Northern Dutchess Hospital’s assessed property value has just been increased by more than $1 million.
According to the Town of Rhinebeck assessor’s office, the hospital will begin paying more property tax on its for-profit lease space next year. While an exact amount of the additional tax will not be clear until tax rates are published for 2014, it could mean as much as $30,000 more for school, town and village coffers.
Assessment records show that the hospital’s new assessed value for 2013 is approximately $4,343,900, which is $1,223,800 more than its 2012 assessment of $3,120,100. The balance of the hospital buildings and property, estimated at close to $110 million, are operated as non-profit and remain tax exempt.
Tax records show that the hospital paid $88,748 on the 2012 assessment, which was based on property valued at $2,887,100 in the village and $233,000 in the town. All together, the hospital owns about 50 acres of property within the town, including the main hospital campus and four smaller parcels adjacent to it. The bulk of hospital property is located in the village, but the hospital also owns a 30.9 acre vacant lot that straddles town and village property, 23.3 acres of which is in the town.
It is still unclear what the new assessment was based on and whether the hospital, which is run as a nonprofit, had been previously paying taxes on the for-profit offices that doctors and other medical personnel lease on its campus.
None of the three town assessors were available to comment in time for this story.
But Elizabeth Spinzia, the town board liaison to the assessor’s office, told The Observer, “The assessors and the hospital agreed on an assessment [within the last year] for all of the property that is used for profit and they do pay tax on that, such as doctors’ offices within the hospital.”
The issue of tax payments surfaced earlier this year when officials for Health Quest, which owns the hospital, approached the village board to outline a proposed new $30-million wing for the hospital. The two top floors would include 40 single-bed patient rooms and six new operating rooms and would be tax-exempt. The bottom floor would be leased to various physicians and medical providers as a for-profit venture.
Hospital representatives could only confirm to The Observer that a new assessment had been made and that the hospital would not be pursuing a payment in lieu of taxes (PILOT) deal for their new addition. Village officials had already rejected the PILOT request after the expansion was proposed.
Spinzia said she did not know how the change in assessment came about because she has only been liaison to the assessor’s board for half a year.
“We have an incredible group of assessors and they researched this and began the conversation. They work hard to maintain our taxable records, which is our source of revenue. They do a fantastic job for the town,” she said.