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Four private colleges in Providence, R.I., have agreed to pay the city more than $200 million over the next two decades in lieu of taxes, The Boston Globe reported Tuesday.
The deal is comprised of two different agreements. According to the first, Brown University, Providence College, the Rhode Island School of Design and Johnson & Wales University will pay Providence $177 million over 20 years, with Brown paying the largest portion, $128.7 million.
The second agreement involves Brown alone paying the city $46 million over 10 years. However, in an announcement released by the university, that agreement stipulates that the city could give Brown a “contribution credit” toward its payment for investments that could bring in tax revenue for the city. The city may also lower Brown’s voluntary payment if the university begins bringing in tax revenue through new developments or building sales.
The institutions will also offer community services that could include “snow and trash removal, support for public schools, scholarships and more,” the Globe reported.
Providence often seeks voluntary payments, known as PILOTs, or payments in lieu of taxes, from tax-exempt institutions like colleges and hospitals; in exchange, the city does not challenge the institutions’ tax-exempt status and does not request additional funds. In the previous iteration of this agreement, the colleges paid $94 million.
Providence also agreed to give Brown four city blocks that are already occupied by the university. Buildings purchased by the four private institutions will immediately become tax exempt, whereas in the past they were removed from the city’s tax rolls over multiple years.
