-. $733 Henry J. Raymond, Director ll MAM CITY of ?l 0 BALTIMORE AGENCY "an: a. Department of Finance ADDRESS Room 454, City Hall (396-4940) SUBJECT Non-Pro?t Assessment Agreement '1 DATE: The Honorable President and Members May 31, 2016 of the Board of Estimates Room 215, City Hall T0 Dear Mr. President and Members: ACTION REQUESTED OF BIE: We respectfully request the Honorable Board of Estimates to approve the non?pro?t assessment agreement with certain non-pro?t organizations for the period of July 1, 2016 through June 30, 2026. This agreement requires an annual payment of $6,000,000 per year to the City of Baltimore. The total payment to the City over the ten year life of the agreement is $60,000,000. M0931: OF MONEY AND SOURCE QF FUNDS: BA GRO The City of Baltimore desires to enter into an assessment agreement with the member institutions of the Maryland Hospital Association and the Maryland Independent College and University Association residing in the City of Baltimore and identi?ed on the attached Schedule A, Annual Non-Pro?t Assessment, whereby special assessments will be paid by the Members to help assist the City?s delivery of services. The aggregate amount of the special assessment payments, paid by all Members, shall be $6,000,000 annually for the period July 1, 2016 through June 30, 2026. This agreement is intended to establish an assessment payment mechanism through which nonpro?t organizations can further contribute to essential City services while at the same time preserve their tax- exempt status. BQTIMORE CITY RESIDENTS FIRST (BCEJ: BCRF applicable: yes ., no BCRF Certi?cation Statement completed and returned to Agency: yes no APPROVED BY BOARD OF ESTIMATES Clerk 6 Date M12016 28441843017 Memorandum of Understanding Between the City of Baltimore and Certain Members of the Maryland Hospital Association and the Maryland Indepenth College and University Association Concerning the FY 2017 - FY 2026 Nonpro?t Assessment Agreement May 4, 2016 . The City of Baltimore (the ?City?) hereby enters into a Memorandum of Understanding with the member institutions of the Maryland HoSpital Association and the Maryland Independent College and University Association residing in the City of Baltimore and identi?ed in the Nonpro?t Assessment Agreement whereby Special assessments will be paid by the Members to help assist the City?s delivery of services. The aggregate amount of the special assessment payments, paid by all Members, shall be annually for the period from FY 2017 through FY 2026. . The Members have determined the incidence of the special assessments payments across their membership as well as the schedule of payments to be provided by the Members. The payments are memorialized in the Nonpro?t Assessment Agreement in the form attached thereto as Schedule A. . To provide maximum certainty, during the term of the MOU, the City and the Mayor acknowledge that they will not request not seek to impose, nor will the Members be expected to offer, new taxes or assessments on the Members and furthermore, they will not sign any ordinances that do so (with the exception of an increase in or establishment of a broad based tax such as the parking tax, or other broad based tax or fee that is not directed at the activities or holdings of nonpro?t organizations generally or Nonpro?t Participants speci?cally). In other words, the Members will only be subject to additional tax obligations that derive from increases in their activity levels on currently taxed activities (increased energy consumption, increased number of phone lines, or the like) or in the limited circumstances as speci?ed in Paragraph 3 of the Agreement. . On July I, 2010, the City increased the Energy Tax rate on non-pro?ts by 33 so that the Members are subject to an Energy Tax Rate of During the term of this MOU the City and the Mayor acknowledge they will not request nor seek to impose any further supplemental funds or additional tax revenues derived from increases to the energy tax rate. This rate will remain ?xed at the current tax rate of 8% for the period of this MOU (through FY 2026). . On July I, 2010, the City increased the Telecommunications Tax rate by 14.28%, so that the Members are subject to a telecommunications tax rate of 3.40 for Centrex lines and $4.00 for all other lines. During the term of this MOU the City and the Mayor acknowledge they will not request nor seek to impose any further supplemental funds or additional tax revenues derived from increases to the telecommunications tax rate. This rate will remain ?xed at the current tax rate of $.40 per month for Centrex lines and $4.00 per month for all other lines for the period of this MOU (through FY 2026). 6. To the extent the City increases assessments, taxes or fees contrary to the provisions in numbers 3, 4 or 5 of this Agreement, the Annual Nonpro?t Assessment payment shall be reduced commensurate with the increases in taxes, payments or fees owed to the City by the Members. 7. MBA and MICUA agree to use reasonable efforts to assist the City in helping the Members understand their assessment payment obligations under the Nonpro?t Assessment Agreement with respect to any members that are more than thirty (30) days delinquent. 8. The Nonpro?t Assessment Agreement, which is attached hereto and incorporated herein, will be in the form agreed to by the Parties. 9. The Nonpro?t Assessment Agreement outlines all other available remedies in the event of a default. 10. This agreement will operate for a period often years. WITNESS Date (1 .4 [251m Aftemate Geo c'A. Solicitor - N?ww' smut Carmela Coyle, eat and CEO On behalf of the Maryland Heepital Association 3'12 o! Lt, ma 33mm: esident On behalf of Maryland Independent College and University Association (MICUA) BY THE BOARD OF ESTIMATES: Dalltei?i a Clerk JUN 12016 SCHEDULE A Hospitals: Bon Secours $74,830 JHH 8: $1,399,972 MedStar Good Samaritan $149,348 MedStar Harbor Hospltal $206,358 MedStar Union Memorial $202,616 Marty Medical Center $226,208 Slnai LifeBridge $316,116 St. Agnes Health Care $190,462 UMMC $746,576 UM Midtown $183,582 Collega and Universities: Johns Hopkins University $1,860,426 Loyola University Maryland $329,630 Maryland Institute College of Art $69,554 Notre Dame of Maryland University 544,272 TOTAL $6,000,000