Town-Gown Tiff of the Day: Brown Versus Providence
You know what they say about the road to hell? Well, Brown University may be getting a close look at all that pavement the hard way.
Providence has asked Brown University, whose endowment topped $2.5 billion last year, to boost its voluntary tax payments. The University has been paying $1 million a year since 2003, when the mayor said the city was about to run out of cash. The mayor would like to up that by $4 million, to $5 million a year.*
Rhode Island is strapped for cash — the state's economy is currently trailing the national recovery, and its capital city has closed schools, renegotiated union contracts and raised property taxes to try and bridge a $110 million budget gap. Tax-exempt organizations own more than half the city's land, and the mayor says the city spends about $36 million a year on services for them.
"The issue is how do we move beyond where we are and do something that is good for the city but not crippling for the university," Brown President Ruth Simmons said last month. "Five million dollars - that's at the level of being crippling for the university and it's completely out of scale with what universities do."
The model for this program is Boston, which this year raised $19 million in PILOT funds from Harvard University alone. And Mayor Menino would like to double the number of schools, hospitals and cultural institutions that pay in.
Without a deal, Providence's mayor says he'll seek the legislative authority to force nonprofits to make payments in lieu of taxes.
*This post initially misstated the mayor's proposed increase.
Photo courtesy Flickr user thurdl01.