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June 23, 2014 (Cleveland)

Cleveland City Council President Discusses PILOT legislation



Cleveland City CouncilOn Wednesday, May 28, Bill Ryan, president and CEO, and Tony Gutowski, public policy development manager, met with Cleveland City Council President Kevin Kelley. The meeting, which was requested by The Center for Health Affairs, was to gauge the City Council’s interest in pursuing legislation that would require the city’s nonprofit institutions to participate in a Payment in Lieu of Tax (PILOT) program. 

The notion of PILOTs is nothing new, especially for Northeast Ohio’s hospitals, but the issue has become an increasingly hot topic over the past year. Late last year, Policy Matters Ohio released an updated report on the property taxes that are foregone by nonprofit hospitals in Northeast Ohio. Since then, members of local government have used this opportunity to reignite the controversial issue to gain public support. 

The meeting with Council President Kelley was to discuss what potential threats, if any, The Center’s members needed to be aware of. It is true that legislatively the Cleveland City Council has the ability to pass a law requiring that certain nonprofits submit payments to the municipal government in exchange for their foregone property tax payment, but no such legislation has been introduced at this point. 

Mr. Kelley was left with comparative data outlining several other PILOT programs in the U.S., which demonstrated that the actual amount of municipal revenue generated is minute relative to what the Cleveland Metropolitan School District needs to operate. Lastly, Mr. Kelley was left with information outlining both community benefit figures and the total payroll taxes collected by the city from The Center’s membership, demonstrating that the total dollar amount of community benefit the region receives from its hospitals far exceeds any dollars that would be collected if these institutions were not exempt from property taxes. 

For more information about this meeting or to learn about future meetings planned with Cleveland City Council members, please contact Tony Gutowski, public policy development manager, via email or by phone at 216.255.3610.

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