MORRISTOWN, NJ — Atlantic Health System and the Town of Morristown have reached an agreement, ending a series of property tax appeals related to Morristown Medical Center.
Morristown Mayor Tim Dougherty, along with President and CEO of Atlantic Health System Brian Gragnolati, jointly announced that the agreement, which was approved by the Town Council last night, will settle all outstanding property tax appeals since 2006 and will provide for future tax payments through 2025.
Under the terms of the agreement, The Town of Morristown will be paid $15.5 million by Morristown Medical Center. This includes $5.5 million of penalties and interest which will be paid in annual installments over the 10 years.
The agreement states that "beginning in 2016 and through 2025, about 24 percent of the hospital property will be taxed at an assessed value of $40 million. This represents an annual tax payment of $1.05 million".
"This agreement benefits Morristown greatly,” said Dougherty. “Taxpayers gain by having the hospital share a greater burden of the cost of providing municipal services, and the 10-year commitment provides a guaranteed revenue stream that allows the town to undertake plans for the future with confidence.”
“We are pleased that the agreement benefits both the town and Morristown Medical Center by providing clarity around financial obligations,” Gragnolati said. “Additionally, Morristown Medical Center plans to have a greater presence in the lives of our community members by offering enhanced health and wellness programs that are reflective of their needs.”
“Both sides recognized the value in avoiding further litigation,” Dougherty said. “I applaud Brian, who came in as the new CEO during this litigation, for bringing a fresh perspective and recognizing the value of working together toward the betterment of our community. It was this spirit of collaboration that not only helped the two sides reach an equitable solution, it helped us cultivate a deeper relationship,” he said.
Gragnolati said the process that led to the agreement enhanced the working relationship between the two entities. “The community and the hospital are interdependent,” he said. “We both gain.
"As we look to the future, this settlement assures that Morristown Medical Center and the town continue to foster a strong relationship that benefits the community and reinforces our vision as a trusted network of caring,” said Gragnolati.