From the Record:
Non-profit acute-care hospitals that have money-making facilities would start making payments to offset the cost of services provided by host municipalities, according to a bill introduced Monday.
Currently, under tax laws that date back to 1913, such hospitals have blanket property tax exemptions on all their property, regardless of how much they profit from money-making ventures.
The proposed legislation, introduced by Senate President Steve Sweeney, Senator Robert Singer and Senator Joe Vitale, was worked out in agreement with the hospitals themselves. It would not change their tax-exempt status, but would require them to make defined payments to the municipalities to help pay for emergency services like police and fire protection.
The bill, called the Hospital Community Service Contribution Bill, would have non-profit hospitals that have for-profit operations make community service contributions directly to their municipalities. The payment formula would be $2.50 a day for each hospital bed and $750 a day for each facility providing satellite emergency care.
“The health care industry has changed substantially over the years, with hospitals engaged in a broad range of activities and services,” said Sweeney, a Democrat representing the counties of Salem and Gloucester.
“There is also a dramatic increase in competition among other hospitals and with other health care providers. The business has changed, but the tax laws have not. This legislation will have the hospitals pay their fair share while at the same time preserving their tax-exempt status,” Sweeney added.
Five percent of the payments under the measure would be sent to the county where the hospital is located. Any voluntary contributions by the hospitals would be deducted from the community service payments, and any hospital that is losing money could apply for an exemption from the payments.