rely for an exemption on the charitable activities of Portage Path because the institute itself does not qualify as a charitable institution as defined in the statute. The majority opinion noted that the court has long held that it is an owner’s use of property rather than a lessee’s use that determines whether the property should be granted an exemption for exclusive charitable use. The court affirmed the Board’s determination that Northeast is not a charitable institution. As a result, it did not have to address the question of whether the BTA correctly found that Portage Path itself qualified as a charity. Justice Evelyn Stratton, who dissented and believes the property should be exempt, noted that “property is exempt from taxation under (state law) if it belongs to an institution, charitable or otherwise, and it is used by that institution exclusively for a charitable purpose.” She said evidence in the case indicated that Northeast “is merely an instrument created and controlled exclusively by Portage Path and used by Portage Path primarily to secure property for its treatment center.”