NYC budget cuts and university tax breaks spark controversy
Mayor Eric Adams' recent call for significant budget cuts, including cuts to education, has ignited a fierce debate. At the heart of the controversy are the financial benefits that wealthy universities are enjoying through tax breaks, leading to questions about the public benefits of these elite institutions.
“It’s insane particularly when they get so much money,” said New York City Public Advocate Jumaane Williams.
Williams called out what he says is an unfair system in the city that would continue to give tax breaks to private institutions like Columbia and NYU while Adams has called for tightening of the city’s budget across the board.
"There's no way that private institutions, which don't accept many New York City students, should be getting more tax breaks than something like Hudson Yards. That policy just doesn't work," Williams argued.
As a result of budget cuts, essential services for New Yorkers are expected to endure a 15% reduction in their budgets. Williams says this includes programs already struggling with underfunding, such as CUNY campuses.
“Places like CUNY that doesn’t have the resources it needs to provide what it should be providing, to give the best pay for adjunct professors, and our students deserve much better than what we give them,” said Williams
Max Garcia, a senior at CUNY, shared his concerns about the impact of budget cuts.
"Because of the budget cuts, I received less financial aid than I was supposed to, which had been consistent for the last four years," Garcia said.
The debate surrounding property tax exemptions for nonprofits, including universities, has gained momentum due to the city's current financial challenges. Advocates argue that both Columbia and NYU are the largest private property owners in the city, boasting substantial endowments. As of June 2022, Columbia's endowment stood at a staggering $13.28 billion, while NYU's endowment as of August 2022 was $5.3 billion.
Sean Henry Miller, Northeast regional director of Young Invincibles, agrees with some officials who believe private universities should pay their fair share, especially when the city’s public institutions are crumbling.
“They’re able to do things like lobby the state Legislature and elected officials in order to preserve their real estate interests. The CUNY system on the other hand is a public university and doesn’t have that luxury,” said Miller.
In response to the opposition, both Columbia and NYU emphasized their contributions to local communities. Columbia cited its investments of millions benefiting in areas such as affordable housing. In a statement a spokesperson said in part, “We focus on meaningful investments that provide local jobs and economic opportunity along with sustainable community partnerships.” A spokesperson with NYU said, “We feel the charitable status that derives from NYU’s educational mission - and the attendant tax policies - is not a one-way exchange. We are deeply appreciative of those policies, but we also take some humble pride in the many, many ways, small and large, that NYU contributes to the city’s well-being and its economy,”
City Hall also weighed in, acknowledging the impact of ongoing crises like the asylum seeker crisis and COVID on the city's finances. A City Hall spokesperson said, “Mayor Adams has repeatedly warned New Yorkers that every city service could be impacted by the ongoing asylum seeker crisis if we did not get the support we needed. Coupling the costs of a national crisis that has fallen onto New York City with COVID funding that is running out and reduced revenue growth, our city’s financial future may be at risk if we do not act. While every option is on the table to ensure we continue to fund city services we rely on, we must be realistic about the mounting costs this crisis poses, which is why we announced a 5 percent Program to Eliminate the Gap in the upcoming November Plan, in addition to looking closely at other ways to reduce the costs of caring for the asylum seekers. ”
For students like Garcia, who managed to secure funding for his senior year, the concern now shifts to the future. "When the school had more funding, they had programs that served as direct pipelines to professional opportunities. Now, because of the budget cuts, we don't have those opportunities anymore," said Garcia.