HELD: L. 2021, c. 17 (Chapter 17), effective February 22, 2021, was enacted to continue the local property tax (LPT) exemption afforded to nonprofit hospitals, and to extend the same exemption to a nonprofit hospital-owned satellite emergency facilities (SECs), even if areas of the hospital and SECs are used by/leased to, for-profit medical providers “for medical purposes related to delivery of health care services directly to the hospital,” provided that such “portion of the hospital . . . is used exclusively for hospital services.” The nonprofit hospitals and SECs should pay an annual community service contribution (ACSC) to the municipality in which the hospital beds of a nonprofit hospital are located or where an SEC is located. Chapter 17 also bars imposing assessments for tax years 2014 through 2020, which would moot those years’ pending tax appeals all filed because of the alleged for-profit activity conducted by the hospital and/or the for-profit medical providers on the nonprofit hospital premises. The law was enacted to mitigate the effects of a 2015 Tax Court decision which revoked the tax exemption of a nonprofit hospital’s property based on facts that the operations/activities of the plaintiff nonprofit hospital and the for-profit, private medical providers on the hospital property were too blurred.
The court here found that (1) the ACSC is not an ultra-vires payment-in-lieu of tax program; (2) the ACSC is not a local property tax for purposes of the Uniformity Clause of the New Jersey Constitution; (3) Chapter 17 is facially constitutional and does not violate the Exemption Clause of the New Jersey Constitution; (4) Chapter 17 is not an invalid special legislation, thus also does not facially violate the Equal Protection Clause of the federal and State constitutions; and (5) Chapter 17’s retroactivity is not manifestly unjust, thus, also does not violate the Due Process Clause of the federal and State constitutions. The court further found there are no bases for imposing an injunction against Chapter 17 under any of the factors enunciated in Crowe v. DeGioia, 90 N.J. 126, 132-34 (1983). The court therefore dismissed the complaint with prejudice.