By Michael Hill
Correspondent
You could say the builders of the Hudson Riverfront hospital and nursing home had a view and a vision — that some day North Bergen would realize the true value of the township bordering Manhattan with priceless vistas.
“The land is very, very expensive,” said Sen. Nick Sacco.
Up and down River Road from one town to the next, high-rise and low-rise apartment buildings and condos and businesses and the sounds of what’s to come across the river from Manhattan — more development.
There was a time when not much value was placed on this land. That’s when the hospital went up as a for-profit institution, meaning it would be paying property taxes. But, the senator says before it even opened, it switched its status to nonprofit, meaning it’s not paying any property taxes even today on land the senator says is some of the most valuable in all of America.
North Bergen values the land of the nonprofit Palisades Medical Center and its Harborage nursing home at $20 million and the buildings at more than $38 million for a total of more than $58 million, yet they’re tax exempt and North Bergen doesn’t collect a dime in taxes for any city services.
“They’re on the Gold Coast. It would be fair for the taxpayers to get some relief,” Sacco said.
Sen. Sacco and North Bergen are delivering a one-two punch to the hospital and nursing home. The township has sued the hospital and nursing home in tax court — emboldened by another tax court ruling that the nonprofit Morristown Medical Center essentially functions just like for-profit hospitals and must pay some property taxes.
“We’re hoping that the legislation will pass and the suit will stop,” Sacco said.
Sen. Sacco, who’s also the mayor of North Bergen, has introduced a bill to keep the tax exempt status for nonprofit hospitals and their nursing homes but to allow cities to charge them $2.50 a day for each of their licensed beds.
“This would be [in lieu of taxes]. They still would not have to pay taxes. If they had to pay taxes for the land that they’re on, it might make them totally non-competitive as a hospital,” Sacco said.
In a statement, the Harborage says it “enjoys a productive and amicable relationship with North Bergen. … Both parties maintain strong communications with each other and this was a matter of process in absence of legislation that addresses the issue. We look forward to our continued discussions with North Bergen and are confident that an equitable solution will be reached … while ensuring that the services for Harborage residents and patients are not compromised.”
“Sometimes enough may need to be enough,” said Jon Dolan, president and CEO of the Health Care Association of New Jersey.
Dolan represents long-term care providers. He says tax-happy New Jersey should define by law what qualifies a hospital or nursing home as nonprofit or for-profit and also consider nursing facilities costly federal mandates to take patients in.
“Without respecting and understanding the service that which one non-for-profit provides, you can’t really start a policy discussion about what should be required or not,” he said. “Why would we ask them to pay anything if they’ve been here a hundred years and taking care of the poor of a community? They are a non-for-profit.”
Other nonprofit industries are paying close attention to the tax court ruling, this debate and Sen. Sacco’s legislation and wondering if and when collecting property taxes or payments in lieu of taxes will land on their doorstep.