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154819 - Harmony Montessori Center v City of Oak Park

Harmony Montessori Center,
Joshua M. Wease
(Appeal from Ct of Appeals)
(Tax Tribunal – Gadola, P.)
City of Oak Park,
Megan K. Cavanagh


Petitioner Harmony Montessori Center is a private, nonprofit preschool and kindergarten. In 2009, respondent City of Oak Park assessed ad valorem property taxes against the school. Harmony protested the assessment, contending that it was entitled to the exemptions in the General Property Tax Act as an educational institution and charitable institution. The Michigan Tax Tribunal determined that Harmony was entitled to neither exemption because it did not substantially alleviate the state’s educational burden and because it charged tuition to the vast majority of its students and offered reduced pricing to only a few. In 2012, the Court of Appeals reversed the tribunal and remanded the case, finding errors of law in the tribunal’s conclusions regarding both exemptions. The Supreme Court denied the city’s application for leave to appeal. In 2015, the tax tribunal again determined that Harmony was not entitled to claim either exemption. In 2016, a different panel of the Court of Appeals affirmed in a split unpublished opinion. The Supreme Court has directed oral argument on Harmony’s application for leave to appeal to address whether Ladies Literary Club v Grand Rapids, 409 Mich 748 (1980), and David Walcott Kendall Memorial School v Grand Rapids, 11 Mich App 231 (1968), continue to provide the appropriate test of what constitutes a “nonprofit . . . educational . . . institution[]” under MCL 211.7n.