Christie calls for two-year ban on lawsuits by towns over hospital property taxes

New Jersey Governor and recent presidential candidate Chris Christie has called for legislation that would put a two-year ban on lawsuits by towns challenging a hospital’s tax-free status.

“It gives us time to come up not just with a solution, but the right solution,” Christie said, as quoted by Bloomberg Business.

Last summer, a court ruled that the 687-bed Morristown Medical Center in Morristown, N.J., functioned as a for-profit business and had to pay property taxes for the years 2006 through 2008. Christie’s moratorium comes after numerous towns have filed lawsuits against hospitals they believe are also functioning as for-profit businesses.

“If it is true that all non-profit hospitals operate like the Hospital in this case, as was the testimony here, then for purposes of the property tax exemption, modern non-profit hospitals are essentially legal fictions,” Judge Vito Bianco of the Tax Court of New Jersey said back in July 2015, as quoted by the Wall-Street Journal.

Christie added that a “patchwork” solution has been determined and that New Jersey’s 62 nonprofit hospitals needed to determine “with certainty” what their costs would be.

The New Jersey Hospital Association (NJHA) issued a statement in support of Christie’s proposed two-year ban.

“We thank Gov. Christie and legislators for crafting this reasonable approach to ‘stand down’ on litigation while the various stakeholders give thoughtful study to the matter,” Betsy Ryan, NJHA president and CEO, said in the statement. “ We also look forward to working with both the Senate and the Assembly to move this bill through the legislative process and provide the certainty that hospitals, and municipalities, seek.”