## Facts

- The Georgia O’Keefe Museum (the Museum) operated in Santa Fe, New Mexico as a nonprofit corporation recognized as tax-exempt under § 501(c)(3).
- The Museum owned real property used as its physical facility for displaying Georgia O’Keefe’s artwork and related operations open to the public.
- The Museum charged an admission fee to enter the building and also operated a gift shop on the premises.
- The Museum offered programs described as educational, including tours, workshops, lectures, and professional-development courses; it also maintained a library and provided educational materials.
- The Museum stated that about 60% of its annual budget was allocated to educational programming conducted both on the property and at other locations away from the property.
- Santa Fe County assessed ad valorem property taxes on the Museum’s real property.
- The Museum challenged the assessment, claiming its property was exempt under Article VIII, Section 3 of the New Mexico Constitution, which exempts property used for educational or charitable purposes.
- The County Valuation Protests Board upheld the assessment, concluding the property’s primary use was operating a museum and gift shop rather than an educational use within the meaning of the exemption.
- The Museum paid the tax and pursued court review; the district court upheld the Board’s decision.
- The Museum appealed to the New Mexico Court of Appeals.

## Issues

1. Whether the Museum carried its burden to show that its property was “used for educational purposes” (or otherwise within the constitutional exemption) so as to be exempt from New Mexico ad valorem property taxation.
2. Whether the Board and district court properly focused on the property’s primary, actual use in concluding the Museum’s operation of a museum and gift shop did not qualify as an educational use for exemption purposes.

## Decision

- The Court of Appeals affirmed the district court.
- The court held the Museum did not establish that the property’s primary use qualified as “educational” within the meaning of the constitutional and statutory exemption.
- The court left the County’s assessment in place, and the Museum’s property remained subject to ad valorem taxation.

## Legal Principles

- Property-tax exemptions are strictly construed, and the taxpayer bears the burden of clearly showing entitlement to an exemption.
- Exemption analysis turns on the actual use of the property; an owner’s nonprofit status or general mission does not, by itself, establish exempt use.
- The “educational” exemption is applied according to the constitutional and statutory meaning in the property-tax setting; general public exposure to art and culture, without more, may be treated as insufficient to prove qualifying educational use.
- When a property is used for multiple functions, the controlling question is the property’s primary use, not whether some activities on the property can be characterized as educational.
- Revenue-related features (such as admission charges and a gift shop) may be considered as part of evaluating the property’s overall, primary use, and do not create an exemption absent proof that the qualifying use predominates.

## Conclusion

The New Mexico Court of Appeals affirmed the denial of the Georgia O’Keefe Museum’s claimed property-tax exemption, holding that the Museum did not meet its burden to prove the property’s primary, actual use was “educational” within the meaning of New Mexico’s constitutional exemption, so the County’s ad valorem tax assessment stood.


Georgia O'Keefe Museum v. County of Santa Fe, 62 P.3d 754, 133 N.M. 297 (2002)