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CASD gets tax windfall from Menno Haven

Pa. Supreme Court upholds decision that community is not tax-exempt

Pa. Supreme Court upholds decision that community is not tax-exempt

January 25, 2008|By DON AINES

CHAMBERSBURG, PA. ? The Chambersburg Area School District, Borough of Chambersburg and Franklin County will be receiving some large checks after Court of Common Pleas Judge John R. Walker signed an order Friday to have escrowed property taxes paid by Menno Haven Inc. distributed to those taxing bodies.

In December, the Pennsylvania State Supreme Court denied Menno Haven's petition to appeal a lower court ruling upholding Walker's 2006 decision that the continuing care retirement community was not tax-exempt.

The district will receive $1,293,135.05 plus accrued interest - the equivalent of more than 2 mills in real estate taxes - from the bank holding most of the escrowed tax money. The county will get $181,679.89 in escrowed taxes along with interest, according to the order of court.

The borough can now use $67,884.64 in taxes plus interest that had been held in escrow as a separate budgetary line item, the order stated.

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"I'll take it," Chambersburg Borough Council President William McLaughlin said. "It's nice to put this behind us and move on as a community."

Menno Haven had tax-exempt status until 2004

Menno Haven has paid all its property taxes during the litigation, with 25 percent being held in escrow pending the outcome of the case, Franklin County Chief Appraiser Gary Martin said.

Menno Haven appealed Walker's initial ruling to the Commonwealth Court of Pennsylvania, which upheld his ruling in March 2007.

The litigation began in 2001 when Menno Haven sought a property tax exemption from the Franklin County Board of Assessment for its independent and assisted living facilities at Menno Haven and Penn Hall, according to court records. The skilled nursing facility at Menno Haven had been tax-exempt since construction in 1967, but the exemption was revoked by the assessment board in 2004, court records stated.

Menno Haven appealed the board's ruling to the Court of Common Pleas. At issue in the 2006 trial was whether it met a five-part test established in an earlier case to show it qualified as a purely charitable organization under Pennsylvania law.

In his opinion, Walker wrote that most of those applying for admission to the nursing home had to show financial resources of more than $100,000 to cover the cost of care and that its "2004 Medicaid eligible population was quite low" at 3.6 percent. Walker's opinion contrasted that figure with percentages at three other county nursing facilities with 50 percent to 82 percent of their populations being Medicaid eligible that year.

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