2000 Legislation
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HOUSE BILL NO. 642 – Hospitals, charity care, reports


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Daily Data Tracking History

H0642...................................................by LOCAL GOVERNMENT
HOSPITALS - Amends existing law to require information regarding charity
care and net profits in reports from certain hospitals exempt from property
02/21    House intro - 1st rdg - to printing
02/22    Rpt prt - to Rev/Tax

Bill Text

  ||||              LEGISLATURE OF THE STATE OF IDAHO             ||||
 Fifty-fifth Legislature                  Second Regular Session - 2000
                              IN THE HOUSE OF REPRESENTATIVES
                                     HOUSE BILL NO. 642
                               BY LOCAL GOVERNMENT COMMITTEE
  1                                        AN ACT
  5    Be It Enacted by the Legislature of the State of Idaho:
  6        SECTION 1.  That Section 63-602D, Idaho Code, be, and the same  is  hereby
  7    amended to read as follows:
  9    purposes of this section, "hospital" means a hospital as  defined  by  chapter
 10    13,  title  39, Idaho Code, and includes one (1) or more acute care, outreach,
 11    satellite, outpatient,  ancillary  or  support  facilities  of  such  hospital
 12    whether  or  not  any such individual facility would independently satisfy the
 13    definition of hospital.
 14        (2)  The following property is exempt from  taxation:  the  real  property
 15    owned and personal property, including medical equipment, owned or leased by a
 16    hospital corporation which is operated as a hospital and the necessary grounds
 17    used therewith.
 18        (3)  If  real  property, not currently exempt from taxation, is being pre-
 19    pared for use as a hospital, the value of the bare land only  shall  be  taxed
 20    while  the  property is being prepared for use as a hospital. All improvements
 21    to and construction on the real property, while it is being prepared  for  use
 22    as  a  hospital,  shall be exempt from taxation. For purposes of this section,
 23    property is being "prepared for use as a  hospital"  if  the  corporation  has
 24    begun  construction of a hospital project as evidenced by obtaining a building
 25    permit that will, on completion, qualify such property for an  exemption  and,
 26    as  of  the  assessment date, has not abandoned the construction. Construction
 27    shall not be considered abandoned if it has been delayed by causes and circum-
 28    stances beyond the corporation's control or when delay is caused by  an  event
 29    that  has  occurred  in  the  absence  of the corporation's willful neglect or
 30    intentional acts, omissions or practices engaged in by the corporation for the
 31    purpose of impeding progress. Notwithstanding the foregoing, in no event shall
 32    improvements to property that is being prepared for use as a hospital  qualify
 33    for  an  exemption from ad valorem property tax under this subsection for more
 34    than three (3) consecutive tax years;  upon  completion  of  construction  and
 35    obtaining a certificate of occupancy, the entire real property shall be exempt
 36    from  taxation  if the corporation meets the requirements of subsection (4) of
 37    this section; provided, property already  exempt  or  eligible  for  exemption
 38    shall not be affected by the provisions of this subsection.
 39        (4)  The corporation must show that the hospital:
 40        (a)  Is  organized as a nonprofit corporation pursuant to chapter 3, title
 41        30, Idaho Code, or pursuant to equivalent laws in its state of  incorpora-
 42        tion;
 43        (b)  Has  received  an  exemption  from taxation from the Internal Revenue
  1        Service pursuant to section 501(c)(3) of the Internal Revenue Code.
  2        (5)  The board of equalization shall grant an exemption to the property of
  3    any hospital corporation meeting the criteria provided in  subsection  (4)  of
  4    this section.
  5        (6)  If  a  hospital  corporation uses property for business purposes from
  6    which a revenue is derived which is  not  directly  related  to  the  hospital
  7    corporation's  exempt  purposes, then the property shall be assessed and taxed
  8    as any other property. If property is  used in part by a hospital  corporation
  9    for  such  purposes, then the assessor shall determine the value of the entire
 10    property and the value of the part used that is not directly  related  to  the
 11    hospital  corporation's exempt purposes. If the value of the part which is not
 12    directly related to the hospital corporation's exempt purposes  is  determined
 13    to  be  three percent (3%) or less than the value of the entire property, then
 14    the property shall remain exempt. If the  value  of  the  part  which  is  not
 15    directly  related  to the hospital corporation's exempt purposes is determined
 16    to be more than three percent (3%) of the value of the entire  property,  then
 17    the  assessor  shall  assess the proportionate part of the property, including
 18    the value of the real estate used for such purposes.
 19        (7)  A hospital corporation issued an  exemption  from  property  taxation
 20    pursuant  to  this  section  and operating a hospital having one hundred fifty
 21    (150) or more patient beds shall prepare a community  benefits  report  to  be
 22    filed  with  the board of equalization by December 31 of each year. The report
 23    shall itemize and provide, under the signature of the hospital's auditor,  the
 24    amount  of charity care provided by the hospital and the hospital's net profit
 25    in the prior year, the hospital's amount  of  unreimbursed  services  for  the
 26    prior year (including charity care, bad debt, and underreimbursed care covered
 27    through  government programs); special services and programs the hospital pro-
 28    vides below its actual cost; donated time, funds, subsidies and  in-kind  ser-
 29    vices;  additions to capital such as physical plant and equipment; and indica-
 30    tion of the process the hospital has used to determine general community needs
 31    which coincide with the hospital's mission. The report shall be provided as  a
 32    matter  of community information. Neither the submission of the report nor the
 33    contents shall be a basis for the approval or denial of a corporation's  prop-
 34    erty tax exemption.

Statement of Purpose / Fiscal Impact

                STATEMENT OF PURPOSE 
     Non profit hospitals in Idaho submit community development plans pursuant to a
     change in the law in 1999. However, the plans do not contain information from a
     hospital's audited financial statements as to the amounts of charity care and net
     profits. This bill would require that such information be provided under signature
     of the hospital's auditor. Such a requirement would ensure the public has solid
     figures to track a hospital's progress in these areas from year to year and to
     compare one hospital to another. This bill does not require certain levels of
     financial commitment in these areas, but only that an auditor certify the amounts.
     This bill will ensure that accounting and auditing standards are applied to the
     reporting of these figures. 
                    FISCAL IMPACT
     There is no fiscal impact. 
     CONTACT:    Rep. David Bieter
                                                       STATEMENT OF PURPOSE/ FISCAL NOTE                               H