tuition tax UPDATE

Pittsburgh Mayor Luke Ravenstahl dropped a proposed tax on college tuition after the University of Pittsburgh, Carnegie Mellon University, and Highmark Inc. promised to make financial contributions to the city. Ravenstahl said he hopes those contributions will serve as a catalyst for other nonprofits to contribute.

At a Dec. 21 news conference announcing the deal, city and university officials pledged to work together as a “New Pittsburgh Coalition” to help solve Pittsburgh’s fiscal problems. Pitt Chancellor Mark A. Nordenberg spoke at the news conference.

Remarks of Chancellor Mark A. Nordenberg at the Tuition Tax News Conference

Mayor's Conference Room, City-County Building

December 21, 2009

The year that is about to close brought some very special victories to our City. It also brought well-deserved recognition—nationally and internationally—for the progress we have made in building a regional economy that has the potential to thrive as we move through the 21st century.

For most of us, though, 2009 will be remembered mainly as a year of struggle. All of us battled the economic crisis now known as the Great Recession, and at least some of those financial struggles will continue in 2010. But the biggest news this morning is that we are going to enter that new year unified and not battling with each other.

We are unified in our belief that a strong City of Pittsburgh is absolutely critical to the well-being of the entire region. We are unified in our knowledge that the City is trapped in a fiscal structure that might have been appropriate for the first half of the 20th century but that is not going to work in the first half of the 21st century. And we are unified in our understanding that the City is being financially crushed by staggering legacy costs tied to significantly underfunded pension obligations.

It is entirely fair to say, of course, that these costs are the product of what is becoming an increasingly distant past, the product of decisions made and practices employed by people who are long gone from their positions of authority. But however good it might make us feel to say that this “mess” is not our fault, the practical reality we face is that the responsibility for dealing with those problems now is ours.

All of us, I know, are very pleased that the Mayor has committed to the step of forming and leading a broad-based coalition to seek and secure a viable, long-term solution to the dramatic imbalance between the expense obligations that the City has inherited and the restrictions on revenue that so tightly constrain what it can do to meet those obligations. I am not empowered to speak officially for the broader nonprofit community or even for the higher education community, much less for the business community. However, I know, from my interactions with them, that leaders from within each of these groups are energized by the prospect of pushing forward, together, to advance the City that is our home.

Over time, the nonprofit community’s deep sense of commitment to the City—including, specifically, a commitment to its financial well-being—has been reflected in a broad range of ways. They include financial contributions, over a period of years, to the Pittsburgh Public Service Fund. As I reported at last week’s City Council session, the University of Pittsburgh made the very first pledge to the first Pittsburgh Public Service Fund and, consistent with that unbroken history, stands prepared to renew and increase that support once the impediment of the tuition tax proposal is removed, as I understand will happen this morning. And Pitt is not standing alone today but is joined by Carnegie Mellon University and Highmark – major institutions that also have been, and want to continue to be, visible leaders in supporting the City.

In a sense, I also stand before you as a representative of tens of thousands of Pittsburgh college and university students. One unfortunate consequence of the recent debate was a spreading misperception that this student group does not make important contributions, financial and otherwise, to the City. I know that is not the case and am pleased that this coalition also is grounded in the recognition that these students not only contribute to the strength and vibrancy of the City today but are likely to produce many of its leaders of tomorrow. One dimension of our ongoing work, then, is to find ways to broaden their engagement, for their benefit and for the benefit of the City, in the months and years ahead.

I do not need to tell anyone in this room that we not only live in challenging times but live in an increasingly competitive world. Most of that competition does not come from within the boundaries of our home City or even our home region. It comes from other cities and other regions, in this country and abroad.

Our shared strength is one of our greatest assets, and I am grateful to the Mayor for mobilizing that strength today. Looking forward, I also welcome the opportunity not only to stand with him but to stand with distinguished and dedicated leaders from the Pittsburgh business and nonprofit communities in moving forward with a determined effort to secure the future of our City.