The university is among several large tax-exempt institutions that make voluntary payments, called payments in lieu of taxes, to Burlington for services such as police, fire and road maintenance.
At its Monday meeting, the City Council approved a one-year extension of UVM’s payment in lieu of taxes at its current level of $1.3 million. The extension still needs approval from UVM’s board of trustees.
In a letter summarizing the agreement, Mayor Miro Weinberger wrote to UVM President Thomas Sullivan, “Hopefully soon we will have a longer-term comprehensive agreement.”
The mayor is also working to negotiate higher payments from Champlain College to support new infrastructure.
If UVM were not tax-exempt, it would be on the hook for $16.6 million in state education and municipal property taxes, with $5 million going to Burlington. Its current payment for services is roughly a quarter of that amount.
UVM also pays $1.2 million in municipal property taxes for non-tax-exempt uses of its property.
Weinberger has said he’s looking to secure roughly $850,000 more annually from UVM over the next decade to support his $50 million 10-year infrastructure plan for the city.
That plan is now in motion with voter approval of two infrastructure bonds in November and a recently passed city budget that puts $5.2 million toward road and sidewalk repaving, $3.2 million toward new water and sewer lines, and $3 million toward extending the waterfront bike path.
“The city is satisfied that the conversation is continuing to move forward and is on track to be completed in advance of the 2018 construction season, when the funds will be needed,” the statement said.
A university spokesman said much the same. Enrique Corredera, UVM’s executive director for news and public affairs, said university officials “continue to have productive discussions” with the city about supporting its infrastructure plan.
“While we have not yet agreed on final terms, we remain optimistic that we will reach a mutually satisfactory agreement,” Corredera said.
In 2015, property taxes accounted for 77 percent of the $30.5 million Burlington collected in tax. Forty-four percent of property in Burlington, geographically, is owned by entities that don’t pay property tax, according to city budgets and its grand list.
Burlington received an additional $5 million in payments in lieu of taxes from the state, utilities and nonprofits. They include Howard Center, which pays roughly $55,000, and the Champlain Housing Trust, which pays roughly $53,000.
Currently, Champlain College, UVM and the UVM Medical Center provide a combined $1.8 million annually in payments in lieu of taxes. Champlain College pays $125,000.
UVM Medical Center’s most recent annual payment is roughly $455,000. Prior litigation between the city and the medical center locked in a payment of $325,000 in 1999, increasing 2 percent annually for 30 years, so the mayor can’t negotiate a higher payment from the hospital.
However, the hospital agreed to donate $250,000 last year to install exercise equipment along the waterfront bike path. It’s unclear whether the medical center will continue to make donations to pay for infrastructure.
