The Dartmouth-Hitchcock Medical Center transferred ownership of two DHMC buildings to the College, following a decision by the Lebanon board of assessors that DHMC is not a tax-exempt charity.
The College will now own two adjacent buildings, Borwell and Ruben, which serve educational purposes for the hospital.
DHMC's decision to transfer the property came only days after the city board of assessors ruled the medical center did not qualify as a charity.
In a report prepared for the board of assessors, Lebanon attorney Adele Fulton wrote "DHMC's corporate purposes are focused on its members and not on the general public. The purposes do not even mention the public."
Fulton concluded that DHMC does not function any differently than for-profit hospitals that pay taxes.
"DHMC doesn't perform a charity," said city assessor Norman Bernaiche, who estimates that the property transfer could save DHMC nearly $2 million in taxes.
Laurie Storie-Monseau, a DHMC spokesperson, said the hospital has not made any formal decision of whether or not to appeal the city's ruling, which they "totally disagree with."
"We could not disagree more with the implication that DHMC is not a charitable organization," DHMC President James Varnum said in a statement issued one day after the assessors' decision.
Varnum told the Valley News these charitable acts include offering services to anyone in need, pediatric, intensive care, emergency care, injury prevention, the poison center and cancer hotline.
The board's decision will most likely be challenged.
The outcome of any court battle could have major implications for other medical centers and hospitals in New Hampshire and elsewhere.
The College has been eligible to control these buildings for about a decade, although the process was only recently formally completed.
To construct the Borwell and Ruben facilities, DHMC borrowed money from outside the College.
"The entire facility was subject to mortgage to secure the debt," Clark said.
Because all debts from borrowed money to construct the facility were paid off nearly a decade ago, Clark said there was "nothing to impede intended transfer of titles" of the buildings to Dartmouth.
The property transfer was filed on March 31 in the Grafton County Registry of Deeds, only one day before the deadline to file all deeds.
If the hospital decides to appeal and fails, the Mary Hitchcock Memorial Hospital could incur $6 million dollars in property taxes in Lebanon.
The hospital has 30 days from March 26 to pay the taxes and until September 1 to appeal the assessors' decision.
