Take the pledge: no donations until Penn pays PILOTs!

David L. Cohen, Chair, Penn Board of Trustees

Who We Are

We are alumni and students of the University of Pennsylvania who believe that Penn has a responsibility to ensure adequate funding for the Philadelphia public schools, Penn is the largest property owner in the city of Philadelphia, but as a non-profit institution, it pays no property taxes on its non-commercial properties. In other words, it contributes nothing to the tax base that funds Philadelphia’s public school system—this in a city whose schools are underfunded and facing deep budget cuts amid the COVID-19 pandemic.

We regard this as an issue of both racial and economic justice. The Philadelphia public schools serve a predominantly low-income, Black and brown student population. By failing to pay its fair share to the school district, Penn denies those students resources that every child needs and deserves. It plays a role in perpetuating racial and economic inequality.

What Penn Must Do

We call on Penn to contribute to an Educational Equity Fund governed by the school district and city of Philadelphia. These would be payments in lieu of taxes (PILOTs)—a fraction of what Penn would owe if it were subject to property tax assessment.

We pledge never to donate to the University of Pennsylvania until the university agrees to pay PILOTs.

Every other Ivy League university already makes payments in lieu of taxes. Penn would be joining the ranks of Harvard, Yale, Princeton, Brown, Columbia, Cornell, and Dartmouth in recognizing its financial obligation to the community of which it is a part.

Why Penn Owes the City

This is not a matter of charity but of justice. Penn’s tax exemption is predicated on the notion that it is a non-profit institution that exists to fulfill a public purpose, not a for-profit corporation that exists to accumulate capital. That distinction must be made meaningful. Today, Penn is the seventh richest university in the country. Philadelphia, meanwhile, has the highest poverty rate of the ten largest cities in the United States. Twenty-six percent of Philadelphians live in poverty, and 13.4 percent in deep poverty. If Penn’s public mission is to have any meaning at all, the university must not be an exemplar or engine of inequality.

Yet the existing system of public finance ensures that Penn benefits from city services that it does not pay to maintain. Penn’s administrators, faculty, and staff rely on city schools, sanitation services, transportation, and other programs. In fact, the campus area enjoys better sanitation and public transportation service than many low-income and Black neighborhoods. Penn’s location in the city of Philadelphia is one of its defining characteristics that enables the university to attract faculty and students. When the university does not pay for the services and environment that make its work possible, other Philadelphians are left to make up the difference—or city schools and other institutions simply go without. Penn has a duty to contribute to the city that sustains it.

Fulfilling this responsibility requires more than targeted programs that Penn designs and administers—whether competitive scholarships, academically based community service courses, investments in University City, or support for the Penn Alexander School. The city of Philadelphia needs functioning public institutions that serve all people and that are governed by democratic procedures. Penn in turn needs a city with robust democratic governance and the capacity to carry out government responsibilities. No amount of philanthropy or research-based intervention can substitute for public schools available to all, financed by all, and capable of being held accountable through public procedures. Penn’s practice of investing in its immediate neighborhood is not equivalent to meeting its obligation—as all residents do—to contribute to the public governance and institutions that serve every person in the city. Moreover, there is no need for Penn to choose between its existing community programs and its responsibility to make payments in lieu of taxes. Universities throughout the Ivy League have long shown that it is possible to do both.

As alumni, we particularly know that scholarships, valuable as they are, do not substitute for payments to the public schools. Many of us received financial aid, but our scholarships did not address the deep inequalities that prevent the majority of Philadelphia students from ever attending college. The consequences of growing economic inequality and disinvestment in public education were evident in the composition of Penn’s student body. In 2018, the New York Times reported that 45% of Penn students came from families in the top 5% of the national income distribution. Just 3.3% came from families with incomes in the bottom 20%.

Penn’s support for its own low-income students, who come from across the country and the world, does not lessen its responsibility to resolve economic and racial inequalities in its own back yard. We know, moreover, that some of Penn’s investments in West Philadelphia, made in the name of community engagement, have increased rather than reduced inequality. Mortgage programs for Penn affiliates and university support for the Penn Alexander School have contributed to gentrification in the neighborhood and pushed out longtime residents. Over time, the Penn Alexander School’s student body has become wealthier and whiter, and the school’s extraordinary resources have become less accessible to low-income children and children of color.

Penn’s obligation to pay its fair share to the public schools is particularly urgent at a time when protests against racial inequality and injustice have engulfed Philadelphia and the entire country. Every institution in our society must address the root causes of racial inequality, which include systems of public finance that enrich wealthy, private, majority-white institutions while underfunding public institutions and public services. Disinvestment in public services has exacerbated educational, health, and economic inequalities, with especially punishing effects on communities of color.

We know that Penn’s failure to pay PILOTs is only one cause of the critical inequalities in Philadelphia’s schools. The state of Pennsylvania has one of the worst funding gaps between low-income and high-income school districts in the country. But Penn’s paying at least some of what it would owe in taxes to the schools of Philadelphia will represent one important step in the fight for educational justice in Harrisburg and beyond.

What an Education Equity Fund Would Do

Penn’s contributions would help the school district address pressing needs. The schools have long suffered from a teacher shortage and large class sizes. The district once had a library and certified librarian in nearly every school, but today has only ten certified librarians on payroll. The district is unable to provide every school with a full range of educational programs and supportive services, including full-time music, art, and physical education teachers; school nurses, psychologists, and counselors; and bilingual staff and teachers. These resources are far more available in surrounding suburban districts whose local tax bases provide superior funding for public education. Philadelphia students deserve the same resources and opportunities as their peers a few miles away.

Perhaps most urgently, the schools require major investments to protect the health and safety of students, teachers, and staff. The Philadelphia Inquirer has made us all aware of the deadly consequences of asbestos in the schools. Across the city, children may be compromising their futures when they sit down in classrooms, and adults are risking their health to teach, feed, counsel, and care for students. The district estimates that it would cost $125 million to remove asbestos and lead paint from all areas occupied by students. Penn must do its part to ensure that Philadelphia’s children have access to high quality public education in schools that are safe and healthy. This should be our commitment to Philadelphia, its children, and future generations at Penn.

Sponsored by

To: David L. Cohen, Chair, Penn Board of Trustees
From: [Your Name]

​As alumni and students of the University of Pennsylvania​, we call on Penn to contribute to an Educational Equity Fund governed by the school district and city of Philadelphia. These would be payments in lieu of taxes (PILOTs)—a fraction of what Penn would owe if it were subject to property tax assessment.

​We pledge never to donate to the University of Pennsylvania until the university agrees to pay PILOTs.