For centuries Princeton University has cast itself as a community of scholars who work to advance the boundaries of human knowledge in the service of the whole of mankind.
Lately, however, residents of the little town beside the Ivy League college have begun to wonder if it might do more to help those humans who live next door by paying its “fair share” of property taxes.
More than 20 local homeowners have filed a lawsuit that casts the university as a giant and profitable corporation that hides behind its tax exempt status. Bruce Afran, their lawyer, has estimated that if the town’s largest landowner finally began stumping up payments on its vast property portfolio, the hefty tax assessments paid by local residents could be reduced by a third.
The lawsuit is the latest attempt to challenge the tax exempt status of America’s richest universities, who have endowments worth tens of billions of dollars, vast property holdings and interests in drug patents and spin-off enterprises, but charge undergraduates tens of thousands of dollars in tuition fees.
Legislators in Connecticut scrambling to fill a budget deficit have proposed a tax on Yale’s $26.5 billion endowment.
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While university administrators there argue that the state risks “undermining one of its greatest assets”, supporters of the proposals have noted that similar inquiries are under way in Congress into the tax exempt status of institutions of learning that have endowments of more than $1 billion.
Leaders of this inquiry have noted that “despite these large and growing endowments, many colleges and universities have raised tuition far in excess of inflation”.