Providence, R.I. (March 13, 2024)- Providence Partner Michael Marcello and Associate Justin Bonnick recently secured a summary judgment ruling confirming the City of East Providence's ability to tax a nonprofit corporation that provides healthcare services to Medicaid-eligible individuals.

The nonprofit corporation, known as PACE, had claimed a property tax exemption from the City of East Providence under a Rhode Island statute that dates back, in part, to 1896. PACE asserted that the City of Providence had previously recognized the corporation's tax exemption under the same statute.

However, upon reviewing the statutory language, Mr. Marcello and Mr. Bonnick concluded that the statute did not apply, and the City of East Providence sent real and personal property tax bills to PACE. The nonprofit corporation appealed the city's decision in Rhode Island Superior Court, and thereafter the parties filed cross-motions for summary judgment.

The Superior Court upheld the city's determination that PACE was subject to local taxation, finding that PACE's claimed exemption did not apply.

"This is a significant case which recognizes that tax exemptions need to be construed narrowly, and any doubt of their application must be resolved in favor of taxation," said Mr. Marcello, who also serves as city solicitor for the City of East Providence. "Through our efforts, the City of East Providence will be able to able to continue to assess property taxes from PACE, and resident taxpayer and homeowners will not have to shoulder any additional tax burden because of their claimed exemption."

Mr. Marcello a member of Lewis Brisbois' General Liability Practice. He has handled a variety of litigated matters including products liability, legal and accounting malpractice, insurance coverage, asbestos/toxic torts, and property loss claims. As city solicitor for the City of East Providence – the 5th largest municipality in the state – Mr. Marcello handles issues related to labor & employment, planning and zoning as well as negotiating labor contracts with public safety and municipal unions.

Mr. Bonnick is a member of the firm's General Liability Practice.