Nonprofits are exempt from property tax on non-revenue producing properties such as galleries and exhibit spaces but often make contributions to municipalities in lieu of taxes. The museum has agreed to pay what it would otherwise pay in property tax on the new properties.
“The PEM will continue to pay annual real estate taxes in the amounts stated, along with an annual escalator similar to the accords reached with other non-profits in the city,” Salem Mayor Kim Driscoll wrote in a letter she sent to the Salem City Council on Friday.
Driscoll noted that she had a "very positive dialogue with PEM officials" with "respect to their on-going and prospective contributions to our community.”
As part of the museum’s $200 million expansion, it will purchase property at 179 and 173-177 Essex St. along with a carriage house at Central and Charter streets. Driscoll’s letter to the council also stressed that the museum is dedicated to maintaining retail space on the ground floor of all three buildings, “as that is a critical part of our downtown revitalization strategy and important to many of the nearby small retailers.”
Driscoll also said, "Both municipal and museum officials value the opportunity to memorialize the work we do together and to leverage their present and upcoming investments for the betterment of the Salem community.”
Justin A. Rice can be reached at email@example.com.