Promising PILOTs: A look at How Baltimore & Other Cities Manage Tax Gaps with Non-Profit Institutions

Local governments can recover forgone tax revenue from property-tax exempt nonprofit organizations like universities and hospitals by requesting voluntary payments in lieu of taxes (PILOTs). This report examines Baltimore's PILOT agreement approach and highlights successful PILOT programs in other localities. It recommends increasing the transparency of PILOT negotiations, specifying yearly inflation-adjusted payment increases, establishing long-term multiyear agreements, and adjusting payment requests to account for public benefits provided by tax-exempt organizations.