Governor Signs Law Setting Municipal Contributions for Non-Profit Hospitals

Sarlo/Cryan/Vitale/Singleton Measure Will Protect Non-Profit Status, Provide for Consistent Municipal Payments

Trenton – The Governor today signed into law legislation sponsored by Senator Paul Sarlo, Senator Joe Cryan, Senator Joe Vitale and Senator Troy Singleton that will protect the non-profit status of hospitals while ensuring that they compensate their communities for municipal services.

The law, S-357/A1135, codifies the tax-exempt status for non-profit hospitals and for certain satellite emergency care facilities, allowing them to retain their non-profit status while they are assessed a community service contribution paid to the host municipality.

“This is an important law that protects the non-profit status of hospitals at the same time it provides for consistent and reliable contributions to their home communities,” said Senator Sarlo (D-Bergen/Passaic), chairman of the Budget Committee. “They play an important role in the lives and livelihoods of the towns and cities they serve with medical care. The relationships between the hospitals and their communities will be strengthened by this legislation.”

“Non-profit health care facilities have long been part of the lifeblood of the communities they serve,” said Senator Cryan (D-Union). “They have answered the call time and again when their professional health care services were most needed. This law makes sure that special relationship – between a hospital and those it serves – is maintained in a way that is reasonable and fair to all parties involved.”

“These hospitals continue to make invaluable contributions to our communities through an array of health care services,” said Senator Vitale (D-Middlesex). “At the same time, this plan will have them make meaningful financial contributions to their home towns at the same time it helps to bolster the important services the communities provide, including operations for first responders and emergency services.”

“Hospitals offer a substantial economic benefit to their communities through health care jobs and services. Equally as important, they are a significant presence in the community from donating to local charities and organizations to sponsoring local events,” said Senator Singleton (D-Burlington). “This community presence and generosity is bolstered by their non-profit status. Continuing to protect this status, as laid out in the bill, will ensure these hospitals remain major civic benefactors.”