Bill Text: NJ A2837 | 2018-2019 | Regular Session | Introduced
Bill Title: Maintains property tax exemption for certain non-profit hospitals with on-site for-profit medical providers.
Spectrum: Partisan Bill (Republican 1-0)
Status: (Introduced - Dead) 2018-02-01 - Introduced, Referred to Assembly State and Local Government Committee [A2837 Detail]
Download: New_Jersey-2018-A2837-Introduced.html
Sponsored by:
Assemblyman RONALD S. DANCER
District 12 (Burlington, Middlesex, Monmouth and Ocean)
SYNOPSIS
Maintains property tax exemption for certain non-profit hospitals with on-site for-profit medical providers.
CURRENT VERSION OF TEXT
As introduced.
An Act maintaining the property tax exempt status of certain non-profit hospitals and amending R.S.54:4-3.6.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. R.S.54:4-3.6 is amended to read as follows:
54:4-3.6. The following
property shall be exempt from taxation under this chapter: all buildings
actually used for colleges, schools, academies or seminaries, provided that if
any portion of such buildings are leased to profit-making organizations or
otherwise used for purposes which are not themselves exempt from taxation, said
portion shall be subject to taxation and the remaining portion only shall be
exempt; all buildings actually used for historical societies, associations or
exhibitions, when owned by the State, county or any political subdivision
thereof or when located on land owned by an educational institution which
derives its primary support from State revenue; all buildings actually and
exclusively used for public libraries, asylum or schools for adults and
children with intellectual disabilities; all buildings used exclusively by any
association or corporation formed for the purpose and actually engaged in the
work of preventing cruelty to animals; all buildings actually and exclusively used
and owned by volunteer first-aid squads, which squads are or shall be
incorporated as associations not for pecuniary profit; all buildings actually
used in the work of associations and corporations organized exclusively for the
moral and mental improvement of men, women and children, provided that if any
portion of a building used for that purpose is leased to profit-making
organizations or is otherwise used for purposes which are not themselves exempt
from taxation, that portion shall be subject to taxation and the remaining
portion only shall be exempt; all buildings actually used in the work of
associations and corporations organized exclusively for religious purposes,
including religious worship, or charitable purposes, provided that if any
portion of a building used for that purpose is leased to a profit-making
organization or is otherwise used for purposes which are not themselves exempt
from taxation, that portion shall be subject to taxation and the remaining
portion shall be exempt from taxation, and provided further that if any portion
of a building is used for a different exempt use by an exempt entity, that
portion shall also be exempt from taxation; all buildings actually used in the
work of associations and corporations organized exclusively for hospital
purposes, provided that if any portion of a building used for hospital purposes
is leased to profit-making organizations or otherwise used
for purposes which are not themselves exempt from taxation, that portion shall
be subject to taxation and the remaining portion only shall be exempt,
provided further that a lease to or other use by profit-making medical
providers, for purposes which are not otherwise exempt from taxation, of a
portion of a building used for hospital purposes shall not subject that portion
of the building to taxation if the association or corporation organized
exclusively for hospital purposes is determined by the federal Internal Revenue
Service to be a tax exempt organization pursuant to paragraph (3) of subsection
(c) of section 501 of the federal Internal Revenue Code (26 U.S.C. s.501) ;
all buildings owned or held by an association or corporation created for the
purpose of holding the title to such buildings as are actually and exclusively
used in the work of two or more associations or corporations organized
exclusively for the moral and mental improvement of men, women and children;
all buildings owned by a corporation created under or otherwise subject to the
provisions of Title 15 of the Revised Statutes or Title 15A of the New Jersey
Statutes and actually and exclusively used in the work of one or more
associations or corporations organized exclusively for charitable or religious
purposes, which associations or corporations may or may not pay rent for the
use of the premises or the portions of the premises used by them; the
buildings, not exceeding two, actually occupied as a parsonage by the
officiating clergymen of any religious corporation of this State, together with
the accessory buildings located on the same premises; the land whereon any of
the buildings hereinbefore mentioned are erected, and which may be necessary
for the fair enjoyment thereof, and which is devoted to the purposes above
mentioned and to no other purpose and does not exceed five acres in extent; the
furniture and personal property in said buildings if used in and devoted to the
purposes above mentioned; all property owned and used by any nonprofit
corporation in connection with its curriculum, work, care, treatment and study
of men, women, or children with intellectual disabilities shall also be exempt
from taxation, provided that such corporation conducts and maintains research
or professional training facilities for the care and training of men, women, or
children with intellectual disabilities; provided, in case of all the foregoing
except for a hospital , the buildings, or the lands on which they stand,
or the associations, corporations or institutions using and occupying them as
aforesaid, are not conducted for profit, except that the exemption of the
buildings and lands used for charitable, benevolent or religious purposes shall
extend to cases where the charitable, benevolent or religious work therein
carried on is supported partly by fees and charges received from or on behalf
of beneficiaries using or occupying the buildings; provided the building is
wholly controlled by and the entire income therefrom is used for said
charitable, benevolent or religious purposes; and any tract of land purchased
pursuant to subsection (n) of section 21 of P.L.1971, c.199 (C.40A:12-21), and
located within a municipality, actually used for the cultivation and sale of
fresh fruits and vegetables and owned by a duly incorporated nonprofit
organization or association which includes among its principal purposes the
cultivation and sale of fresh fruits and vegetables, other than a political,
partisan, sectarian, denominational or religious organization or association.
The foregoing exemption shall apply only where the association, corporation or
institution claiming the exemption owns the property in question and is
incorporated or organized under the laws of this State and authorized to carry
out the purposes on account of which the exemption is claimed or where an
educational institution, as provided herein, has leased said property to a
historical society or association or to a corporation organized for such
purposes and created under or otherwise subject to the provisions of Title 15
of the Revised Statutes or Title 15A of the New Jersey Statutes.
As used in this section , "hospital purposes" includes health care facilities for the elderly, such as nursing homes; residential health care facilities; assisted living residences; facilities with a Class C license pursuant to P.L.1979, c.496 (C.55:13B-1 et al.), the "Rooming and Boarding House Act of 1979"; similar facilities that provide medical, nursing or personal care services to their residents; and that portion of the central administrative or service facility of a continuing care retirement community that is reasonably allocable as a health care facility for the elderly ; and
"Medical provider" means an individual or entity which, acting within the scope of its licensure or certification, provides health care services, and includes, but is not limited to, a physician, physician assistant, psychologist, pharmacist, dentist, nurse, paramedic, respiratory care practitioner, medical or laboratory technician, ambulance or emergency medical worker, orthotist or prosthetist, radiological or other diagnostic service facility, bioanalytical laboratory, and health care facility; and further includes administrative support staff of the individual or entity.
(cf: P.L.2011, c.171, s.4)
2. This act shall take effect immediately.
STATEMENT
This bill would maintain the property tax exempt status of non-profit hospitals with for-profit medical providers on site as long as the hospital remains exempt from taxation under the federal Internal Revenue Code. The bill would help these non-profit hospitals avoid additional costs by preserving their property tax-exempt status.
The Tax Court recently held that a non-profit hospital was not entitled to a property tax exemption because profit-making medical services were provided throughout the hospital. Since for-profit medical services are commonly provided at non-profit hospitals in the same manner, this ruling could potentially be applied to many other non-profit hospitals throughout the State. The loss of property tax exempt status for these non-profit hospitals is likely to raise health care costs. This bill would help rein in health care costs by preserving the property tax exempt status of non-profit hospitals that lease space to for-profit medical providers, but still qualify as tax exempt charitable organizations under federal law, which would in turn help these hospitals fulfill their charitable purposes.
