Urbana council backs Prussing resolution on Carle tax exemption
URBANA — City council members on Monday night OK'd Mayor Laurel Prussing's resolution lamenting the loss of Carle Foundation Hospital's property tax payments to Champaign County taxing bodies.
The legislation, titled "A Resolution in Support of Hospitals Paying Their Fair Share," says a state law passed last year that exempts hospitals from property tax payments if their charity care exceeds their tax bill disproportionately affects Urbana.
"The removal of Carle property from Urbana's tax base will lead to higher tax rates and shift Carle's fair share onto all Urbana homeowners and all other businesses in Urbana; and ... higher tax rates will make Urbana less competitive for businesses and residents," according to part of the resolution.
Prussing has said she plans to bring the resolution to other Champaign County taxing bodies to encourage their support, too. Carle property comprises about 11 percent of the total value of all the city's taxable properties. The city stands to lose $830,000 this year, and the school district could see more than $3 million in losses.
Throughout Champaign County, taxing bodies could lose more than $6 million this year. Government officials are anticipating that the Carle losses will be picked up by the rest of property taxpayers in subsequent years.
Hospital officials say they provided $32 million in free or discounted healthcare last year, and $5.6 million of that went to Urbana residents. Another $8 million went to Champaign residents.
Prussing contends that Urbana and Champaign County will be disproportionately affected — 83 percent of Carle's tax-exempt property is in Urbana, while Urbana's population is only about 3 percent of the region that Carle serves, according to Prussing's resolution.
State Rep. Naomi Jakobsson, D-Urbana, is attempting to ease what has become known as the "Carle effect" on Urbana. She introduced legislation in May that would nullify the exemption in cases where a local community receives a "disproportional impact."
That legislation will not move quickly. State representatives adjourned their legislative session on Friday.