Massachusetts Town Considers Seeking Voluntary Patron Payments in Lieu of PILOTS

From The Berkshire Eagle, a newspaper serving Western Massachusetts:  

Are the town’s numerous nonprofit businesses, ranging in size from Tanglewood to Chesterwood, willing to ask patrons for a voluntary surcharge on their ticket prices?  That’s one of the questions that the town’s PILOT Program Committee will present when it sends out a survey to the organizations, committee Chairman Tom Stokes told the Select Board on Monday.  The committee’s mission is to find out whether the nonprofit groups, exempt from property taxes, can contribute toward the town’s expenses, he said. The group was set up by the Select Board this year to consider a policy for voluntary payments in lieu of taxes.  Recommendations for setting up the PILOT program will be submitted to the Select Board for consideration, Stokes said. If approved, the proposal would appear as an article on the annual town meeting warrant for next May, seeking support from registered voters through a nonbinding resolution, preceded by another public forum.  The questionnaire includes the following points:

– Would nonprofit groups that charge admission be open to a voluntary surcharge on tickets purchased by the public, instead of a PILOT payment to the town?

– What town services do the nonprofit groups use, and how much are they aware of the benefits of those services?

– What type of in-kind services might be offered to the town, which could cut in half the amount of a voluntary contribution based on 25 percent of the taxes that would be due if the property were a commercial venture? Examples of in-kind services include the value of discounted or free tickets for residents or public forums on mental health offered by Austen Riggs, Stokes said.

– Other than in-kind services, what are some ways a nonprofit agency could contribute to the town?

– What’s your feeling about a voluntary PILOT program — is it a worthy effort or are you against it?

I imagine nonprofits that make payments in lieu of taxes (PILOTS) already implicitly pass the cost along to patrons or benefactors, but this is the first I have heard of an explicit sort of voluntary sales tax on nonprofit patrons.  Presumably, the voluntary “surcharge” would be in addition to whatever sales or use taxes the nonprofit collects from patrons on the sale of even its charitable goods and services.   Massachusetts, Pennsylvania, and, surprisingly, New Hampshire, are the states containing the most cities and towns collecting PILOTS, according to this article from the Lincoln Land Institute.

dkj