After negotiations stalled in early August, Cornell and the City of Ithaca have reached a financial contribution agreement of $4 million annually from the University to the City in payments in lieu of taxes. The agreement was announced in a joint statement between Ithaca Mayor Laura Lewis and University President Martha Pollack at around 3 p.m. on Thursday, Sept. 14.
“We are very pleased to announce today that we have reached an agreement in principle that, subject to approval by the Ithaca Common Council and the Cornell University Board of Trustees, will provide the City and its residents immediate and significant new financial resources,” Lewis and Pollack wrote in the statement.
Once the agreement is approved, Cornell will begin contributing an annual, inflation-adjusted $4 million to the City as voluntary payment under the updated Memorandum of Understanding, which will stand for 21 years. Effective immediately, the policy will induce a $2.4 million payment on top of the $1.6 million already contributed to the City this year in compliance with the previous financial agreement reached 20 years ago.
Eighty percent of each year’s contribution will be unrestricted, allowing City officials to funnel the funding towards projects of greatest concern to Ithaca residents. The remaining $800,000 will support city infrastructure and mutual interest projects, including a $100,000 annual grant for a Cornell faculty member to work with city officials on issues like sustainability.
“This new agreement will further strengthen our critical relationship and partnership for the long-term, for the benefit of the people of the City,” Lewis and Pollack wrote.
Cornell and the City held four negotiation meetings between April and August of this year. The City initially proposed a contribution of $8 million, with Lewis and the City citing the approximately $33 million in property taxes Cornell avoids as a tax-exempt institution.
The University’s previous offer of $3.15 million was guided by “Cornell’s deep commitment to the City,” vice president for University Relations Joel Malina told The Sun last Thursday.
Pollack noted that on top of the updated MOU contribution, Cornell will continue providing funding for joint priorities including TCAT, the Community Housing Development Fund, the Ithaca City School District, local nonprofits and various municipal services like public safety, snow removal, sidewalk construction and paving. According to the University, Cornell currently spends nearly $26.2 million annually in support of the City and its residents.
“For over 150 years, the City of Ithaca and Cornell have recognized the importance of each entity to the other and to the quality of life of City residents,” Pollack and Lewis wrote. “Cornell would not be Cornell without the City, and Ithaca would not be Ithaca without Cornell.”