Clergy Back Bill To Clarify Special Yale Tax Exemption

Churches pay taxes on commercial activities, so Yale should, too.

That’s what a coalition of clergy and community leaders demanded Thursday as they gathered in Deliverance Temple Church at 584 Congress Ave. to support Senate Bill 414, which is pending at the state Capitol.

The bill would clarify how to apply an 1834 state law that grants a special tax exemption to Yale and four other colleges, allowing them to avoid paying taxes on buildings that partly house commercial activity that produces less than $6,000 in annual income.

The clergy’s statement came a day after Yale officials threatened to evict New Haven Symphony from its Woolsey Hall performance space if the bill passes.

More than 100 members of the clergy signed onto a letter to the General Assembly urging legislators vote ​“yes” in order to ​“clarify the rules dictating which commercial properties are taxable and which are tax-exempt. New Haven needs that clarification.”

Ron Hurt, senior elder of Deliverance Church, said the division for the church is clear: ​“The building where we carry on the core mission is tax exempt,” he said. But the commercial property is taxed.

The church nonprofit owns the property next door at 592 Congress Ave., which it leases to restaurant China Café. It pays $7,000 in municipal taxes on that property, Hurt said.

“Yale University should be treated the same way we are treated,” he said Thursday.

Rabbi Herb Brockman quoted the prophet Jeremiah in supporting the bill: ​“Seek the welfare of the community where I have sent you … for in its welfare you will find welfare.” 

“Religious institutions clearly benefit from the services of the community in which they abide. As any corporate citizen, they [Yale] too have an obligation to help support those services,” Brockman argued. ​“While they often provide in-kind support through their charitable mission work, nonetheless they have an obligation as well. In Jewish tradition, the sages taught, ‘[Even] he who receives [tzedakah from the community] is obligated to give [tzedakah from the community].’” 

Yale argues that it already pays taxes on its commercial properties, and that the bill would redefine non-commercial properties like Payne-Whitney Gymnasium and the Yale Repertory Theatre as taxable and commercial. Yale estimates they would pay almost $760,000 in annual taxes on Woolsey Hall alone unless they boot groups like the symphony from using it. Supporters of the bill say they’re happy to specifically exempt such properties and that they looking instead of buildings like the Center for Genome Analysis in West Haven and Yale’s travel service, both of which Yale insists are legitimately tax-exempt.

The university’s lead state lobbyist, Associate Vice President for State and Federal Relations Richard Jacob, wrote a letter to the Yale community arguing that taxing Yale would not help create jobs and discounts the more than $4.5 million in property taxes it already pays on nonacademic properties.

“Yale is also making clear that SB 414 violates the U.S. and the Connecticut Constitution, and Yale is prepared to defend its constitutional right of non-taxation,” the letter reads. Click here to read the full letter at the bottom of the article. (Yale also published a set of FAQs to ​“clear up misconceptions” on taxation of university real estate.) Jacobs said.

The letter from the 100 clergy members argued that ​“this ambiguity in the law makes our city’s ability to provide basic services dependent upon voluntary payments made by Yale that are subject to change at any time. Indeed, Yale’s ongoing opposition to the bill demonstrates the potential for such a change.”

Few buildings would be affected if the bill passes, so not much if any tax revenue is at stake, Mayor Toni Harp said this week on WNHH radio’s ​“Dateline New Haven” program. She said she supports the law to get ​“clarity” on how to tax properties in the city.