Tax Revenue Boost Expected for Cambria County Following Sale of Conemaugh Health System

Aug 21, 2014

A western Pennsylvania judge has approved the sale of the Johnstown-based Conemaugh Health System to a for-profit Tennessee network, Duke LifePoint Healthcare.

Under the deal approved Wednesday by Cambria County Judge Timothy Creany, Duke LifePoint will pay $111 million for Conemaugh, and agree to invest $425 million more on capital improvements, including new facilities in Richland Township, near Johnstown, and Ebensburg, over the next decade.

Additionally, the properties in the system will now be taxable.

“We do anticipate that it will improve our tax base,” said Tom Leiden, Cambria County solicitor. “Currently the Conemaugh Health System is all non-profit and exempt from real estate taxes though they do make a payment in lieu of taxes which is considerably less than taxes paid would be on real estate.”

The amount the county would receive is unclear. The buildings have been assessed, but Leiden said that because they were run by a nonprofit, Conemaugh was never motivated to challenge the assessments.

“A new owner that is taxed will be more likely to challenge the assessments, and those assessments will change,” he said. “At the current assessment, if all those properties went into taxation at the current assessed rate, the county would receive about $900,000 a year in new real estate taxes.”

But Leiden said he does not anticipate that the building will be assessed at the current rate, so the exact financial impact remains unclear.

Conemaugh runs hospitals in Johnstown, Hastings and Meyersdale, as well as outpatient centers and group practices. Duke LifePoint Healthcare is a for-profit joint venture of Duke University Health System, Inc. and LifePoint Hospitals.

Officials with the health systems say no layoffs are planned as part of the takeover, which could close as early as next month now that the deal has court approval.