Private Philanthropy Puts Yale in the Drivers Seat in New Haven

Gleaming new campus buildings arise while the city's infrastructure crumbles around them. 

One of the enduring paradoxes of charity is that it is often easier for institutions to build than to serve.  The New York Times (Louis Uchitelle) recently reported on the massive construction projects being undertaken by Yale University (EIN 06-0646973 Form 990), while the city of New Haven struggles to pay for much needed improvements in highways. 

The contrast: Yale is spending $400 million a year on capital construction, New Haven just $137 million. 

But the more notable point of the article is that there are no effective advocates for increased infrastructure spending.  In decades past, major local businesses promoted road building and other projects that would make the city more efficient.  But now the manufacturing businesses have gone, leaving only Yale.  And Yale is not that interested in infrastructure projects unless it is of direct benefit (like streets and sidewalks around its own campus). 

Also worth noting (although it is not in the article) is the double standard that applies to capital giving.  Charity watchdogs are always paying attention to the percentage of charity spending that goes directly to programs.  However, that standard goes out the window when capital spending is concerned.  Charity capital campaigns raise billions of dollars, not a penny of which goes for programs.  Typically construction only provides a charity with a reduction in ongoing occupancy costs, which is usually just a small percentage of total spending. 

So the contrast continues, as we have already seen in New Orleans and Pittsburgh.  Private (and occasionally public) universities (with their associated hospitals forming the Eds and Meds sector) are the dominant economic force in many of the second-tier cities in the US (those past the top fifteen or so, metro areas with less than 3 million in population).  They have yet to step up to their responsibilities to the cities that host them. 

 

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