SPRINGFIELD – The suspense continues for Urbana's Provena Covenant Medical Center, which is waiting to hear whether its tax-exempt status will be restored.
Illinois Department of Revenue Director Brian Hamer on Thursday refused to say when he might issue his final decision, despite repeated questioning at a Senate confirmation hearing.
"This is a very complex matter," he said. "I take this responsibility very seriously and want to get it right."
Hamer said he received the administrative law judge's recommendation on the matter "a month or two" ago.
"It's now my responsibility to review that recommendation, as well as the record, and agree to accept it, reject it or modify it, which becomes the department's final decision," he said. "Then either the hospital or the county can appeal it to the circuit court."
Hospitals around the state and around the country have been watching the precedent-setting case closely, but it's been a long wait, especially for Provena.
"Over eight weeks ago the administrative law judge completed her recommended decision in the Provena Covenant case," said an e-mailed statement from Lisa M. Lagger, spokeswoman for the Provena Health system. "For some unknown reason, final release of that ruling is being delayed by the Department of Revenue. In the meantime, Provena Covenant is being required to expend millions of dollars in property tax payments that directly challenge the financial stability of our hospital, draining scarce resources from our ability to fulfill our faith-based mission of compassionately responding to the needs of our patients in the Champaign-Urbana community. The opinion is important to all tax-exempt hospitals in Illinois and should be released as soon as possible so that Provena Covenant is able to proceed in its case and regain its position as a charitable institution."
The matter dates back to January 2003, when the Champaign County Board of Review recommended that the state refuse to renew Provena's application for tax-exempt status. The Department of Revenue did just that in February 2004, which triggered a local property tax bill of over $1 million a year for Provena. The hospital appealed the ruling, and an administrative law hearing was held in December 2004.
At Provena's appeal hearing, the attorney representing the Department of Revenue said the central question was whether the hospital property's primary use was as a charitable institution or as a business, and argued that Provena had not proven to the state that it deserved the exemption.
The hospital's attorney claimed that Provena was indeed a charitable institution, with an 80-year history of giving medical care to all who needed it, regardless of their ability to pay.
Since the hearing, there's been no word from the Department of Revenue.
In the meantime, Illinois Attorney General Lisa Madigan has introduced legislation to set a minimum charity care requirement for tax-exempt hospitals which would equal at least 8 percent of their operating costs. Hospitals say it could put a severe financial strain on already-struggling facilities and may drive some out of business entirely.
State Sen. Kirk Dillard, R-Hinsdale, said the debate on Madigan's legislation prompted him to question Hamer about his timetable for a decision.
"I was just looking to see if the director was going to give us direction on his interpretation of not-for-profit hospital status before we act on Attorney General Madigan's bills," Dillard said, noting that the General Assembly is scheduled to adjourn on April 7. "I'm just trying to get a time frame."
Hamer said he was "very uncomfortable" giving any kind of specific time frame and refused to say when he might reach his decision.
"My guess is he's going to wait and see where the Legislature is going on the broader topic (of charity care) before he might act, but I don't know," Dillard said.