WOONSOCKET â State and local officials of the cash-strapped city took action on two fronts this week to bolster its authority to pry from Landmark Medical Center some sorely needed tax revenue for the first time.
Nobody knows yet how much Landmark will pay, although Prime Healthcare Servicesâ application to buy the hospital estimated the amount would be almost $2 million a year. After lengthy review by state regulators, the California-based hospital chain closed on the sale of Landmark in a $60 million deal last year, converting the non-profit facility into the stateâs first for-profit hospital, thereby eliminating its tax-exempt status.
The city has never questioned Primeâs willingness to live up to its promises. But at the same time some officials see a loophole in the law that may give the company an avenue to avoid taxes on real estate and pricey medical technology â and they want it closed.
âWe really donât anticipate a problem,â said Finance Director Thomas M. Bruce III. Still, he said, âWeâre making sure itâs foolproof.â
To that end, the Senate Finance Committee on Tuesday recommended passage of a bill that would close the loophole and establish procedures for taxing for-profit hospitals for the first time. The bill was co-sponsored by State Sen. Roger A. Picard (D-Dist. 20, Woonsocket, Cumberland), State Sen. Marc A. Cote (D-Dist. 24, Woonsocket, North Smithfield) and Finance Committee Chairman Sen. Daniel DaPonte (D-Dist. 14, East Providence).
Picard said the measure was sought by local officials after the sale of Landmark, but it will apply to other for-profit hospitals that are likely to emerge as health care facilities increasingly partner up with larger entities in a âfast changing health care landscape.â
Echoing Bruce, Picard said he fully expects Prime to live up to the assurances the company has previously made on its willingness to pay local taxes. Nevertheless, he said, current law seems to suggest that all hospitals are exempt from taxes. Itâs silent on the issue of whether the facilities must be charitable, non-profit entities or for-profits to qualify, an ambiguity some say could be construed to mean that all hospitals are exempt, period.
Read the full story in Thursday's newspaper.