Though Providence Mayor Angel Taveras is reviewing recommendations to garner more revenue from non-profits, representatives of the city's hospitals and higher education institutions said officials have not yet approached them about increasing contributions to the city.
The city has not talked to any private colleges and universities in Providence about paying more for city services, Taveras' spokesman David Ortiz said. Taveras has so far focused on cutting spending rather than increasing revenue.
Providence faces a $180 million budget deficit over the next two years, according to a Feb. 28 report released by the Municipal Finances Review Panel. Ortiz said the rest of the report's recommendations — including those concerning non-profits — are currently "under review."
The report estimates that non-profits' tax-exempt properties are worth $3 billion. "Hospitals and colleges need to either increase or begin to make payments for city services," the report reads.
But both university and hospital representatives expressed a tepid response to the recommendations in the report.
"Taxing students or institutions of higher education are counterproductive approaches," said Marisa Quinn, vice president of public affairs and University relations.
Ed Quinlan, president of the Hospital Association of Rhode Island, said hospitals hope the city will take into account their financial challenges. "We understand and appreciate the financial pressures and that there will be a similar understanding about our hospital funding," Quinlan said.
Brown and three other private colleges in Providence signed an agreement in 2003 to contribute $50 million in voluntary payments to the city over the next 20 years. "They were able and willing to support the city as good neighbors," said Dan Egan, president of the Association of Independent Colleges and Universities of Rhode Island.
Universities can sympathize with Providence's financial situation because "collectively we've had to make the same tough decisions," Egan said. "We thought the 2003 agreement was landmark in length and amount, and there's a legal value to that agreement that should be respected."
Egan said the city needs to focus on making other sectors contribute before attempting to make colleges and universities pay more. "It can't just be higher education helping," he said.
Hospitals do not pay voluntary fees to the city like colleges and universities do. "The principle we have taken is that hospitals are unique in that they provide service to Providence residents regardless of ability to pay, and that represents over $150 million a year," said Quinlan. He said the hospitals' tax-exemption was reviewed in a series of meetings between the city and hospital officials last year. No proposals to charge hospitals were made at that time.
In addition to recommending the closings of four elementary schools last Monday, Taveras agreed to a 10 percent pay cut for himself and his executive office payroll and laid off about a dozen city employees to generate about $2 million in savings. He also froze all nonessential spending and new hiring and plans to combine city departments.
Some of the report's other suggestions include implementing a special vehicle registration for college students as part-time residents of the state, as well as possible housing fees and property taxes for residence halls and medical office buildings owned by hospitals.
