Children's Hospital Claims it was Unlawfully Taxed by Greenfield

Children’s Hospital of Wisconsin Greenfield campus has filed a claim against the City of Greenfield alleging the city unlawfully taxed the non-profit corporation nearly $20,000 in 2011.

Children’s is looking to recoup the $19,644 it paid in personal property taxes as well as interest from the date of the claim to the date of payment.

Children's Hospital sent a letter to  on Jan. 23, saying that its campus in Wauwatosa as well as spaces it leases in other buildings, like the Greenfield campus at 3365 S. 103rd St., is exempt from federal taxation because of its hospital status. 

The letter, written by Sheila Reynolds, corporate secretary and general counsel for the hospital, says at the Greenfield Campus, the hospital provides a “wide variety of specialty hospital services and programs that address patient and community needs, including the following: orthopedic care; physical therapy; occupational therapy; sports medicine; concussion clinic; and radiology/diagnostic imaging.”

“Based on these uses, the personal property at this location should not have been taxed for the year 2011 because it is reasonably necessary for the accomplishment of the Hospital’s primary purposes involving the diagnosis, care and treatment of the sick, injured and disabled,” Reynolds wrote.

Reynolds wrote the Greenfield location is not used as a health and fitness center, nor is it a doctor’s office and that the property is treated as hospital space for billing and accreditation purposes, and patients served at this location are hospital patients, not patients of a separate physician clinic.

Children’s Hospital leases spaces in the Greenway Medical Clinic, and the 2011 tax, was on the assessed personal property value, including, but not limited to equipment, supplies, furnishings, fixtures and leasehold improvements. In past years, Children’s Hospital did not report the personal property value to the city, according to the city’s attorney Ryan Braithwaite, but this year the corporation submitted a list of personal property with an assessed value of more than $1 million.

“You can’t just go and figure out what a business has in terms of personal property,” Braithwaite said. “(The city) has to rely on the taxpayer to report personal property. In previous years, (because Children’s Hospital didn’t report it) we put a minimal amount of value on their personal property.”

Children’s Hospital submitted a property tax exemption request for personal property at its Greenfield campus in March. According to Braithwaite, the city assessor’s department did an investigation, obtained several documents and inspected the facility and determined Children’s Hospital did not qualify for the exemption.

According to Braithwaite, the city found that the campus operates like an outpatient facility, or doctor’s office, rather than an inpatient facility.

“It’s a campus that’s a sub-unit of the hospital,” Braithwaite said. “These cases are not really cut and dried. It’s a very gray kind of area.”

The city has 90 days from the date of the claim to act, by either allowing the claim and refunding the money or disallowing the claim. Should the city choose to disallow it, Children’s Hospital would then have 90 days to file a lawsuit in circuit court.

“Typically these kinds of claim are not resolved in the claims stage because you don’t have all the information,” Braithwaite said. “Chances are this will end in litigation.”