IN THE SUPREME COURT OF THE STATE OF KANSAS

No. 79,672

IN THE MATTER OF THE APPEAL OF

UNIVERSITY OF KANSAS SCHOOL OF MEDICINE--

WICHITA MEDICAL PRACTICE ASSOCIATION

FROM A DECISION OF THE DISTRICT COURT

OF SHAWNEE COUNTY, KANSAS.

SYLLABUS BY THE COURT

1. The Board of Tax Appeals (BOTA) is a state agency, and under K.S.A. 74-2426(c), it is subject to judicial review under the Act for Judicial Review and Civil Enforcement of Agency Actions, K.S.A. 77-601 et seq. In reviewing a decision of BOTA, the appellate court makes the same review as the district court in its review of BOTA's final order.

2. BOTA is a specialized agency that exists to decide taxation issues, and its decisions should be given great weight and deference when it is acting in its area of expertise. However, if the Supreme Court finds that BOTA's interpretation is erroneous as a matter of law, it will take corrective steps.

3. The fundamental rule of statutory construction is that the intent of the legislature, where it can be ascertained, governs, and it is the function of the court to interpret a statute to give it the effect intended by the legislature.

4. In construing statutes, the legislative intention is to be determined from a general consideration of the entire act. Effect must be given, if possible, to the entire act and every part thereof. To this end, it is the duty of the court, as far as practicable, to reconcile the different provisions so as to make them consistent, harmonious, and sensible.

5. When a statute is plain and unambiguous, a court must give effect to the intention of the legislature as expressed rather than determine what the law should or should not be. However, where the face of the statute leaves its construction uncertain, the court may properly look into the historical background of the enactment, the circumstances attending its passage, the purpose to be accomplished, and the effect the statute may have under various constructions suggested.

6. K.S.A. 79-201 Ninth provides a tax exemption for property actually and regularly used by a community service organization for the predominant purpose of providing humanitarian services. In order to qualify for this exemption, the property must be owned and operated by a not-for-profit corporation and meet the following conditions: (a) The directors of the corporation must serve without pay for such services; (b) the corporation must be operated in a manner which does not result in the accrual of distributable profits, realization of private gain resulting from the payment of compensation in excess of a reasonable allowance for salary or other compensation for services rendered, or the realization of any other form of private gain; (c) no officer, director, or member of such corporation may have a pecuniary interest in the property for which exemption is claimed; (d) the corporation must be organized for the purpose of providing humanitarian services; (e) the actual use of the property for which the exemption is claimed must be predominantly related to the purpose of providing humanitarian services, except that an incidental nonexempt use may be made of the property as long as the use is minimal in scope and insubstantial in nature; (f) the corporation must be exempt from federal income taxation under 501(c)(3) of the Internal Revenue Code; and (g) contributions to the corporation must be deductible under the Kansas Income Tax Act.

7. The threshold requirement in K.S.A. 79-201 Ninth that the property claimed as exempt must be owned and operated by a not-for-profit corporation, does not require that the property be owned and operated by the same entity.

8. The requirement in K.S.A. 79-201 Ninth (a) that the directors of the not-for-profit corporation serve without pay for such services, means any payment for the services which they provide as directors; it does not prohibit directors from receiving reasonable compensation for other services which they provide to the corporation.

9. The requirement in K.S.A. 79-201 Ninth (c) prohibiting any officer, director, or member of the corporation from having a pecuniary interest in the property is designed to prevent officers, directors, or members of the corporation claiming an exemption from individually profiting from the tax exempt status of property in which they have a pecuniary interest. It prohibits an actual interest in the property for which exemption is claimed rather than simply an interest in the continued operation of the corporation.

10. The provisions of K.S.A. 79-201 Ninth are examined and applied. We hold that where the property for which exemption is claimed is owned and leased by a corporation fulfilling all requirements of K.S.A. 79-201 Ninth to another separate corporation that operates the property and also fulfills all statutory requirements of K.S.A. 79-201 Ninth, exemption is appropriate where it is established that (1) profit was not a dominant motive in the leasing arrangement, (2) any surplus revenue generated by the lease is substantially and predominantly related to the purpose of providing humanitarian services as defined by K.S.A. 79-201 Ninth, and (3) the property claimed as exempt is actually and regularly used by a community service organization for the predominant purpose of providing humanitarian services.

Appeal from Shawnee district court, JAMES P. BUCHELE, judge. Opinion filed February 5, 1999. The district court's decision affirming BOTA is reversed.

Richard D. Greene, of Morris, Laing, Evans, Brock & Kennedy, Chtd., of Wichita, argued the cause and was on the brief for appellant University of Kansas School of Medicine--Wichita Medical Practice Association.

Patricia J. Parker, assistant county counselor, argued the cause and was on the brief for appellee Board of County Commissioners of Sedgwick County.

The opinion of the court was delivered by

DAVIS, J.: The issue raised by this appeal is one of first impression involving a claimed property tax exemption under the provisions of K.S.A. 79-201 Ninth. Specifically, the question is whether a not-for-profit corporation which leases property to another not-for-profit corporation for below fair market value, which second not-for-profit corporation then uses the property for predominantly humanitarian purposes, is entitled to exemption where both the owner-lessor and lessee satisfy all the requirements of K.S.A. 79-201 Ninth. Contrary to the decision of Board of Tax Appeals (BOTA) and the district court, we conclude that under the particular facts here, exemption is warranted.

The case presents itself in a rather unusual fashion. Before BOTA, before the district court, and before this court on petition for review, the Sedgwick County Commissioners agreed with the appellant that the property was entitled to tax exemption. In its brief before this court, the county commissioners note:

"when the evidence regarding the use of the subject property is analyzed within the perimeters of K.S.A. 79-201 Ninth, and applicable case law, it appears the Appellant's property is entitled to said exemption. It should be noted that the Courts have not construed K.S.A. 79-201 Ninth's provisions regarding 'substantial and predominant use' and BOTA acknowledged it lacked guidance from the Courts in its effort to define substantial and predominant use. However, it is also noteworthy to consider the Kansas Courts' relaxation of the 'exclusive use' test, and the expanding definition of 'educational use' found in other exemption statutes. See e.g. K.S.A. 79-201 Second, and K.S.A. 79-201b First and Second."

The University of Kansas School of Medicine--Wichita Medical Practice Association (WMPA) is the owner-lessor of the property for which exemption is claimed. It is a Kansas not-for-profit corporation and certified by the Internal Revenue Service (IRS) as a 501(c)(3) charitable organization. Its board of directors consists of doctors who teach medicine at the University of Kansas School of Medicine--Wichita (University). The WMPA is not part of the University. However, the WMPA was set up to further the mission of the University in providing health care, teaching medical students and residents of the University, and providing the faculty of the University the opportunity to maintain their skills while teaching.

The WMPA operates its own primary care clinic upon University property which is open to the public. The clinic provides primary care for approximately 105 patients a day. In addition, the WMPA fosters the creation of other clinics in the Wichita area for primary and preventive care, and aids in the operation of the clinics established. Its articles of incorporation provide in part that the WMPA is to

"engage in the continuous active conduct of medical education, medical research and medical care primarily in space located within the University of Kansas School of Medicine--Wichita in conjunction with and utilizing the facilities of such School of Medicine (including equipment, case studies, etc.) on a continuing basis. The principal purposes or functions of the corporation shall include the instruction and training of students, undergraduate, graduate and enrolled in the University of Kansas School of Medicine--Wichita Medical Practice Association pursuing a course of medical education offered by the University of Kansas, the conduct of investigations, research, experiments and studies to discover, develop or verify knowledge relating to the causes, diagnosis, treatment and the prevention or control of physical or mental diseases and impairments to man and the providing of medical care through its professional staff performing clinical services."

The Wichita Primary Care Center (Center) is the lessee of the property for which exemption is claimed. It is also a Kansas not-for-profit corporation and an IRS-certified 501(c)(3) charitable organization. The Center was created by the WMPA as an extension of the WMPA mission. The Center is a separate entity with a separate board of directors. However, one member of the board of directors of the WMPA serves as a board member of the Center. The Center operates a primary care clinic in Wichita and is designed to serve low income and medically underserved patients. Thirty percent of the Center's patients are very low-income individuals who do not have any support from Medicare or Medicaid. Another 50% are low-income individuals who are subsidized by Medicare or Medicaid. The balance of patients have adequate health insurance. Approximately 10% of the patients speak very little or no English.

The purpose of the Center is to provide a medical facility for patients that may not be otherwise served. It is designed to be a place where patients receive primary health care, preventive health care, and access to tertiary care such as the hospital, surgeon, and/or testing that patients might not otherwise access. The Center attempts to change people's patterns of accessing health care for primary and preventive health care.

The Center is set up as a Federally Qualified Health Center (FQHC) and provides medical care for low income and underserved populations on a sliding scale. As a FQHC, the Center receives a reimbursement advantage with the Medicare and Medicaid programs. Once the Center has established a rate of cost of seeing a patient and that cost is approved by Medicare or Medicaid, reimbursement to the Center is based on the number of encounters as opposed to typical fee for service schedules in Medicare and Medicaid reimbursement. In order to maintain FQHC status, at least seven persons on the Center's thirteen-member board of directors are required to be actual patients of the facility. The remaining six members, only three of which can derive their income from the medical field, are drawn from the community.

Through personal interviews with prospective patients and a sliding fee schedule, the Center attempts to determine and remove the barriers that medically underserved and low income patients typically encounter. The Center arranges a referral service for patients who need immediate hospitalization and surgery but who would avoid these services because of the economic barrier. These services are provided at no cost to the patient or on a sliding scale depending upon the financial condition of the patient. No patient is refused service.

The primary difference between the Center and a private primary care clinic is the mix of patients. The numbers of patients who do not pay, or pay very little, is high compared to a private primary care practice. The number of no-shows in the Center is also high. Patients are seen by physicians serving on the faculty of the medical school, together with medical students, interns, and residents who are supervised by a physician. The Center is able to provide a unique role in the delivery of primary and preventative health care to the medically underserved in the Wichita community.

The Center's articles of incorporation provide in part that it will

"[p]rovide primary health care services to the citizens of Kansas; promote improved health status and well being of citizens of Kansas; care for the sick and injured without regard to race, sex, color, political or religious beliefs, country of national origin, or ability to pay; promote a cooperative working relationship with the University of Kansas School of Medicine--Wichita in the development of medical care delivery systems designed to enhance the health and welfare of the citizens of Kansas: and to promote such other related charitable and educational endeavors as may be permitted under Section 501(c)(3) of the Internal Revenue Code."

The Center was temporarily housed as a clinic in space inside a building operated by the University. The WMPA began looking for a suitable site to house the Center. The site needed to be located in the vicinity of the patients who would use the clinic, in a location where barriers to primary health care exist, such as language, low income, and racial mix.

The property for which exemption is claimed satisfied the above requirements. It was a stand-alone medical facility that had been designed and built for a group of surgeons years ago, located at 1125 North Topeka in Wichita. It consists of approximately 5000 square feet with ample off-street parking. However, the Center was not in a position to buy the property. The WMPA approached the St. Francis Via Christi Health System to inquire if it would buy the building and lease it to the Center. However, after negotiations, the WMPA determined that the lease rate was too high. Thus, the WMPA chose instead to purchase the property out of its own reserves and lease it back to the Center.

The WMPA purchased the property in the summer of 1994 for the express purpose of leasing the facility to the Center. The WMPA and the Center entered into a nonresidential lease on September 30 for the term of 30 months beginning October 1, 1994, and expiring April 1, 1997. Under the lease, the Center pays rent in the amount of $8.25 per square foot per month, which amounts to $3,644 per month. The Center is also required to pay such real estate taxes as may be assessed against the property. These taxes are estimated to be approximately $1.60 per square foot per year. It should be noted that this provision regarding payment of taxes is not a binding obligation upon the Center. The Center is responsible only in the event taxes are required to be paid by the WMPA. In addition to other standard conditions, the lease prohibits the use of the property for any other purpose than the operation of medical offices.

Administrative leadership for the Center is provided by the administrator of the WMPA, who is a co-administrator for the Center. Through contractual agreements, the Center uses the WMPA facilities for billing, accounting, and related services, and pays for these services. While the physicians who staff the clinic are not employees of the Center, all other personnel working at the Center are employees of the Center.

The Center contracts with the WMPA for physician services. The Center pays the WMPA a below-market rate for the physicians who staff the Center. The physicians who see patients at the Center are faculty members of the University and also employees of the WMPA. For their work in the Center and other work on behalf of the WMPA, the WMPA pays an amount equal to 7¹/₂% of their faculty salary. Thus, the physicians who teach at the University and work at the Center receive compensation from the State as members of the faculty of the University and compensation from the WMPA in an amount of 7¹/₂% of their salary for their services at the Center.

The WMPA is responsible for maintaining the clinic property of the Center. The rent paid by the Center, $8.25 per square foot, is below fair market value, which evidence establishes is $10 to $12 per square foot. The WMPA uses 22% to 23% of rental income for the operation and for repairs to the facility. The remainder becomes part of the budget of the WMPA and either goes into its reserves to be utilized as needed for sustaining the WMPA during periods of financial hardship where revenues collapse and expenses continue, or is used in furtherance of the humanitarian services that the WMPA provides.

The WMPA sought a tax exemption for the property under K.S.A. 79-201 Ninth, which provides in pertinent part:

"All real property and tangible personal property actually and regularly used by a community service organization for the predominant purpose of providing humanitarian services, which is owned and operated by a corporation organized not for profit under the laws of the state of Kansas or by a corporation organized not for profit under the laws of another state and duly admitted to engage in business in this state as a foreign not-for-profit corporation if: (a) The directors of such corporation serve without pay for such services; (b) the corporation is operated in a manner which does not result in the accrual of distributable profits, realization of private gain resulting from the payment of compensation in excess of a reasonable allowance for salary or other compensation for services rendered or the realization of any other form of private gain; (c) no officer, director or member of such corporation has any pecuniary interest in the property for which exemption is claimed; (d) the corporation is organized for the purpose of providing humanitarian services; (e) the actual use of property for which an exemption is claimed must be substantially and predominantly related to the purpose of providing humanitarian services, except that, the use of such property for a nonexempt purpose which is minimal in scope and insubstantial in nature shall not result in the loss of exemption if such use is incidental to the purpose of providing humanitarian services by the corporation; (f) the corporation is exempt from federal income taxation pursuant to section 501(c)(3) of the internal revenue code of 1986 and; (g) contributions to the corporation are deductible under the Kansas income tax act. As used in this clause, 'humanitarian services' means the conduct of activities which substantially and predominantly meet a demonstrated community need and which improve the physical, mental, social, cultural or spiritual welfare of others or the relief, comfort or assistance of persons in distress or any combination thereof including but not limited to health and recreation services, child care, individual and family counseling, employment and training programs for handicapped persons and meals or feeding programs."

BOTA Decision

BOTA denied the WMPA request for exemption. BOTA analyzed the requested exemption under the provisions of K.S.A. 79-201 Ninth from the perspective of the corporation requesting the exemption, the WMPA. BOTA began its analysis of the question and its decision by stating that "the Board strictly construes applications for exemption and all doubts are resolved against the applicant." In adopting this approach, BOTA relied upon earlier decisions of this court in interpreting Kansas constitutional and statutory tax exemption provisions. The decisions relied upon by BOTA involved questions of whether the property claimed as exempt was "exclusively used" for an expressed constitutional or statutory purpose. See T-Bone Feeders, Inc. v. Martin, 236 Kan. 641, 645-46, 693 P.2d 1187 (1985).

The statute we consider in this case does not involve the question of "exclusive use" but rather involves a question of actual use "for the predominant purpose of providing humanitarian services." K.S.A. 79-201 Ninth. We do not depart from our earlier decisions and the fundamental rules and legal principles established as guidelines to be applied when examining tax exemption statutes, which are quoted in part in the BOTA decision:

"(1) Taxation is the rule; exemption is the exception. All doubts are to be resolved against exemption and in favor of taxation. [Citation omitted.]

"(2) Constitutional and statutory provisions exempting property from taxation are to be strictly construed. [Citations omitted.]

"(3) The burden of establishing exemption from taxation is on the one claiming it. [Citation omitted.]" 236 Kan. at 645-46.

However, because we deal with a newly enacted exemption based upon other than "exclusive use," we may not ignore the very fundamental rule of statutory interpretation. The intent of the legislature, where it can be ascertained, governs the construction of the statute, and it is the function of the court to interpret a statute to give it the effect intended by the legislature. See In re Tax Exemption Application of City of Wichita, 255 Kan. 838, 842, 877 P.2d 437 (1994). The rule of strict construction is subservient to the fundamental rule of statutory construction, which requires that the intent and purpose of the legislature govern. In re Tax Appeal of Collingwood Grain, Inc., 257 Kan. 237, 246, 891 P.2d 422 (1995).

BOTA acknowledged that it had no guidance from this court on "predominant use" but failed to give any consideration to the intent of the legislature in its adoption of K.S.A. 79-201. BOTA also gave very little consideration to the Center's actual and regular use of the property for which exemption is claimed. According to the provisions of K.S.A. 79-201 Ninth, we may not ignore this aspect of the case.

In denying the requested exemption, BOTA concluded:

"12. With respect to requirements (a) and (c) of K.S.A. 1995 Supp. 79-201 Ninth, the Board is not convinced that the directors of [the WMPA] serve without pay and without a pecuniary interest in the medical clinic. Testimony indicated that all of the directors of [the WMPA] are physicians, some of whom see patients in the medical clinic. Physicians who see patients at [the Center] are full time faculty members of the Kansas University Medical School and, also, are considered employees of [the WMPA]. Thus, they receive two checks: one from the University of Kansas and the other from [the WMPA]. [The WMPA] collects fees from [the Center] for the physicians' time pursuant to contractual agreement. Although it is clear that the contractual fees collected are not distributed directly to the physicians, the fees become part of [the WMPA]'s operating revenue from which the physicians' [the WMPA] salaries are derived. Thus, though not directly, those directors of [the WMPA] who are physicians working in the clinic receive pay for their services, thereby giving them a pecuniary interest in the operation of the medical clinic."

BOTA also noted that it was not convinced that the WMPA was organized for the purpose of providing humanitarian services as required by K.S.A. 79-201 Ninth (d). BOTA stated that one of the original purposes of the WMPA was to provide a way for physicians teaching at the school to supplement their salaries and that this purpose "cannot be ignored by the Board in its determination whether the subject property qualifies for an exemption."

Finally, BOTA determined that while the Center was physically using the property, the WMPA was also using the property by leasing it, which generated revenue. According to BOTA, while there was testimony that the revenue was used for humanitarian purposes, the evidence was not sufficient to allow it to determine whether the purposes for which the money was used qualified as humanitarian services as required by K.S.A. 79-201 Ninth (e).

District Court

On petition for judicial review, the district court agreed with BOTA, although for different reasons. The court determined that K.S.A. 79-201 Ninth was "ambiguous as to whether the 'owned and operated' requirement refers to the property or to the community services organization or both." The actual language of this provision is: "All real property and tangible personal property actually and regularly used by a community service organization for the predominant purpose of providing humanitarian services, which is owned and operated by a corporation organized not for profit." Applying strict construction, the court concluded that in order to qualify for the exemption the legislature intended to require a corporate property owner to dedicate the use of the property to providing humanitarian services and to also be the humanitarian service provider on the exempt property. The district court reasoned that if the legislature had intended otherwise, the disjunctive "or" could have been placed between "owned" and "operated."

Like BOTA, the district court, relying upon earlier decisions of this court interpreting Kansas constitutional and statutory tax exemptions requiring that the property be "exclusively used" for an expressed constitutional or statutory purpose, applied strict construction. With the exception of considering the expressed statutory language of the new provisions contained in K.S.A. 79-201 Ninth, the district court gave little, if any, consideration in its order denying the exemption to the fundamental rule of statutory construction that the intent of the legislature, where it can be ascertained, governs the construction of the statute, and it is the function of the court to interpret a statute to give it the effect intended by the legislature.

Relying upon past precedent from this court concerning the constitutional and statutory conditions for the exemption of property "exclusively used" for charitable purposes, the district court noted that the renting of property constitutes a simultaneous use of the property by the lessor and lessee which would bar a claim of exclusive use for exempt purposes. "Renting property is a nonexempt use of the property." See Board of Wyandotte County Comm'rs v. Kansas Ave. Properties, 246 Kan. 161, 786 P.2d 1141 (1990); In re Board of Johnson County Comm'rs, 225 Kan. 517, 592 P.2d 875 (1979). The district court, in looking at the humanitarian services exception, stated that the substantial rent received by the WMPA would certainly preclude the renting of the property from constituting a "nonexempt purpose which is minimal in scope and insubstantial in nature," as allowed by K.S.A. 79-201 Ninth (e).

In holding that the WMPA rental of the property to the Center did not qualify as a humanitarian service, the court concluded:

"A review of the record does not reveal sufficient evidence from which BOTA or the Court can determine the scope of the [WMPA]'s programs and activities, its financial structure, the establishment and reasonableness of the compensation paid to its member doctors, to analyze its books and records which might show the accrual of profits or weigh the humanitarian services it provides against its other non-exempt activities, if any, besides purchasing and renting real estate. While providing health care is generally considered humanitarian, neither the BOTA nor the courts are required to accept that the [WMPA] is per se a humanitarian organization for purposes of a property tax exemption because its members are doctors and because it provides medical services as part of its business activities."

Thus, the district court affirmed BOTA's denial of the exemption.

Standard of Review

BOTA is a state agency, and under K.S.A. 74-2426(c), it is subject to judicial review under the Act for Judicial Review and Civil Enforcement of Agency Actions, K.S.A. 77-601 et seq. In reviewing a decision of BOTA, this court makes the same review as the district court in its review of BOTA's final order. Under K.S.A. 77-621(c), this court may grant relief if it determines:

"(1) The agency action, or the statute or rule and regulation on which the agency action is based, is unconstitutional on its face or as applied;

"(2) the agency has acted beyond the jurisdiction conferred by any provision of law;

"(3) the agency has not decided an issue requiring resolution;

"(4) the agency has erroneously interpreted or applied the law;

"(5) the agency has engaged in an unlawful procedure or has failed to follow prescribed procedure;

"(6) the persons taking the agency action were improperly constituted as a decision-making body or subject to disqualification;

"(7) the agency action is based on a determination of fact, made or impled by the agency, that is not supported by evidence that is substantial when viewed in light of the record as a whole, which includes the agency record for judicial review, supplemented by any additional evidence received by the court under this act; or

"(8) the agency action is otherwise unreasonable, arbitrary or capricious."

The resolution of this appeal involves the interpretation of K.S.A. 79-201 Ninth. "Interpretation of a statute is a question of law, and this court's review is unlimited." Hamilton v. State Farm Fire & Cas., Co., 263 Kan. 875, 879, 953 P.2d 1027 (1998). BOTA is a specialized agency that exists to decide taxation issues, and its decisions should be given great weight and deference when it is acting in its area of expertise. However, if we find that BOTA's interpretation is erroneous as a matter of law, we will take corrective steps. In re Tax Appeal of Boeing Co. 261 Kan. 508, 515, 930 P.2d 1366 (1997).

As noted above, the fundamental rule of statutory interpretation is that the intent of the legislature, where it can be ascertained, governs the construction of the statute, and it is the function of the court to interpret a statute to give it the effect intended by the legislature. See In re Tax Exemption Application of City of Wichita, 255 Kan. at 842. The rule of strict construction is subservient to the fundamental rule of statutory construction which requires that the intent and purpose of the legislature govern. In re Tax Appeal of Collingwood Grain, Inc., 257 Kan. at 246.

"'In construing statutes, the legislative intention is to be determined from a general consideration of the entire act. Effect must be given, if possible, to the entire act and every part thereof. To this end, it is the duty of the court, as far as practicable, to reconcile the different provisions so as to make them consistent, harmonious, and sensible.' [Citation omitted.]" KPERS v. Reimer & Koger Assocs., Inc., 262 Kan. 635, 643-44, 941 P.2d 1321 (1997).

When a statute is plain and unambiguous, a court must give effect to the intention of the legislature as expressed, rather than determine what the law should or should not be. Martindale v. Tenny, 250 Kan. 621, Syl. ¶ 2, 829 P.2d 561 (1992). However, where the face of the statute leaves its construction uncertain, the court may properly look into the historical background of the enactment, the circumstances attending its passage, the purpose to be accomplished, and the effect the statute may have under various constructions suggested. Bd. of Sedgwick County Comm'rs v. Action Rent to Own, Inc., 266 Kan. 293 Syl. ¶ 3, ___ P.2d ___ (1998); Brown v. U.S.D. No. 333, 261 Kan. 134, 142, 928 P.2d 57 (1966); Director of Taxation v. Kansas Crude Oil Reclaiming Co., 236 Kan. 450, 458, 691 P.2d 1303 (1984).

The provisions of K.S.A. 79-201 set forth the property to be exempted from taxation in Kansas. K.S.A. 79-201 Ninth, a subsection of K.S.A 79-201 enacted in 1988, created a new exemption and has never been interpreted by this court. L. 1988, ch. 373,