The state House passed a bill Wednesday that would give the General Assembly, not the courts, sole authority to determine what qualifies an organization as a purely public charity.
Senate Bill 4, which cleared the Senate in March, paves the way for 2015 legislative approval and a public referendum. Because it amends the state constitution, the same legislation would have to be passed by the next session of the General Assembly in 2015-16.
“This is an important first step in restoring uniformity and certainty to the process of determining qualification for tax exemption as a purely public charity,” said Andy Carter, president and CEO of the Hospital & Healthsystem Association of Pennsylvania, one of 16 stakeholder organizations in a coalition that backed the bill.
S.B. 4 became necessary after the state Supreme Court last year issued a decision placing its own test above the measurable and constitutional provisions of Act 55 of 1997, the Institutions of Purely Public Charity Act.
“When this is done, nonprofits will enjoy greater confidence that their status rests properly in the hands of the elected legislators who are best positioned to determine their communities’ needs,” Carter said.