The so-called Johnstown Flood Tax, enacted in 1936 after the Conemaugh River jumped its banks and destroyed a large swath of Cambria County, is an odd remnant in the state's revenue quiver. It's an 18 percent levy on the sale of liquor and wine that originally was to fund restoration projects but that long ago started going into the state's general fund, to be used as needed. It brings in about $240 million a year.

Now state Rep. Don Walko and 49 of his colleagues from across the state have proposed a new use for that pot of money, but not in a way that makes much sense or is likely to be adopted.

Their proposal, House Bill 2018, would keep the flood tax but redirect the money it raises to compensate cities and towns that play host to tax-exempt institutions. Municipalities in which at least 17 percent of the land is off the tax rolls would be eligible for as much as $24 million a year.

The legislation, if enacted, would leave a $240 million hole in the state's budget. Granted, cities with large amounts of tax-exempt property like Pittsburgh would be the beneficiaries, but how would the state's budget gap be closed? Which services and programs would be eliminated?

Perhaps more troubling is that this notion leaves deep-pocketed tax-exempt institutions out of the equation. Is the state really in a position to bail out the University of Pittsburgh Medical Center, for instance, a nonprofit whose profits jumped 43 percent in the last reported quarter? Or what about Highmark Inc., which is pursuing a lucrative merger in the health-insurance industry and already has a surplus exceeding $3 billion?

We do not oppose the state coming up with a program for replacing the lost revenue of municipalities that play host to many nonprofits -- and if the nonprofits themselves could play a role in it, all the better. But an outright transfer of a quarter-billion dollars from the state would only create a different problem.

If the new era of the mega-nonprofit has made a sham of Pennsylvania's law on tax-exempts, then smart lawmakers should address it through modern legislation. As it is, this bill is another way for government to tell corporate nonprofits: Your city is starved for support, but you're off the hook.