Palmer, Mass. Duns Tax Exempt Property Owners for PILOTs

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May 23, 2011; Source: The Republican | Since Boston’s Mayor Tom Menino mailed letters to tax-exempt hospitals and universities asking for “voluntary” payments in lieu of taxes (PILOT), municipalities throughout the state (and elsewhere in New England) have been hitting up tax-exempt property owners for money. The danger is not simply that tax-exempt entities are being taxed, even though the PILOTs are in theory voluntary, but that the definition of potential payers is going to be more than just big institutions with hefty endowments.

The 25 letters sent by the acting town manager of Palmer, Mass., Patricia A. Kennedy, went to Wing Memorial Hospital, but also to Camp Ramah, the Three Rivers Chamber of Commerce, the American Legion, Palmer Ambulance, and the Amvets. “We are looking for sources of revenue. We really should extend our tax base,” Kennedy straightforwardly revealed. “They have no obligation to pay that, but I would hope that in the spirit of good community cooperation they would make some kind of payment because they do use our town services, such as the ambulance, or police.”

How much is Kennedy asking the tax exempts to voluntarily ante up? For the Chamber of Commerce, $75.95 , $2,078.43 billed to the Union Evangelical Church, and $115,572.90 from the hospital. “I don’t see where there is anything to lose by asking,” Kennedy admitted.

We were particularly struck by the $5,180.64 bill sent to the Palmer Housing Authority. The Housing Authority is, presumably, a public sector entity, tax exempt because it is part of the governmental apparatus. Is Kennedy going to bill the Palmer post office? Will she send a bill to the Fire Department?

At some point in municipal efforts to eke out tiny sums from tax exempt property owners, this will become like exacting PILOTs from Peter to generate revenue for Paul who will then have to pay Peter for the services Peter delivers but can’t afford to because of the PILOTs paid to Paul . . . and so on and so on.—Rick Cohen