Several Kankakee taxing bodies are participating in an appraisal of St. Mary’s Hospital for the potential collection of tax dollars.
St. Mary’s Hospital in Kankakee was one of eight Illinois hospitals acquired in 2025 by Prime Healthcare.
At the time of the acquisition, Prime had indicated that St. Mary’s would maintain its not-for-profit status.
However, Prime has not applied for non-for-profit designation or status for St. Mary’s, making it subject to taxation, Kankakee school officials said.
Last week, the Kankakee School Board gave its approval for Kankakee School District 111 to join a consortium of agencies seeking to determine a fair assessment of the hospital properties for taxation.
Other agencies include the City of Kankakee, Kankakee Valley Park District, Kankakee Community College, Kankakee Airport Authority, Kankakee County Board, Kankakee Township Supervisor, Kankakee Township Road District, and Kankakee Forest Preserve.
Lyle Neal, assistant superintendent of business services in District 111, said the Kankakee County assessor has asked the taxing bodies to share in the cost of a specialized appraisal of the hospital.
The appraisal is expected to cost about $16,500.
As the largest taxing unit in Kankakee County, District 111 will pay the largest share of the cost, about 45%, or $7,000.
The effort could result in a significant source of property tax revenue for the various entities.
The appraisal will be used to determine the equalized assessed value of the property, which then would be added as new property to the tax rolls.
The appraisal is scheduled to be completed in time to place the property on the rolls for the 2026 tax year, payable in 2027.
The process is not without risks.
Prime could still apply for tax-exempt status at a later time.
If that happens and the status is granted, then the taxing bodies may then have to return any tax revenue that has been generated.
“That is the one risk we have, but the flip side of that is they also have to prove they are not-for-profit,” Neal noted.
Considering the potentially substantial tax revenue to be gained, district administration felt it was best to participate in the process despite the risk, Neal said.
If Prime were to apply for tax-exempt status, it would likely result in a lengthy appeals process, which could take several years to resolve, he said.
St. Mary’s Hospital properties have historically been designated as not-for-profit and have been exempt from paying property taxes.