City of Syracuse Pushes Fees/Tax for Nonprofits

The Syracuse Post-Standard featured a recent article about the City of Syracuse's financial challenges and plans to address it. This includes fees/PILOTs for nonprofits:

Eyeing nonprofits

The city boosted property taxes 5.4 percent in 2010, but property taxes account for less than 12 percent of city revenues — $33 million out of a budget of $284 million.

Just over half of the city is exempt from taxes.

“When 50 percent of your property is off the tax rolls, using property tax to fund your services as a city doesn’t make sense,” Miner said.

Many tax-exempt parcels are owned by government agencies. But about one-sixth of city property — $1.2 billion worth — is owned by private, tax-exempt institutions such as universities, hospitals and churches, assessor David Clifford said.

Miner and members of the council want those nonprofit institutions to pay a share of the city’s costs.

“If you use snowplows, you should have to pay for snowplows,” Miner said. “If you use police services and fire services, you should have to pay for that.”

Last year, Miner persuaded Syracuse University to make $500,000-a-year voluntary payments for city services, saying she hoped to persuade other nonprofits to do the same. But thus far there are no other takers.

“We’re having discussions,” Miner said, not specifying with whom. “Nobody has banged on my door with a million dollars.”

City leaders will push the issue this year.

Common Councilor Pat Hogan said tax-exempt institutions should pay a fee for city services based on the number of employees they have, a rough proxy for how much they depend on city services.

If they won’t contribute voluntarily, Hogan said he is prepared to propose a city income tax. Hogan said he envisions allowing city property owners to deduct their city income tax from their property tax.

He floated a similar idea during negotiations with Onondaga County over sharing sales tax revenue, but dropped it when the county agreed to the city’s terms.

“The large nonprofits have to start paying their fair share,” Hogan said. “Or we’ll bring back the commuter tax.”

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