Mayor Brett Smiley Announces New PILOT Agreement with Lifespan

Tuesday, October 1

Proposed Agreement Would Provide $1.5M in Voluntary Payments to the City of Providence Over Three Years

Mayor Brett P. Smiley, Providence City Council President Rachel Miller and Lifespan President and CEO John Fernandez today announced the new proposed Payment In Lieu of Taxes (PILOT) agreement between the City of Providence and Lifespan. This proposed agreement would be the first formal PILOT agreement between Lifespan and the City, providing $1.5 million in voluntary financial contributions over the next three years to the City of Providence. Once signed, this agreement would provide the first voluntary payment the hospital system has made to the City in three years and would be the largest annual contribution it has made to Providence since 2014.

"Following last year's historic agreement with our colleges and universities, I am proud to have once again negotiated a new payment in lieu of taxes agreement that ensures our tax-exempt institutions contribute directly to the Providence community," said Mayor Brett Smiley. "The financial contributions from this agreement would represent the largest annual voluntary payment Lifespan has made to Providence in over a decade and would finally ensure that every major tax-exempt institution in Providence has a formalized PILOT agreement with the City that meaningfully gives back to our community."

In addition to the $1.5 million in financial contributions which would be paid to the City in two installments, one installment of $750,000 in this fiscal year and another installment of $750,000 in fiscal year 2026, the three-year agreement also formalizes and quantifies the community contributions that Lifespan provides to Providence with an estimated value of $50 million annually. Within the memorandum of understanding (MOU), Lifespan has agreed to enter negotiations with the City in the third year of the MOU for a future PILOT agreement to ensure continued collaboration between Lifespan and the City.

"I'm encouraged Lifespan has agreed to a deal for the next three years, which now comes to Council for review," said City Council President Rachel Miller. "As the state's largest hospital system, Lifespan needs to contribute its fair share. $1.5 million is just the start, but Lifespan has much more to do to truly honor its commitment to Providence taxpayers who right now foot the bill for the city services Lifespan benefits from. In years to come, City Council will continue pushing to ensure that Providence residents come out on top."

"Lifespan makes substantial contributions to the city and its residents, providing necessary health care, regardless of ability to pay, along with many programs and services in support of resident's physical, mental and financial well-being. Like much of the healthcare industry, Lifespan has faced financial challenges over the years. Our goal is to achieve an operating income, which will allow us to continue to invest in our health system, provide top-tier healthcare and community benefit to the city's residents and the region, while working in partnership with our host city. We appreciate the collaboration with the mayor in developing an agreement that recognizes the important role we play in the health of the city, and that enables us to continue to provide additional financial contributions and quality community care," said John Fernandez, President and Chief Executive Officer, Lifespan.

The proposed PILOT agreement will go to the Providence City Council on Thursday, October 3 for introduction and then is subject to further review by the Council Finance Committee.