Wednesday, August 29, 2007

Final Notice. Save Your City. Please.

An otherwise brilliant P-G editorial meekly concludes:

Pittsburghers can only hope that UPMC, ever more successful and ever more profitable, will direct more of its abundance to aid the city that sustains it.

Ahem. We can do a lot more than hope.

Tomorrow, Thursday the 30th, from 9:00 AM until noon, the Pennsylvania Senate Finance Committee will hold a public hearing on State Act 55, the Purely Public Charities Act, right here in our City County Building.

Let us reflect on that title. What other purely public charity can compile $618 million in "excess margin" in a single year?

That's $618 million after a $3.3 million payout to the CEO, after million-plus payouts to at least six other executives, after all the acquisitions and investments, and even after the famously vital research and development.

That's 618 million reasons any sane individual should reconsider the definition of "purely public charity."


Let's leave class warfare out of it. We want UPMC to succeed. We want all of our hospitals and insurers and universities to succeed.

Or rather, we want to want them to succeed, but this poorly-written law is getting in the way.

It's brilliant that health care and academia are replacing long-gone heavy manufacturing industries, employing hundreds of thousands of citizens, and making great contributions to medicine and to humankind.

The problem is, a city simply cannot be expected to function if its primary economic activity falls outside of the tax rolls, outside of the commonweal. The equation does not compute. The center can not hold.

Under Act 55, we are systemically unsustainable.


UPMC and the rest do a lot for Pittsburgh, but let us state clearly: Pittsburgh does a heck of a lot for them in return.

We provide a safe city. We provide a clean city. We provide infrastructure. We provide plumbing. We provide a steady stream of literate, capable workers. We provide neighborhoods and a culture that allows these "non-profits" to attract the best talent in the world.

You will hear much talk tomorrow about how everything these institutions do is a benefit to the City of Pittsburgh. It will be a laughable overstatement, but one they have made straight-facedly before.

Rather than focusing on everything they do for themselves, we should emphasize everything we do for them in return.

Pittsburgh and its hospitals, health insurers, and universities are symbiotic. We should be moving forward together. We should be moving forward as partners, as equals.

We should not be moving forward as nobles and serfs, as benign overlords and disenfranchised worker-bees.


The Comet really should not spend our time ranting against UPMC. We have no standing.

Of course a billion-dollar enterprise is going to take the position most advantageous to them! Of course they are going to scream bloody murder if Act 55 is amended! That's their job!

However, unlike the Post-Gazette editorial, and unlike all of the reporting and commentary on this matter to date, we recognize that the remedy lies not in persuasion, but in legislation.

There is no reason to continue lobbying these interests to make payments in lieu of taxes. We will only ever receive the barest minimum that decent public relations demands. That's business. And it is a business.

Our righteous indignance should instead be directed at the State Senate, which is examining this law tomorrow, and for good reason. That is where we have the upper hand. That is where the issue truly lies. It is a flawed law.


A final note. Act 55 of 1997 was passed, obviously, in 1997.

Dr. Jonas Salk discovered the polio vaccine in a laboratory within a building that was taxed like any other.

Most of the great medical breakthroughs of the 20th century were carried out on properties that were taxed like any other.

Expect UPMC and the gang to howl in desperation, weaving tales of collapse and layoffs and death and ruination, if they are made to suffer the indignity of doing right by their own city, county, and state.

That is their role tomorrow.

Just remember. $618 million. In one year. They'll be okay.


  1. I think local government might have some other forms of leverage to use - doesn't UPMC have to apply for building permits when they purchase property, and don't they have to pass code inspections, etc.? What if these were denied, unless they paid up? There must be other stuff too.

    Electeds need to go into that meeting & fight for us. They need to have lots of answers to all of the objections they're sure to hear. They need to have lots of alternative solutions. For example, UPMC says it doesn't want to pay taxes? Fine, it can provide health insurance to all city workers FOR FREE.

    UPMC needs running water going into its buildings? Fine, it has to pay for it. UPMC needs cops to respond to calls, fine, it needs to pay for every call.


  2. I've been blogging and fighting the fight with UPMC since 1999.

    Get a grip on this folks.

    Act 55 is NOT the problem.

    What is NOT sustainable is the swelling of land into the control of nonprofits, such as UPMC.

    The root of the problem -- no pun intended -- is the LAND.

    UPMC's profits are not a problem -- unless you want to be driven by envy. I don't.

    Furthermore, much of that 'profit' -- as was covered today in the hearing -- is paper money profits / investments. They come and they go. That is development money.

    If UPMC would cash out those profits into REAL PROPERTY -- by buying up land -- then the city is dead forever. They can knock us out by getting off of Wall Street and onto everyone's front stoop.

    We need serious blocks to all nonprofit land expansions -- NOW. That is the key to sustainable development.

    Running after Act 55 is like trying to hit the leaves on the tree of suffering. Go for the roots.

  3. Mark -- do you have any conflicts of interest you would like to declare regarding UPMC? Any *perceived, possible* conficts of interest?