April 7, 2016
University of Hartford

CCIC Joins National Higher Education Associations
Representing Most U.S. Colleges and Universities
in Opposition to Connecticut Proposal
to Tax Yale University

The statement below was issued by the Association of American Universities, the American Council on Education, and the National Association of Independent Colleges and Universities in response to SB 414, An Act Concerning the Tax on College Property, which is being voted on by the General Assembly’s Finance, Revenue and Bonding Committee later today.  
CCIC joins these groups in strong opposition to this bill, which seeks to tax academic property owned by Yale that generates revenue. Academic property of colleges and universities has long been exempt from taxation reflecting a state as well as federal policy of promoting higher education. Yale already pays millions of dollars in property taxes on its revenue generating, non-academic commercial properties, as outlined in 
its testimony on this bill.  Now is not the time to raise the cost of higher education by taxing academic property.
Yale is leading the economic growth in New Haven by investing in the very type of work this bill seeks to tax – supporting research and promoting entrepreneurship.   These investments lead to taxable revenue when a product is commercialized or a business is launched   It makes no sense to tax the property that fosters this innovation from occurring.   It will only limit what Yale has the capacity to do in this area and stifle the economic growth New Haven and the State of Connecticut so desperately need.
The state needs to stop viewing Connecticut’s independent colleges as a 
source for property tax revenue and start considering us as partners in business development and economic growth, as SB 1 seeks to do.  Connecticut’s independent colleges and universities are some of the state’s best assets.  We hope legislators will recognize that and abandon plans to tax Yale’s academic property.  
As associations representing most of the nation’s colleges and universities, we are deeply troubled by state legislation proposed in Connecticut to tax the endowment and academic properties of Yale University. Private colleges, from small religious colleges to major research universities, are tax-exempt for the same reason as children’s charities, relief and religious organizations, and other nonprofits: their foundational commitment to public service. Universities’ missions of education and research are dedicated to serving the public good. The economy and American society rely deeply on the people universities educate, the discoveries made in their labs, and the work they do to improve their communities and their states.
Taxing a large university would set a precedent for taxing not only other private colleges but also every nonprofit, from local churches and soup kitchens to the Red Cross and Salvation Army. Nonprofit charitable organizations are part of the foundation of American society. If we begin to tax them, we erode that foundation.
Yale is one of the world’s great research universities. Like other such institutions, it is vital to the economy of its community and state. Connecticut should be very careful indeed about taking precipitous action that would, however unintentionally, undermine Yale’s ability to carry out its education, research, and service missions. Nowhere would the impact be greater than in Connecticut.

Matter of Fact

In 2014-15, CCIC’s fifteen member institutions awarded 45% of the bachelor’s degrees earned in Connecticut but received only 2.5% of the state’s funding for higher education through the General Fund.

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