BREAKING: Brown Pres. Issues Letter Calling Taveras’ Decision “Surprising and Disappointing”
Friday, January 13, 2012
In the latest war of words, Brown University President Ruth Simmons issues a letter to the Brown community and calls Mayor Angel Taveras's recent rejection of a $10 million Brown offer "surprising and disappointing."
The following is President Simmons' letter.
Members of the Brown Community,
GET THE LATEST BREAKING NEWS HERE -- SIGN UP FOR GOLOCAL FREE DAILY EBLASTI am writing to update you on discussions with the City of Providence aimed at increasing the University’s financial support. You may have read reports of these discussions in the media and I wanted to provide you with an accurate account of these interactions.
Last spring, Mayor Taveras met with me and asked that Brown consider providing an additional $5 million annually to the city to help him close the city’s budget deficit. I explained that Brown is committed to working with the city in mutually beneficial ways, but that we could not simply provide unrestricted funds to address a structural deficit that had accrued for many years, and, according to the Mayor’s Municipal Finance Review Panel, was the result of reductions in state aid, high employee and retiree costs and a reliance on one-time budget fixes. I indicated that given our commitment to Providence, we would seek to identify ways to enhance our current contributions to the city in ways that align with our mission, and specifically to support the schools and economic development. I also indicated that in view of the significance of the amount of his request and the potential long-term nature of any proposal, the Corporation would need to approve any final agreement.
Since that meeting, representatives from Brown and the Taveras administration have been working to find a mutually agreeable solution to address the city’s request. We appreciate the economic challenges confronting the city and the difficult actions that the Mayor has taken this past year to deal with Providence’s deficit. When Brown faced significant projected deficits as a result of the global economic crisis, we addressed them through a number of difficult actions, including a freeze on salary increases and the elimination of positions. We know that finding solutions can be challenging, particularly in this economic climate, and we recognize the sacrifices that many in the city have made — including firefighter, police officer and public school teacher unions, city employees, and commercial and residential taxpayers — to help the city close its deficit.
In mid-December, we offered to increase the $4 million in voluntary and property tax payments we already make annually to the city by providing an additional $10 million over five years to support Providence’s schools. Given Brown’s size and resources, the $10 million that we offered when combined with what we are already paying the city through the 2003 Memorandum of Understanding, which the city agreed would satisfy the need for such payments for 20 years, plus voluntary payments and property tax payments on commercial property, is a substantial contribution and comparable to what any U.S. university contributes to its local community. We also indicated that we hoped to work with the city to advance our shared interest in developing the knowledge based economy, acknowledging that this may require additional financial support for the city.
Earlier this month Mayor Taveras rejected the $10 million offer, which was both surprising and disappointing. As you know, Brown already contributes in myriad ways to the city. While Brown remains tax-exempt, in 2003, Brown joined the other private colleges and universities and signed a memorandum of understanding (MOU) with the city that established a substantial and long-term financial contribution to Providence’s budget equaling nearly $50 million in voluntary contributions over 20 years. It is also important to note that colleges and universities in the city account for 8.1 percent of tax-exempt property in Providence — not the 40 percent often cited. The remainder of the tax exempt property is held by city, state, and federal governments; churches; hospitals; museums; and other nonprofits. The city also receives funds from the state’s Payment in Lieu of Taxes Program as compensation for hosting hospitals and private colleges and universities. The state increased this funding last year, with Providence receiving $23 million from the state through the PILOT program.
Brown University is and always has been a good partner for Providence and Rhode Island. As a nonprofit institution, we provide educational opportunities, advance research and spur innovation — all crucial to the strength of our city and state. Brown is a stable leading employer, even during uncertain times, and directly employs thousands of Rhode Islanders — 1,400 of whom live in Providence — and thousands more indirectly through construction, purchasing and start-up companies launched by students, faculty and alumni of Brown. We provide millions in institutional scholarship funds to Rhode Islanders, and our students, faculty and staff strengthen area schools, hospitals and community service agencies through volunteer efforts.
Aware that these are difficult times for the city, we remain committed to the success of Providence and Rhode Island. We are hopeful that given the potential progress we can make working collaboratively, our discussions with Mayor Taveras will continue and result in an equitable solution that benefits the people of Providence and the Brown community.
While we must continue to partner with other nonprofits in working with the city, we must do so in ways that do not effectively cripple the University. A strong Brown is a significant asset to the long term health and vitality of the city and state.
Sincerely,
Ruth J. Simmons
