Erin Faulkner / Gavel Media

BC Paid 10 Percent of Boston's Requested Payment in Lieu of Tax

Boston College contributed 10% of the requested Payment in Lieu of Tax (PILOT) to the city of Boston in 2019, according to a recent report on the city’s website. The failure of BC and other nonprofit institutions to contribute to this program, which would alleviate the burden on local taxpayers, was opposed in a press release on Monday from PILOT Action Group

PILOT is a city program in which educational, medical, and cultural institutions that are exempt from property taxes voluntarily contribute funding to key services provided by the city, such as police, fire protection, and snow removal. 

According to guidelines, all institutions that own property worth more than $15 million in the city are asked to pay “25% of what the institution might expect to pay in real estate taxes if the exempt property were taxable.”

The guidelines also allow for up to “a 50% PILOT deduction for qualifying community programs that uniquely benefit Boston residents.” 

The 2019 fiscal report reveals that the Boston College voluntarily paid the city $357,943, or 10%, of the total request of $3,620,146. It also reports that the city did not receive a community benefits report from BC and that 0% of the community benefits credits were utilized. 

Other leading Boston institutions of higher education contributed significantly higher percentages of the requested PILOT, including Boston University (86%), Harvard University (79%), Northeastern University (65%), and Tufts University (88%). 

In total, educational institutions contributed 71% of the requested PILOT, compared to hospitals which contributed 92% of the request, and cultural institutions which provided 52%. Altogether, these privately-owned institutions contributed to 79% of the total requested PILOT.

PILOT Action Group, a coalition of local community, faith, labor, and student organizations in Boston, is advocating for increasing accountability to make sure wealthy institutions contribute the full PILOT payment.

In a press release on Monday, the coalition highlighted that BC and other Boston nonprofit institutions have opted not to pay PILOT requests totaling over $98 million since 2012. 

“At the same time, Boston continues to increasingly rely on property taxes to fund services,” said the statement. “In FY 2020, property taxes represent 71.1 percent of the city revenue, with the cost of providing city services falling mostly on Boston taxpayers.” 

More than half of the land in Boston is tax exempt, the majority because it is government property. Although only 5% of the city is owned by private educational, medical, and cultural institutions, their property value amounts to more than $13 billion and consists of nearly half of the total property value of tax exempt land in the city, according to a 2017 report by the Boston Municipal Research Bureau.  

The press release included statements from various community leaders, who highlighted the need for city revenue not only for services such as fire protection and snow removal, but also for addressing the house affordability crisis and investing in public education.

Lisa Owens, executive director of City Life/Vida Urbana, noted that many Boston residents, including employees of major institutions, are struggling to afford the cost of living in Boston.

"We call on the City to ask these wealthy institutions to pay their PILOT commitments so the City can better invest in services that benefit working class renters and homeowners," said Owens.

Jessica Tang, president of the Boston Teachers Union, emphasized the need for investment in schools, healthcare, and affordable housing.

"In the face of a significant lack of investment in such priorities at both the federal and state levels of government, we must take action to increase funding for these priorities at the municipal level," said Tang. "We hope our largest and wealthiest institutional neighbors will join us in this conversation and put forth more reasonable investments in our city and our communities through the PILOT program."

BC spokesman Jack Dunn responded to The Gavel's request for comment with a statement from the university, which said, “as a non-profit educational institution and a religious affiliate, we choose not to participate in the PILOT program so as not to forfeit our tax-exempt status.”

The PILOT program only applies to private institutions with tax exempt status.

The statement noted that the university, which has campuses in both Boston and Newton, “pays the City of Boston approximately $335,000 and the City of Newton $130,000 annually in payment for municipal services agreements that were established by the two municipalities.” 

“As a Jesuit, Catholic university that is committed to service, we believe that the best way we can assist the City of Boston is through the more than $30 million in community benefits that we provide to the City and its residents each year through scholarships, jobs, volunteer outreach, community grants and public and private funding we procure for Boston’s public and parochial schools,” the statement concluded. 

The university's decision regarding the PILOT program has been criticized by individual members of the Boston College Graduate Employees Union - UAW, who said that despite BC’s professed mission of social justice, the institution does not pay attention to issues of injustice in their backyard.

“Hypocritically, BC ignores issues that are close to home. The grievances of graduate student workers on campus are silenced, and obligations to the city of Boston are unmet,” said graduate student Sara Suzuki. “If BC wants to be regarded as a morally just institution by members of its immediate community, it must stop being a bad employer and neighbor.”

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