For affirmance -- Chief Justice Weintraub, and Justices Jacobs, Francis, Proctor, Hall, Schettino and Haneman. For reversal -- None. The opinion of the court was delivered by Schettino, J.
The Division of Tax Appeals denied the Textile Research Institute tax exemption under N.J.S.A. 54:4-3.6, from taxes assessed by Princeton Township for the year 1957 on land, improvements and personal property owned and used by the Institute. Plaintiff appealed to the Appellate Division and before argument there, we certified the cause on our own motion.
The Legislature has exempted from local property taxation buildings of New Jersey non-profit corporations which are "actually used for colleges, schools, academies or seminaries." N.J.S.A. 54:4-3.6. The sole issue for determination is whether the Textile Research Institute is a "college" within the meaning of the statute?
The Textile Research Institute is incorporated as a non-profit organization of the State of New Jersey under the provisions of R.S. 15:1-1 et seq. The Institute consists of company members and personal members. An active company member must be a corporation, company or firm engaged in the production or utilization of textiles, textile supplies, textile raw materials, textile products, textile machinery or equipment, or engaged in the utilization, manipulation or chemical or physical treatment of fibers, or engaged in research or education related to these fields. There are approximately 90 company members, which pay annual dues ranging from $200 to $2,250 based upon their net textile shipments. Personal members, 300 in number, pay $20 annually.
The Institute is governed by a board of trustees which manages the corporation's business, property and affairs, makes and controls its policies, and has final say on all major fiscal matters. The board consists of 30 trustees plus
ex officio members, who are past presidents and past chairmen of the board continuing to be associated with active member companies. The trustees are elected by the company membership only, each company member having one vote regardless of the dues contributed by it. By contrast personal members have no voting privileges. The board of trustees elects from its membership a chief executive officer who becomes chairman of the board and who may also be president. The board also elects a vice-president and a treasurer from its membership, and a secretary who is not necessarily a member of the board, but is a full-time employee who serves as executive secretary of the Institute and assistant treasurer.
The certificate of incorporation of the Institute sets forth a threefold purpose:
"To provide instruction, to conduct research and to disseminate knowledge in the arts, sciences, technologies, and economics, particularly those relating to the field of textiles."
The Institute provides instruction by offering fellowships and by making available laboratory facilities to predoctoral and postdoctoral students in the textile field. The fellowship program is executed by a unique cooperative arrangement with Princeton University. The Institute selects outstanding bachelor degree graduates capable of satisfying the admission requirements of the Graduate School of Princeton University and designates these predoctoral men as TRI Research Fellows. They register as graduate students of Princeton University and take the regular lectures and examinations of that institution. Their thesis research, however, is conducted in the Institute laboratories under the joint supervision of Institute staff scientists and Princeton faculty members. Upon graduation, a predoctoral fellow receives the appropriate advanced degree of Princeton University and a certificate entitled "Graduate Fellow of Textile Research Institute." Approximately 54% of the Institute graduates take positions on the research staffs of member companies.
Postdoctoral fellows are not formally affiliated with Princeton University. They are invited to the Institute to do research and upon departure receive the same certificate as predoctoral fellows. Member companies supporting postdoctoral fellowships have the privilege of specifying the subject of the fellow's research. This privilege is not enjoyed in the case of the predoctoral participating fellowship program.
The second major objective of the Institute is to conduct research in the textile field. The research program falls into four main categories: (1) general research supported by company membership dues, fellowships and grants; (2) special projects supported by groups of company members and trade groups; (3) government ...