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PHOENIX — The state Court of Appeals has ruled Tucson Botanical Gardens does not have to pay property taxes on its gift shop or other areas of its facility in which moneymaking activities take place.

Besides the gift shop, the Botanical Gardens has areas where art is displayed for sale, and that are rented out for such special events as weddings, parties and private meetings, as do other charities that would be covered by the ruling.

Pima County charged the organization property taxes on the areas where moneymaking activities take place, which the county contended are not part tax-exempt.

Court records show the organization is organized as a federally recognized charity dedicated to horticultural and ecological education. It operates 16 different gardens representing various themes on its 5.7-acre site in central Tucson.

There also are six buildings on the site, including a gift shop.

Although the court said the materials sold there are "primarily educational," the shop also sells such things as T-shirts, napkins, hats, salsa seasoning and dishes.

Those items bring in more than they cost, though the organization said there is no profit if operating expenses are added in, which include staffing and utilities.

The organization also has meeting rooms it rents out and where it also exhibits art for sale.

State law says the property of botanical gardens, museums, zoos, dance and community arts groups is exempt from taxation "if the property is used for those purposes and not used or held for profit."

Based on its interpretation of the law, Pima County assessed property taxes on the gift shop and meeting areas of $3,835 in 2005, $2,028 in 2006 and $2,079 last year.

Appellate Judge Patricia Norris, writing for the unanimous court, said judges generally are required to construe tax statutes strictly to ensure that all taxpayers share the burden.

But she also said they should not be interpreted so strictly so as to frustrate legislative intent.

In this case, she said, the county has incorrectly concluded the sale of the non-educational items means the organization is engaged in commercial activities, which are not exempt from property tax laws.

"By focusing on the nature of a few of the items sold in the gift shop and (Tucson Botanical Gardens') incidental use of the meeting areas, the county has failed to take into account the primary use TBG makes of the gift shop and meeting areas," she wrote.

"As long as the taxpayer's principal or primary use of the property is for the designated exempt purpose, the taxpayer is entitled to the exemption notwithstanding its occasional or incidental use of its property for other purposes."

Here, Norris said, Tucson Botanical Gardens presented undisputed evidence it was primarily using the gift shop for the charitable purpose of enhancing its educational mission. The same is true, the judge said, of the meeting areas, with the sale of art only incidental to the main purpose of the organization. And Norris said the fact the organization is recognized as a charity by the federal government shows the gift shop and meeting rooms were "not used or held for profit," allowing it to get the property tax exemption in state law.