Ononato: Tuition tax wrong approach

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Allegheny County Executive Dan Onorato says taxing college tuition is the wrong approach to solving Pittsburgh's fiscal woes, but he agrees with efforts by Mayor Luke Ravenstahl and the city to secure $6 million annually from nonprofits.

Mr. Onorato, who is seeking the Democratic nomination for governor, said yesterday he's willing to approach those tax-exempt groups to advance an idea he recalls being discussed by them and the city five years ago after he became county executive.

"I support the mayor, and I support the city's effort to get the $6 million that a lot of people thought was coming back in 2004," Mr. Onorato said.

His remarks, during and after a campaign appearance at the Community College of Allegheny County, lend momentum to what some now view as an alternative to Mr. Ravenstahl's controversial tuition levy that college groups say would be the first of its kind in the nation.

Shortly after Mr. Onorato spoke, Pittsburgh City Council, as expected, voted to delay for another week its initial vote on the tuition tax. Council members said they wanted to give the mayor time to continue trying to persuade academic institutions to agree to voluntary payments to the city.

"Maybe, working together, we can come up with a solution so the kids won't be in the middle of the situation," said Councilwoman Theresa Smith, who arranged a meeting last Friday between council members and two university presidents that both sides called "productive."

The idea of $6 million in yearly contributions was enough to quell interest in 2004 in enacting state legislation that would include nonprofits in a new tax on payrolls. But the target amount was never fully realized, and the offer from a tax-exempt umbrella group this year was less than $2 million a year.

"Who knows why it never materialized," Mr. Onorato said.

A representative of the Pittsburgh Council on Higher Education, which represents 10 city colleges, could not be reached for a response to Mr. Onorato's remarks.

Mr. Ravenstahl said he's glad Mr. Onorato "acknowledged that the nonprofit community has to do more to help city government. ... His voice today to that is something that today we're very excited about and happy to have."

But the mayor also said there is no need for Mr. Onorato to "further interject himself" into talks with universities that Mr. Ravenstahl described as serious and hourly over the tuition levy.

The mayor welcomed council's decision to hold off on a vote until Wednesday, but said there won't be many more delays.

"The clock is ticking. We're running out of time, and we need to come to some sort of decision here, soon, but I think this week will buy us time to further these discussions.

"I have to be the one at the end of this process to say, either, that we vote the tuition tax, or the Fair Share Tax, or we don't."

Mr. Onorato broached the subject yesterday in response to reporters' questions at the CCAC news conference, called by the candidate to outline his statewide policy proposals for higher education.

Mr. Onorato said he was "not going to get in the middle of a city-college fight" but said he believes a better approach than either a levy on nonprofits or students would be seeking payments or services in lieu of taxes.

Noting that he recently vetoed an attempt to tax county nonprofits, Mr. Ravenstahl said such approaches would not likely withstand a legal test.

"I think there are better ways to approach nonprofits right now as opposed to the legal confrontation way," he said.

"I don't support that approach," Mr. Onorato said of the tax on the table. "I don't think it's going to go through."

Mr. Onorato stressed that while he differs with Mr. Ravenstahl's current tack, he fully agrees with his efforts to secure voluntary support from the organizations.

Backers of the tuition levy say colleges that are generally exempt from property taxes must do more to offset the costs to the city of providing the campuses with police, firefighting and other municipal services.

Councilman Ricky Burgess, who has pushed for talks with the universities toward voluntary payments, said the emergence of information suggesting a 2004 arrangement by which the nonprofits would provide $6 million a year gives impetus to the effort.

He floated an amendment to the tuition tax bill that would have it take effect on July 1, instead of Jan. 1. "That will give the universities another six-month opportunity to do the right thing," he said.

The amendment did not come up for a vote, but he said he would reintroduce it as soon as a tentative vote is held.

Bill Schackner can be reached at bschackner@post-gazette.com or at 412-263-1977. Rich Lord can be reached at rlord@post-gazette.com or 412-263-1542


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