CLARKSVILLE, TN (CLARKSVILLE NOW) – The 2025 hospital boom has been a windfall of great news for Clarksville, with Ascension Saint Thomas and TriStar both building hospitals here, and Vanderbilt University Medical Center announcing it will buy the Tennova hospital. But that silver cloud has a grey lining, in the loss of about $2 million in local property tax revenue.

At Wednesday morning’s Industrial Development Board meeting, Montgomery County Property Assessor Erinne Hester informed the board that unlike for-profit Tennova Healthcare, Vanderbilt is an education-based nonprofit, so the hospital likely won’t be subject to property tax after VUMC buys it.

So how much could be lost in taxes? Tennova had a 2025 county property tax liability of just over $1.45 million, and a city liability of just over $637,000, adding up to $2 million in local revenue per year, Hester told Clarksville Now.

Will Vanderbilt hospital in Clarksville pay property taxes?

While VUMC hasn’t applied yet for tax-exempt status for its pending purchase of Tennova, Hester expects them to.

“If Tennova transfers to Vanderbilt as of January 31, 2026, and if they successfully apply for local property tax exemption from the State Board of Equalization and are granted the exemption, we are required to remove them from the tax roll as of the date established by the SBOE,” Hester said in a later statement to Clarksville Now. “We can reasonably assume they will receive the exemption as they have exempt property in Montgomery County and many other Middle Tennessee counties. The exemption is based on Vanderbilt being a teaching hospital.”

VUMC announced in October it plans to acquire full ownership of Tennova-Clarksville from Community Health Systems Inc. for $600 million. Since 2021, VUMC has held a 20% minority interest in the hospital, its freestanding emergency department and related physician practices. This purchase will give VUMC the remaining 80% of the 270-bed facility on the 54-acre site.

Who pays most in local property taxes?

At an appraised value of $173 million, Tennova is the largest property taxpayer for both Clarksville and Montgomery County. The second-largest is Bristol Ridge Apartments at $125 million in value, then Trane at $116 million.

Montgomery County Government receives a total of over $197 million in property tax annually, and this will remove $1.45 million. The City of Clarksville receives over $60 million, and this will be a $637,000 loss.

“I don’t really expect growth this year to cover that fully,” Hester said at the meeting, adding that she’s informed the mayors of what will be coming, and to be prepared for that revenue loss during the budget process this year.

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“I don’t like to frame the decrease in revenue from the sale to an exempt entity as a loss, because having Vanderbilt level of care for our community is a win,” Hester said in the statement to Clarksville Now. “However, as the former Finance Director for Montgomery County, and currently serving as Assessor of Property, it is incumbent upon me to inform the mayors to not expect the same rate of revenue growth from local property taxes in the upcoming budget year. The information is timely as both governments are entering budget season for FY27.”

What about Ascension Saint Thomas and TriStar?

In July, nonprofit Ascension Saint Thomas was granted a state Certificate of Need to build a 44-bed hospital, expandable to 132 beds, on a site just east of Exit 11. At the same hearing, for-profit TriStar Health was approved for a 68-bed hospital, expandable to 224 beds, on a site on the south side of Tiny Town Road.

Because AST is a religious nonprofit, they are tax-exempt, so their 98-acre campus outside the city limits is expected to move off of the Montgomery County tax rolls as well. TriStar is a for-profit business, so they will remain on the property tax rolls.

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