Yale Threat Pays Off

Don't feel bad, Paul. Marchand doesn't respond to his constituents either.

The level of cattiness in New Haven's town-gown relationship has reached 'Mean Girls' status!

Yale is saying to Harp, "Want to play hardball? We can be jerks, too."

More than anything, to me, this series of events confirms that the State and City should come up with a plan to clarify the University's tax code, rather than relying on the (cough cough) "charitable" contributions of Yale, that, apparently, are directly tied to how closely they agree with our elected officials.

Also, Mr. Bass, as a journalist, doesn't your professional integrity not prompt you to at least attempt to disguise your bias? Your writing has never been particularly objective, but this is beyond the pale. Captioning a photo "Marchand: The Artful Ducker?" Are you seriously stooping to name calling?

Seriously disappointed with the Independent right now...

This is despicable behavior on the part of Yale! They're throwing a temper tantrum because city residents and their elected representatives are standing up to them and saying they should be subjected to the rule of law. Whenever they don't get what they want they resort to bribes, extortion, threats (e.g. We're gonna evict the symphony orchestra), and general bullying tactics.

This is not a sustainable relationship or viable way to govern a city. The city should make Yale sign a contractual agreement saying what they're obligations will be every year. We should NOT have to get down on our knees and beg for pocket change.You can't run a municipality that way.

Let's not forget that Yale's "generous" "voluntary" ANNUAL contribution amounts to less than they make DAILY in interest on their investments. Despicable

City Hall has refinanced debt to increase spending and still make it appear that taxes are flatlined. We should have had some generous tax cuts as a dividend when we passed peak financing for the school construction program.
Besides that, the reason that taxes might go up now isn't because of Yale. It's because the local union backed alders led by Alder Adam Marchand continue to hurl flaming bags of dog $&!+ onto Yales front porch.

Of course Marchand was ducking the NHI. But then again, Yale essentially ducked the NHI too.

Why the strange request to have Marchand on the phone in person? (Is Alexander about to blackmail him? lol) This does remind me of earlier this year when the Yale corporation tried to single out Roland Lemar for essentially just doing his job. If I were Marchand, I would call the University's bluff by not picking up the phone.

Obviously Salovey and Alexander feel attacked by the Union-controlled BofA, and under-appreciated by everyone else. But to go to the brink against the City's budget? In what way is that winning them any friends or sympathies? Whoever is handling the PR for the university, they need someone else. Maybe Salovey can bring Levin back as a consultant?

@ Skeptical -- As a public official, Marchand should have given Bass the decency of a phone call. Or a decision to go "no comment" on this one. Instead he dickered around with the NHI, holding up a story and wasting the reporter's valuable time.

That being said, it is understandable if Marchand had difficulty coming up with a response to Yale's peculiar ultimatum "We'll give you the money, but first we need Adam down on his knees"?

Adam Marchand of the BofA, Brad Marchand of the Boston Bruins...they both have that 'je ne sais quoi', that antagonistic way of getting under ones's skin...could they be related?

Paul so you are satisfied with "no comment" from Zucker and Alexander, but you print a text message conversation and engage in name calling with Marchand? Yale is by far and away the most powerful institution in New Haven, but I guess alders are easier targets. I love the NHI, but I'm very disappointed in your willingness to do Yale's bidding here.

The story seems to me, that Yale is unhappy with the city, and now it is leveraging its tax-free status as a way to bully the city. The voluntary payments fall far short of what Yale would have to pay the city in property taxes. And Yale's voluntary payments are not voluntary. They are a source for Yale to continue its strategy of making the city do whatever it desires no matter the impact on New Haven's residents.

I feel naive admitting how shocked I am by this. Does the Yale administration not have enough to deal with unless they throw ego-fueled hissy fits? What a bizarre tantrum.

And NHI, can you get to the bottom of why Yale would withhold their normally scheduled first payment? They clearly are framing this as a response to an unusual request from the city, but that really doesn't seem to add up with a decade of history.

I think any alder(s) who create a multi-million dollar hole in the budget should be obligated to identify the spending cuts and/or tax increases they would recommend to fill it.

Also despicable is the editorializing, the character attacks, and the grand leaps liberties the author takes that reflect deep biases:

"personality-fueled Yale-union spat"

"The latest drama follows months of tussling between Yale and its UNITE HERE locals"

("Drama!?" Is that what you call attempting to run a small city controlled by a massive corporation? As a resident I resent the condescension and disdain for the people of this city)

Marchand's conflict of interest is blatant. He is using his position to work for his employer, often to the detriment of his city and his constituents. If we had real ethics laws in New Haven, he would be prosecuted. He has been asked repeatedly to explain himself and has arrogantly ignored such demands. Adam, I know that you read this. Answer for yourself immediately, decide explicitly whether you serve your employer or ward 25, or resign. You are intelligent enough to know that your conduct is unethical. Your silence speaks to your character, or lack thereof.

Like other union affiliated alders, Marchand either blew off the conflict of interest notification, or ignored its significance. Is there no automatic constitutional mechanism for relieving public officials from office who advocate for their own financial interests?

Alders who work for Yale or who work against Yale for their day job ought to recuse themselves on Yale business that goes before the board.

New Haven taxpayers are being caught up in a fight between the union and the university and it is improper for the Yale alders to use their public position to represent their employer when they have a sworn duty to represent the residents of their city.

Continuing to hold up economic development
In New Haven will not create one job, will result in increased taxes for every resident, and ultimately compel Yale to open their next genomics lab in New York City.

Is this a "Forced Give' or a 'Big Ask' ????

Marchand. Wow. Where to begin.

@Westville voter, "Don't feel bad, Paul. Marchand doesn't respond to his constituents either." and "Your silence speaks to your character, or lack thereof."

Agreed. Perhaps the delay in response to NHI is similar to his delays on matters before CPC / BOA. He simply needs a CMT to sound off on the text before he acts.

@ATP, "Maybe Salovey can bring Levin back as a consultant?"

Okay. And ought Harp do likewise with Destefano?

@robn, "Like other union affiliated alders, Marchand either blew off the conflict of interest notification, or ignored its significance. Is there no automatic constitutional mechanism for relieving public officials from office who advocate for their own financial interests?"

Agreed. As far as relieving him from office, whether there are constitutional grounds or not, believe that room exists, at least conceptually, for a bold prosecutorial mind to push for an indictment under the RICO statutes. This is as fringe as my views get on the matter:
http://www.newhavenindependent.org/index.php/archives/entry/ocean_manaegement_dwight/

I see absolutely nothing wrong with the position(s) Yale is taking.

UNITE HERE wants to play hardball with Yale today in private, and will be begging Yale tomorrow in public.

Bruce Alexander, a principled man, certainly will not intentionally hold the city hostage just to prove a point. That's far from his style. But for those Alders who don't know him, you're not dealing with a fool.

UNITE HERE union Locals 34 & 35 and their employees who serve on the Board of Alders are encroaching upon a battle that they may soon regret that they stumbled into. Getting in the way of progress by holding up a project is both politically suicidal and downright dumb. You Alders are sent there to hear both sides of an argument, vote it up or down and move forward. Now how hard is that?

The entire city knows that this board is going to support every construction project Yale proposes, so stop pretending to flex what you don't have, power. These projects bring additional revenue to the city's coffers.

What you're doing is so embarrassing that you have an Alder (Marchand) that volunteered himself to be enrolled in the witness protection program. This guy is running from Paul as if he's hiding thousands of emails on his private server. (Laugh)

SkepticalNHV, your proposal is reasonable, but I wonder about its workability. Let's say that faculty members use a science library partially for their academic research and partially for commercial research, with the proportions varying by professor and over time. How would the guidelines determine the extent to which the library is taxable?

The tax exemption given to Yale was based on the fact that no public college system existed when Yale and other colleges were established in the colonies. These private colleges were viewed as serving the public interest and deserving of support in the form of tax exemptions.
Now CT and most states have a true public college system and the need to subsidize private institutions is long past.
As we daily inch toward further economic collapse in CT, the Legislature will eventually have to look to wealthy "non-profits" for tax revenue.
Legislation to prevent hoarding of multi-billion dollar endowments will also come up.
Until we remedy these historical artifacts, Yale will be the elephant in the room.

Good for Yale. The board of alders have been completely out of control in their efforts to protect Union members (who largely live out of town).

It would be great to see Yale contribute even more, and to pay more attention to things like transportation for city residents who are impacted by the university's extensive reliance on publicly-funded infrastructure.

However, holding up massive development projects at the last minute is definitely NOT the way to go about getting to that.

Sure, there might be a long "back story" about the project, payments, parking, etc. However, given that there is no way for the public to verify that, the way this has unfolded looks extremely bad for the Alders and others involved. It simply looks as if a handful of Alders swooped in at the last minute and tried to hold up a project that had been planned for over a decade, potentially jeopardizing years of planning and investments by what is the entire state's most economically significant private employer.

Dwight; The existence of public schools does not mean private school don't serve a public purpose. Public schools, at all levels, are the biggest expense towns have. Private schools like Hopkins, Hamden Hall, Notre Dame, etc. educate students from New Haven, Hamden, and West Haven at no cost to the taxpayers of those towns. Considering per pupil costs of over $15K for public schools, taxpayers really benefits when kids go to public schools. (Yes, many students from Hopkins are from out of town, but it largely comes out in the wash when New Haven kids attend Notre Dame, Hamden Hall, etc.) Many other non-profits, such as health care and social service providers also save taxpayers money by providing services taxes would otherwise need to fund. Thus, it makes sense not to tax them. Yale, and many other residential schools, however, do little to serve the local population. Yale, Wesleyan, Hotchkiss, and Choate serve national and international student bodies. A closer analysis of the cost benefit formula is called for with institutions like those. PILOT was supposed to help remedy this situation, but the state has shortchanged PILOT for years.

After so long of clearly giving the run around against all sense for town or gown, perhaps no surprise Marchand doesn't want to confess he had to swallow the smugness.

Whether you like Marchand or not, or Yale or not, its a brilliant touch. If drama like this continues it could almost compensate for the damage this school yard politics does to the city itself.

"Yale initially offered to pay the money in August under one condition: that Westville Alder Adam Marchand, a UNITE HERE paid employee and a leader of the anti-Yale Board of Alders actions, call them to make the request."


I wonder if Yale looses its checkbook for six months next time. "We want to move it along. We just. . . ."

BLJ. Bruce Alexander, on behalf of Yale, uses bullying tactice when it suits him. I've been in the room when he's done so. Principled? Only if it benefits Yale

The first consideration to this communication problem between Yale and Alder Marchand is the FAC that Alder Marchand does NOT have authority to negotiate contracts or agreements with any NON profit in the city.

The sole responsibility belongs to the Mayor under the Charter:
Sec. 2. - Mayors Powers and Duties.

Powers 154. The Mayor shall have power:
(4) To see that all contracts and agreements with the City are faithfully kept and performed176.

(5)

To submit to the Board of Alders in writing at its first meeting in February of each year a complete report of the affairs of the City for the preceding year including the activities of each Department177.

The FAC that Yale has not paid its contribution for the fiscal year is not new, Yale pays what it wants to, and when it wants depending on the date of interest payment from its endowment. The city has to hurry up wait!

According to Clerkin's latest June monthly financial report- on-line- the state on payments from Yale and other large non-profits is as follows:

Non-Profits:

FY 15-16 - Actual
Adoni Spiritual center & Other
6,230.00
5,483.00 pd
Yale New Haven Hospital
2,655,641.00
2,612,597 pd
Yale University
5,578,403.00
-0- pd

Yale has been pulling this untimely payment stunt since first providing a hand shake agreement with former Mayor John Daniels, later agreeing to the same terms with John Destefano for payment for the number of dorms room on campus. Even today this agreement has never been ratified by the BOA, and operates outside the city Tax levy and revenue appropriating ordinance #2.


Yale is a bully and Harp allows it to continue.

1644: if you want to subsidize private schools, make a donation.
But don't cut tax funds to a city in dire need of a better tax base.

Marchand has gone out of this way on the BOA to represent UNITED-HERE, not the city of New Haven. He hasn't been subtle, he is doing this very openly, as a message to Yale and the city, that the unions are in control and the rest of us are just hostages. He has been holding the new science building hostage to the union agenda, holding up the jobs and building fees that would result, and he is not at all ashamed of this.

Can you blame Yale for playing hardball in return? There is no formal agreement that Yale pays its voluntary payment in August rather than October. Just like Marchand, Yale is threatening to play to the "letter of the law" rather than in a more cooperative way.

Can someone explain to me why it is OK for Marchand to play hardball on behalf of the unions, against Yale and the city of New Haven, but not for Yale to respond in kind? It is Marchand that invented this nasty game, not Yale. Thank goodness someone is standing up for the interests of the city, including the interests of other union members, against UNITED-HERE.

Yale's $8M "voluntary contribution" is a drop from the bucket of their $26B endowment, but a contribution the City needs since PILOT money never comes through in full. Marchand and the BOA work to get Yale to share the burden of running this city in lieu of the taxes they would pay if it weren't for non-profit status and an 1834 law that grants Yale a "special tax exemption over and above the general tax exemptions enjoyed by not-for-profit educational institutions." As far Marchand not returning NHI's texts/calls, Yale has entire departments to answer questions from the press, and Adam's indirect answer to your direct question is not any worse than Zucker's and Alexander's "No comment".

Another example of these rich cities always trying to steal from the poor.

Of course Yale is playing hardball, as well they should. How else would you expect them to react to public officials from New Haven supporting ridiculous and sometimes unconstitutional proposals aimed squarely at them?

Dwight: Private schools, at least the local, day schools are NOT subsidized. They save far more tax dollars than they consume in services. The properties that are subsided are residences for families. A typical family home might pay $5-$10 in taxes per year, while each child costs over $15K to educate in public schools that, of course, also keep land off the tax rolls. THAT is a subsidy, one that has to be made up by commercial and industrial properties. Would you really rather pay higher taxes to educate all the kids going to private schools like Foote, St. Bernadettes, Hopkins, etc., than grant them tax relief?

"Adam's indirect answer to your direct question is not any worse than Zucker's and Alexander's 'No comment.'"

Nonsense. If Marchand had no comment, then why not say so in his first text? How hard is it to text "no comment"?

Instead Marchand delayed the story and gave the NHI the run-around. Only in his sixth text did Marchand even purport to answer the question--and of course his answer was no answer at all.

Delay and obfuscate. Kind of like the way Marchand handled Yale's biology building itself.

"Marchand and the BOA work to get Yale to share the burden of running this city."

No, Marchand is using his power as an Alder and CPC member to get Yale to give his union a better contract.

This is not about "running the city." More like Marchand RUINing it.

I love this idea that while all these UNITE members live in the burbs, all these ~jobs~ are just waiting for New Haven and totally not going to people outside the city. Lets not pretend Yale is being treated unfairly, they've been a bully to the city and unions as long as any of us have been alive and when someome decides to fight back, Yale basically goes, "MOM! The other kids are being mean to me!"

"The deal called for Yale to pay all the money each year in October at the latest. But under an arrangement with the previous DeStefano administration, Yale has annually paid the first $5.6 million in August, according to city Budget Director Joe Clerkin. (It pays the other $2.7 million, in lieu of paying for fire service, in October.) That early payment helped the DeStefano administration balance its books one year. Clerkin said the $5.6 million has never been double-counted in any one fiscal year, but rather that it's expected each August to balance the books on the fiscal year recently ended."

So under the initial agreement, Yale paid the City $8.3M per year in October for that fiscal year, until one year the DeStefano administration asked for an advance on the following year's payment in August in order to close a budget hole for that previous/current fiscal year. Yale then made the remaining $2.7M payment in October, followed by another advance in August for the coming year. So the City continued to get $8.3M in total payments from Yale each year, except one year where that budget got an additional $5.6M in the form of an advance in order to close a budget hole. Is the plan to continue getting advances from the coming year's payment in the hopes that we never have to deal that $5.6M that we took from one year's budget and applied it to the previous years?

Do I have this right?

@ 1644:

you missed my point.
I wrote about private colleges getting a tax break for a non-existent public benefit.
you wrote about prep schools.
Not the same thing.
Yes, I know they are not subsidized. I never said they were.
If you want to subsidize Yale thru your taxes, you can choose to do so for a prep school.
I choose not to.

Poor showing all around. Yale looks silly singling out local alderman to bully, Marchand caught in web of conflicted interests. Bass a little too close to the story.

Dwight: You missed my point. If Yale were more of a commuter school, serving a local population like Foote and Hopkins do, and QU used to do, we might not need the massive subsidies we pay to public schools like Gateway and Southern. Foote and Hopkins mean a lot of cost avoidance for local communities. Yale and Hotchkiss do not, because they do not serve their local communities; they serve a largely out-of-state population. If you think higher education should not be subsidized period, Gateway and Southern, UConn, and other state schools cost CT taxpayers far more than Yale does. U New Haven, Fairfield, Sacred Heart, and Bridgeport have better arguments for tax-exemption than Yale or Wesleyan because the former schools serve the local population, the latter do not.

This story is the culmination of back and forth over the past few years between the UniteHere -34/35, the Board of Alders, Yale & the Harp administration. I feel that there is an underlying point that needs to be stated (and it has been by some of the commenter's to this story) when you have a member of a trade union directly in charge of approving or disapproving their employer's requests to the City this is a conflict of interest. It is an even greater and clearer conflict when the member of the BoA is a member of the trade union's executive board.

In my estimation members of the BoA are playing hardball with Yale. They are using the power they have as the ultimate zoning body in New Haven as a tool to use at the bargaining table. Do not be surprised or upset when Yale plays the same game with the one tool they have - the power of the purse.

Our elected officials playing this game need to understand the consequences for us the citizens and taxpayers of New Haven and not only view this in the context of the UniteHere / Yale context. It appears to me that they are putting their personal needs in front of those of the City and taxpayer.

This is exactly the reason why we have conflict of interest policies and wonder why the folks that are both members of 34/35 and the BoA do not recuse themselves on such issues.

"they've been a bully to the city and unions as long as any of us have been alive and when someome decides to fight back, Yale basically goes, 'MOM! The other kids are being mean to me!'"

Perhaps you might consider the wit and wisdom of J.K. Rowling....

"Draco dormiens nunquam titillandus."

Never tickle a sleeping dragon.

@1644

One last shot at this.

" Gateway and Southern, UConn, and other state schools cost CT taxpayers far more than Yale does. U New Haven, Fairfield, Sacred Heart, and Bridgeport have better arguments for tax-exemption than Yale or Wesleyan because the former schools serve the local population..."

Dwight: For example, look at Gateway's financial statements: http://www.ct.edu/files/pdfs/finance/finance-CCC-financial-statements-FY14.pdf
Notice how much of its annual income comes from state appropriations and bonding, i.e. tax dollars. In contrast, any private school will show its income being a mix of tuition, gifts, and grants, with grants being much smaller. They do not receive any annual appropriation of tax dollars. That massive tax subsidy is what allows tuition, especially in-state tuition, to be so low relative to the private schools. If those attending private schools wanted to attend state schools, we would need to massively expand state schools, increasing costs to taxpayers. When a Connecticut resident chooses a state school, he receives a massive tax subsidy to his education, When he chooses a private school, the only "subsidy" he gets is the tax-exempt status of the school's realty. If all Connecticut students attended private schools, we could close the state schools and save a boatload of tax dollars.

I'm not inclined to be extremely sympathetic either to Yale or to this mayor's administration. But I can say: given the bush-league political antics and self-dealing tactics on the Board of Alders and City Plan Commission (thanks, Westville! for this stellar alder), the University would be crazy not to maintain and, when necessary, use leverage. Presumably the University, in order to proceed with dispensing funds, needed to know from the horse's mouth (or some other part of horse anatomy) that there would not be continued obstruction of the lab construction, costing the University millions in additional fees.

Marchand deserves a medal for the way he parried with the Yale heavies and the dogged Paul Bass. It is more than a Yale-union issue here as has always been the case. It is the welfare of our city that is at stake and if the poor need to leverage their hopes on an Alderman's prowess then so be it!

Boola boola, boola boola
Boola boola, boola boola
When we rough house poor old UNITE/BOA
They will holler, "Boola boo"

@cellardoor "thanks, Westville! for this stellar alder"

Don't thank all of Westville... only the part that doesn't pay attention. Where's Nancy Ahern when we really need her?
http://wtnh.com/2016/04/26/new-haven-poll-workers-have-a-16-hour-day-ahead/

+1 Jeff Klaus - Adam absolutely should be recusing himself from votes related to his employer. How this conflict has not been addressed yet is truly concerning for the health of democracy in NHV. Adam, it's morally irresponsible to not recuse yourself regardless of what the law currently states.

It's not like it's against the law to impose property taxes on a private educational institution:

"Dartmouth pays taxes on dormitories and dining halls based on a 1930's NH Supreme Court ruling (Concord v. St. Paul's School) which requires all private schools, including colleges and universities, to pay taxes on such facilities. The College also pays taxes on the Inn, all of the property it owns in Downtown Hanover (7 Lebanon St., 4 Currier, etc) and, of course, all residential property it owns off campus as well as any non-academic related commercial properties. They do not make a PILOT [Payment In Lieu of Taxes] payment to the Town.

"The amount Dartmouth pays is part of the public record (you can find information about the Town's 10 largest taxpayers on page 83 of the 2012 Town Report which is available on the Town website). For 2012, Dartmouth paid $5,481,661 in property taxes and is the Town's largest taxpayer."

http://www.dartblog.com/data/2013/10/011053.php

Pant: New Hampshire is a foreign jurisdiction, with different laws. Moreover, Yale has a few specific legal protections beyond those other schools have. If people want to tax Yale, they really should look at the labs, which, as your link says, generate patents which generate millions in income to the university. Some time ago, there was a story about an AIDS drug that was generating $40 million for Yale. Under political pressure, Yale waived its royalties, but it seems to me that the labs, not the dorms, is where the money is.

"Marchand deserves a medal."

He's more likely a flash in the pan. In the sport of what-goes-around-comes-around.

"[I]f the poor need to leverage their hopes on an Alderman's prowess then so be it!"

Exactly what did Marchand accomplish here? Other than return the town-gown relationship to the depths of the 1990s, and give Yale every justification to flex its muscles?

Marchand showed clever tactics, but truly abysmal strategy. Based on this year, if the poor or anyone else needs to "leverage their hopes" on Marchand's "prowess," then they will be sadly disappointed.

City government is not--or should not be--a UNITE shakedown operation. Like it or not, Yale and New Haven are partners. And partners do not hold each other's priorities hostage.

I guess it was time for a new generation of so-called "city leaders" to learn this lesson the hard way.

About time folks in the city realize that their elected officials like Marchand have different priorities because of their unions ties. He acts for UNITE HERE first and his ward and the city second. And he's not the only one!

New word for dictionary? Marchanded: Getting beat at your own game!

Thanks Paul - great reporting!

Paul,

You could have been more clear with this article. I keep reading comments about how bad Marchand is for standing up to the 800-pound-gorilla in New Haven, and how weak and helpless that gorilla is in the face of someone like Marchand. We all know that guy owns like half of downtown. lol

Also, it seems to have gone over most people's heads that Yale has been making the payment early for the LAST 10 YEARS so that we can keep our books straight! wtf? Gee, must be just another example of our rich city having so much left over each year that Yale gives us our annual gift early in appreciation. Yep, I think I understand it.

@1644

The point is that the state ruling was never challenged in federal court, which implies it's perfectly constitutional to tax Yale property.

Hew: No one is saying Yale is weak. Quite the contrary: Yale is the 800 pound gorilla. The Wizard told the Lion he had confused cowardice with wisdom. Perhaps Harp and Marchand, in picking a fight with Yale, have confused courage with foolishness. If I lived with a gorilla, I would not want to fight it. I would want to be friends with it.

@Pantagruel

You're setting up a straw man. No one is arguing unconstitutionality under the federal constitution.

The point is that Yale has special protections--appropriate or not--under state law, which also applies here.

Of course, the federal government has chosen to not tax universities' charitable-purpose income either.

@ budgeteer --

If you bother to read the state law, it grants Yale a special tax emption, BUT ONLY on properties producing less than $6,000/year of income.

Of course Yale pretends that exclusion doesn't exist. Yet it does.

Go figure.

@AverageTaxpayer

The constitutional question is harder than you think. It involves Dartmouth College v Woodward and would probably go to the US Supreme Court. At one point the legislature removed the cap (which limited the constitutional protection to property producing less than $6000 in income), but then later they put it back on. However, the Yale Corporation refused to accept the change, and a US Supreme Court case appears to say that university charters granted by states cannot be changed unilaterally. It sounds nuts, but it is a serious argument, see

https://www.bloomberg.com/view/articles/2016-03-30/tax-yale-s-endowment-good-luck-with-that

Of course, aside from the issue of the charter and the state constitution, Yale is in any case protected for now by the same general statutes that grant a property tax exemption to all universities, as in done in every other state in the nation.

@AverageTaxpayer,

You are referring to the special statute for Yale (and a few other institutions) that dates from the 19th century. That $6,000 provision is a very specific and antiquated statute that protects Yale, Trinity, and a few other named institutions of similarly long standing, with respect to certain for-profit activities.

But of course Yale is also subject to the general rule that nonprofits are not taxed on their charitable, public-purpose activities. That's a more general principle of Connecticut law as well as of federal law.

In other words, the $6,000 provision is not the only one that protects private educational institutions in Connecticut. And sorting out which activity is for-profit and which is public-purpose/nonprofit can be quite complex.

See the drug-patent example that another commentator raised above--is that research? Or does it become "for profit" if the educational institution gets royalties on the patent that results?

If your point is that the line between taxable and nontaxable under Connecticut law is not well defined or drawn, and that Yale might take advantage of any gray area (as any taxpayer would), then your point may be a good one. I don't know enough about state law of nonprofit taxation to say--I'd want to compare Connecticut with other states.

AT: There are many statutory provisions regarding tax exemption. The section you cite concerns personal and real property held for income purposes, essentially the endowment. Yale, and a later few other colleges, were allowed to have their endowments be tax-free and commercial properties tax-exempt so long at they did not, original, produce income of over 500 English pounds per year, later updated to $6K dollars. Property held for scientific and educational purposes is tax-exempt under a separate section of the statute you cite. Section 12-66c says student housing with less than 20 beds is taxable, but "dormitories", i.e., student housing with 20 or more beds, is tax-exempt.

Note: there is a provision that officers of a tax-exempt entity can only get reasonable compensation. One could argue that the millions some professors make from patents voids Yale's tax-exempt status.

Here are the laws regarding Yale's tax exemptions:
http://www.yale.edu/sites/default/files/files/University-Charter.pdf

Esbey: Contrary to your Bloomberg article, I read these to say the six thousand dollar exemption applies only to real property. All personal property, which would include the endowment, is exempt. The 1834 law/charter amendment makes that pretty clear. The amendment also took away the tax exemption for officers and employees of the university, which had hitherto existed. The bottom line of the Bloomberg article is correct: The state cannot tax Yale's endowment without Yale's consent.

@a644. You wrote: If all Connecticut students attended private schools, we could close the state schools and save a
boatload of tax dollars.

You get the prize for non sequitur of the year!

Of course we subsidize state colleges with our tax dollars.
The fact remains that wealthy non-profits with humongous endowments and unexamined properties are living off the people based on an outmoded assumption (private college = public benefit) and a ludicrously out of date formula.
This WILL change because we can't afford it.

But trust that those feasting off the public will fight to the bitter end.

Yale lives off of New Haven? LMFAO!! This is the lefty equivalent one of Donald Trump's non-sequiturs.

The only reason that any property in New Haven has any tangible value is because it is either owned by Yale or near property owned by Yale. Yale is the economic engine of New Haven. Bridgeport would love to have New Haven's "Yale problem."

Dwight: Of course we subsidize state colleges" Why should we? Why is a student attending a state school more deserving of subsidy than a student attending a private school? If private school students should pay the full-frieght, no tax-exemption for property, why should state schools pay full property taxes and students pay for those taxes through tuition, as well as pay all the others costs, with, as for private schools, zero state subsidy?

@1644: Why is a student attending a state school more deserving of subsidy than a student attending a private school?

State college students are more worthy of subsidy because a) not every one can afford a private college b) some private colleges have a religious or discriminatory focus c) education of the citizens is necessary for participation in a representative form of gov't (however oligarchical it is at the moment) where people at least have a vote and should ideally know how to think.

If private school students should pay the full-frieght, no tax-exemption for property, why should state schools pay full property taxes and students pay for those taxes through tuition, as well as pay all the others costs, with, as for private schools, zero state subsidy?

Dwight:
Private schools could be as affordable as public schools if they received the same subsidies as public schools. Fundamentally, it seems you believe in the Prussian model of education, in which state schools are a vehicle to indoctrinate students with the values that the state wants them to have. Private schools, which may have different values, make worse citizens because their students may learn values (such as religious ones) which the state does not want them to have.
Sorry about the last: I meant to say way should the property of state schools be exempt from property taxes if you think private schools' property should be subject to property tax. I suppose the answer is that the state cannot control what is taught in private schools, and some of those values may not conform with the state's values.

@1644.
There is no public policy or even logical reason private school should be as affordable as public.
My educational preference is for cooperative learning i small groups and with multi-disciplinary projects, - not that it matters.
It would be plain goofy for public schools and colleges to tax themselves.
We're stuck with a capitalist model of schools with some socialism and that's how it works.
The taxation system is collapsing and the vast middle can no longer support the elites.