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UPMC Altoona, county revise payment deal

HOLLIDAYSBURG — A revised agreement has been signed in which UPMC Altoona will guarantee local taxing bodies a payment in lieu of real estate taxes for a five-year period, with an automatic renewal for five additional years unless the agreement is terminated.

Blair County commissioners have approved an updated version of an 2006-16 agreement providing the county with a payment in lieu of taxes, also referred to as a PILOT, of $140,900 annually for the 2017-21 fiscal years.

The agreement also guarantees a PILOT to the Altoona Area School District, at $245,042 annually, and to the city of Altoona, at $226,664 annually, for the same five fiscal years.

Those are the same payments listed in the former 10-year agreement. But the latest version also eliminates a clause the former 10-year agreement contained which allowed the hospital to reduce or make no PILOT payments in years of poor fiscal performance.

Local governmental leaders have been critical of that option over the years because they said it left them guessing as to whether they would receive the hospital’s payment.

“Now they’ll be able to count on it,” Blair County solicitor Nathan Karn said.

Karn credited attorney Janet Burkhardt of Pittsburgh with negotiating the agreement, which commissioners unanimously approved on Friday.

Karn said he believes the latest version is typical of agreements that UPMC has with other governments where UPMC facilities are located.

“This is more like a traditional PILOT,” Karn said. “What we used to have was an aberration.”

The earlier version was negotiated with the Altoona Regional Health System, the forerunner of UPMC Altoona.

Over the years, PILOT payments have been the preferred option to address a debate over whether nonprofit organizations, including hospitals, are entitled to claim exemption from the payment of real estate taxes under the Purely Public Charities Act.

By signing a PILOT, both sides are able to avoid the cost and uncertainty associated with the pursuit of legal action.

Jerry Murray, president of UPMC Altoona, said his organization is pleased to continue its long-standing commitment in support of the county, school district and city.

He described the payments as part of approximately

$40 million that UPMC Altoona provides annually in IRS-defined community benefits.

“As a strong leader in our region, UPMC Altoona remains focused on caring for our communities both inside and outside the hospital walls,” Murray said.

Mirror Staff Writer Kay Stephens is at 946-7456.

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