Mayor sees 'no commitment' from university leaders on city's finance effort
December 15, 2009 5:00 AM
Pittsburgh Mayor Luke Ravenstahl; University of Pittsburgh President Mark Nordenberg; and Robert Morris University President Dr. Gregory G. Dell'Omo gather in city council chambers to discuss the proposed tuition tax.
By Rich Lord Pittsburgh Post-Gazette
With a tenuous City Council majority willing to vote for a proposed tuition tax, Pittsburgh Mayor Luke Ravenstahl wants to see the levy tentatively approved tomorrow, despite the pledges of university leaders yesterday to work with the city on its finances if the tax is dropped.
"What we heard clearly was really no commitment from the nonprofit community to commit to anything tangible, or real," Mr. Ravenstahl said, following a 2 1/2-hour public meeting that featured five higher education leaders and all 11 elected city officials. No one pledged to come up with the $5 million a year he has requested to avert the tuition tax, he said.
"One does not negotiate with an ax hanging over your head," said Chatham University President Esther Barazzone, while joining her peers in calling for "a big-tent coalition to help to lead the city to a different future." One caveat: "We cannot give up our nonprofit status."
The 1 percent tuition levy is expected to raise slightly more than the $15 million a year the administration has said it needs to right the pension fund. The mayor said last week he would settle for one-third of that, plus an agreement with the universities to seek help in Harrisburg to cover the balance.
At yesterday's meeting, under questioning from Councilman Ricky Burgess, Robert Morris University President Gregory Dell'Omo said his institution could pay the city $1 without compromising its educational mission, but couldn't pay $10,000 without hurting its operations.
That was the closest the meeting got to the bottom-line pledge the mayor has said he needs before shelving the tax.
Councilwoman Theresa Smith, who chaired the meeting, said she's prepared to vote for the tax tomorrow, but held out hope that "something can change" by the time of a possible Monday final vote.
Mr. Ravenstahl has submitted a 2010 budget that would not rely on the tax, but wants it passed this year so an inevitable court fight with the schools can run its course next year. He said he's also aware that two of his aye votes on council -- Tonya Payne and Jim Motznik -- will be replaced next month by new members who haven't committed to saying yes to the tuition tax.
"I do know that there are five members today that will vote for it," he said. "It is urgent for that reason."
Separately, the Allegheny Conference on Community Development yesterday announced its opposition to the tax, saying it was "bad public policy" and "a simplistic solution" to the city's chronic pension fund shortfall.
"I think a yes vote on this tax will mean a competitive issue for this region around our colleges, universities, and for-profit educational institutions," said conference CEO Dennis Yablonsky. "We will become the only city in America that has this tax."
Mr. Yablonsky, who was the state Department of Community and Economic Development secretary in 2004 when the city was working toward a prior agreement with its tax-exempt institutions, yesterday denied any knowledge that the city was promised $6 million a year from universities, hospital systems and nonprofit insurers. Several state senators and former Mayor Tom Murphy have said they got verbal pledges of that amount.
"That $6 million at that point in time was our estimate," Mr. Yablonsky said. "It was never discussed with the nonprofit community."
Several council members seemed agonized, but at the same time resigned to the tax vote.
Ms. Payne said that if the universities don't come through, and if the tuition tax is nixed, the city would have to "actually increase taxes on our residents, who can't shoulder any more of the burden. They simply can't do it."
Though she was voted out in May, Ms. Payne said she "can't leave those people behind. I can't shoot them in the head. I can't do that."
Mr. Burgess said he intends to amend the legislation so the levy wouldn't take effect until July 1, giving the universities six more months to negotiate voluntary donations. The university presidents insisted that the tax be removed from consideration instead.