Ambiguity in Rhode Island Tax-Exemption Statutes Is Resolved in Favor of Taxation: § 44-3-3(a)(12) and the Meaning of “Society”

1. Introduction

In PACE Organization of Rhode Island v. Sarah Frew, in her capacity as Tax Assessor for the City of East Providence (R.I. Apr. 28, 2026), the Rhode Island Supreme Court addressed whether PACE Organization of Rhode Island (PACE)—a federally certified “Programs of All-inclusive Care for the Elderly” provider—qualified for a local property-tax exemption after relocating operations to East Providence.

PACE sought exemption under G.L. 1956 § 44-3-3(a)(12), arguing its property was held “for the aid or support of the aged poor.” The East Providence tax assessor denied the application, the local tax board affirmed, and the Superior Court granted summary judgment for the tax assessor. The Supreme Court affirmed, not because PACE’s mission is uncharitable, but because the exemption statute—when applied here—was ambiguous, and ambiguity in tax exemptions must be resolved in favor of taxation.

Key issue: Whether § 44-3-3(a)(12) unambiguously extends exemption to any entity holding property “for the aid or support of the aged poor,” or instead restricts the exemption to certain enumerated entities (libraries/library societies and nonprofit hospitals), and—critically—whether the term “society” is broad (any organization) or narrow (library-related) in context.

2. Summary of the Opinion

  • The Court held that § 44-3-3(a)(12) is ambiguous as applied because the term “society” can reasonably be read in two different ways.
  • One reading supports PACE’s position: “society” broadly means an “organization,” potentially encompassing entities aiding the aged poor.
  • The other reading, using ejusdem generis, limits “society” to a library-related society because it appears in a list dominated by library entities.
  • Because the statute is ambiguous and tax exemptions are strictly construed, the ambiguity was resolved in favor of taxation, defeating PACE’s claim.
  • The Court affirmed summary judgment for the tax assessor and declined to “paint the lily” by undertaking additional interpretive analysis once the ambiguity triggered the strict-construction rule.

3. Analysis

3.1 Precedents Cited

The Court’s analysis rests on a layered set of prior decisions addressing (i) summary judgment standards, (ii) de novo statutory interpretation, (iii) ambiguity and interpretive canons, and (iv) the special rule for tax exemptions.

A. Summary judgment and review posture

  • Riccitelli v. Town of North Providence by and through Vallee and Benaski v. Weinberg: reaffirmed de novo review of summary judgment, using the same standards as the trial court. This mattered because the material facts were largely undisputed; the case turned on statutory meaning.
  • Bayview Loan Servicing, LLC v. Providence Business Loan Fund, Inc. and Cancel v. City of Providence: framed the familiar requirement that summary judgment is proper only where no genuine issue of material fact exists and the movant is entitled to judgment as a matter of law.
  • In re Tetreault: supported the Court’s statement that statutory interpretation is reviewed de novo.

B. Plain meaning, ambiguity, and interpretive method

  • Capital Video Corporation v. Bevilacqua and Newport and New Road, LLC v. Hazard: anchored the plain-language rule—unambiguous statutes are applied literally using ordinary meanings.
  • Rhode Island Truck Center, LLC v. Daimler Trucks North America, LLC and D'Amico v. Johnston Partners (with Webster v. Perrotta): reiterated that interpretation aims to effectuate legislative intent and that ordinary meaning is especially important when terms are undefined.
  • In re Kyle S.: provided the Court’s definition of ambiguity as being “susceptible of more than one construction.”
  • In re Proposed Town of New Shoreham Project and Lazarus v. Sherman: cautioned against “metaphysical” ambiguity arguments and required an “ordinary, common sense” evaluation of whether multiple reasonable meanings exist. Here, the Court found two reasonable readings without resorting to hypertechnical parsing.
  • Johnson v. Johnson: supported the step that interpretive maxims are used only after finding ambiguity. Notably, the Supreme Court in this case used one canon (ejusdem generis) to demonstrate ambiguity rather than to resolve it.

C. Canons and specialized rules applied to this statute

  • St. Clare Home v. Donnelly: PACE invoked the anti-surplusage canon (“no sentence, clause or word should be construed as unmeaning and surplusage”). PACE argued that if only library-type entities qualify, the references to aiding the aged poor/poor children/the poor generally become meaningless because libraries do not do that work. The Court responded that “society” could cover organizations that do provide such aid—yet that still left the competing (library-limiting) reading available.
  • State v. Oliveira (quoting State v. Dearmas): supplied the doctrine of ejusdem generis, which the Court treated as making it reasonable to read “society” narrowly (library-related), because “society” is embedded in a list of library-specific entities (“incorporated library,” “free public library,” “free public library society”). This canon was pivotal to the Court’s conclusion that two reasonable constructions exist.
  • Polseno Properties Management, LLC v. Keeble (quoting Delta Airlines, Inc. v. Neary): stated the governing rule that tax exemptions must be strictly construed in favor of the taxing authority. This precedent sets the asymmetry: once ambiguity exists, the taxpayer does not receive the benefit of the doubt.
  • Killoran: though not quoted with a full caption in the opinion excerpt, it is cited for the specific proposition that if doubt or ambiguity exists in an exemption statute, it must be resolved in favor of taxation. This is the decisive “tie-breaker” the Court applied once ambiguity was found.
  • In re Toryn C. (quoting In re Jeramie N.): supported the Court’s express limitation that the holding is as applied in this case, leaving room for different applications or legislative clarification.
  • Rodríguez v. Encompass Health Rehabilitation Hospital of San Juan, Inc.: cited rhetorically (“To say more would be to paint the lily”) to justify stopping the analysis once the strict-construction rule controlled the outcome.

3.2 Legal Reasoning

The Court’s reasoning proceeds in three principal steps.

Step 1: The statute enumerates entities and uses, but is drafted in an “inartful” way

Section 44-3-3(a)(12) exempts certain “Property, real and personal,” held for or by: (i) “an incorporated library, society, or any free public library, or any free public library society,” subject to the property being held exclusively for certain uses; or (ii) “a nonprofit hospital for the sick or disabled.” The Court agreed with the trial justice that punctuation and phrasing are confusing, making the statute difficult to parse reliably.

Step 2: Two reasonable readings exist because of the word “society”

The Court first described a straightforward textual inference: listing specific entities suggests a claimant must be one of them; listing “uses” connected to the phrase “so far as the property is held exclusively” suggests those entities must use the property for enumerated purposes.

PACE tried to avoid this limitation by arguing the statute creates a “second instance” where any entity (not just the listed entities) can qualify if property is held “for the aid or support of the aged poor.” The Court did not adopt that structure. Instead, it focused on whether PACE could fit within “society.”

Here the Court identified the statutory fork:

  • Broad reading: “Society” (per Black’s Law Dictionary) is synonymous with “organization,” which could include an entity like PACE. This reading also helps avoid surplusage concerns by giving work to the “aid or support of the aged poor” language.
  • Narrow reading: Under ejusdem generis, “society” may be limited to a library-type organization because it appears alongside library entities. This reading preserves coherence within the list but narrows eligibility significantly.

Because both readings were “reasonable,” the statute was ambiguous in this context.

Step 3: Ambiguity in exemption statutes must be resolved in favor of taxation

Having found ambiguity, the Court invoked two related legal anchors:

  • The general rule of taxability in § 44-3-1 (“All real property…are liable to taxation unless otherwise specially provided”).
  • The strict-construction rule for exemptions (Polseno Properties Management, LLC v. Keeble; Delta Airlines, Inc. v. Neary; and Killoran), which requires resolving ambiguity against the taxpayer.

That combination meant PACE could not carry the burden of showing a clear entitlement to exemption under § 44-3-3(a)(12), so the tax assessor was entitled to judgment as a matter of law.

3.3 Impact

  • Reinforced burden on exemption claimants: The decision underscores that charitable or quasi-charitable function alone will not secure an exemption when the statutory category is unclear; claimants must fit within an unambiguous exemption.
  • “Society” is a litigation hotspot: The Court effectively identified “society” as the pivot term in § 44-3-3(a)(12), inviting future disputes over whether particular entities resemble library-associated societies or qualify under the broader dictionary sense.
  • Predictable outcomes in close cases: Once a court finds genuine ambiguity in a Rhode Island tax exemption, this opinion signals that courts may end the analysis quickly under the strict-construction rule rather than expansively reconstructing legislative intent.
  • Legislative pressure point: If the General Assembly intends to exempt modern nonprofit service providers (e.g., elder-care organizations operating outside the hospital model), it may need to amend § 44-3-3(a)(12) to name them explicitly or restructure the sentence to clarify whether “aid or support” is an entity-independent exemption.

4. Complex Concepts Simplified

  • Summary judgment: A case can be decided without trial when the key facts are not disputed and the law clearly favors one side. Here, the dispute was legal (what the statute means), not factual (what PACE does).
  • Statutory ambiguity: A statute is ambiguous when it reasonably supports more than one meaning. The Court found ambiguity because “society” could mean any organization or could mean a library-related entity.
  • Ejusdem generis: When a general word appears in a list with specific words, the general word is often read narrowly to match the type of the specific ones. Because “society” appears next to library entities, it may be read as a library-type society.
  • Strict construction of tax exemptions: Exemptions reduce the tax base, so courts require clear legislative language before removing property from taxation. If the exemption statute is unclear, the taxpayer loses.
  • Anti-surplusage canon: Courts prefer interpretations that give effect to every word, avoiding readings that make phrases meaningless. PACE used this to argue the “aid or support of the aged poor” language must have real work to do. The Court acknowledged that point but still found a competing reasonable reading, producing ambiguity.
  • “As-applied” limitation: The Court emphasized its holding is limited to how the statute functions in this case, preserving flexibility for different factual contexts or future statutory amendments.

5. Conclusion

The Rhode Island Supreme Court affirmed that § 44-3-3(a)(12), as applied to PACE’s claim, is ambiguous because “society” can plausibly be read broadly (any organization) or narrowly (a library-related society under ejusdem generis). Once that ambiguity was found, longstanding Rhode Island doctrine requiring strict construction of tax exemptions compelled the Court to resolve the ambiguity in favor of taxation, resulting in judgment for the East Providence tax assessor.

The decision’s significance lies less in the merits of PACE’s mission and more in its institutional message: absent clear legislative drafting, Rhode Island courts will not extend property-tax exemptions by inference—especially where the statute’s structure and canons support competing readings.