Chesterton Tribune

 

 

Hospital to get property tax bill; abatement questions remain

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By JEFF SCHULTZ

Porter County Auditor Bob Wichlinski told the County Council at its meeting Tuesday he is ready to mail Porter Regional Hospital tax bills totaling over $5.5 million based on the values the Property Tax Assessment Board of Appeals has assigned for 2012 and 2013.

The PTABOA ruled for the values to be $117 million and $244.5 million, respectively.

The revenue will be distributed appropriately among the respective taxing units, he said. The hospital is located in Liberty Twp. and within the Duneland School District at U.S. 6 and Ind. 49.

Wichlinski said there will likely be modifications over time as the hospital has appealed the two assessments to the Indiana Board of Tax Review, but he will issue the bill according to the information he’s received from the assessor’s office.

The County and the hospital have yet to agree, however, on what the assessed values should be for those two years, which also plays a part in setting the ten-year abatement.

Abatement issue progresses

Council Attorney Scott McClure said the hospital has retained Indianapolis Tax Attorney Tom Atherton to work on a solution to the abatement dispute with the County Assessor Jon Snyder. The parties met earlier in the day and had a “productive discussion” dealing with the issue, although no agreement came out of it, McClure said. He encouraged the Council to allow the conversation to continue as the next step in resolving the abatement.

“We’ve come further in the last 30 days than we have in two years,” McClure said.

Meeting with representatives from Porter Hospital’s parent company, Community Health Systems, just recently, McClure said hospital officials have heard the points made by the Council and are looking at the issues with “a fresh set of eyes.”

“I think they understand that time is of the essence and the Council will not lead this into becoming a negative issue,” he said.

Representatives from Porter Hospital were not present at Tuesday’s Council meeting, but in ongoing discussions McClure said it has been determined the ten-year tax abatement should have begun in the 2012 assessment year just as PRH was completing construction.

The hospital failed to file the 322/RE form required to start the abatement, but it can request the Council waive the missed deadline, he added.

Another determination made was that the 60,000 sq. ft. medical office building attached to PRH is not part of the abatement because the building’s owner, the Sanders Realty Trust, had not petitioned the Council, McClure said.

The Council does not have the responsibility of deciding the assessment but its objective is to judge whether the hospital is in compliance with the terms of the abatement granted in 2009, said council president Dan Whitten, D-at large.

One of those provisions is that the hospital structure would have to be valued at $130 million or more and it would not be compliant if the value was $39 million, he said, which is the value PRH is asserting in its latest assessment appeal.

Whitten and Council Vice-President Karen Conover, R-3rd, sent a letter to PRH representatives telling them to agree to a $130 million or higher for the building’s value or give up the abatement.

The County Assessor valued the hospital at $34 million in 2012 when it was 90 percent complete and $244.5 million last year with the assistance of an outside appraiser.

Last week, the hospital appealed the PTABOA’s decision on the 2013 assessment but, McClure said, that should not be taken as a sign the hospital is purposely going against the terms of the abatement, because it had a specific time frame in which to file an appeal to the IBTR.

“A hair more” in taxes

Council member Robert Poparad, D-at large, said he wanted to know if Porter has ever paid a tax to which Wichlinski responded it paid on the 2012 assessment, based on $34 million.

Wichlinski said he billed the hospital for $34 million the following year because when a taxpayer appeals their assessment, they are required by law to pay whatever the amount they previously agreed to.

Poparad then asked Wichlinski what assessed values of the hospital were put into the overall AV for each of those years.

With a lower assessment figure, Poparad said it would mean higher tax rates for those living in Duneland like himself. “We paid a hair more for what was not put into Duneland’s AV.”

Wichlinski said $34 million was included in the net AV in 2012 and $39 million in 2013 because those were the figures he had from the Assessor when he came up with the net assessed value to send on to the state. He said he did not put in the $117 million or the $244.5 million assessments because of the risk of shortchanging the taxing units if the hospital was successful in their appeals and the money had to be refunded.

Not being able to collect the hospital funds would mean the taxing units relying on that money would have less than anticipated, he added.

When asked by the Chesterton Tribune after the meeting if residential taxpayers in Duneland would ever see any benefits with the additional revenue from the hospital, Wichlinski said they would in the long run because if a taxing unit has a surplus of funds, it lowers the tax rate.

Wichlinski also said he would like to make it clear that he does not control the abatement or the assessment. He said his sole charge is to calculate and issue the tax bill.

 

Posted 4/23/2014