In re Gardens Regional Hospital & Medical Center, Inc.

MEMORANDUM OF DECISION DENYING THE DEPARTMENT OF HEALTHCARE SERVICES’ MOTION FOR ALLOWANCE OF AN ADMINISTRATIVE PRIORITY CLAIM

Ernest M. Robles, United States Bankruptcy Judge

At issue is whether an exaction assessed against the estate by the California Department of Health Care Services (“DHCS”), pursuant to the hospital quality assurance fee program, is properly characterized as a tax entitled to payment as an administrative priority claim pursuant to § 503(b)(1)(B)(i), or whether instead the exaction is a fee not entitled to administrative priority status.1 The Court finds that the exaction…