UMass Lowell and the City

The ongoing controversy over University of Massachusetts Lowell not paying property taxes to the city of Lowell received more attention at last Tuesday’s city council meeting, Councilors Bill Samaras and Jim Millinazzo had a motion requesting the city council to “go on record to re-affirm our working relationship/partnership with UMass Lowell which will continue to benefit the economic vitality of the city and its residents and to request the city manager to do what is necessary to preserve and strengthen this relationship/partnership.” To me, councilors sounded measured and subdued in their remarks. I’m guessing that most councilors had received vigorous comment from constituents on both sides of this issue. Being in a cross-fire between two sides of a controversial issue is not a fun place for councilors to be. Watching the councilors speak that night, I got a sense that none of them had backed off their previous positions; they just collectively lowered the volume a bit.

In their remarks, Samaras and Milinazzo also gave the impression that they both been criticized for “trying to tie the hands of the city manager,” which they both assured everyone was not the intent of the motion. The city manager’s hands may indeed be tied in these negotiations, but that’s because of the law, not because of any council motion. UMass Lowell is not legally obligated to pay any property taxes for real estate it owns in the city – period, end of story. What bargaining power does the city have in this negotiation? Much of what municipal government does for its residents, the university does for itself such as road maintenance, snow plowing, trash removal, and even police protection, so it’s not as if the city could withhold those services (and while the university does not have its own fire department, no rational person would propose withholding Lowell Fire Department services). The university does use city water and sewer, but it pays for them.

When it comes to new buildings and other projects, the university is not bound by the decisions of city regulatory boards. It may bring its projects before the Historic Board, the Conservation Commission, or others, but that’s just voluntary and only for advisory purposes, so it’s not as if the city could withhold building permits or similar authorizations. What can the city threaten should the university not accede to the city’s demands in these negotiations? Other than waging a negative publicity campaign, labeling the university a “bad” neighbor, there’s not much.

Part of the problem with this whole debate is the way so many blur the line between a state entity (like UMass Lowell) and a nonprofit corporation. UMass Lowell is part of state government. The repeated labeling of it as a nonprofit skews the discussion in an unrealistic direction. UMass Lowell does not pay local property taxes because the state does not pay taxes to cities, just as the federal government does not pay taxes to states. That is how our federal system of government works.

UMass President Marty Meehan has said that it would be illegal for UMass Lowell to pay property taxes to the city, a statement I don’t dispute. Only the legislature can authorize the expenditure of funds by a state agency like UMass Lowell, and there is no precedent for a state agency paying local real estate taxes.

It is possible, however, for university to legally pay the city for certain items such as the maintenance of shared facilities like the Lower Locks Parking Garage and LeLacheur Park. And it would be in the university’s best interest to have cordial relations with city government. I’m not sure that was the case back in the 1980s when off campus student housing created bitter conflict with certain neighborhoods and with the Lowell Police Department. I’m sure no one in the city or at the university wants to return to those days. That alone is a good reason for the two entities to be meeting and to reach some kind of agreement on those types of things.

However, when it comes to making up property tax revenue lost when the university acquires previously taxable property, it seems to me that the city’s recourse lies with the state legislature and not with the university’s leadership. Maybe the city should ask our elected officials in the state legislature to get more publicly involved in this issue. Rep. Nangle did try to address it legislatively last month with a measure that would require nonprofits (there’s that word again) to pay some real estate taxes, but that was unsuccessful. Perhaps the state legislature could appropriate additional state aid to Lowell in the next state budget as compensation for the added municipal costs of having a major state university in the city.

Unfortunately, I expect most other communities in the Commonwealth (and their representatives in the legislature) would have little sympathy for those in Lowell complaining about UMass Lowell’s growth. Most would welcome the university in their communities, just as Dracut Town Manager Jim Duggan did last week or as the city of Haverhill has done with UMass Lowell’s ever-expanding satellite operation in that city. Communities that don’t already have a major state university recognize that notwithstanding any lost property tax revenue, the tangible and intangible benefits of having a world-renowned research university like UMass Lowell in one’s community far outweigh whatever fiscal challenges may accompany that.

Lowell Real Estate

The local real estate market keeps chugging along. It’s a great time to be a seller, mostly because there aren’t that many homes for sale and partly because interest rates are still so low. But like an old wound that just won’t heal, foreclosures remain a big factor. In the first two weeks in August, there were 15 foreclosure deeds recorded for properties in Lowell; the same time last year there were just two. In fact, the number of foreclosures in Lowell for the first seven months of this year is up 47% from last year. We’re nowhere near the number of foreclosures experienced during the collapse of the market, but there are more than there should be.

It turns out, however, that the majority of the mortgages being foreclosed were obtained back before the real estate bubble burst in late 2007. Why it’s taking nine or more years for the foreclosure to occur is unclear from the record. Certainly in some cases, death of a co-owner, divorce, health problems, or loss of a job could suddenly threaten anyone’s ability to make the monthly mortgage payments, but I suspect the bulk of these recent foreclosures involve homeowners who have been in financial trouble for years, but because of shoddy paperwork or other administrative difficulties, the lenders have held off on foreclosing until the documents were legally remediated. Fortunately for the city and the rest of its residents, these foreclosures aren’t lumped in a particular neighborhood but are spread across the city. Also, with such a great demand for homes to purchase, these places should not stay vacant for long, post-foreclosure.

One place that seems free of real estate trouble is Cross Point. Earlier this week, the towers were refinanced for $112,000,000. That’s quite a bit more than the $525,000 that was the high bid for that property at its 1994 foreclosure auction. It’s also a sign of the strength of the local economy.

Ireland and Lowell

If you’re interested in history, there’s a great conference coming to UMass Lowell next month. Remembering 1916: The Easter Rising, The Battle of the Somme and Impact on Lowell—A Public Engagement Conference will be held on Wednesday, Sept. 7 and Thursday, Sept. 8, 2016 at the UMass Lowell Inn & Conference Center. It is presented by UMass Lowell in partnership with Queen’s University Belfast. It’s open to the public, but there is a $50 registration fee to cover the cost of attending all conference sessions plus coffee breaks, lunches, and the opening reception. To register, check out the conference website.

Butler on Broadway

Well, Off Broadway, maybe. There’s a comedy about Lowell’s own General Benjamin Butler now playing at the 59E59 Theaters in New York City. Written by Zachary Stewart, the play is about Butler’s decision early in the Civil War that a slave who escaped into the fort commanded by Butler should be kept as “contraband of war” and not returned to his “owner” who claimed the return was required by the Federal Fugitive Slave Act.

Although this show is a comedy (which is fine – funny is more memorable), Butler’s decision was one of the most momentous of the Civil War. Until that point, there was no official policy on escaped slaves, but Butler’s instinct was both legally and morally correct. Some historians now say that Butler’s contraband policy set President Lincoln on a path that led to the Emancipation Proclamation.

Steve Panagiotakos leading Lowell Walks tour

Lowell Walks

Thanks to Steve Panagiotakos for the superb job he did in leading yesterday’s Lowell Walk on Greeks in the Acre. Sharing stories that were alternatingly poignant, inspiring, and humorous, Steve placed the Lowell Greek community in the context of the bigger picture of Greek and world history. After hearing Steve’s remarks and visiting such places as Ymittos Candles, the Greek American Veterans Headquarters, the Holy Trinity Greek Orthodox Church, and others, everyone on the tour had a better sense of the place of the Greek community in Lowell’s history.

Fr Pelekoudas, inside Holy Trinity Greek Orthodox Church

I’ll be leading next Saturday’s tour which will cover East Merrimack Street and all the history that is packed into that street, especially the Lowell Memorial Auditorium. The tour begins at 10 am on Saturday, August 20, 2016 from the Lowell National Historical Park Visitor Center at 246 Market Street.