The Institute for Wisconsin's Future (IWF) has just released an excellent and valuable report, "Hospitable Taxes: How Property Taxes Subsidize Wisconsin's 'Non-Profit' Hospital Industry." Hiding under the veneer of being "charitable" organizations, not-for-profit hospitals benefit from municipal services while paying no taxes to support them. In Wisconsin, 95% of hospitals have a non-profit designation, compared to a national average of 60%.
According to data obtained from the IWF report, Oshkosh's Mercy Medical Center is valued at $108,100,000. If paying property taxes, $837,775 would be owed to the city and $572,930 to Winnebago County. The hospital's annual revenue is $108,553,678.
Aurora Medical Center in Oshkosh is valued at $75,800,000. If paying property taxes, $587,450 would be owed to the city and $401,740 to the county. Aurora's annual revenue is $50,435,794.
The report notes that the process of a municipality trying to change the tax-exempt status of a hospital is time-consuming and costly. As a result, some municipalities have worked with hospitals to get them to participate in a PILOT ("Payment in Lieu of Taxes") program. Essentially, a PILOT program is a system of voluntary taxation.
In Oshkosh and Winnebago County we will be facing another difficult budget year. Hopefully the IWF report can serve as the spark necessary to get the Common Council, city administration, and Winnebago county officials to begin to look for ways to increase the hospitals' contribution to paying for the cost of city and county services.
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1 comment:
if hospital was "non profit" i would say do not tax, but we have a for profit health care system therefore they should be taxed.
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