The Carrier Dome Controversy: Rewriting the Town-Gown Relationship Author(s): Donald J. Kirby Source: Change , Mar. - Apr., 1988, Vol. 20, No. 2 (Mar. - Apr., 1988), pp. 42-49 Published by: Taylor & Francis, Ltd. Stable URL: https://www.jstor.org/stable/40164593

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This content downloaded from 130.127.238.233 on Mon, 23 Nov 2020 22:05:37 UTC All use subject to https://about.jstor.org/terms /';-=09 )(8* =-0/']

This content downloaded from 130.127.238.233 on Mon, 23 Nov 2020 22:05:37 UTC All use subject to https://about.jstor.org/terms THE CARRIER DOME CONTROVERSY

"rewriting the town-gown relationship

1984, when activities," and that the Dome was in- paid the city of Syracuse $1.25 mil- deed taxable. Murphy delayed entering lion in contested taxes and interest an order, and for the next eighteen charges- its 1982 property tax bill months the city and university strug- on the 5O,OOO-seat known gled to resolve the problem locally. Fi- as the "Carrier Dome" - colleges nally, on December 16, 1986, a new city and municipalities looked on with administration and the university an- anxious interest. Although the nounced an agreement exempting the payment was made "under protest," Carrier Dome from real estate taxes; in had the university failed to pay that bill return, the city would receive a share of the city had the authority to sell the ticket proceeds from nonacademic Dome for back taxes. Even as it made Dome events. The city retained the the payment, the university was hold- $1.25 million in taxes paid earlier by ing city tax bills for the Dome of overthe university. $1 million per year for 1983 and 1984. I have changed my mind about this The university's fears were con- case three times. The first was when firmed on June 7, 1985, when New students researched the matter during York State Supreme Court Justice its early stages and presented their Thomas J. Murphy ruled that the pri- findings in a senior seminar on "Cor- vate university had used the facility for porate Responsibility." Their presen- "deliberate, willful revenue-producing tation and class discussion persuaded me that the university was right to fight 3 taxation. I switched to the city's side a DONALD J. KIRBY, S.J. is associate pro- >■ few months later when at Vassar Col- fessor of Religious Studies at Le Moyne c/5 College, Syracuse, and project director lege of I /presented a reworked analysis of ^. Le Moyne 's Working Group on Values the in case to a work group studying "val- Higher Education. His areas of interest ues are conflict in institutional decision u Christian social ethics and the theological I making." This meeting of the Society foundations of ethics, especially in business CD for Values in Higher Education had as- areas. He has published in the Journal of Business Ethics, Liberal Education, and sembled college presidents, deans, fac- other journals. ulty, lawyers, and legislators; their in- © 43 Change March/April 1988 by Donald J. Kirby. S. J.

This content downloaded from 130.127.238.233 on Mon, 23 Nov 2020 22:05:37 UTC All use subject to https://about.jstor.org/terms sights convinced me that the City's po- tionally ranked program, facility's financial and political impli- sition had more merit. But the final which was already playing before cations; ca- no one party felt strong out-of-court settlement caused me to pacity crowds in the 9,000-seat Manley enough to pressure another. The uni- reconsider; both sides have persuasive Field House. An enhanced sports pro-versity needed public services and good arguments about this complex issue. gram and the resulting publicity would will; surrounding communities needed Now that a settlement has been help recruit high-quality athletes theand spin-off revenue from Dome events. reached, the full story of the facilitateCarrier general student recruitment Thus all parties proceeded cautiously. Dome controversy can be told. onIts a nationalout- basis. The increase in stu- The money needed for operating costs come can help educators and citydent numbersad- and spin-off income and related services clearly would be ministrators understand critical issues from the Dome would allow the uni- great, and it was by no means clear of taxation and town-gown relations. versity to improve its educational pro- how much revenue the facility would grams. The Dome, then, was seen as an The Carrier Dome Story generate. Given the financial uncer- answer to problems the university tainties, the city adopted a more giving The Carrier Dome is massive. Sub- would face over the next twenty years. attitude in early discussions. stantially completed on September 19, But where should the Dome be built? 1980 at a cost of $27.5 million, the Funding the Dome: A breakdown of At least three sites received considera- white shining roof of the 50,000-seat how the Dome was paid for sheds light tion. One was Skytop, a large parcel of Dome dominates the physical and psy- on the financial controversy. Of the land contiguous with and owned by the chic geography of central Dome's total cost of $27.5 million, $15 university. Construction was to be a million came from the State of New State. It symbolizes both Syracuse Uni- joint city and county effort, with the uni- versity's hope for big-time athletics York, $2.75 million from the Syracuse- versity contributing the land. Another and a controversy that lingers across based Carrier Corporation, and $9.75 proposed site was the New York State million from other sources. More than campus, city, and state. The history of fairgrounds on the outskirts of Syra- half the cost, then, came from New that controversy is illuminating. cuse. Like Skytop, this site had ample Why It Was Built: Except for the im- York State taxpayers. The next largest parking and access by interstate high- portance of football to Syracuse there amount came as a gift from a large cor- ways and public transportation. (The would be no story to tell. Since 1889 poration (note that, for $2.75 million, site eventually chosen had little or no football has been a major part of the Carrier gets continual advertisement parking.) fall for both the university and central on national television). So from the be- New York State. Football legends such The Skytop location was dropped ginning, the Dome reflected a marriage as , , and Larry when it became clear that prolonged between government, business, and ed- Csonka played for Syracuse in the '50s opposition from citizens groups made ucation, an attempt to make a univer- and '60s. The Orangemen won the na- the cooperation of local communities sity and community more viable. tional title in 1960. Throughout the and municipalities unlikely. As various Why Syracuse University received '70s, the team struggled to regain na- parties wrangled, the university opted such a large sum of money from the tional repute. That struggle reached a for a pre-emptive strike: It would build state treasury for this facility was a milestone this past January when Syra- a huge, multipurpose facility itself, mystery and a source of contention cuse, after an undefeated 1987 season, right in the middle of its own crowded within the state. Governor Hugh Carey played Auburn to a tie in the Sugar campus on the site of the old, 22,000- and key local legislators were up for Bowl. seat Archibold Stadium. The univer- election at the time, and the governor For a number of years the city and sity's plan called for playing fields and was in trouble in Onondaga County. surrounding municipalities in Onon- basketball courts, of meeting areas, That circumstance, and heavy, effec- daga County had hoped cooperatively and health facilities- a major attrac- tive lobbying by influential alumni in to construct a major sports facility. tion for alumni, students, and the Albany and support from small busi- But who would build such an arena, larger Syracuse community. ness across the state, convinced state and where to locate it, was always the The site's main advantage was that it officials in late September 1978 to problem. For its part, the university was already appropriately zoned, so the award $15 million to the university. was feeling pressure to build a new sta- structure could be built promptly. The Provided as a grant from the Urban dium to meet ncaa stadium require- disadvantage of the decision to proceed Development Corporation, the money ments for division-I football. alone was that sufficient time wasn't would go for construction costs (the In the early '70s the university had left to negotiate with neighborhoods, state would not agree to fund operating hired a consultant to evaluate its finan- the city, or the county. The fact that costs). Back in 1978, this allocation cial future in light of expected drops in neighborhoods and hospitals around meant that what remained of the student enrollments. The consultant the Dome would be greatly impacted state's financial pie for other private suggested that an alternative would was be not carefully considered, which incolleges and universities was very small to build a large, attractive, domed, ex-retrospect was a mistake. indeed. To this day, deep feelings linger tracurricular/sports/multipurpose fa-Building a large, domed sports facil- among sister institutions about the way cility, one that could open the door ity to in Syracuse in 1978 was risky. The money was siphoned off to Syracuse. national recognition for the Syracuse university, city, and the surrounding The Dome's construction was further football program and promote the municipalities na- were unsure about the helped when Governor Carey signed 44 Change March/April 1988

This content downloaded from 130.127.238.233 on Mon, 23 Nov 2020 22:05:37 UTC All use subject to https://about.jstor.org/terms legislation in July 1980 offering exemp- commercial ventures unrelated to the erty tax bill for the Dome on January tion from state taxes to the Carrier educational status upon which tax ex- 5, 1982; it was for $965,000. Upon re- Dome as an educational facility. In emption re- was based. A second reason ceiving it, the institution replied, "we turn for the grant, the university signed may lie in a report from Roy Bernardi, will not pay the taxes; we will litigate." a contract with the New York State De- the city auditor, who recommended The university's position was that partment of Parks giving the state use prompt collection of $620,000 from the taxing the Dome was a precedent-mak- of the Dome for twenty days each year university as reimbursement for traffic ing decision affecting the very nature for the next forty years. The rationale control costs at Dome events. The aud- of not-for-profit institutions - their was that public funds should somehow itor's report claimed that as of Decem- ability to survive and provide for the benefit the public. ber 1981, the city had not received any public interest. University officials felt Two agreements were made with the reimbursement for costs reported bythat decisions of this import should not city that would eventually lead to ten- department for 1980 and be made by individuals negotiating out sion. The first, in 1979, authorized the 1981. of court, but in court where precedents city's police department to pay its offi- Newspaper reports claim that another could be established. This is why the cers for special assignment to Dome reason for the city's action was a bill for university chose to litigate rather than events. The city, county, and university $35,000 sent to the university to cover negotiate. According to university offi- agreed that if sales taxes for events overtimeat costs incurred by the city cials, the dispute had become "a mat- the facility did not cover costs for traf- while training security personnel for ter of law, and the best forum for set- fic-control staff, the university would the Dome. Confusion ensued about the tling a matter of law is the court." pay the excess. This arrangement later meaning of the original agreement and The city felt that sending the tax bill became crucial to the larger dispute; about the overtime costs; the university to the university was fair and equita- the university and city would soon argue refused to pay the $35,000. The combi- ble. Kenneth Mokrzycki, the new as- about how many people were needed to nation of Bernardi's report and the sessment commissioner, reflected that control traffic at Dome events. The university's reaction to the bill for attitude when he asserted that property second agreement allowed the univer- overtime costs were the sparks that ig- tax bills had been sent to all property sity a full exemption from city taxes nited for the controversy. owners in the city, and the university's the first year of the Dome's operation The political impact of this well-pub- Dome bill is "due just the same as any- (because of the project's risky nature). licized report led to heated exchanges one else's." In November 1978, the university between be- the university and the city. At the heart of the disagreement be- gan demolition of the old stadium. The university claimed that it had been tween the city and university was the Within twenty-one months the Carrier overcharged and demanded an investi- question of whether the Dome had Dome was completed, and in Septem- gation, which the city resisted; the mat- been organized "exclusively" for edu- ber 1980, the first football game ter was never was resolved. cational purposes. For two years the played. The controversy reverberated through university resisted all efforts to open the Assessing the Dome: Fewer than a financially strapped city. In 1965 the Dome's financial records to the city, in- eight months after the Dome's opening proportion of tax-exempt property insisting that private institutions were it was clear that the project would be a Syracuse, as a percentage of the as- not required to make their books pub- huge financial success. Right after that sessed value, was 31 percent; in 1980 lic.it But the court, needing to discover the tax controversy began, in July had been 47.8 percent; today it is more whether "the primary use for which it 1981. The city's Commissioner of As- than 50 percent. Confronted with a di- is used is educational or reasonably in- sessment assessed the parcel of land minishing tax base, the city chose not cidental thereto" or whether it was a (real property) on which the Dome is to ignore the fact that over 800,000 guise for profit making, ruled on De- situated at one-half its total value; the people using the Dome in its first eight cember 30, 1983, that the university taxable value was put at $6,242,200. months had generated $8,139,000 in must open its books so that the actual Three months later the university pro- gross revenues, along with an esti- records and revenues from each event tested that the partial exemption was il- mated $23 million in other business ac- might be investigated. legal; it initiated an action pursuant to tivity for the community. The Dome The Trials: The case came to trial in Article VII of the Real Property Tax had housed the National Sports Festi- January 1985. The university argued Law seeking relief from the assessment val, the Sugar Ray Leonard boxing that under Section 420 of the Real and a declaration that the facility was match, a Republican Property Tax Law, the Carrier Dome exempt totally from real property party benefit, and the National Invita- was entitled to a full exemption from taxes. tion Basketball Tournament; soon to taxation "as a matter of law." Every Why did the city set its mind to taxfollow were two Rolling Stones con- event in the Carrier Dome, it argued, the Dome? City officials told the uni-certs attracting over 90,000 people atby definition was an educational event; versity that some events at which traf- $20 a ticket. These kinds of events, and its goal, it said, was to defend the sanc- fic control costs were incurred - such their very size, made the city's tax re- tity of tax exemption for all educa- as a Rolling Stones concert and a pro- view board want to reassess the tional institutions. The city, unwilling fessional boxing match between Sugar Dome's tax status. to have things so black and white, ac- Ray Leonard and Larry Bonds- were The university received its first prop- cused the university of using the Dome Change March/April 1988 45

This content downloaded from 130.127.238.233 on Mon, 23 Nov 2020 22:05:37 UTC All use subject to https://about.jstor.org/terms as a guise for profit-making operations Among the judge's findings were sity has become. In reporting the deci- and argued that the Dome should be that the Dome had been rented to third sion, the Syracuse Herald American only partially tax exempt. parties; that the public was sought headlined a story, "Neighbors Believe Was there validity to the university's through advertising; and that SU per- SU is rich and 'Fair is Fair.' " claim that the Carrier Dome and all its mitted use of the Dome for noneduca- The university complained that the tional events. The court record also activities should be tax exempt? Ac- judge had failed to state criteria for de- cording to New York law, tax exemp- showed that the university's vice-chan- ciding what was educational and non- tion can be granted if cellor had ordered Dome managers educational. to It also complained that reach the largest possible audience, and 1. The organization or agency is or- when the judge ordered the university that a complete analysis of financial ganized exclusively for purposes de- to pay taxes based on a percentage of potential was made before any con- Dome revenues from nonexempt events, clared to be tax exempt; tracts for events were signed. The 2. The property is used for a desig- rather than on the assessment of prop- judge reminded both parties that he erty value, he in effect created a gross nated exempt purpose; and was well aware of the "tolerance" of 3. No profit beyond reasonable income tax annexed to the real prop- New York courts for some degree erty of law. compensation is obtained or the prop- use of exempt property for incidental The decision that the university erty is not used as a front for profit but unrelated activities but, he con- making. could and should be taxed in certain cluded, the university had taken part in situations meant that the city's tax base The university's arguments were ' 'deliberate, willful, revenue-produc- had been broadened. It also meant that ing activities." Finally, in an important many and varied. One maintained that a method had to be worked out to es- note, the judge observed that no tickets since similar events - such as high tablish the value of the five-year-old were reserved or discounted for stu- school athletic events, several profes- stadium and so determine the base on dents. If the events had been solely for sional football games, and concerts - which the university must pay taxes for students, or had discount tickets been had been held in the old Archibold Sta- 1982, 1983, and 1984. made available, then these events more dium, which had been treated as tax ex- A second trial ended on January 11, likely would be declared tax exempt. The empt, the same privileges should apply 1986. Justice Murphy determined that judge concluded that when "it leased out to the Dome. The judge rejected this the city had overassessed the Carrier the facility, it was usually to high-audi- argument, responding that "each taxa- Dome. The university claimed that the ence-oriented events that would gener- ble year is separate and distinct." The valuation of the land and improve- ate a profit." university also argued that if less than ments should be $25 million for each of 10 percent of the events were commer- The judge's decision established twothe years at issue. The city estimated cial, then the Dome maintained its tax principles. First, it is permissible forthe avalue to be: 1982- $36 million; exemption. The judge also rejected this "profit" to be made on an activity 1983-of a $37 million; and 1984- $40 mil- argument, agreeing with the city's call nonprofit entity, but not one beyond lion. Both parties agreed to the follow- for assessment based on a percentage reasonable compensation. Second, iting: is that the Dome is a special-purpose of the commercial revenues. permissible for a university to engage property; that the market data ap- A third argument was that the num- in noneducational, nonexempt activi- proach is not appropriate because the ber of people attending an event, or the ties, but it must pay property and Dome in- was not built for exchange in the size of its revenue, did not transform its come tax on them. Thus, some events marketplace; and that there are no nature from educational to commercial. are nonprofit but may generate a salesrea- of properties comparable to the It noted that rock concerts held in the sonable compensation, while others Dome. They also agreed that an in- 9,000-seat were not have profit as their primary motive. come approach was not appropriate considered commercial, while the same The judge in this case was attempting because the Dome was not used pri- type of event drawing 40,000 people to to define a test for tax exemption for marily for the production of income. the Dome was considered commercial. private colleges and universities. The They also decided to use the Reproduc- In June 1985, Justice Murphy ruled test, he said, was whether Syracuse tion Cost New Less Depreciation University used the Dome primarily for that the "university is entitled to a par- (RCNLD) method for valuing the educational purposes and whether all tial exemption only." He listed the Dome's land and improvement. other uses were incidental to educa- nonexempt events from 1982, 1983, Thus the court concluded that the city and 1984. The judge observed that tional purposes. overassessed the Dome for the three "the Carrier Dome sponsored a signifi- Some university officials argued thatyears in question as follows: 1982 - cant number of commercial ventures, the judge ruled in response to public $5,408,778; 1983- $5,448,431; 1984- open to the public, which were neither opinion and pressure. They believe that $4,951,580. This was a major decision educational, nor incidental to the uni- for the citizens of Syracuse the Dome because the judge's ruling meant that versity's educational purposes." In the had come to symbolize the newly the university would wind up paying mind of the court, the evidence was found riches of the institution; it taxes is a based on an assessed value of clearly against Syracuse University as "cash cow," an extravagant "extra- about $7 million, nearly 40 percent less to whether there had been "no profit curricular palace," a reminder of how than the $12.4 million the city had re- beyond reasonable compensation." "rich" and "able to pay" the univer- quested.

46 Change March/April 1988

This content downloaded from 130.127.238.233 on Mon, 23 Nov 2020 22:05:37 UTC All use subject to https://about.jstor.org/terms The Carrier Dome Controversy centered on two basic issues: whether the Carrier Dome should be ex- empt from property tax, and how and for what amount the Dome should be assessed if declared taxable (Syracuse University photo).

The Final Settlement: In the court each ticket sold at nonacademic events gers (chancellor) and Michael Sawyer hearings there were two basic issues: at the Dome. The surcharge is to be (vice chancellor). The first item settled whether the Carrier Dome should be levied at events attended by at least was the one that had generated early exempt from the property tax, and 5,000 how people who pay at least $2 admis- controversy: the cost of traffic control and for what amount the Dome should sion charge and will be factored into for Carrier Dome events. The core of be assessed if declared taxable. the admissions fee for events such as the controversy in the past had been On December 16, 1986, Mayor Tom concerts or professional sports events. the university's contention that the city Young and University Chancellor Mel- • The university will pay the city provided at more police service than was vin A. Eggers announced a new agree- least $100,000 a year. necessary. Under the new agreement, ment: The city would exempt the Car- It was the election of Mayor Tom the city and university created a for- rier Dome from property taxes but re- Young in November 1985 that changed mula whereby the number of police of- ceive a share of ticket proceeds from the atmosphere from combativeness to ficers assigned to Dome events would nonacademic events held at the Dome. cooperation. During the new adminis- be directly proportionate to the atten- The settlement cleared the way once tration's transition period it became dance. The university agreed to pay po- again for the Dome to host major cul- clear that the city wished to settle the lice wages and employee benefits, and tural and entertainment events. matter out of court. Both sides knew for snow removal for Dome events. Fi- Major elements of the agreement in- the matter could drag on in the courts nally, the university agreed to pay cluded: for up to seven years; there was still $316,000 for police protection ren- • The city of Syracuse retained the time to act since Justice Murphy had dered between 1980-85, in addition to $1.2 million paid in 1982 under pro- yet to sign an order implementing thehis $228,000 it had already paid. tests by the university. decisions. With these obstacles out of the way, • The city agreed to exempt the Car- Frank Harrigan (corporation coun- the university chancellor, the mayor, rier Dome from real estate taxes. sel) and Joseph Mareane (director of and the city corporation counsel met • In the future the city would receive development) negotiated for the city. with Justice Murphy, who gave his ap- a surcharge of 75 cents from the cost ofThe university's team was Melvin Eg- proval for continued out-of-court ne- Change March/April 1988 47

This content downloaded from 130.127.238.233 on Mon, 23 Nov 2020 22:05:37 UTC All use subject to https://about.jstor.org/terms "The Dome, when taken in conjunc- summer youth program. Within New tion with our other facilities like the York State, St. Lawrence, Colgate, and zoo, puts us over and above the compe- Cornell all make municipal payments tition when it comes to attracting con- in lieu of taxes. vention business," said Irwin Davis, During the negotiations a major executive vice president of the Metro- stumbling block was what to do with politan Development Association. The the $1.25 million the university had al- Hhe Carrier Dome moratorium on nonuniversity events is ready paid to the city. The city was one reason why the Hotels at Syracuse controversy rewrote the firm that it would not return the money Square ran some $3 million in the red, because of the public reaction that rules for noneducational according to hotel officials. would ensue. The impasse was over- entrepreneurial activities Even as the city suffered from cur- come by counting up the people who tailment of the Dome's use, the univer- had attended events in the nonaca- by private colleges and sity found many of its goals being met. demic category and surcharging for universities, and both Football did indeed prosper, and with each; the amount nearly equalled what it came publicity, culminating with the the university had already paid in taxes. sides now agree that the Orangemen's undefeated season this In return for this the city decided not to final agreement is wise past fall. But the big surprise - and rev- press its claim for other back taxes. enue boon - came from basketball: In Henceforth, with a head-tax concept as and fair. 1986-87, 498,000 attended SU home the controlling factor, the university games in the Dome, including crowds would be free to sponsor whatever events of 32,000 each for games with George- it wished in the Dome facility. town and Notre Dame. Home and away, Syracuse hoopsters played Lessons be- and Issues fore 641,146 fans last year, an Before ncaa examining the lessons and record, and, by reaching the critical ncaa issuesfi- raised by the Carrier nals, garnered a windfall of Domepublicity controversy, it is important to for the university. recognize three developments that helped It was clear, then, that a city create victory the volatile, highly charged nature in the courts could be nothing but of this university-city tax debate. phyrric. As this became clearer, both First, as U.S. society becomes more sides agreed to keep working until they secularized, municipalities and govern- could come up with a settlement and ments are less cautious about openly return the Dome to full use. challenging the tax-exempt status of The plan was to submit proposals universities, churches, and other non- and weigh their pros and cons until an profit groups. The recent law that taxes gotiations. From June through No- amicable settlement could be reached. income of priests and ministers doing vember 1986 negotiations continued. The city's research office communi- work not directly related to their minis- The motivation behind the negotia- cated with other municipalities and put try reflects this secularization process. tions was that it would be a "no- win together proposals based on arrange- The second development is the emer- situation" for both parties if the court ments in other town-gown situations. gence of the fund-starved municipality and appellate process continued. In Princeton, New Jersey, the univer- with diminished revenue sources. Like On the basis of earlier court deci- sity gives the town $35,000 annually most in cities, Syracuse is experiencing a sions, the chancellor in 1985 had or- lieu of taxes, plus additional services. decline in taxable property, decreased dered that the Dome cease hosting any In Ann Arbor, the university makes federal revenue sharing, and a shrink- event not clearly educational. Given payments of $410,000 toward the cost age of its once-stable workforce. Merg- this order, the city and country were of police services, and the state of ers and plant closures from major em- far more the losers than the university. Michigan makes a payment of $630,000 ployers such as Carrier, Allied Chemical, Between 1980 and 1985 (when the mor- towards costs of providing fire protec- General Electric, and Bristol Myers have atorium took effect), twenty-seven tion. In Scranton, Pennsylvania, the weakened the city economy. concerts at the facility had an esti- University of Scranton and city negoti- Third, universities are feeling the fis- mated economic impact of $15.9 mil- ate an agreement each year in lieu of cal strains of tight enrollments and lion on the community, according to payment of taxes; the figure has been higher operating costs, while still want- the Syracuse Chamber of Commerce. A $50,000 per year since 1982. In Berke- ing to expand and enhance their prestige. total of 758,454 people attended these ley, California, the university has There are two crucial lessons to be concerts, about ten percent of whom agreed to help the city by providing learned from the Carrier Dome tax stayed at area hotels. The events also services-in-kind; for example, by hiring story. A bottom-line lesson is that liti- generated an estimated $1.1 million in approximately seventy-five city youths gation is costly. Legal fees for the city sales tax. to help with landscaping as part of a and university alone were between 48 Change March/April 1988

This content downloaded from 130.127.238.233 on Mon, 23 Nov 2020 22:05:37 UTC All use subject to https://about.jstor.org/terms $500,000 and $1 million. The Alexan- competitive? If private colleges deteri- wise and fair. But that agreement is der administration bypassed city law- orate and can no longer compete with more an accommodation to existing re- yers and hired Fisher and Fisher, a po- public institutions, then government ality than a permanent resolution. De- litically connected law firm from may be forced to accept the responsi- spite its ad hoc nature, the accommo- Brooklyn; it billed the city $383,065 be- bility (and expense) of providing their dation demonstrates the advantages of tween 1981 and 1985. Using the new services. Related to the question of en- innovation and cooperation in this revenue formula worked out as part of trepreneurial activity is the recognition kind of tax debate. In the end it took the settlement, it will take the city four that private education provides a vi- the city and the university five years to years to recoup the money spent on its tally important alternative for the pub- recognize that the Dome is a new kind law firm. City costs increase further lic, by encouraging and making possi- of animal in a changing environment when time spent on the Dome case by ble diversity and variety. But what that calls for fresh approaches and new members of the city's administration is price is society willing to pay for this rules. Both parties needed time to see factored in. The university's legal fees freedom to choose between different that when the old approaches and rules are not public, but they too must be educational models and values? were invoked, everyone lost. substantial. A second issue is how far society will The first new approach was to see The cost could have been truly enor- go in allowing rules to be rewritten the to Dome as a unique property benefit- mous if the case had continued through preserve this diversity. Because of ingthe not only the university but also the the appellate process. Communities, uni- Carrier Dome controversy, the city entire area. What de- versities, churches, and nonprofits would now allows the university to engage veloped in was a new sense of property, have joined the lawsuit, or been forced noneducational activities, making this neither public nor private, worked out to tread carefully because of confusions private university more competitive by the city and the university. On line over their tax liability. and financially viable. In essence, awith that sense, the city now admits new set of rules has been created to ad- The economic vitality of central New that certain kinds of profit-making ac- York also came under a financial dress a new set of tax problems. But tivities are legitimate for universities. squeeze. According to Mayor Young, while many problems were solved byIndeed, educational institutions through- "the curtailment of activities at the the innovative city-university accom- out the nation are already engaged in Dome deprived our area of an eco- modation, there are potential difficul- profit-making activities, such as build- ties ahead: When the Carrier Dome is nomic boost." Recall that the 27 con- ing super computers, developing new certs held at the Dome had generated in need of major maintenance or products,re- and consulting for business. building, who then will fund it? What $15.9 million in economic impact; Even though an accommodation has if the university and city chose to go into they have had almost no concerts in the been reached, the underlying issue of a joint venture in which a professional three years since the moratorium was whether noneducational enterprises by football team was lured to the city by imposed. private universities should be subject to the promise of a major stadium? A second lesson concerns the impor- tax has not been squarely faced. Be- A third issue is whether "private" tance of process. The Carrier Dome cause of this, uncertainties lie ahead. A and "public" institutions are being case models two approaches to prob- new administration in the city or the treated equally. If a public university lem solving: brinkmanship vs. cooper- university, for example, could raise constructs a "dome" and uses it for ation and dialogue. It is a vivid exam- this issue again, to argue for better noneducational purposes, would it ple of the cost of brinkmanship meas- terms. What is needed, beyond "a new have to pay property taxes? Both fed- ured in financial, political, and human sense of property," are more-certain eral and state governments recognize terms. It is a lesson Syracuse University criteria, clear rules understood by all by their statutes and acts that public Chancellor Melvin Eggers takes to parties. and independent colleges and universi- heart. In a telephone interview this past ties share the same purpose, and they In the end, the agreement "signalled January 5, Eggers acknowledged that the end of the wars" between the uni- afford them equal treatment. In New the university should have worked York this is shown by the current tax- versity and the city. It has, according more closely with its neighbors and city exempt status of private colleges and to city corporation counsel Frank Har- officials. For Eggers, a crucial lesson universities, the uniformity of student rigan, "paved the way for forging bet- of the Carrier Dome tax debate is the aid throughout the state, and by the ter relationships between the city and the importance of maintaining close, work- common regulation of education in university." The controversy's solution ing relationships with City Hall. demonstrates that difficulties can be general by the State Board of Regents. Beyond these lessons, the Dome case Should this equality be extended to fa- dealt with equitably. The final solution puts critical issues on the table. The cilities like the Dome? was acceptable because all sides were most fundamental is this: Will society sensitive to what the policy would do to Conclusion allow private educational institutions and for people from different constitu- to engage in profit-making activities, The Carrier Dome controversy re- encies, and because those constituents and thereby remain competitive with wrote the rules for noneducational en- were at least consulted. The people of public institutions? Just what financial trepreneurial activities by private col- Syracuse are proud of their city; the reso- resources will society allow private col- leges and universities, and both sides lution of this problem should make them leges and universities to tap to remain now agree that the final agreement is more so. □ Change March/April 1988 49

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