Federal Hocking Weighs Options On Holzer Tax Exemption

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Federal Hocking Local School District has 30 days to respond to a ruling that Holzer Clinic of Athens is eligible for tax-exempt status, but the likelihood of overturning that decision appears slim.

Gary Gudmundson, spokesman for the Ohio Department of Taxation, said it is “almost impossible” to counter Holzer’s argument in favor of the exemption, which he said is based on a broadly written law that exempts properties financed with health-related bonds.

“What I’m hearing is that it would almost be fruitless for them to appeal,” Gudmundson said.

The exemption would result in a loss of property tax revenue to Federal Hocking Schools of about $100,000 a year.

According to Federal Hocking Supt. George Wood, the argument Holzer is making in favor of the exemption is not the one in their initial filing for the exemption.

The Messenger was unable Friday to obtain from the Ohio Department of Taxation copies of documents Holzer filed the the case.

“Originally, they had claimed they were entitled to the exemption due to charity care,” Wood said in an e-mail to The Messenger.

“When we challenged that, and were given a positive response to that challenge by the tax commissioner, we felt we might prevail. Unfortunately, Holzer is now taking a different tact, with a different law firm, arguing that due to tax-exempt bonds issued to make the purchase of the clinic they should be considered tax exempt.”

Wood said the school district has not made a decision whether to contest the Ohio Department of Taxation’s finding that Holzer qualifies for an exemption.

“We are exploring our options. We have 30 days in which to respond to this rather surprising move by Holzer,” Wood said. “Our attorneys are researching that issue (regarding the bond financing), but it was a complete surprise as this was not their initial filing.”

As The Messenger reported Friday, the Ohio Department of Taxation sent a letter last week to Federal Hocking and Tri-County Career Center stating that Holzer had been found to qualify for tax exemption, but that schools had 30 days to respond to the ruling.

Tri-County Career Center also receives tax revenue from Holzer Clinic of Athens, but less than $8,000 a year.

Supt. Bill Wittman told The Messenger on Thursday that the Tri-County Career Center board will determine if it will contest the tax-exemption finding.

He said the benefit of pursuing the matter must be weighed against the cost.

When Holzer filed last fall for property tax exemption, both Federal Hocking and Tri-County Career Center objected, although Wittman said his school was doing it primarily to support Federal Hocking.

Holzer Clinic in Athens was purchased in 2012 for $21 million by Holzer Health System, a not-for-profit corporation.