Monday, March 26, 2012
Another revenue-pinched city is exploring the PILOT (payment in lieu of taxes) option for raising funds from charities with property exempt from taxation, according to Lowell Seeks Annual Fees from Nonprofits to Pay for Services. The story explains that the Lowell City Council has crafted a plan under which at least some tax-exempt entities that own property would be charged a PILOT of 25 percent of the equivalent residential property tax assessment. Religious institutions and government entities would be exempt from the PILOT. City Manager Bernard Lynch is reported to estimate that Lowell would receive an additional $500,000 to $1 million in annual revenue from the plan – revenue that is all the more critical because of reductions in state and federal aid. Current efforts to receive voluntary PILOTS are reported to yield only approximately $25,000 annually.