Municipal governments usually fund the services they provide through taxes, and Tufts’ host cities of Somerville and Medford raise the major portion of their budgets through real estate taxes. Due to a controversial Massachusetts law, nonprofit organizations are not required to pay property taxes to the communities they reside in. Instead, the municipalities must raise the required money in other ways, including asking the exempt institutions they host for voluntary payments in lieu of taxes (PILOT).
Tufts has had two PILOT agreements with Somerville and Medford over the years. For Somerville, the first ten-year agreement gave $100,000 annually, while the most recent five-year agreement, which expired on June 30, provided $275,000 annually. This is approximately four percent of the real estate taxes that would normally be due.
The City of Boston implements a generally successful PILOT program. Boston requests that non-profits make a voluntary PILOT contribution equal to 25% of the real estate taxes they would otherwise pay, half in cash and half in services. While there is wide variability in compliance among the institutions, Tufts pays Boston this full amount for the downtown campus.
With negotiations coming up between Tufts and its main campus host communities on the next PILOT agreement, a coalition of citizens from groups including the West Somerville Neighborhood Association, Our Revolution Somerville and Our Revolution Medford has met a number of times to study and discuss the situation. We have come to the conclusion that the only fair arrangement going forward is parity with the PILOT terms Tufts has voluntarily agreed to with the City of Boston. On April 23, before the expiration of the most recent agreement, members of our coalition had a standing-room-only meeting with Tufts’ Directors of Community Relations Barbara Rubel and Rocco DiRico to present our views and request that Tufts provide Boston PILOT parity in the next Medford and Somerville agreements.
It’s eminently fair to give Medford and Somerville the same deal as Boston. If anything, shouldn’t Tufts feel an even closer relationship with the communities on which its main campus resides than with the City of Boston? I don’t need to explain how beneficial and intrinsic the location of the Medford/Somerville campus is to the Tufts experience — there are plenty of admissions office publications that do that very well! While Massachusetts’ richest city of Weston has better resources to support a tax-exempt institution, how many students would want to attend a Tufts located out in the Boston suburbs?
Many Somerville and Medford citizens appreciate the positive aspects of hosting Tufts in our cities, and we’re willing to pay some extra taxes to support the university as a contributing member of our communities. But our own taxes and living expenses keep going up, and some of that is directly tied to Tufts’ growth. In particular, the administration’s policy of annually increasing student enrollment without building new on-campus dormitories has had a dramatic effect on housing prices in the surrounding neighborhoods (which in turn cascades into increased individual real estate taxes). No matter what, Somerville and Medford citizens will be paying more money than they otherwise would if the Tufts campus were somehow teleported to Weston and replaced with tax-paying homes and businesses. Our request for PILOT parity still represents a 75 percent discount of otherwise due property taxes.
PILOT parity for Somerville and Medford is an issue like paying workers a living wage. While it’s true that Tufts is not legally obligated to do so, the university should treat those it depends on fairly because it’s consistent with the values that Tufts says it holds dear and promotes in its own community — and because it’s the right thing to do.