[Continued from last week’s Part 2 and the preceding Part 1.]
By: David A. Smith
If Boston is to thrive, as we say yesterday then its universities must thrive, and for them to thrive, they want to grow, and for several of those domiciled in the city itself, the constraining factor is land that can be developed in student housing. As reported in The Boston Globe (October 9, 2014), the universities would love to have access to that land:
The plan, part of the mayor’s new housing initiative, would encourage colleges to work with private developers to build the new facilities.
By implication, the new student housing will be built off-campus:
Devin Quirk, director of operations at Boston’s Department of Neighborhood Development [Which handles affordable housing, and has taken over BRA linkage disbursements after Mayor Walsh stripped the BRA of that authority – Ed.] , said the city would facilitate partnerships between colleges and private developers to build new dorms, with one or more colleges agreeing to lease all or portions of the buildings.
Devin Quirk, up against a City Hall Brutalist raw concrete wall
That’s the student-housing model of the proposed off-campus student housing in Flagstaff, Arizona that I profiled six months ago, which faced so much opposition that its development has been tabled.
Such agreements would save schools from having to put up large amounts of capital to construct the facilities, while giving developers a guarantee that the property would be rented.
Off-campus dedicated student housing is also a win for the city:
Privately developed dorms can also be taxed, unlike dorms built solely by colleges, which are classified as nonprofits, city officials said.
This is a much larger issue than it might appear. For Boston, the silver lining of all its universities conceals an inner cloud – plenty of high-value real estate that is exempt from property taxes.
A bit overstated as it includes parks, airports, and the Mass Pike, but still ….
The city thus loves and hates expanding universities: it loves the students (and their money), jobs, and visibility/ prestige university expansion brings, and hates that when a university’s campus expands, the property is exempt from taxes unless the university and city negotiate a pre-acquisition PILOT agreement.
Boston, like Providence with its Ivy League university Brown, has been suffering from severe case of endowment envy – relishing the universities’ success but wanting a piece of that action. So, as I reported 3½ years ago (The Battle of Charities’ Taxation, Part 1, Part 2, Part 3, and Part 4), Boston has been asking its local non-profits – mainly universities and hospitals – to pony up a share of what they would owe if they were actually taxable. Though there wasn’t (and isn’t) a scintilla of legal argument for it, the city mustered up a political one – that universities were getting city services for free – of dubious validity but good potential for head-line grabbing.
Building more dormitories on-campus would raise the awkward shakedown ask again; building them off-campus would simply win the issue for the city – and the amount is enough to say grace over.
And please lord, let there be dormitories for these young wayward youths
Boston’s annual real estate taxes are probably in the vicinity of 1½% of value, so each dormitory bed built privately, rather than on campus, would yield the city roughly $2,100 a year in additional real estate taxes, for a resident who wouldn’t otherwise consume any city services. An additional 18,500 beds could give the city an additional $40 million a year, relieve overcrowding and placate the neighbors, and lower upward rent pressure, making housing more affordable throughout.
So off-campus dedicated professionally owned and operated student housing would be a clear win for the city – and also for the university, which compared with seeking more on-campus dormitories gains two critical benefits:
1. Liability and operation of the real estate would be outsourced. If bad things happened in the off-campus housing, that would be the landlord’s problem, not the university’s.
2. The university doesn’t need more land! The university can expand its enrollment without expanding its own land footprint. For the urban universities, that’s the biggest win of all.
“I think most universities will be on board with the general principles of the plan,” Nucci added.
As one might expect, the universities have figured this out:
The proposal, greeted positively by officials at several colleges, comes amid increasing concern over shoddy, dangerous conditions common in off-campus student housing. The additional dorm space would give colleges greater oversight of students and ease the rapid growth of the student rental market in many neighborhoods.
Universities don’t want to be bad neighbors, but if it’s between growing the student body and being a good neighbor, they’ll grow the student body and take their chances.
Quirk said that during a pair of recent meetings with city leaders, local college presidents supported the ideas outlined in the report.
“The big change here is the commitment from the universities to work with us on this issue,” said John Nucci, a spokesman for Suffolk University [And long-time Boston city politician – Ed.], which houses 21% of its 5,800 undergraduates on its downtown campus he said. “It’s really a partnership.”
One Boston Italian-American speaking before another one: John Nucci at Suffolk groundbreaking
Building up the campus takes time, and landlocked urban universities know that the outside market can take only some limited number of additional renters, so where they can, they have been building – if they can get city approval:
Some area colleges have a head start on increasing undergraduate housing, as more than 7,000 new undergraduate dorm beds are currently under construction or have preliminary city approval, including at Boston University, Northeastern University, and the University of Massachusetts Boston.
UMass Boston has always been the red-headed stepchild among Boston’s universities; geographically isolated out by Harbor Point, the erstwhile Columbia Point and blocked off by the southeast Expressway, only recently arrived on the scene, and the state’s public university (and outstation campus of UMass Amherst), it struggles for academic recognition and for students – but it has steadily built its campus over the decades, and it has the acreage to grow.
UMass Boston, on its peninsula, with the Kennedy Library at far right
BC, out on the border between Boston and Newton, likewise has room to grow.
Boston College houses 80% of its 9,000 undergraduates on campus, the highest percentage in the city. The school has plans to add another 810 dorm beds soon, which would push its on-campus housing rate to nearly 90%.
“We support Mayor Walsh’s housing plan and look forward to working with him to meet our common goals,” campus spokesman Jack Dunn said.
The universities particularly like that it will be the mayor taking the lead in pressing the public policy issues:
City officials said they plan to work with neighborhood residents to establish, by 2015, a list of suitable locations and other criteria for new student housing.
And that, boys and girls, will be where the mayor’s real political capital will be required – when the desire for improved student housing clashes with the NIMBYs.
I’ll be against development … once I get my dorm room
