Penn State officials have received the ruling they anticipated concerning the taxability of the University Hospitals at The Milton S. Hershey Medical Center for 1994-97. The ruling, handed down Jan. 12 by the Court of Common Pleas in Dauphin County, states that the hospital can be taxed for those years. The ruling is consistent with earlier rulings by Judge Richard A. Lewis of the Dauphin County Court of Common Pleas. The medical center is located in Derry Township, Dauphin County.
This ruling in no way affects the University's tax status as determined under Act 55 of 1997, in which the state Legislature declared that Penn State property is public property and is exempt from real estate taxes, according to University officials.
Penn State, nevertheless, plans to appeal this decision.
"We do not believe a teaching hospital operated by a university, funded by the state and charitable resources for the public good, should be held liable for real estate taxes," said Gary Schultz, Penn State's senior vice president for finance and business.
The Dauphin County Court did concede in its opinion that Penn State, through the medical center, "advances a charitable purpose" and in fact meets four of the five criteria established to qualify as a purely public charity.
The recent decision is based on the court's belief that the University's hospital failed to "operate entirely free from private profit motive" during the years in question.
Penn State is a non-profit, charitable institution that applies all its resources for the sole purpose of advancing education, research and patient care for the betterment of the Commonwealth of Pennsylvania and for society at large.