UPMC maintains it has no employees

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Attorneys for UPMC have again asked the courts to dismiss Pittsburgh's challenge to its tax-exempt charity status, reiterating that UPMC is a parent holding company that oversees 44 subsidiaries -- but has no employees.

In a filing Monday in Allegheny County Common Pleas Court, the region's largest health system declared, "The City of Pittsburgh has not, and cannot, identify a single person who is employed by or on the payroll of UPMC, the parent holding company."

The city has sued UPMC, challenging its tax-exempt status and demanding payment on payroll taxes. When the health system first asserted that UPMC had no employees last month, Ronald Barber, the attorney representing the city, said UPMC tax documents state that "UPMC Group" employs about 52,000 people. Mr. Barber declined further comment Monday.

In the new filing, UPMC attorneys headed by William Pietragallo II noted that all health system employees get their W-2 tax forms from one of the UPMC subsidiaries and not the parent holding company.

It further states that UPMC's approach is "well-founded in law and widely practiced throughout the business community. Each subsidiary has its own corporate identity, tax identification number, executive officers, and payroll."

UPMC spokesman Paul Wood on Monday added that "virtually all of UPMC's tax-exempt property" consists of hospital campuses such as Children's Hospital, Mercy, Magee-Womens and Presbyterian/Shadyside.

"These properties were tax exempt when each hospital joined UPMC, they continue to operate as 'institutions of purely public charity' in every sense of the phrase, and they are unquestionably tax exempt. If they are not, then there is no other hospital and clinic in Pittsburgh that would qualify."

He said UPMC pays real estate taxes on the remaining 49 percent of the property it owns.

Steve Twedt: stwedt@post-gazette.com or 412-263-1963.

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