Columbia and NYU Would Lose $327M in Tax Breaks Under Proposal
nytimes.com
nytimes.com
-- BUT, I think it's absolutely fair to keep tax breaks only for buildings used primarily for educational/research and related activities (like dorm rooms and student centers and research labs).
Because if Columbia and NYU are investing in real estate as part of their endowment, e.g. residential and office buildings unconnected to their educational mission, then those should be taxed normally. And the same for any other nonprofit -- no reason to single them out.
NYU has 26,000 undergraduate students--is this not of value? Seems like a very broad brush with which to paint the largest university in New York.
I've had plenty of friends attend there for grad and undergrad, and I also had the choice to attend for undergrad years ago, but decided against for the reasons above.
You'd be better off attending a regional program that is specialized in your disciple than NYU.
Pedantry and HN - name a more classic combo
"Their tuition is expensive" isn't a good reason to exclude them from the tax break. "They are abusing their non-profit status to basically operate as a for-profit corporation" would be a good reason, but I don't think it's true.
According to https://www.nytimes.com/2023/09/26/nyregion/columbia-univers...
>> Universities, including Columbia, pay tax on properties they own that are not used for educational purposes.
So I don't think they're able to just become tax-free real-estate investors, although I don't know where the dividing line is?
So then I'm even more confused -- it doesn't seem like Columbia/NYU are taking up all that much land then?
It's just that their college campuses are in Manhattan which has some of the most expensive real estate in the country.
But the whole point of tax exemptions is to be able to place things like universities on land that would otherwise get turned into office buildings and Starbucks.
The size of those exemptions in absolute dollar terms doesn't seem relevant at all, as long as the total amount of land being used is reasonable for a university campus, which it seems like it is.
I mean what's next -- are we going to start asking about the property taxes that New York Public Library real estate could otherwise generate, especially with its majestic building on 5th Ave?
"The legislation would only apply to Columbia and N.Y.U. and not other large private universities that own significant land, such as Cornell University in Ithaca. Lawmakers said that other universities would be excluded because their tax breaks are far lower than those of Columbia’s and N.Y.U.’s; the annual real estate tax exemption threshold would be $100 million."
Here's the text to the amendment and, for now, it's just about allowing the state government to start taxing private institutions of higher education (not museums nor other non-profits though): https://www.nyassembly.gov/leg/?default_fld=&leg_video=&bn=S...
Columbia offers admittance to fewer than 3% of the people who apply. More people than those admitted have the requisite grades etc to think they'd perform well at an elite school; why not offer more of the admittance and use the endowment to make it happen? Or, use the endowment to further lower the list price of the education (approaching $500k for 4 years)?
Even without UPMIFA, endowments are a mix of unrestricted and restricted funds, and donor restrictions can and do prevent universities from using money when they might otherwise want to. Even if a university desired to draw down the full 7% allowed without triggering red tape, it's unlikely that they would be able to draw it all without running afoul of donor intent.[2]
If anything, the system is to blame here, not the universities themselves necessarily (not to excuse bad apples in academic administration).
[1] https://en.wikipedia.org/wiki/Uniform_Prudent_Management_of_...
If you look at their budget every year they have an "other" line that's very big and comprises all these types of dealings. It's scummy and doesn't fulfill the mission of teaching people, but it sure does enrich specific people.
I still remember taking a course under Julian Togelius where we had to translate some statement from hex or something that amounted to "Columbia is better than NYU". So even the well respected research professors agree on the quality of the education.
Shout out to the various student run labs and individual professors I worked with that made the experience more worthwhile and who actually care to foster curious students.
NYU continues to have the audacity to reach out to me for handouts though.
Usually you can trot someone out like "tell that to this first-gen college student" and shit like that. I think SF is ripe for this.
Columbia was a major beneficiary of the city's power of eminent domain in the early 2000s, killing small business and other local flavor in favor of their expansion and planned urban renewal, which is kind of slimy already. The big arguments were that it couldn't expand and maintain its status without it.
So now time to pay the piper. All those places used to pay property taxes, now they don't.
"In a unanimous decision, the Court of Appeals overturned a lower court ruling that barred the state from using its power of eminent domain to take private property in the 17-acre expansion zone west of Broadway without the property owner’s consent. The ruling held that the courts must give deference to the state’s determination that the area was “blighted” and that condemnation on behalf of a university served a public purpose, two requirements under the law.
Lee Bollinger, the president of Columbia University, said he was grateful for the state’s hard work in the case. “This is an extremely important moment in the history of Columbia,” he said. “It’s only fair to say that the opportunity to build a new campus comes along very rarely.”"
Said case would be a court case because such a law would be a bill of attainder, which are explicitly unconstitutional.
"The two main criteria that the courts use to determine whether legislation is a bill of attainder are (1) whether “specific” individuals, groups, or entities are affected by the statute, and (2) whether the legislation inflicts a “punishment” on those individuals. The U.S. Supreme Court has also identified three types of legislation that would fulfill the “punishment” prong of the test: (1) where the burden is such as has “traditionally” been found to be punitive (historical test); (2) where the type and severity of burdens imposed are the “functional equivalent” of punishment because they cannot reasonably be said to further “non-punitive legislative purposes” (functional test); and (3) where the legislative record evinces a “congressional intent to punish (motivational test).” ...
"It would appear that the identification of papers and recordings under the control of a named person (the former President) would meet the per se requirement. The Court in Nixon, however, found that the statute was constitutional despite this specificity. In Nixon, the Court found that the bill failed the second prong (punishment) of the test for a bill of attainder, since the act fulfilled the valid regulatory purpose of preserving information which was needed to prosecute Watergaterelated crimes and was of historical interest.31 As part of this analysis, however, the Court even questioned whether the statute in question met the specificity prong of the two-part test, finding that naming an individual could be “fairly and rationally understood” as designating a “legitimate class of one.”32 Thus, it has been suggested that Nixon stands for the proposition that any level of specificity is acceptable, even the naming of individuals, as long as a rational, non-punitive basis for the legislation can be established."
https://sgp.fas.org/crs/misc/R40826.pdf
Property taxes are not traditionally punishments. The type and severity of the property taxes in this case are entirely in line with taxes that most everyone else pays, and the purpose here entire furthers non-punitive legislative purposes.
Even the single class-member herewould like meet the "rational, non-punitive" test.
There are also a mountain of very carefully crafted tax breaks and subsidies designed to benefit the one particular corporation that qualifies.
I have no idea if the above proposal is a good idea or a bad one, but I would be very surprised if it qualified as a Bill of Attainder.