University Times

Post-secondary education students in the city, including Pitt undergraduates, will have to dig deeper into their pockets if the budget proposed by Mayor Luke Ravenstahl is approved by Pittsburgh City Council.

This week the mayor unveiled his $454 million 2010 budget proposal, which includes a new 1 percent fee on undergraduate tuition.

Billed as the Fair Share Tax, the proposal is intended to raise $16 million for the city’s coffers to plug a $15 million gap in its underfunded employee legacy and pension commitments, with $1 million of the fee directed to aid the city’s financially strapped public libraries.

The tax would levy a 1 percent fee on tuition, to be paid annually by the nearly 100,000 students attending any of the more than 30 post-secondary schools in the city, including universities, colleges, seminaries, art and culinary schools. The institutions would be responsible for collecting the fees.

Based on current tuition rates, Pitt in-state undergraduates would be charged $133 per year; out-of-state students would pay $230. Carnegie Mellon undergrads would have to pay about $400 annually. Part-time students would pay a prorated fee.

In response to Ravenstahl’s proposal, Pitt issued a statement that said, in part, “To place this region’s nonprofit sector at a competitive disadvantage through the implementation of a targeted tax on our students would undermine current patterns of growth and undercut the economic momentum that has been building in the region. Through all of our current avenues of direct and indirect support to the city, we do believe we are paying our fair share for city operations. The University of Pittsburgh will oppose any attempt to impose a service or privilege tax on our undergraduate and graduate students and any other effort that would directly or indirectly alter the tax-exempt status of the University.”

City Council’s next regularly scheduled meeting is Nov. 17. By charter, a balanced city budget must be approved by Dec. 31.

In a separate development, Allegheny County Council unanimously passed a bill Nov. 4 calling for annual “essential services fees” on nonprofit organizations’ tax-exempt properties, including Pitt’s. The bill would levy a $200 fee for every 1,000 square feet of building space over the first 1,000 square feet. That plan was expected to raise $13 million.

But two days later, Allegheny County Chief Executive Dan Onorato vetoed the bill, calling it an illegal attempt to circumvent the state prohibition against taxing the county’s nonprofit entities. Pitt officials also voiced opposition to the fees.

Onorato previously had announced his own plan to approach the county’s nonprofit sector to request voluntary contributions totaling $4 million beginning in the 2011 budget cycle.

County Council is expected to meet Nov. 19 to consider whether to override Onorato’s veto.

—Peter Hart