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Boston to non-profits: Pay up; Non-profits to Boston: We don't think so
By adamg on Tue, 04/06/2010 - 12:14pm
The Globe reports a mayoral task force today will recommend the city increase the amount of "payments in lieu of taxes" most non-profit landowners pay in Boston to 25% of what they would pay if the property were not tax exempt. Non-profits warned of layoffs and higher prices passed onto consumers and students if the city tries that.
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Comments
I Know What Boston's Non-Profits Should Do
Pull a Fidelity.
universities become supply-siders
When did these universities ever defend the private sector against tax increases, because it will cost jobs and lead to higher prices?
Ah, but that's different!
Ah, but that's different!
Hard core socialism and
Hard core socialism and communism are still en vogue on most university campuses. The ivory tower thinks it's great and all, as long as they aren't the ones paying the bills or facing restrictions.
Some Pigs
Are more equal than others.
If this passes
If this passes, it will be a requirement for ALL non-profits that own property to pay part of their property tax, not just universities and hospitals. There are 8,500 non-profits in Boston, many of which own property. They will all have to pay, including museums.
Time to put the squeeze on
Time to put the squeeze on those bastards at Bikes Not Bombs.
Honestly what's next? Taxing
Honestly what's next? Taxing the can men/women whom redeem every recyclable left accessible to the public within the city limits?
Two thoughts
Having worked on this for many years two thoughts:
1) Doing this as pilot is somewhere between difficult and impossible. It's unenforceable. A better way would be to set a limit on any land over a certain limit to be deemed taxable until we fall below a certain level. For example, I think about 55% of land by area is currently tax exempt. Set a law that says that if you are normally tax exempt but wish to acquire land in the city of Boston your land will be "deemed taxable" until that percentage falls below 50%. If you acquire it anyway and other tax exempts keep acquiring land you get in a queue and your land doesn't fall off the rolls until other tax exempt land comes back on the rolls and your position in the queue puts you below the 50% threshold. This way everyone already off the rolls is grandfathered so you don't "shock the system", but the likes of Harvard etc. don't continue a habit of landbanking huge swaths of land without paying taxes. There are probably other ways to do this. Above is just one example of a more structured approach. Could do it by value or other more objective criteria.
2) This should not be viewed as incremental revenue for the city. It's not like they are using this to provide incremental services. New revenue from this source should be used to plug short term gaps (need to be careful of abuse, but for example you could solve the current library problem for a year so we can address the restructuring objectively and rationally), build emergency reserves and pay off our enormous and growing pension and retirement benefits obligations etc.
Won't be holding my breath on any of these happening.
It is a complicated problem
It is a complicated problem and it is even more complicated when you look at the numbers. According to 2000 BRA data, 50% of the land in Boston is taxable and 50% is tax exempt. What I think is interesting is how that 50% tax exempt breaks down: 26% owned by the state, 14% owned by the City of Boston, 8% by "other exempts," and 2% by Higher Education and Medical.
Same is true in Cambridge. "Private Education" as the City defines it, makes up 9.5% of the land area in terms of ownership. As someone who grew up around here, I had always assumed (and heard) that MIT and Harvard owned something like 40% or 50% of the land in Cambridge.
Clearly the assessed value of the land is really high but I think too often the discussion focuses on the acreage of land.
One other point to keep in mind is that the institutions pay commercial taxes on land that is not used for institutional uses. MIT is the top commercial taxpayer in Cambridge. For all the commercial/industrial land in Allston, Harvard is paying the comercial/industrial tax rate on that land until it changes the zoning to make that land part of its campus.
Grandstanding by any other name
Is still grandstanding! They want more $$, but there is no mention of the actually pretty small amount of land that these institutions occupy (8-10%), nor of the amount by which they raise the assessments - and taxable value - of adjacent parcels. Where is the hue and cry to get the state to pony up?
Let's see, does anyone remember what a shithole the Kendall Square area was before MIT put a lot of attention into redeveloping it from tarpaper factories to what it is now? What about the effect of having all the hospitals and medical research institutions at Longwood? You can't tell me that the assessments in the area are not higher because of their presence!
Classic Boston - instead of planning for future development, squeeze and attack what little you actually have going for you.