With Guarantee, Harp Open To Hospital Tax

Paul Bass Photo A proposal to tax the real estate of not-for-profit hospitals like Yale-New Haven might be getting new life at the state Capitol.

State Senate President Martin Looney of New Haven said legislators are discussing a tweak to the original proposal to guarantee that hospitals would ultimately not lose money in the deal.

Gov. Dannel P. Malloy originally proposed enabling legislation in February to allow municipalities to levy property taxes on not-for-profit hospitals as part of a broader package of increased urban aid; he said he was promising to find ways to shield cities from the brunt of overall cuts at the time of a $1.7 billion projected deficit in the coming year’s state budget. Each city would make its own decision about whether to pursue the new hospital taxes. Malloy’s proposal counted on increased Medicaid reimbursements from the federal government to return the lost revenue to the hospitals.

At the time, New Haven Mayor Toni Harp said she was disinclined to have the city tax Yale-New Haven property, in part because the plan by Republican leaders in D.C. to cashier the Affordable Care Act (“Obamacare”) convinced her that the state couldn’t count on future increases in Medicaid reimbursements.

Harp revised her position this week after meeting with Looney and learning that legislators might include a guarantee to the proposal — that if federal reimbursements drop, the state will make up the difference.

“If that happens, that takes my objection off the table,” Harp said during her latest appearance on WNHH radio’s “Mayor Monday” program. Harp’s administration, trusting in Malloy’s promise of increased urban aid, is counting on $31 million more from the state this year to balance its $554.5 million proposed city budget for the fiscal year beginning July 1. So the maneuvering in Hartford over the upcoming state budget, especially when it comes to municipal aid, will determine whether the city budget adds up.

“That would take care of it,” Harp said of a potential hospital property tax.

Harp said her administration calculated last month that it would collect $33 million from real estate taxes on Yale-New Haven in the coming year under the proposal. Then the city completed its twice-a-decade citywide property reassessment. In recent weeks, based on the new numbers, it calculates it would collect $50 million from Yale-New Haven in the coming year.

(Though under another Malloy proposal, to require municipalities to start contributing to teacher pension payments, the city would be on the hook for a new $15 million tab, netting New Haven around $35 million overall, Harp said.)

Without the new proposed guarantee of state back-up money to return to hospitals, Malloy’s idea would not pass, Looney said in an interview. He said he supports the new taxing authority as a way to help cities like New Haven make up for budget challenges. Asked whether the state should simply increase reimbursements to cities under the Payment in Liu of Taxes (PILOT) program instead, Looney noted that PILOT was never designed to match all lost local dollars, so cities would make out better this way.

Looney also said that because the federal government currently has a two-to-one match for state Medicaid spending, the proposal — assuming rules for Medicaid reimbursement don’t change; or the proposed state guarantee makes up the difference— would generate $250 million in new municipal revenues statewide, and reimburse hospitals $38 million more than they’d pay out for property taxes.

Wary of past clashes with Malloy, however, the hospitals still aren’t buying.

The Connecticut Hospital Association remains “strongly opposed” to the property tax, said spokeswoman Elizabeth Hamilton.

“Our hospitals are the bedrock of our society and have strong and unique partnerships with their local communities. This scheme would undermine these partnerships. We need healthcare policies that are sustainable and improve the quality and access to care, not more taxes that are just bad policy. Hospital funding should be used to care for patients, not to solve municipal and state government budget problems.”

Yale-New Haven, too, remains opposed, according to Vice-President Vin Petrini. He said that Yale-New Haven Health System is now the state’s top taxpayer at over $200 million thanks to the six-year-old hospital provider tax. “Back in 2011, the state promised hospitals they would make them whole” for the provider tax, and that never happened, Petrini said. “We would have serious and grave concerns about any additional taxes. Those dollars should be used for care for patients.”

Click on or download the above audio file to hear the full episode of WNHH radio’s “Mayor Monday.”

The episode of was made possible with the support of Gateway Community College and Berchem, Moses & Devlin, P.C.

Following is a status report on bills of particular interest to New Haven before the state legislature this session:

The 2017 Agenda

Bill #StatusSummarySponsors
SB11/ HB5539Committee DeniedWould legalize, tax recreational use of marijuana.Candelaria
Dillon
Lemar
Walker
Porter
et al
SB 17Committee ApprovedWould make certain undocumented immigrant students (DREAMers) eligible for state college financial aid.Looney
HB 5434Committee ApprovedWould have CT join with other states to elect the President based on popular, rather than Electoral College, vote.Winfield,
Porter
Albis
Elliott
D'Agostino
et al.
HB 5458, HB 6058Committee ApprovedWould establish electronic tolls on state highways.Genga
HB 5575/HB 7126Passed SenateWould regulate companies such as Uber and Lyft.Scanlon
HB 5589Passed HouseWould expand disclosure requirements for contributions to campaign funds.Dillon
Lemar
D'Agostino
Elliott
et al.
HB 5591Passed HouseWould require equal pay for employees doing comparable work.Dillon
Walker
Lemar
Albis
D'Agostino
Elliott
et al.
HB 5703Committee DeniedWould have CT enter into an agreement with other states to limit "poaching" of each other's businesses.Lemar
HJ 13/HJr 95Passed HouseWould amend the state constitution to permit early voting.Lemar
HJ 16In CommiteeWould amend the state constitution to permit absentee voting for all voters.Lemar
SB 1/HB 6212Committee ApprovedWould require employers to provide paid family and medical leave for their employees.Looney
SB 2Committee ApprovedWould make the education funding formula more equitable.Duff
SB 8Committee DeniedWould allow municipalities to adopt a 0.5% sales tax.Looney
SB 10/HB 5743Passed SenateWould strengthen hate crime laws.Winfield
SB 13/HB 6208/HB 6456Committee ApprovedWould increase the minimum wage.Looney
Winfield
et al.
Albis
Candelaria
D'Agostino
Elliott
Lemar
Paolillo
Porter
Walker
SB 137Committee DeniedWould expand birth-to-three and provide universal pre-school, among other things.Gerratana
SJ 5/HJ 1Passed HouseWould amend the state constitution to create a "lock-box" for transportation funding.Duff
HB 5588Committee DeniedWould limit certain bond allocations.Dillon
Lemar
Albis
Walker
Elliott
et al.
HB 5912HB 6127Committee DeniedWould establish a 1-cent/ounce tax on sugared beverages.Lemar
Elliott
et al.
HB 6554Committee DeniedWould tax carried interest as ordinary income.Porter
Albis
Lemar
Elliott
Winfield
Candelaria
Dillon
D'Agostino
et al.
HB 5831Committee DeniedWould provide bonding for transitional housing for NH female ex- offenders.Porter
Candelaria
Lemar
Winfield
Looney
Paolillo
SB 631Committee DeniedWould provide bonding to make structural improvements to the Shubert Theatre.Winfield
Looney
Walker
Porter
Lemar
Candelaria
Paolillo
HB 6863Committee DeniedWould authorize bonds for renovating the Barbell Club as a youth/ community center.Canelaria
Porter
Paolillo
Lemar
Winfield
SB 649Committee ApprovedWould allow local building officials to impose fines for building w/o a permit.Looney
Winfield
Walker
Candelaria
Lemar
Porter
Paolillo
Et al.
SB 590/591Committee DeniedWould limit police ccoperation w/Immigration and Customs Enforcement (590); establish an immigrant's bill of rightsWinfield
SB 20Committee DeniedWould require affordability to be considered in reviewing proposed health insurance rate hikes.Looney
HB 6352Committee ApprovedWould establish a deposit system for car tires.Ritter
Gresko
McCrory
HB 6901Committee DeniedWould impose a surtax on large employers that pay an average wage less than $15/hour.Elliott
HB 7278Passed SenateWould convey various parcels to New Haven, among other things.Gov't Administration and Elections

Tags: , , ,

Post a Comment

Commenting has closed for this entry

Comments

posted by: southwest on March 16, 2017  7:25am

What about all of these no taxable churches who get everything in the church names from cars to furs so they don’t have to pay taxes..with 10 churches on each block they most definitely need to pay some taxes with all the monies fundal thur churches and other so called non profits…who came up with this so call nonprofit status anyway..in my opinion it has served its purpose because so many people has used it for their advantage to make a propet and others taxpayers got to pick up the tab without anyone their to bail us out when we are in need..so what happens if Yale and other nonprofits bought up all the property in the city…would it then become a nonprofit city where nobody payed taxes..how do or would that scenario work?.??  Who would be responsible for the infrastructure in the cities… just so courious about all these debates in which nobody is coming up with a common sense solution all hypothetical answers with them trying to hide the real answers from their constituents..just saying!!

posted by: Noteworthy on March 16, 2017  7:51am

Voodoo and Doodoo Notes:

1. Malloy and state legislators like Martin Looney and the entire New Haven state delegation all promised Yale New Haven Hospital that if it stepped up under the ACA - that the increased federal dollars would be returned to them and be a wash. As the state’s deficit worsened, the promised was quickly broken and now the hospitals as a group are paying $600 million in taxes.

2. The state guarantee isn’t worth the idea in Looney and Mayor Harp’s heads. The state has no pot of money from which such a guarantee could be harvested. The state is broke. It is looking at billions in deficit that last as far as one can project. Today’s state financial problem has its roots in fuzzy math and shallow thinking.

3. This is nothing but voodoo thinking and it will drop a load of doodoo on local taxpayers and Yale New Haven Hospital. The result will be higher property taxes and for sure, higher healthcare costs when those additional taxes are dropped on consumers.

4. The city’s budget is in poor condition because we employ too many people; benefits and overtime are out of control; there is zero risk management, we have far too many schools and HR issues controlled by department heads and the mayor are chronically bad to the worst I’ve ever seen anywhere. Constant litigation and subsequent losses have cost taxpayers tens of millions and the poor practices continue.

5. So, dump this terrible idea. It is smoke and mirrors and it’s a recipe for yet more broken promises from the governor and the dome dwelling political elites that have wrecked this state’s finances. More bad decisions will not fix the problems years in the making and that continue to be made.

posted by: southwest on March 16, 2017  10:08am

Thank you “Noteworthy ” for shedding some insight on this..it make sense that if Yale is tax the burden will be passed on to the taxpayers and people who pay for healthcare..it’s a no brainer someone got to pick up the tab…I really don’t understand how they continue to spend moneies on frivolous projects like it’s their own personal “Slot Machine”.. as much as people in office say they are there to change things it stays the same with just a different “Caption”..

posted by: alphabravocharlie on March 16, 2017  7:28pm

Tax hospitals, great idea. What could go wrong? They don’t call him Looney for nothing.