What's Happening with the Tufts PILOT Agreements?
July 2019 PILOT Report
Did you know that if Tufts weren’t a non-profit it would owe $6.7 million in real estate taxes in Somerville, every year? Like all of our neighbors and local businesses, Tufts enjoys public goods funded by tax revenues: the services of city staff and city programs, investments in infrastructure and transit, our forward-looking policies and more. But as a non profit, Tufts is not required to pay property taxes. Instead it enters into a Payment In Lieu Of Taxes of agreement with the City.
What is a PILOT and why should you care? Instead of paying that $6.7 million tax bill in Somerville and a similar amount in Medford, Tufts negotiated a five-year deal to pay $275,000 per year to each city over the past five years ending June 30, 2018. In Somerville, this represents approximately 4% of its full tax bill if it were a for-profit organization.
A part of the solution or a part of the problem? Tufts markets our thriving and culturally diverse neighborhoods and squares, our safe streets, our accessible transit, and our possibilities for research and civic engagement to incoming students, donors and grantors. But the wellbeing of our communities is not a given; it takes ongoing effort and investment in the face of challenging times. Increasing rents (exacerbated by the shortage of on-campus housing at Tufts), the growing threat of climate change and the withdrawal of state and federal funding from cities and schools threaten to displace our residents and undermine our community.
Tufts can do better! In Boston, it does. Tufts has a PILOT agreement for its Boston campus in which it pays 25% of its potential property taxes, half in cash and half in-kind. The current PILOT agreement for Somerville and Medford expired a year ago. We want Tufts to stop dragging its feet and come to an agreement that brings Somerville and Medford to parity with Boston and puts the University on a path toward housing all Tufts students and providing a foundation for lifelong learning for all residents of our community.
Want to get involved and help get a better deal for Somerville and Medford?
The Tufts PILOT Working Group is made up of Medford and Somerville residents who want to see a better relationship with Tufts.
Please join us in organizing for a better deal! Come to our next working group meeting in August. Date, time, place, to be announced. To receive notices of meetings and minutes please contact Adelman19@gmail.com.
Why a PILOT Working Group?
ORS formed a committee in June 2017 to look into Somerville's agreements with non-profits for "Payments In Lieu Of Taxes" or PILOT.
Some of the questions we asked were: What are the existing agreements with Somerville's non-profits? When do they expire? What could be done to gain more revenue for the city in future PILOT agreements. Could negotiations for PILOT agreements yield other benefits for city residents?
Since that meeting in June, we've done some research and met three times. The focus for now is on Tufts University because its PILOT agreement with Somerville expires on June 30.
The agreement is negotiated between the Mayor and the university president. Currently Tufts pays the city $275,000 a year. Tufts signed a similar deal with Medford. We have reached out to Tufts student group, OR Medford, and to the West Somerville Neighborhood Association.
Tufts owns about $286 million dollars of tax-exempt property in Somerville. There is no standard formula for how much a non-profit must pay toward its PILOT, but if Tufts were required to pay taxes, its nontaxable property would have netted the city of Somerville $6.64 million in Fiscal Year 2014.
In Boston, a task force determined how much non-profits should pay the city. The task force recommended that all non-profits should pay 25 percent of what they would pay if they were property taxable, which includes services provided by the institutions into that percentage.
At our last meeting on Feb. 15, we decided to convene stakeholders from Somerville and Medford on March 24 to draft a platform of needs and objectives that Tufts should meet either through the PILOT or a community benefits agreement. The next planning meeting is March 1 at 5:00 PM.
Participants in the PILOT meetings have included Ian Adelman, Zac Bears (Medford), Joe Beckman, Edward Beuchert, DJ Cronin, Susan Eldridge, Penelope Jennewein, Jon Leonard, Mark Neidergang, Alex Place, Jane Regan (Cambridge), Mary Jo Rosetti, Hersh Rothmel, Luke Schaber, Marianne Walles, Rachael White, and Rand Wilson .