ÿWPCÑ% …# VUNa %¯ 0 (µw@Ý4 1 0l@ 0D¬ 0Jð UH: 0T‚ 0DÖ b 0^" 0h€ 0rè 0|Z 0†Ö 0\ 1uì 0daÅ BÍU >êU*(VRV¨ D3þU61B)g 0@DCÐ AMU*`Š™)Ñ=Ív~ÛvÓY AO,$Æ{$ 0DA% D/…% B´%˜HP LaserJet 4Si/4SiMX PS 600dpiPSCRIPTÈÚØÚÚØÈÚ0nLHÎ(ÖÃ9 Z ‹6Times New Roman RegularX($¡¡ p Dq Ur Ps {t u v Uw Dx Ó€‚ DÒ 3|x‚ ((3üÝ$¤¤Ý ƒ!ÝÝ  Ýà  àòòÚ  Ú0Ú  Úóó(#Ã$òòÚ  Ú0Ú  Úóó2 ÿÿ0Indent1Ô2ÔÔ3  Ô<à09Z 0Courier (W1) Regular2" ÿÿ0Indent2à0 àÔ2ÔÔ3  Ô(3¯$©©Ý ƒ!ÝÝ  Ý- ù-2, ÿÿ0Indent3à0 àà0 àÔ2ÔÔ3  Ô26 ÿÿ0Indent4à0 àà0 àà0 àÔ2ÔÔ3  Ô2@ ÿÿ0Indent5à0 àà0 àà0 àà0 àÔ2ÔÔ3  Ô2J ÿÿ0Indent6à0 àà0 àà0 àà0 àà0 àÔ2ÔÔ3  Ô2T ÿÿ0Indent7à0 àà0 àà0 àà0 àà0 àà0 àÔ2ÔÔ3  Ô2^ ÿÿ0Indent8à0 àà0 àà0 àà0 àà0 àà0 àà0 àÔ2ÔÔ3  Ô  ÿÿ?AGMSYaioIndent0I.A.1.a.(1)(a)i)a)P ÿÿ8Mac DefaultMac DefaultÓ ` °šXÓ d< Œ 9p`(&Times New Roman< Œ 9p`(Times LÝ ƒ!ÝÔ€&ÔÝ  ÝÝ ƒ)ÝÝ  ÝÌÌÌ LÝ ƒ!ÝÔ€&ÔÝ  ÝÝ ƒ)ÝÝ  ÝÌÌÌ$$$$'ÿÿdxd< Œ 9p`(Courier New% Line 7 d("ÿÿ$££Ò  ÒÒ  Ò,,,,7Border 1dd€-.Cþÿ << Gÿÿ< Œ 9p`(Arial Ý ƒ!ÝÑ  ÑÑ#€d#ÑÔ€&ÔÝ  ÝÔ€0ÔÔ€0ÔÓ  Óò òÔ YYY ÔFILEDÔ€0XÔÌÌAugust€25,€1997ÌÌCecil€W.€CrowsonÌAppellate€Court€ClerkÔ  Ôó ó †Ý ƒ!ÝÑ#€d#ÑÔ€&ÔÝ  ÝÝ ƒ $Ýà àòòÚ  ÚÚ  ÚóóÝ  ÝÔ€+ÔÔ€+ôÔInterest€from€lawfully€issued€industrial€development€bonds€is€exemptÏfrom€the€State€income€tax.€€òòSeeóó€Tenn.€Code€Ann.€ðððð€7„53„305(a)€(1992);€67„2„104(e)€(Supp.€1996);€67„5„205(a)(2)€(1994).€€Ì Ý ƒ!ÝÑ#€d#ÑÔ€&ÔÝ  ÝÝ ƒ $Ýà àòòÚ  ÚÚ  ÚóóÝ  ÝÔ€+ÔÔ€+ôÔTenn.€Code€Ann.€ðð€67„2„119(b)€provides:ÌÌà8 àà8 àWhere€a€taxpayer€residing€within€the€corporate€limitsÏof€any€municipality€pays€a€tax€imposed€at€the€rate€ofÏsix€percent€(6%)€per€annum,€then€three€eighths€(3/8)Ïof€the€net€tax€collected€from€such€taxpayer€shall€beÏreturned€to€the€city€within€which€such€taxpayerÏresides.Ì ÇÝ ƒ!ÝÑ#€d#ÑÔ€&ÔÝ  ÝÝ ƒ $Ýà àòòÚ  ÚÚ  ÚóóÝ  ÝÔ€&ôÔÔ€+ÔTenn.€Code€Ann.€ðð€67„2„102€(1994)€provides:Ìà8 àÌà8 àAn€income€tax€in€the€amount€of€six€percent€(6%)€per€annum€shall€beÏlevied€and€collected€on€incomes€derived€by€way€of€dividends€fromÏstocks€or€by€way€of€òòinterest€on€bondsóó€of€each€person,€partnership,Ïassociation,€trust€and€corporation€in€the€state€of€Tennessee€whoÏreceived,€or€to€whom€accrued,€or€to€whom€was€credited€during€anyÏyear€income€from€the€sources€above€enumerated,€except€as€hereafterÏprovided.ÌÌÓÓ(Emphasis€added.)Ìà àÌ ÃÝ ƒ!ÝÑ#€d#ÑÔ€&ÔÝ  ÝÝ ƒ $Ýà àòòÚ  ÚÚ  ÚóóÝ  ÝÔ€&ôÔÔ€+ÔTenn.€Code€Ann.€ðð€67„2„101(1)€provides:ÌÌà8 à€€€€€€(A)€ð ðBondðð€means€all€obligations€issued€by€any€person,€firm,Ïjoint„stock€company,€business€trust€or€corporation€organized€andÏdoing€business€under€the€laws€of€this€state,€or€any€other€state,Ïevidenced€by€an€instrument€whereby€the€obligor€is€bound€to€payÏinterest€to€the€obligee€regardless€of€whether€the€obligor€is€doingÏbusiness€in€this€state,€or€whether€the€obligation€under€the€termsÏof€which€the€interest€accrues€is€a€mortgage€or€lien€on€propertyÏlocated€in€this€state€or€beyond€the€jurisdiction€thereof;ÌÌÌà8 à€€€€€€(B)€ð ðBondðð€does€not€include:€€ÌÌà8 àà à(i)€Ordinary€commercial€paper,€trade€acceptance,€etc.,Ïmaturing€in€six€(6)€months€or€less€from€the€date€ofÏissuance....ÌÌÌPtPtHHÚ(ÿáÿâùFG(üHHÚ(d'hStyl{WP}01•ÃÃÃÃÃÃÃÃÃÃÃÃÃÃÃÃÃÃà Ãà Ãà Ãà Ãà ÃÃÃÃÃÃÃÃÃÃÃÐ ÐÐHHÐÐ  ÐÐ2ÐÐÿÿ¸æ$ÿÐÐHHÐÐÐÐÐÐÐÐ  ÐÐ ÐÐ ÐÑÑÑGenevaÑÑ ÑÑ € ÑÑ<Px–ÈÑÒÒÒ443!#4ÒÒ$ *$ÒÒ$*$ÒÒ ÿKK ÒÒ  Geneva ÒÒ  Geneva ÒÓ.,ÓÓÓÓ6ÓÓ ÓßßßßßßßßßßßßßßßßßßÑGenevaÑÑ ÑÒ  h HD: Geneva ÒÒ  h HD: Geneva Ò€-‚ƒCþÿ<< CÿÿƒLevel 1Level 2Level 3Level 4Level 5($$””ò òÚ  Ú1Ú  Úó ó„„'÷ÿ dxdüÿP PdÝ ƒ!ÝÔ . ÔÔ€&ÔÝ  Ý›Ò ° ÒÒ H ÒÑ  ÑÑ\R AØ'\ÑØ ØÓ&€Ðd&ÓÓ&€''XÐd&ÓÖ€(ÖÖ€)ÖÑ\R AØ'\ÑÔ€+ÔÑ€ÑÑ7€<ËXXdÈdÈ7ÑÓ` Ü` ˜XÓÑ  ÑœÞ ÞÌà àà àà àà àà àà àà àà àAugust€25,€1997Ì›à àà àà àà àà àà àà àà àòòFOR€œPUBLICATIONÌÙ€€ÙóóßR€/1.A1-j|Þq` ç `€€@ÿRß›ÌÓÓÓÓà@ àIN€THE€SUPREME€COURT€OF€TENNESSEEÌÌà@ àAT€NASHVILLEÌÌÌÌHAROLD€E.€STEELE,€DON€PETERSON,à à(ÌREV.€DAVID€MAYNARD,€HARMON€WRAY,à à(ÌAND€REV.€TOM€BAKER,€JR.,à àà àà à(ÌINDIVIDUALLY,€AS€MUNICIPAL€TAXà à(ÌPAYERS€AND€AS€MEMBERS€OF€AMERICANSà à(ÌFOR€RELIGIOUS€LIBERTY,à àà àà à(€€No.€01S01„9607„FD„00136Ìà àà àà àà àà àà à(Ì€€€€€Plaintiffs„Respondents,à àà à(Ìà àà àà àà àà àà à(ÌÒ ° ÒÒ à Òà àà àà àà àà àà à(€€On€Certified€Question€of€LawÌv.à àà àà àà àà àà à(€€from€the€United€States€DistrictÌà àà àà àà àà àà à(€€Court€for€the€Middle€DistrictÌà àà àà àà àà àà à(€€of€Tennessee€€ÌTHE€INDUSTRIAL€DEVELOPMENT€BOARDà à(€ÌOF€THE€METROPOLITAN€GOVERNMENT€OFà à(€€Hon.€John€T.€Nixon,€Chief€JudgeÌNASHVILLE€AND€DAVIDSON€COUNTY;€THE€(€€No.€3„91„0421ÌMETROPOLITAN€GOVERNMENT€OF€à àà à(ÌNASHVILLE€AND€DAVIDSON€COUNTY;€à à(ÌDAVID€LIPSCOMB€UNIVERSITY;€SOVRANà à(ÌBANK,€A€NATIONAL€BANKING€à àà à(ÌASSOCIATION;€AND€SOVRAN€BANK/à àà à(ÌTENNESSEE,€A€TENNESSEE€BANKINGà à(ÌCORPORATION,à àà àà àà àà à(Ìà àà àà àà àà àà à(Ì€€€€€œDefendants„Petitioner.›à àà à(ÌœÌÌÒ ° ÒÒ À ÒÌòòFor€Defendant/Petitionerà àà àà àà àFor€Plaintiffs„Respondentsóó:òòÌDavid€Lipscomb€Universityóó:à àà àà àà àà àÌà àà àà àà àà àà àà àJoseph€H.€JohnstonÌBradley€A.€MacLeanà àà àà àà àà àNashvilleÌStephen€H.€Priceà àà àà àà àà àÌFarris,€Warfield€&€KanadayÌNashvilleÌÌÌòòFor€Defendant/Sovran€Bank€&€SovranóóÌòòBank/Tennesseeóó:ÌÌRobert€J.€Warner,€Jr.ÌBoult,€Cummings,€Conners€&€BerryÌNashvilleÌÌòòFor€Industrial€Developmentóóà àà àà àòòFor€MetropolitanóóÌòòBoard€of€Nashville€andóóà àòòà àà àà àGovernment€of€Nashville€andóóÌòòDavidson€Countyóó:à àà àà àà àà àòòDavidson€Countyóó:à àà àà àÌBobby€D.€Davisà àà àà àà àà àà àJames€L.€CharlesÌMcKinney€&€Davisà àà àà àà àà àJames€L.€Murphy,€IIIà àÌMadisonà àà àà àà àà àà àà àPaul€D.€KrivackaÌà àà àà àà àà àà àà àNashvilleÌÌÌòòFor€Amicus€Curiae€State€ofà àà àà àFor€Amicus€Curiae€TennesseeÌTennesseeóó:à àà àà àà àà àà àòòMunicipal€League€andóóÌà àà àà àà àà àà àà àòòTennessee€County€ServicesóóÌCharles€W.€Bursonà àà àà àà àà àòòAssociationóó:ÌAttorney€General€&€ReporterÌNashvilleà àà àà àà àà àà àà àGeorge€E.€BarrettÌà àà àà àà àà àà àà àPhillip€A.€PurcellÌMichael€W.€Catalanoà àà àà àà àà àBarrett,€Johnston€&€ParsleyÌAssociate€Solicitor€Generalà àà àà àNashvilleÌNashvilleÌÌÌòòÌóóà àà àà àà àà àà àÌÌÌÌÌà@ àòòò òO€P€I€N€I€O€Nóóó óÌÌÌÌÌÌÌÌÌÌÌÌÌÌÌÌÌÌÌÌÌÌÌà àà àà àà àà àà àà àà àREID,€J.ÌÌÓÓà àPursuant€to€Rule€23,€Rules€of€the€Tennessee€Supreme€Court,Ïthe€Court€has€accepted€the€following€question€of€law€certified€byÏthe€United€States€District€Court€for€the€Middle€District€ofÏTennessee:ÌÌÓÓà8 àWhether€bonds€which€contain€a€"liquidity€demand"Ïprovision,€giving€bondholders€the€right€toÏcollect€the€face€value€of€the€bonds€upon€givingÏseven€(7)€days€notice,€are€bonds€"maturing€inÏsix€(6)€months€or€less€from€the€date€ofÏissuance"€within€the€meaning€of€Tenn.€Code€Ann.Ïðð€67„2„101(1)(B)(i),€such€that€the€interest€onÏthe€bonds€is€exempt€from€the€Tennessee€"HallÏIncome€Tax"€under€Tenn.€Code€Ann.€ðð€67„2„101€òòetÏseqóó.ÌÌÌÌÓÓà àThe€decision€is€that€interest€on€the€bonds€is€subject€toÏthe€State€income€tax.€ÌÓ  ÓÌò òIó óÌÌÓ  Ó€à àIn€the€federal€court€action,€the€plaintiffs,€as€municipalÏtaxpayers,€are€challenging€the€constitutionality€of€the€issuance€byÏthe€Industrial€Development€Board€of€the€Metropolitan€Government€ofÏNashville€and€Davidson€County€("Industrial€Development€Board")€ofÏindustrial€development€bonds€in€the€amount€of€fifteen€millionÏdollars€($15,000,000)€to€finance€construction€of€facilities€on€theÏcampus€of€the€defendant,€David€Lipscomb€University€("Lipscomb"),€aÏprivate,€liberal€arts€university€in€Nashville€affiliated€with€aÏreligious€denomination€known€as€the€Church€of€Christ.€€TheÏplaintiffs€contend€that€the€issuance€of€the€bonds€violates€theÏEstablishment€Clause€of€the€First€Amendment€to€the€Constitution€ofÏthe€United€States.ÌÌà àThe€District€Court€has€held€that€in€order€to€establishÏstanding€to€bring€the€federal€court€action,€the€plaintiffs€must€showÏthat€the€issuance€of€the€bonds€by€the€Industrial€Development€BoardÏhas€caused€a€direct€or€indirect€loss€to€the€municipal€fisc.€€TheÏplaintiffs€contend€that€if€the€bonds€had€not€been€issued€as€"taxÏexempt"€bonds€by€the€Industrial€Development€Board,× ƒ2 ××  ×€then€the€interestÏearned€on€the€bonds€would€be€subject€to€the€State€income€tax,€and€aÏportion€of€the€tax€revenue€collected€from€bondowners€residing€inÍMetropolitan€Nashville€and€Davidson€County€€would€be€remitted€to€theÏmunicipality€pursuant€to€Tenn.€Code€Ann.€ðð67„2„119(b)€(1994).× ƒ3 ××  ×€€TheÏplaintiffs€assert€that€the€resulting€loss€of€revenue€is€a€directÏfinancial€loss€which€gives€them€standing€to€prosecute€the€suit.€€ÌÌà àLipscomb€contends€that€the€interest€earned€on€the€bonds€isÏexcluded€from€the€State€income€tax€because,€by€virtue€of€a€liquidityÏdemand€provision€in€the€bond€documents,€they€are€bonds€"maturing€inÏsix€(6)€months€or€less€from€the€date€of€issuance"€within€the€meaningÏof€Tenn.€Code€Ann.€€ðð€67„2„101(1)(B)(i)€(1994).€€Lipscomb€thereforeÏasserts€that,€even€if€the€instruments€are€not€lawfully€issuedÏindustrial€bonds,€the€plaintiffs€cannot€show€any€loss€to€theÏmunicipal€fisc,€and,€therefore,€they€do€not€have€standing€to€pursueÏthe€federal€action.€€€€€ÌÌà àThe€bonds€in€this€case€were€issued€pursuant€to€a€series€ofÏvoluminous€documents.€€Key€among€these€documents€were:€€a€MasterÏBond€in€the€original€principal€amount€of€$15,000,000€issued€pursuantÍto€a€Trust€Indenture€between€the€Industrial€Development€Board€as€theÏissuer€and€Sovran€Bank,€N.A.,€as€the€bond€trustee,€bond€registrar,Ïpaying€agent€and€rate€agent;€a€Loan€Agreement€and€Promissory€NoteÏunder€which€Lipscomb€obligated€itself€to€provide€the€funds€necessaryÏfor€the€Industrial€Development€Board€to€repay€the€bonds;€a€Deed€ofÏTrust€and€Security€Agreement€under€which€Lipscomb€pledged€its€realÏestate€and€certain€other€property€to€secure€its€obligations€and€theÏrepayment€of€the€bonds;€a€Letter€of€Credit€Reimbursement€AgreementÏunder€which€Sovran€Bank/Tennessee€guaranteed€the€repayment€of€theÏbonds€and€Lipscomb's€obligations;€and€an€Official€Statement/OfferingÏCircular€through€which€the€bonds€were€marketed€to€members€of€theÏpublic€in€denominations€of€$1,000€or€any€integral€thereof,€with€aÏminimum€holding€of€$5,000.ÌÌà àThe€bonds€were€issued€effective€as€of€January€31,€1991,Ïwith€a€stated€maturity€date€of€May€1,€2020.€€However,€the€owner€ofÏeach€of€the€bonds€has€a€right€to€demand€earlier€payment€under€aÏprovision€in€the€Master€Bond€referred€to€as€"liquidity€demand."€€TheÏOfficial€Statement/Offering€Circular€provides:ÌÌÓÓà8 àà àAny€Bondowner€may€require€his€Bonds€to€beÏpurchased€on€any€Business€Day€in€whole€or€in€anyÏmultiple€of€$1,000,€subject€to€holding€anÏAuthorized€Denomination€of€at€least€$5,000,€uponÏa€"Liquidity€Demand"€from€such€owner€to€the€BondÏRegistrar.€€The€Bondowner€must€give€telephonicÍnotice€to€the€Bond€Registrar€of€a€LiquidityÏDemand€by€not€later€than€11:00€a.m.,€EasternÏTime,€on€the€7th€day€prior€to€the€date€suchÏpurchase€is€demanded€(the€"Liquidity€Date").€ÏAfter€giving€such€notice,€the€Bondowner€shall€beÏdeemed€to€have€surrendered€such€bondsÏirrevocably€to€the€Bond€Registrar€on€theÏLiquidity€Date.€€Bonds€subject€to€a€LiquidityÏDemand€shall€either€be€remarketed€by€theÏRemarketing€Agent€or€purchased€pursuant€to€aÏdraw€on€the€Letter€of€Credit.ÌÌÌÌÓÓà àAccording€to€the€Master€Bond,€during€the€initial€variableÏrate€period,€the€bondowners€will€not€receive€certificatesÏrepresenting€their€ownership€interests€in€the€bonds.€€The€beneficialÏownership€of€the€bonds€will€be€evidenced€only€by€book€entries€in€theÏownership€records€maintained€by€the€bond€registrar,€who€also€holdsÏthe€Master€Bond.€€At€any€time,€Lipscomb€has€the€option€to€terminateÏthe€variable€interest€rate€feature€on€all€the€bonds€and€convert€theÏinterest€to€a€fixed€rate.€€After€the€conversion€date,€the€MasterÏBond€may€be€exchanged€for€certificated€bonds€in€fully€registeredÏform.ÌÌÌ€€€€€€€€€€Ìò òÓ  ÓIIó óÌÓ  ÓÌà àThe€State€imposes€an€income€tax€on€the€ð ðinterest€onÍbonds.ðð× ƒ4 ××  ×€€Whether€interest€on€the€bonds€in€this€case€is€subject€toÏthe€State€income€tax€depends€upon€the€statutory€definition€of€bond.€ÏThat€definition,€in€pertinent€part,€is:€€ð ðððBondðð€means€allÏobligations€.€.€.€evidenced€by€an€instrument€whereby€the€obligor€isÏbound€to€pay€interest€to€the€obligee€.€.€.€[but]€ððBondðð€does€notÏinclude:€[o]rdinary€commercial€paper,€trade€acceptance,€etc.Ïmaturing€in€six€(6)€months€or€less€from€the€date€of€issuance.ðð× ƒ5 ××  ×€€ÌTenn.€Code€Ann.€ðð€67„2„101(1)€(1994).ÌÌà àIn€determining€the€meaning€of€ð ðbond,ðð€the€Court€is€guidedÏby€several€rules€of€statutory€construction.€€Legislative€intent€isÏto€be€ascertained€primarily€from€the€natural€and€ordinary€meaning€ofÏthe€language€used€in€the€statute,€without€any€forced€or€subtleÏconstruction€that€would€extend€or€limit€its€meaning.€€òòState€v.ÏSligeróó,€846€S.W.2d€262,€263€(Tenn.€1993);€òòWorrall€v.€Kroger€Co.óó,€545ÏS.W.2d€736,€738€(Tenn.€1977).€€The€statute€must€be€construed€in€itsÏentirety,€and€it€should€be€assumed€that€the€legislature€used€eachÏword€purposely€and€that€those€words€convey€some€intent€and€have€aÏmeaning€and€a€purpose.€€òòTennessee€Growers,€Inc.€v.€Kingóó,€682€S.W.2dÏ203,€205€(Tenn.€1984).€€The€background,€purpose,€and€generalÏcircumstances€under€which€words€are€used€in€a€statute€must€beÏconsidered,€and€it€is€improper€to€take€a€word€or€a€few€words€fromÏits€context€and,€with€them€isolated,€attempt€to€determine€theirÏmeaning.€€òòFirst€Natððl€Bank€of€Memphis€v.€McCanlessóó,€186€Tenn.€1,€207ÏS.W.2d€1007,€1009„10€(1948).€€Although€tax€statutes€must€beÏliberally€construed€against€the€taxing€authority,€exemptions€areÏstrictly€construed€against€the€taxpayer,€who€has€the€burden€ofÏproving€entitlement€to€the€exemption.€€òòCape€Fear€Paging€Co.€v.ÍHuddlestonóó,€937€S.W.2d€787,€788€(Tenn.€1996);€òòCovington€Pike€Toyota,ÏInc.€v.€Cardwellóó,€829€S.W.2d€132,€135€(Tenn.€1992).ÌÌà àThe€issue€stated€in€the€certified€question€and€the€issueÏfocused€on€by€the€parties€is€actually€a€secondary€issue.€€TheÏcertified€question,€as€stated,€fails€to€recognize€that€the€exemptionÏunder€Tenn.€Code€Ann.€ðð€67„2„101(1)(B)(i)€is€not€for€òòbondsóó€but€onlyÏfor€"òò[o]rdinary€commercial€paper,€trade€acceptance,€etc.óó,€maturingÏin€six€(6)€months€or€less€from€the€date€of€issuance."€€(EmphasisÏadded).€€Lipscomb€asserts€that€ð ðalthough€the€Lipscomb€Bonds€have€aÏstated€maturity€date€of€May1,€2020,€they€function€for€all€intentsÏand€purposes€as€demand€instruments,€and€any€interest€on€the€Bonds€isÏexcluded€from€the€Hall€Income€Tax.ðð€€The€taxpayers€respond€that€ð ðtheÏLipscomb€Bonds€contain€numerous€terms€and€conditions€that€clearlyÏcontemplate€a€future€maturity€date€of€May1,€2020.€€Therefore€.€.€.Ïsuch€bonds€cannot€be€demand€or€short€term€instruments€maturing€inÏsix€months€or€less€of€the€date€of€issuance€and€are€therefore€notÏexempt€from€the€Hall€Income€Tax.ðð€ÌÌà àThe€first€issue€is€not€whether€the€bonds€mature€within€sixÏmonths.€€The€first€issue,€and€the€only€issue€that€need€be€resolvedÏin€this€case,€is€whether€the€bonds€are€ð ðbondsðð€within€the€meaning€ofÏthe€statute€or€if€they€are€some€other€type€of€obligation,€theÍinterest€on€which€may€be€exempt€from€taxation.€€If€they€are€ð ðbondsððÏwithin€the€meaning€of€the€statute,€there€is€no€applicable€exemptionÏand€interest€on€the€obligations€is€taxable.€€If€they€are€ordinaryÏpaper,€trade€acceptances,€or€similar€instruments€maturing€in€sixÏmonths€or€less€from€the€date€of€issuance,€then€they€are€not€bondsÏwithin€the€meaning€of€the€statute.€€The€statutory€provisionÏregarding€maturity€date€becomes€material€only€if€the€instruments€areÏfound€to€be€commercial€paper,€trade€acceptances,€or€other€similarÏinstruments.ÌÌà àThe€terms€"commercial€paper"€and€"trade€acceptance"€areÏnot€defined€in€the€tax€statutes.€€However,€both€terms€have€wellÏdefined€meanings.€€Black's€Law€Dictionary€defines€"commercial€paper"Ïas:ÌÓÓÌÌà8 àBills€of€exchange€(òòi.e.óó,€drafts),€promissoryÏnotes,€bank„checks,€and€other€negotiableÏinstruments€for€the€payment€of€money,€which,€byÏtheir€form€and€on€their€face,€purport€to€be€suchÏinstruments.€€Short„term,€unsecured€promissoryÏnotes€generally€issued€by€large,€well„knownÏcorporations€and€finance€companies.€€U.C.C.ÏArticle€3€is€the€general€law€governingÏcommercial€paper.ÌÌÌÌBlack's€Law€Dictionary€271€(6th€ed.€1990).€€"Trade€acceptance"€is€ÌÌdefined€as:ÌÌÌÌà8 àA€bill€of€exchange€or€draft€drawn€by€the€sellerÏof€goods€on€the€purchaser€and€accepted€by€suchÏpurchaser.€€Once€accepted,€the€purchaser€becomesÏprimarily€liable€to€pay€the€draft.€€See€U.C.C.€ððÏ3„413(1).ÌÌÌÌòòÓÓId.óó€at€1493.€€The€bonds€in€this€case€are€not€commercial€paper,€tradeÏacceptances,€or€similar€instruments.€€The€form€and€terms€of€theÏbonds€are€not€consistent€with€ordinary€commercial€paper€or€tradeÏacceptances€within€the€meaning€of€the€exemption€statute.€€Nor€canÏthe€term€"etc."€in€Tenn.€Code€Ann.€ðð€67„2„101(1)(B)(i)€be€construedÏto€bring€the€bonds€within€the€coverage€of€the€exemption€statute.€ÏUse€of€the€term€"etc."€at€the€end€of€a€series€of€terms€is€construedÏby€courts€to€import€other€things€or€purposes€of€like€character€withÏthose€already€named.€€òòDoty€v.€American€Tel.€&€Tel.€Co.óó,€123€Tenn.Ï329,€130€S.W.€1053,€1055€(1910).€€ÌÌà àThe€bonds€in€this€case€are€obligations€evidenced€byÏinstruments€whereby€the€obligor€is€bound€to€pay€interest€to€theÏobligees,€and,€consequently,€are€ð ðbondsðð€within€the€meaning€of€theÏstatute.ÌÌà àThe€Court€observed€in€òòUnion€&€Planters€Bank€&€Trust€Co.€v.ÏFortóó,€170€Tenn.€285,€95€S.W.2d€39€(1936),€that€the€definition€ofÍ"bond"€for€tax€purposes€is€broader€than€its€ordinary€meaning€in€aÏfinancial€context.ÌÓÓÌÌà8 àà àThe€word€"bond"€is€commonly€understood€inÏfinancial€circles€to€be€the€obligation€of€aÏstate€or€the€subdivision€of€a€state,€or€aÏprivate€corporation,€represented€by€aÏcertificate€for€the€principal,€and€by€detachableÏcoupons€for€the€current€interest.€€Ordinarily,Ïthe€meaning€expressed€by€the€word€"bond"€wouldÏnot€extend€to€and€include€all€interest„bearingÏobligations€of€persons,€firms,€and€corporations.€ÏTherefore,€in€order€to€give€the€word€a€broaderÏmeaning,€some€definition€was€necessary.ÌÌòòÌÌId.óó€at€40.€€ÓÓIn€òòShields€v.€Williamsóó,€159€Tenn.€349,€19€S.W.2d€261Ï(1929),€the€Court€addressed€the€constitutionality€of€variousÏclassifications€of€incomes€to€be€taxed€under€this€statute,€andÏcommented€upon€the€rationale€for€excluding€certain€short€termÏobligations€from€the€definition€of€"bond."€€The€Court€stated:ÌÓÓÌÌà8 àà àThe€only€debatable€classification€arisesÏfrom€the€proviso€contained€in€section€4€ofÏchapter€86€of€the€Acts€of€1929,€which€excludesÏfrom€the€obligations€described€as€bonds€in€thatÏsection€"ordinary€commercial€paper,€tradeÏacceptances€and€rent€notes,€etc.,€maturing€inÏsix€months€or€less€from€the€date€of€issuance."ÌÌà8 àà à.€.€.ÌÌà8 àà àWe€think€such€classification€isÏpermissible.€€Short„term€loans€are€employed€inÏmerchandising,€manufacturing,€and€trade.€€SuchÏbusiness€activities€produce€wealth€and€createÍnew€taxable€values.€€On€the€other€hand,€theÏproceeds€of€long„term€loans€are€used€ordinarilyÏfor€investment,€to€acquire€property,€not€toÏproduce€property,€not€to€create€new€taxableÏvalues.ÌÌÌÌòòÓÓId.óó,€19€S.W.2d€at€267.à à€€Ìà àÌà àLipscomb€cites€òòShackleford€v.€Olsenóó,€675€S.W.2d€171€(Tenn.Ï1984)€in€support€of€its€argument€that€interest€on€the€bonds€isÏexempt€from€the€Hall€Income€Tax.€€In€that€case,€a€corporation€issuedÏinstruments€of€indebtedness€bearing€interest€to€its€employees€whoÏlent€money€to€the€company€under€an€employee€investment€program.€€TheÏnotes€were€payable€thirty€days€after€demand.€€The€Court€concludedÏthat€the€exemption€applied€because€the€notes€effectively€were€demandÏnotes,€which€are€considered€to€mature€on€the€date€of€issuance.€€òòId.óóÏat€173„74.€€òòShacklefordóó€is€distinguishable€from€the€present€caseÏbecause€the€only€issue€in€òòShacklefordóó€was€the€time€within€which€theÏinstruments€matured.€€In€òòShacklefordóó,€the€Commissioner€of€RevenueÏhad€denied€exemption€under€Tenn.€Code€Ann.€ðð€67„2„101(1)(B)(i)Ïsolely€upon€the€basis€that€the€notes,€by€their€terms,€did€not€matureÏwithin€six€months€or€less€from€their€date€of€issue.€€TheÏCommissioner€of€Revenue€did€not€question€the€fact€that€the€notesÏwere€"ordinary€commercial€paper"€such€as€usually€pass€in€trade€butÏdenied€that€they€matured€within€six€months.€€òòId.óó€at€173.€€€WhetherÍthe€instruments€mature€within€six€months€would€become€material€inÏthe€case€before€the€Court€only€if€the€Court€should€conclude€that€theÏbonds€are€commercial€paper,€trade€acceptances,€or€similarÏinstruments.€€The€right€to€demand€payment€under€the€liquidity€demandÏprovision€of€the€bonds€does€not€alter€the€conclusion€that€they€areÏbonds,€not€ordinary€commercial€paper,€trade€acceptances,€or€similarÏinstruments.€€The€Court,€therefore,€does€not€reach€the€issue€ofÏwhether€the€bonds€mature€within€six€months€for€purposes€of€theÏexemption€in€Tenn.€Code€Ann.€ðð€67„2„101(1)(B)(i).€€€ÌÌà@ àò òIIIó óÌÌà àIn€response€to€the€certified€question,€the€bonds€in€thisÏcase€are€ð ðbondsðð€within€the€meaning€of€Tenn.€Code€Ann.€ðð€67„2„101(1)(A)€and€are€not€commercial€paper,€trade€acceptances,€or€aÏsimilar€type€of€instrument.€€Accordingly,€interest€on€the€bonds€isÏsubject€to€State€income€tax.ÌÌà àThe€Clerk€will€transmit€this€opinion€to€the€United€StatesÏDistrict€Court€for€the€Middle€District€of€Tennessee€and€counsel€forÏthe€parties€in€accordance€with€Rule€23,€Section€8€of€the€Rules€ofÏthe€Tennessee€Supreme€Court.€€The€costs€in€this€Court€will€be€taxedÏto€the€petitioner,€David€Lipscomb€University.Ìà àÌÓÓà àà àà àà àà à€€€_______________________________Ìà àà àà àà àà à€€€Reid,€J.ÌÌConcur:ÌÌAnderson,€C.J.,€Drowota,€Birch,€andÌ€€€€€Holder,€JJ.Ì€€Ì€€