Sale of Local Hospitals Could Become a Nightmare for School Districts

By

The sale of four local hospitals to not-for-profit Reading Health System could halt property tax payments to school districts.

Local school district leaders are beginning to think through how they may have to triage bleeding budgets if the hospitals being acquired by the Reading Health System go tax-exempt.

Simply put, seller Community Health Systems is for-profit and Reading Health is not-for-profit.

Thus, possible property tax exemptions for Pottstown Memorial, Phoenixville, Brandywine, and Jennersville Regional hospitals could lead to a messy surgical removal of significant tax income for their school districts, according to a Philadelphia Inquirer report by Harold Brubaker.

“We are certainly concerned with the potential loss of the revenue,” said Pottstown School District Director of Community Relations John Armato. “I’m not being an alarmist. I’m just saying that we need to hear more about what their plan is moving forward.”

The hospitals are some of the largest property taxpayers in their respective school districts:

  • Pottstown Memorial is assessed at $20 million and recently paid a $923,998 tax bill, which was 3.2 percent of the district budget.
  • Phoenixville Hospital is assessed at $32 million and paid $940,702, or 1.6 percent of its district’s budget.
  • Brandywine Hospital carries a $21 million assessment in the Coatesville School District.
  • Jennersville is assessed at $19 million for the Avon Grove School District.

“We’re hopeful that we’ll be able to build a strong working relationship with them,” said Phoenixville Area School District Superintendent Alan Fegley, suggesting that Reading Health could provide some services to his school district or other community investments.

Read more about the potential tax impact of the Reading Health deal in the Philadelphia Inquirer here, and check out previous VISTA Today coverage of the acquisitions here.

Connect With Your Community

Subscribe to stay informed!

"*" indicates required fields

This field is for validation purposes and should be left unchanged.
Advertisement
Creative Capital logo