Thursday, September 18, 2014
Inquirer Daily News

Should Pa. cities tax new university property?

Governing takes on the issue of large, tax-exempt non-profits, and the double-edged sword they represent for cities: Hopsitals and universities provide vitality on the one hand, but they also use services without paying taxes. The revenue drain is becoming an issue for cities across the country, Josh Goodman reports, though the locus of the fight appears to be here in Pennsylvania. The article quotes state Sen. Wayne Fontana, who represents Pittsburgh, making the case for making these institutions pay more:

Should Pa. cities tax new university property?

Governing takes on the issue of large, tax-exempt non-profits, and the double-edged sword they represent for cities: Hopsitals and universities provide vitality on the one hand, but they also use services without paying taxes. The revenue drain is becoming an issue for cities across the country, Josh Goodman reports, though the locus of the fight appears to be here in Pennsylvania. The article quotes state Sen. Wayne Fontana, who represents Pittsburgh, making the case for making these institutions pay more:

"They're buying up taxable real estate properties and taking them off the tax rolls ... The trickle-down effect is that everyone else pays more for the same services."

When Pittsburgh considered a tuition tax (bad idea) earlier this year, it ended up striking a deal in which big non-profits made voluntary financial contributions instead (good idea, said the Daily News at the time). That's how things have generally gone here in Philly, too.

But Fontana feels that voluntary contributions -- even is strongly encouraged -- aren't enough, and is proposing state legislation that would allow cities to tax newly-acquired property of large non-profits. We wonder what the effect of this sort of thing would be here in Philly, with oft-expanding institutions like Temple or Penn.

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Every year, city government spends slightly more than $4 billion. Where does all that money come from? More importantly, where does it go? Are we getting the most bang for our tax buck? “It's Our Money” is a joint project between Philadelphia Daily News and WHYY, funded by the William Penn Foundation, designed to answer these questions.

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