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Councilman wants colleges to pay city based on land value
Thursday, November 12, 2009

Pittsburgh Councilman Ricky Burgess said today that he will introduce legislation aimed at getting city colleges and universities to make negotiated payments to the city based on the land they occupy and the services provided to their students -- a potential alternative to the tuition tax proposed by Mayor Luke Ravenstahl this week.

"I think that our educational institutions have to participate," Mr. Burgess said. "They have to support our city, and to participate in funding the services that are given to all of our constituents, including their students."

That's been a long-running goal of city government, but Mr. Burgess proposes a novel tack. One of three bills he'll introduce Tuesday instructs the administration to hire appraisers to calculate the fair market value of university- and college-owned land, so the city can get a picture of what they would pay in property taxes, if they weren't tax-exempt. A second piece tells the administration to calculate an average cost of providing services to residents, which could then be extrapolated to students. The third piece proposes negotiations between the city and the schools on payments in lieu of taxes.

The goal of those talks would be a long-term agreement that would immediately fill a gap of around $16.2 million in the city budget, followed by promised annual payments that would be based to some degree on the schools' property holdings and the costs associated with their students.

Some cities have similar agreements -- the schools in Providence, R.I., pay that city $2.5 million a year -- but it's unclear that any schools pay their hosts anything like $16.2 million a year.

"We have universities that have endowments in the billions of dollars," Mr. Burgess said. "It's not a question of ability [to pay]. It's a question of will."

Mr. Ravenstahl wants to impose a 1 percent tax on tuition bills, to help replenish the city's pension fund and aid the Carnegie Library of Pittsburgh. Mr. Ravenstahl said this week that he would prefer voluntary payments of the amount needed but hasn't received any such offers.

The universities have said they will fight the tax, if enacted.

Rich Lord can be reached at rlord@post-gazette.com or 412-263-1542.
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First published on November 12, 2009 at 2:25 pm