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leasing activity was performed mainly to expose the artwork to
people who otherwise would not have seen it, rather than as a
revenue-generating activity.
At this point, we recall the stated purposes of the Museum.
The Museum was created to expose people to the outdoor arts and
to promote interest in outdoor objects as art forms. By offering
the building spaces for special events, the Museum argues that it
effectively exhibited the artwork to an audience who normally
would not have come to the Greenwood Plaza and viewed the
exhibits. This rationale is consistent with the Museum's stated
purposes. Accordingly, we conclude that the Museum's leasing of
building spaces to members of the public was substantially
related to its exempt purpose. Therefore, the revenue generated
by this activity is not UBTI.
Issue 2. Leasing of FGA
The second issue for decision concerns whether the Museum
realized UBTI from leasing FGA to MCA. In the notice of
deficiency, respondent determined that revenues from the lease
with MCA constitute income from a trade or business, regularly
carried on for profit and not substantially related to the exempt
function of the Museum, thereby resulting in UBTI under section
513. The Museum disputes this determination.
The Museum contends that the leasing activity did not rise
to the level of a trade or business, and, even if it did, it was
not regularly carried on. In making this determination, the size
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