Chesterton Tribune

 

 

Hospital owes $600K to county but also has tax refunds coming

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By JEFF SCHULTZ

Porter County may not see new tax revenue right away from Porter Regional Hospital as it catches up with the abatement, but it will be able to net $600,000 from a provision in the tax abatement agreement requiring the hospital to dish out funds for economic development, according to Porter County Auditor Robert Wichlinski.

In June, the county came to an agreement with hospital officials to set the ten-year tax abatement starting in 2012 at an assessment of $117 million and $130 million for years 2013 and 2014.

But the hospital had been paying $297,717 per year on a prior assessment for $38 million while under appeals during those years.

After a series of discussions with the County Assessor and hospital tax representatives, Wichlinski arrived at the conclusion that the county currently owes the hospital $512,151 in tax refunds once the abatement is retroactively applied abatement, which is phased in over ten years. That does not include, however, the $105,326 the hospital will owe this year for its fall tax installment.

The hospital received its tax notices one week ago, Wichlinski said, and has a few days to decide whether its wishes for the county to write it a check to refund the taxes or to apply the balance as a credit for next year.

Wichlinski said the latter, in his opinion, would be a more preferable option because then the county would not have to take back revenues that were given to the corresponding taxing units for the refund. Porter Regional Hospital is located at U.S. Highway 6 and Ind. 49 in Liberty Township within the boundaries of the Duneland School Corporation.

The auditor's office will also be mailing a tax bill possibly today to TST Porter LLC Sanders Trust for the 60,000 square-foot medical office plaza next to the hospital. That, though, is not being abated as was determined in recent discussions between the County Council and the hospital.

TST will owe $8,729 on the 2012 pay 2013 assessment of $501,100 and $64,771 for taxes due this year on an assessment of $4,049,400.

The assessment for 2014 pay 2015 on the plaza has been set at $4,138,000. That includes just the real property--the building itself and improvements--and not personal property, the auditor's office said. The hospital is paying the taxes on the assessment for the land.

By the end of the year this year, however, the hospital is to dole out a lump sum of $600,000 which the county can put toward economic development.

According to the original abatement resolution that was approved by the County Council in 2009, the county may charge a fee during the ten years of the abatement, either $100,000 or a percentage multiplied by the amount of additional property taxes that would have been paid by the hospital had the abatement not been granted, whichever is the lesser value.

That would be for both real property values and personal property values which makes the amount owed to the County $200,000 over three years.

The resolution states that the money could be given to “one or more public or non-profit entities established to promote economic development,” but points to no one in particular.

The question came up at Thursday's County Redevelopment Commission of whether that board would be receiving the funds. Wichlinski told the RDC he believes that the County Commissioners have the power to decide since the charge of economic development falls under their auspices. Copies of the hospital bill were passed along to the Council and Commissioners last week but Wichlinski said he's heard no response from either as to what is to be done with the money.

The Commissioners would be able to pass an ordinance creating an account to hold the money but the County Council would get to vote on appropriating the money, he said.

Redevelopment Commissions have the power to create economic development areas and capture tax dollars to build infrastructure in those areas. Members are appointed by the County Commissioners and the Council.

 

 

Posted 8/25/2014

 
 

 

 

 

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