Tulane University appreciates New Orleans’ sacrifices

July 1^st marked the implementation of the new state operating budget.  Since no one seems to have a handle on just how much the newly enacted revenue raising measures will generate for the state, we’ll have to wait and see if the traditional mid-year funding cuts will appear yet again this fiscal year.

One clear result of the latest budget rework is that parishes throughout the state are going to have to pick up the slack left by the reduced state-funded services.

However, this may not be an easy task for our local parishes since one of their major sources of funding is from property taxes.  Orleans parish which encompasses New Orleans is particularly vulnerable due to its greater dependence on state funding.

In fact, even before the latest budget crisis at the state level, New Orleans had a cash flow problem.  According to the Bureau of Governmental Research nearly 60% of all New Orleans’ property exempt from taxes for reasons other than the homestead exemption is publicly owned and has been granted exemption at the state level.

Tulane University falls into this category.  It owns about 10% of this tax free land due to a little known ‘good ole boys’ agreement between the state and Tulane University.  It is a state regulation known in Baton Rouge as the “Tulane University Exemption Allocation Regulation.”

This regulation “established general applicability, definitions and requirements as it pertains to application of a statewide exemption in favor of Tulane University.”

Basically, this regulation permits the private Tulane University exemption from property taxes on properties used for educational purposes, and vacant, non-income producing properties.  Additionally, Tulane pays no property tax on income producing properties up to a maximum statewide total limit of $5 million in fair market value. 

In return for this tax exemption each member of the state Legislature gets a one year tuition-paid scholarship to Tulane that he or she can give out each school year.  Even the mayor of New Orleans gets in on the deal for he gets to dole out five such scholarships.  Tulane set the value of the scholarship for the 2015-16 school year at $45,758.  Apparently this is not just some recent agreement for it has been going on in one form or another for 125 years, and no one is willing to even suggest it be reduced or eliminated entirely.

Perks given to our esteemed leaders for a local tax break, but a double edged sword for New Orleans, cutting state support while at the same time continuing to block avenues for additional revenue.

To add insult to injury Tulane is also eligible for TOPS money.

This is the kind of preferential gaming that continues in Baton Rouge and causes one to wonder if there is any sincere desire to right Louisiana’s fiscal ship.

However, at the end of the day, it’s important that as the folks in New Orleans reach further into their pockets to come up with that extra money to support city services they remember how thankful Tulane University is for their sacrifice.

Just how many other buried “good ole boys” deals are operating at our state capital and what is their impact on other parishes throughout our state?