While Yale has maintained that a controversial bill regarding its property taxes is unconstitutional, 11 law professors — many of whom currently teach at or are affiliated with the Yale Law School — now argue otherwise.
In a letter delivered Monday to State Senate President Martin Looney, D-New Haven, and House Speaker Brendan Sharkey, D-Hamden, the professors said they examined Yale’s concerns regarding the bill’s constitutionality and found them “significantly overstated.” The letter counters the University’s aggressive attacks on S.B. 414 that have discounted the bill as unconstitutional. The bill, which passed the state Finance Committee by a 28 to 22 vote on April 7, centers on which property taxes Yale pays to municipalities and now awaits debate on the full Senate floor. Yale has continued to advocate strongly against the bill, suggesting that S.B. 414 would tax Yale’s academic property and force the University to alter activities which occur inside buildings like the Yale Center for Genome Analysis and Woolsey Hall.
The University has argued that the legislation would unlawfully impair Yale’s right to nontaxation as established in its state charter and violate the contracts clause of both the federal and state constitutions. In an April 22 statement released by the Office of Public Affairs and Communication, the University noted that Yale’s charter has been construed by the courts, including the state Supreme Court, to affirm the nontaxation of academic property, while the contracts clause has been upheld by the U.S. Supreme Court to protect charters like Yale’s from “impairment” by state legislatures.
But in the April 25 letter, the law professors said Yale’s claim that the contract clause divests the Legislature of power to clarify between “educational” and “commercial” activities is unfounded, and that the state could indeed clarify or even modify Yale’s charter in service of a “legitimate public purpose.”
“The legislature is fully empowered to clarify, by legislation, that university property on which certain commercial activities occur is not exempt from real estate taxation,” the letter states. “In fact, we believe the legislature has the authority to go substantially further than the proposed legislation in providing for the taxation of university property.”
The letter does not intend to make specific policy proposals for legislation that goes “substantially further,” Yale Law School clinical lecturer Jonathan Brown, who signed the letter, told the News. Instead, the letter affirms that S.B. 414 is not an “ambitious” clarification of the current legal standard, and could in fact go much further, Brown said.
According to Henry Weaver LAW ’18, the letter originated as a project among law students who wanted to study the University’s claims on the legality of the state bill. After discovering that Yale’s claims were “far from airtight,” Weaver and three other Law School students — Adam Bradlow LAW ’18, Wally Hilke LAW ’18 and Amit Jain LAW ’18 — sought the support of clinical faculty at the Law School to craft the letter. Prior to the letter, commentary on the bill’s constitutionality had been one-sided, Weaver said.
“Our hope by putting out this statement, which has received significant support from the legal academy, is simply to provide more clarity and more balance to the public discourse on this subject,” Weaver told the News.
The bill’s proponents, including New Haven’s state delegation and Mayor Toni Harp, say S.B. 414 will only clarify tax exemptions set forth by current law, which exempts real estate owned by certain private colleges and universities in the state except for property which generates over $6,000 in annual income. S.B. 414 would only affect institutions with real estate valued at over $2 billion, singling out Yale.
Looney told the News in a statement on April 20 that the General Assembly was modifying the bill’s language to narrow its scope. The goal of the legislation is to remove the ambiguity currently in the state statute, Looney said.
“We must evaluate all exemptions in a contemporary context,” he added.
The letter cites two cases, Yale Univ. vs. New Haven (1899) and Yale Univ. vs. New Haven (1975), which affirmed that university property for education and training is tax-exempt while property used for “income-generating commercial purposes” can be taxed. Echoing Looney, the letter said the bill will update “ancient terms for a 21st-century economy.”
The professors noted that the scope of the contract clause is limited by states’ authority to “safeguard the vital interests of its people.” The writers suggest that occasions do exist when “public interest or social welfare demand revision of past agreements,” adding that charter is not a permanent contract separate from policy-making.
“In Yale’s case, a tax could help rectify the educational inequities produced by a private university’s concentration of massive wealth, or condition the continued enjoyment of tax privileges on fundamental, structural changes to a university’s admissions, research, employment or expenditure policies,” the letter states.
Responding to the letter, University spokesman Tom Conroy told the News that a national law firm had advised the University that, based on five Connecticut judicial decisions and two centuries of Supreme Court rulings, the proposed legislation would violate Yale’s charter as well as the federal and state constitutions.
“We respectfully disagree with the law professors and students who have argued otherwise,” Conroy told the News. “Ultimately the courts would resolve the issue and we have every confidence that Yale would prevail, just as Yale has prevailed in every case attacking its charter rights over many decades.”
The University’s charter was established in 1701.