Vanderbilt University is turning to Davidson County Chancery Court to bring 11 fraternity houses under a 100 percent tax-exempt status after being denied by Metro and the state.
Vanderbilt frat houses currently receive a 50 percent tax-exempt status based on a 1968 Chancery Court decree, according to the court filings. But the university has argued that the frat parcels — which are now fully owned and operated by the school — should have the same tax-free status as dormitories.
After having their appeal denied by the state’s Assessment Appeals Commission, Vanderbilt filed suit in Chancery Court on Jan. 11 in order to get a judicial review of the case.
Vanderbilt, whose operating budget is $3.7 billion in 2013, will owe roughly $74,000 in combined property tax for the 11 frat house parcels this year, according to public records.
Vanderbilt argues in the filings that frat houses are used in the same way as other student housing facilities on campus: “to sleep, eat, hold meetings related to university and student activities, to tutor, to participate in educational programs ... and generally to engage in life’s daily activities such as socializing and interacting with fellow students, playing games, watching television and partying,” the suit reads.
The university points to two state laws that allow tax exempt status for dormitories and facilities that are used exclusively for “carrying out thereupon one or more of the purposes for which the institution was created or exists.”
Vanderbilt is asking for the tax-free status after a lease agreement with the Greek organizations was changed, therefore bringing the houses under the full control of the university. Court filings indicate that the tax assessor believed the agreement was a change “primarily in name only” while Vanderbilt called it a “sea change.”
The Assessment Appeals Commission, under the State Board of Equalization, ruled that the frat houses weren’t “directly incidental” to Vanderbilt’s educational purposes.
“Fraternities afford their members a unique life experience that is valuable to their members, but these worthwhile social and personal experiences are distinct from the education Vanderbilt provides to its students,” the final order, filed in August 2012, reads.
Chancellor Russell Perkins is handling the case.