SPRINGFIELD, Ill.—Fitch Ratings said Illinois' review of not-for-profit hospital property tax breaks could be a “negative credit development” for some of the state's healthcare borrowers. Fifteen unidentified hospitals are under review by the Illinois Department of Revenue, Fitch said in a newly released report. The New York-based ratings agency rates 19 hospitals and health systems in the state, the report said. Fitch analysts will separately evaluate each hospital's credit risk based on its property assessment, tax rate, credit profile and its plan to “absorb the impact on operating profitability” from tax payments, according to the report. “Clearly, Fitch believes the higher-rated borrowers are in better position to absorb the additional expense of property taxes, while for lower-rated borrowers the impact may be more profound,” according to the report. Three Illinois hospitals lost property tax breaks last fall, and hospitals and lawmakers failed to meet a March deadline to draft legislation that would have defined criteria for exemption. That prompted the state's governor to lift a moratorium on further reviews of hospital tax breaks. Meanwhile, five Illinois hospitals withdrew their applications for exemptions, leaving about 17 with applications pending, the Associated Press reported. “It's not a surprise, given the risk of denial that might be involved in having an application reviewed now when a potential legislative solution with clear standards is close at hand,” Illinois Hospital Association spokesman Danny Chun told the AP.
Regional News/Midwest: Fifteen Illinois hospitals under review by Illinois Department of Revenue
Send us a letter
Have an opinion about this story? Click here to submit a Letter to the Editor, and we may publish it in print.