Pittsburgh Sets Vote on Adding Tax on Tuition

By IAN URBINA. NY Times

The mayor of Pittsburgh calls it the “Fair Share Tax.” But to officials at the city’s 10 colleges and universities and many of their 100,000 students, it is anything but.

On Wednesday, the City Council is expected to give preliminary approval to Mayor Luke Ravenstahl’s proposal for a 1 percent tuition tax on students attending college in Pittsburgh, which he says will raise $16.2 million in annual revenue that is needed to pay pensions for retired city employees. Final Council action will be on Monday.

The tax would be the first of its kind in the nation, and other cities are watching closely as they try to find ways to close their own budget gaps.

Students and college officials argue that the tax will drive students away and place an unfair burden on institutions that already contribute substantially to the city. They add that the measure comes at an especially difficult time for colleges, as endowment values have fallen and requests for financial aid have risen.

The tax, which will most likely end up in the courts, represents a turning point for Pittsburgh, which has remade itself after the steel mills shut down, becoming a hub for nonprofit hospitals and universities. Yet it has been unable to draw significant revenue from its new identity.

“It’s really a disappointment that we’re in this situation,” Mayor Ravenstahl said. “Our colleges and universities are giving less and less while they increase tuition and executive pay and expand their campuses, removing high-value land from the tax rolls. The cost to provide public safety and public works services continues to increase, but our revenue continues to decrease.”

The tax, which would take effect as early as July, would range from about $20 a year for students at cheaper schools like the Community College of Allegheny County to just over $400 for students at the city’s priciest university, Carnegie Mellon.

As a town-gown clash, the issue pits local taxpayers against mostly out-of-state students. But it is also a struggle between the old Pittsburgh and the new, as the mayor tries to force the city’s youngest residents to support some of its oldest.

Other cities have considered going this route. This spring, for example, Mayor David N. Cicilline of Providence, R.I., proposed a $150-per-semester tax on students at the city’s four private colleges. The State Legislature, however, did not take it up.

And in Boston, Mayor Thomas M. Menino created a task force in January to explore increasing voluntary payments from the city’s universities and hospitals.

“City officials see this as an untapped revenue source, and if Pittsburgh succeeds, I think you will see a lot of other cities immediately move to do the same,” said Terry Hartle of the American Council on Education, a lobbying group for universities. He added that if the Pittsburgh City Council approves the mayor’s proposal, the matter will surely go to the courts.

Students and university officials are not pleased.

The added cost “could prevent prospective students from coming to Carnegie Mellon, and Pittsburgh would be missing out on some of the best talent from around the world,” said an editorial published this month in The Tartan, the student newspaper at Carnegie Mellon.

Officials at the University of Pittsburgh said they would “vigorously oppose any attempt to impose a service or privilege fee on our undergraduate and graduate students.”

But Mr. Ravenstahl said he was left with no other option.

He said that he asked the universities and other tax-exempt nonprofits to pay $5 million annually to the city, and that in lieu of the tax he would find the other $10 million by dipping into reserves, cutting services and getting Harrisburg to increase the commuter tax rate.

Mr. Ravenstahl said the city currently forgoes about $50 million in real estate taxes from nonprofit institutions.

The universities rejected his request last week.

In a four-page letter, the Pittsburgh Council on Higher Education said it refused to consider payments as long as the mayor continued the threat of a tax that it called divisive, illegal and unenforceable.

The council added that the city’s colleges and universities pay $23 million annually in taxes to the city for payroll, parking, business privileges and any real estate not directly related to their educational missions.

Politically, Mr. Ravenstahl risks few votes in leaning on universities for revenue because college students rarely vote in local elections. And many of the constituencies that supported Mr. Ravenstahl’s re-election in November have been vocally supportive of his tax plan.

“This is a turning point for us,” said Joe King, president of the Pittsburgh firefighters’ union. He said that after Miami-Dade County in Florida, Allegheny County has the second largest number of seniors of any county in the United States and that in his union alone he has 900 retirees and 450 surviving spouses whose pensions need to be financed.

“Without the tax, the fate of those pensions could be in trouble,” he said. “We are not asking young people to carry more than their due. We’re just asking them to pay for what they use.”

But students say they already do.

“We have jobs in Pittsburgh so we pay taxes on that income, we rent apartments so we pay taxes on that, we have cars here, which provide parking taxes,” said David Gau, an undergraduate at the University of Pittsburgh, adding that he resented the portrayal of students as freeloaders. “We go to a variety of events like symphony, sports games, plays, concerts, and there are amusement taxes on those that produce even more revenue from us.”

“Why try to divert new people from coming here with a college tax?” added Mr. Gau, 21, who is from Kennett Square, Pa. “It’s the furthest thing from fair.”

Chad Ellis, 28, a graduate student in chemistry at Carnegie Mellon University and a Pittsburgh homeowner, agreed.

“Holding students hostage in negotiations with nonprofits to come up with money to pay for bloated city pension plans is divisive,” he said.

Pittsburgh Post-Gazette Endorses Barack Obama

Barack Obama: Democrats deserve a nominee for change

Wednesday, April 16, 2008

Pittsburgh Post-Gazette http://www.post-gazette.com/pg/08107/873625-192.stm

On Tuesday, Pennsylvanians will have the unusual luxury of voting in a Democratic presidential primary that promises to be truly relevant. Like two opposing armies marching to a new Gettysburg, the forces of Barack Obama and Hillary Clinton come to this latest battlefield symbolizing two views of America -- one of the past, one of the future. Pennsylvania Democrats need to rise to the historic moment.

For us it is the candidates' vision and character that loom as the decisive factors in this race. For as dissimilar as they are, the two share much in common. It starts with their mold-breaking candidacies. Whoever wins the nomination will vie for a special place in U.S. history -- to be either the first African-American or the first female commander in chief.
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Although their backgrounds are different, they have come to the same conclusion, one now shared by many Americans, that the Bush administration has taken the nation on a profoundly wrong course both at home and abroad. The excitement that has animated this primary season -- the surge of new voters, the change of party registrations -- is an expression of the nation's hunger for change.

For as hard as they have run against each other, both candidates are united in running vehemently against President Bush and all his works -- another common theme that came out in their visits to the Post-Gazette editorial board on successive days this week. Sen. Clinton was the more explicit in her disdain: George W. Bush "is one of the worst, if not the worst, president we have ever had."

Not surprisingly, the policies they advocate have much in common and are generally the polar opposites of those espoused by the current administration.

On the domestic front, the prescriptions they offer on issues such as health care, the environment and education declare that government must be an agent of change to benefit the lives of ordinary Americans, not a power that shrinks from regulating or directing for fear of offending a core ideology.

In their expansive plans, Sen. Obama and Sen. Clinton do have their own emphases and differences -- Sen. Clinton's health-care plan, for example, would cover more Americans than Sen. Obama's, but both would be a vast improvement on the status quo that leaves 47 million Americans uninsured and continues to soar in expense.

On foreign policy, both are united in their desire to bring the troops home from Iraq while improving the strategic situation in Afghanistan, the place of unfinished business where the al-Qaida spiders first spun their deadly web for 9/11 and are coming back thanks to the Iraq diversion.

On Iraq, for those inclined to remember, Sen. Clinton carries more baggage, for she voted to approve the war in the first place. For those inclined to forgive, she would seek to repair relations with allies strained by the Iraq misadventure, as Sen. Obama also would.

There is one last common ground for these candidates: They are both uncommonly smart, thoughtful and very well-versed in the issues. They care about people and they care about the workings of government. They are prepared.

Their strengths promise, in short, the one thing that the Bush administration has so shockingly lacked: competency. There will be no intellectually lazy president in the White House if either succeeded to it, no outsourced thinking to the vice president or the secretary of defense, no cheerfully shallow praise for unqualified political appointments, no enduring cause for embarrassment by the American people.

So forget all the primary skirmishing. Sen. Obama is every bit as prepared to answer the ring of the 3 a.m. phone as Sen. Clinton. Forget this idea that Sen. Obama is all inspiration and no substance. He has detailed positions on the major issues. When the occasion demands it, he can marshal eloquence in the service of making challenging arguments, which he did to great effect in his now-famous speech putting his pastor's remarks in the greater context of race relations in America.

Nor is he any sort of elitist. As he said yesterday in effectively refuting this ridiculous charge in a meeting with Post-Gazette editors, "my life's work has been to get everybody a fair shake."

This editorial began by observing that one candidate is of the past and one of the future. The litany of criticisms heaped on Sen. Obama by the Clinton camp, simultaneously doing the work of the Republicans, is as illustrative as anything of which one is which. These are the cynical responses of the old politics to the new.

Sen. Obama has captured much of the nation's imagination for a reason. He offers real change, a vision of an America that can move past not only racial tensions but also the political partisanship that has so bedeviled it.
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To be sure, Sen. Clinton carries the aspirations of women in particular, but even in this she is something of a throwback, a woman whose identity and public position are indelibly linked to her husband, her own considerable talents notwithstanding. It does not help that the Clinton brand is seen by many in the country as suspect and shifty, bearing the grimy stamp of political calculation counting as much as principle.

Pennsylvania -- this encrusted, change-averse commonwealth where a state liquor monopoly holds on against all reason and where municipal fiefdoms shrink from sensible consolidation -- needs to take a strong look at the new face and the new hope in this race. Because political business-as-usual is more likely to bring the usual disappointment for the Democrats this fall, the Post-Gazette endorses the nomination of Barack Obama, who has brought an excitement and an electricity to American politics not seen since the days of John F. Kennedy.

First published on April 16, 2008 at 12:00 am