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Universities, colleges in Pittsburgh reject tax talks because of UPMC challenge

Monday, April 8, 2013, 5:18 p.m.
 

Pittsburgh Mayor Luke Ravenstahl's challenge of UPMC's tax-exempt status creates an “adversarial climate” that makes it impossible for the city's colleges and universities to discuss increasing payments in lieu of taxes to the city, a group of school leaders says.

The Pittsburgh Council on Higher Education, which represents Carnegie Mellon University, University of Pittsburgh and eight others, said in an April 5 letter to Ravenstahl that its members won't take part in discussions with a task force created to examine financial support from the city's largest nonprofits.

“Making progress on these long-standing issues is difficult even in the best of circumstances,” said the letter, which the Tribune-Review obtained Monday. “It would be counter-productive to try to push forward in the adversarial environment that exists today.”

The Nonprofit Sector Support Task Force, which the Intergovernmental Cooperation Authority asked the city to create as a condition of passing the 2013 budget, is required to issue a report by the end of June on payments nonprofits can make to the city because they don't pay property taxes. The ICA is one of two groups overseeing the finances of the city.

Marissa Doyle, Ravenstahl's spokeswoman, declined to answer questions about the letter. “We look forward to reviewing the results of the ICA-mandated Nonprofit Task Force's efforts and hope that all nonprofits will work in cooperation with the ICA and the Task Force,” read a statement from the mayor's office.

Kenneth Service, executive director of the higher education council, said colleges and universities think the task force should postpone any meetings. Nine of the 36 members on the task force represent council members.

The talks “are too important to enter into at a time when they're unlikely to have success,” Service said.

Donald Smith Jr., chairman of the task force and president of the Regional Industrial Development Corp., could not be reached for comment.

The council's members represent “the single largest block of voluntary contributions that have been made to support the city through the Pittsburgh Public Service Fund,” according to the letter. The fund pledged to provide payments in lieu of taxes to the city of $2.6 million annually in 2012 and 2013.

Gregory Dell'Omo, president of Robert Morris University and the council's president, said there were too many “complicating factors” going on to make the task force work, including Ravenstahl's decision to not seek re-election and the lawsuit against UPMC.

“We just felt that now was really not the time to get this group together,” he said.

Dell'Omo said the council had not received a response from Ravenstahl.

The mayor filed the lawsuit against UPMC and challenged the status of its properties on March 20.

Although the legal challenge to UPMC's tax-exempt status is focused on Western Pennsylvania's largest hospital system, the council said nonprofit universities and colleges could be affected by any legal precedent that might be set. In addition to Pitt, CMU and Robert Morris, the council's members are Carlow University, Chatham University, Community College of Allegheny County, Duquesne University, La Roche College, Pittsburgh Theological Seminary and Point Park University.

“Any time you enter into a lawsuit of this type there's no way to guarantee what the outcome or implications could end up being,” Service said.

Alex Nixon is a staff writer for Trib Total Media. He can be reached at 412-320-7928 or anixon@tribweb.com.

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