A (not so) taxing relationship: Part I (continued)

What the University, as the largest private employer in the city, does provide is a stable -- and frequently increasing -- base of employees for the city to tax. The report also lists other taxes, construction costs, the purchases of goods and services, tuition and fees, imported research dollars, fundraising and health care revenue attracted from other areas as contributing to the indirect benefits. According to Assistant Treasurer Robert Helfman, who helped Coopers and Lybrand gather the information for the report, indirect benefits are those which result from spending by members of the University community. Indirect costs are determined by using "the multiplier effect," Helfman said. The consultants multiply the amount of money generated by a predetermined "multiplier" and find the indirect impact. For example, when the University recruits a student from California and that student spends money at a local store, the income that student generates for the store the employee's job are indirect economic benefits, according to the economic impact report. Then the money spent by the employees of the store creates the multiplier effect. The report says that the University creates approximately 20,000 jobs through indirect spending. · Finally, the University and the city exchange an undetermined amount of volunteer services, educational and cultural resources. Van Pelt Library is open to the community and, according to the University's report, 22 percent of those who use Van Pelt Library are not University affiliates. Likewise, the Free Library of Philadelphia is utilized by University affiliates. The University Museum and the Annenberg Center, as well as many city-subsidized cultural institutions, are visited by city and University community members alike. And countless volunteers, including students, faculty and staff, spend time in West Philadelphia tutoring school children, serving at soup kitchens and working at shelters. Clearly, the University and the city are linked inexorably and the benefits they provide each other go beyond what mere numbers reveal. A fight over what role the University should play in the future economic well-being of the city may be unavoidable as Philadelphia elects a new mayor and struggles to stay afloat.

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