Columbia University and NYU’s property tax exemption statuses could be revoked

It wasn’t long ago when an investigative report by The New York Times posited that Columbia University and New York University—two of New York City’s largest private landowners with billions of dollars in real estate assets—recently avoided a combined $327 million in property taxes. After the ink dried, many scratched their heads: How does that math add up?

In a state legislative bill with potentially national ramifications, New York state senator John Liu and Queens Assembly Member Zohran K. Mamdani proposed this week abolishing both universities’ tax exemption statuses. Instead, Columbia and NYU would pay hefty property taxes that will help finance CUNY under the tentative measure, a public university that’s felt the full brunt of Mayor Eric Adams’ austerity measures. (In the 2023 fiscal year, CUNY lost $155 million in funding, costing 235 faculty and staff their jobs.) 

Columbia itself owns 320 properties in New York City valued at nearly $4 billion; yet it benefits from a nearly 200-year-old law that alleviates universities, museums, and nonprofits from paying property tax. The bill sponsored by Liu and Mamdani, however, only targets NYU and Columbia; other higher education institutions with properties in New York City such as Fordham and Cornell would not lose their tax exemption status.

The measure is supported by Comptroller Brad Lander, who says it could mean great things for CUNY. According to Lander, New York City’s public university is “facing repeated patterns of disinvestment and serious financial challenges while some of the City’s wealthiest private institutions expand their campuses’ tax-free footprints.”

John Beckman, a NYU spokesperson, disagrees with this week’s proposition. “To choose two charitable, non-profit organizations out of the thousands in the state and compel them to be treated like for-profit entities certainly strikes us as misguided and unfair,” Beckman said. 

“Were NYU suddenly taxed on its property, it would be extraordinarily disruptive, not only to our extensive operations, but to the now well-established mechanisms of support that NYU provides to every level of New York government,” Beckman continued. He said in a statement that NYU pays $15 million on properties it leases while providing vital services to public institutions in New York.

University of Pennsylvania (Swordsman1/Wikimedia Commons/Public Domain)

NYU and Columbia however are far from alone. Philadelphia is facing a similar issue. The University of Pennsylvania, sitting on a cushy $21 billion endowment with $3 billion in land assets, doesn’t pay property taxes either.

And in Massachusetts, state officials have also long chastised its private universities for not paying their fair share. Harvard University, for instance, is indeed outside Boston municipal limits, but it’s still one of the city’s largest landowners and isn’t required to pay property taxes. And neither is Northeastern University, Boston University, or MIT. (To MIT’s credit, that Cambridge institution paid $66 million in property taxes on its commercial properties valued at $5.8 billion in 2021; that year, Harvard paid $6.6 million in property tax for its $790 million real estate portfolio.)

In 2011, a program called Payment in Lieu of Taxes (PILOT) was passed that encouraged Massachusetts private universities and nonprofits to pay 25 percent of what they owe in property taxes, but the program was only voluntary; and Harvard rarely managed to meet its quota. For the eleventh year in a row, Harvard has fallen short in paying its 25 percent, The Harvard Crimson reported.

This November, progressive Massachusetts reps voted to strengthen the PILOT program to help amend Boston’s affordable housing crisis and connect struggling public institutions to capital. In Philadelphia, public school parents, activists, and even UPenn professors are fighting for a similar program under the same name. Over 1,200 UPenn faculty and staff recently signed a petition for Philadelphia to adopt PILOT.

As of this week, the Empire State has made the boldest mandate yet. “It is time that these institutions pay their debt to the working class of New York City,” Queens Assembly Member Zohran K. Mamdani told Gothamist.

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