Will the Nonprofits in New Rochelle Be Willing to Give Voluntary Contributions? by Peggy Godfrey
This year there is a new thrust for the city budget in New Rochelle. Finance Commissioner, Howard Rattner, has proposed asking non-profits who are exempt from taxes, to voluntarily agree to give PILOTS (payments in lieu of taxes) to the city. Among the reasons cited by Rattner were the large number of calls for police and fire services by "too many of these institutions" and the need for the rest of the taxpayers to make up this shortfall. Rattner asks the Council members to decide whether this initiative should be supported. The proposed contributions by seven nonprofits in New Rochelle (Sound Shore Medical Center, Iona College and Prep, College of New Rochelle, Salesian, Ursuline, and Thornton Donovan) were on the list comprising a combined proposed PILOT of $401,102. Cited also were the 301 Police responses at Sound Shore Medical Center and 129 at Iona. Iona also had 130 fire responses last year, far more than any other nonprofit.
Rattner's memorandum also mentioned that "several taxing jurisdictions" across the nation have been requesting that their nonprofits give voluntary payments. Accompanying Rattner's statement on the City's website are several newspaper articles which cited nonprofits which had voluntarily given PILOTS to their municipality. Boston in an article in the Boston Globe on 4/24/11 is listed because several nonprofits (e.g. Beth Israel Hospital, Boston University and Children's Center, Boston College and Northeastern University) have agreed to the voluntary PILOTS. Boston's nonprofits are asked to pay up to 25% of what the voluntary payment would be. The City is projecting $25 million in payments in 2011. In the future higher PILOTS are requested.
In New York State according to an article by Tim Knauss in the Post-Standard, Syracuse has convinced nonprofit Syracuse University to voluntarily agree to an $2.5 million payment for city services. Over the next five years they will voluntarily pay $500,000 to the City. Syracuse has a high amount of tax exempt property, 51%. New Rochelle's tax exempt properties now comprise 28.6% of the tax rolls. Other universities such as Brown University in Providence and Yale in New Haven are also cited for their voluntary contributions to their municipalities. An article in the Buffalo News by Stephen T. Watson, 7/16/11, states "At least lll municipalities in l8 states" received payments in lieu of taxes.
Anthony Galletta in New Rochelle Talk of the Sound wrote the "New Rochelle City Council embraces Republican ideas on voluntary PILOTS for nonprofits...While a voluntary public service fee for nonprofits has been recommended for over a decade the 800-pound Gorilla in the room remains unscathed…. Avalon. Last year, 115 students were registered from Avalon 1 (255 Huguenot) & Avalon East (40 Memorial Highway). These students cost New Rochelle taxpayers $2.3 million to educate last year. This year, the Avalons have once again exceeded the 58 students calculated in the Final Environmental Impact Study (FEIS) by 86% enrolling 108 students costing taxpayers $2.16 million. When combined with what the Avalons would pay in school taxes at 100% taxation ($7,728,762.14) the burden to New Rochelle taxpayers is almost $10 million."
New Rochelle Republican Councilmen have continually asked to have the City request voluntary payments from nonprofits. Councilman Lou Trangucci told the Westchester Guardian that the Republicans on City Council have brought this up at budget meetings for several years, suggesting the City should ask the nonprofits for voluntary payments. He continued that, "Because of the City's misdirection with tax abatements and the increase in population and the lack of sales tax," the City is in a desperate condition. Citing Mount Vernon, Port Chester and White Plains which have maintained or exceeded their tax revenues, this is not true in New Rochelle.. New Rochelle sales tax in 2010 went from $25 to $23 million dollars, a 10% drop. He adds that the City is in dire need of revenue and hopes the City will reach out to these nonprofits to ask them to make voluntary contributions to the City.
In the September 29, 2011 issue of the Westchester Guardian