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PghUSA

UPMC to move downtown?

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UPMC's administration offices, "the most profitable not-for-profit the world has ever seen" as I like to call them--besides Highmark and CMU and a few others of course, are mulling a move to Grant Street, possibly the US Steel Tower.

The are currently housed in the Forbes Tower in Oakland, from the look of it this would be a good move for the city having the executives closer to the main institutions of the city and financial companies. It also means that some of downtowns weak office market will get a shot in the arm, and Oakland's en fuego office market will get some relief. The biggest benefit though in my mind is that UPMC will start paying rent to a taxable endeavor. Basically they will start to pay property taxes!!!

I don't mean to be Sheriff of Nottingham here but when you have the area's largest employer and one that made an after-tax (oh wait after-expenses because remember they don't have to pay for our government like we do) profit of $274 million (Westinghouse money it sounds like) on total revenues of over 5 BILLION, any bit of them coming ONTO the tax rolls is good news for the average worker paying their way. Lots of things can be said about the old smokestack industries of Pittsburgh's past, Gulf Oil, Teledyne, Joy, Rockwell, Mesta, Westinghouse, etc. but at least they PAID their fair share of taxes. Man they must have been stupid or something to pay 10-15% to the county and city on profit of $274 million, don't they know they could have kept almost all of it?

Here's the link:

http://www.post-gazette.com/pg/06158/696176-28.stm

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PghUsa, I know this is a pet peeve of yours but to call CMU one of the most profitable non-profits is a joke. It's endowment is miniscule to those of Stanford, Berkely, MIT, and so on... and those are its direct competitors. Stop bashing the institutions that make this city great. Remember UPMC & CMU stayed when everybody else left.

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^^Balist, no bashing IMHO, simply stating the facts. My beef is more with UPMC not paying any taxes since it is affliated with Pitt, but CMU since you forwarded that point is taking advantage of the city's taxpayers as well. True the endowment is not as large as some other schools but forget the "contributions to specific educational departments" and consider that wealthy "general fund" CMU is collecting millions from, it still owns the rights to and recieves an ownership steak in Lycos, very similar to what a private tax paying financial company would have.

Also Google, Apple, Intel, Vivisimo and Guru.com are all housed at CMU's Collaborative Innovation Center, which for all the information I can see is also 100% off the tax rolls, so CMU has a pure profit on being the REIT to the tech stars, all tax free? It is great to have those companies expanding in the 'burgh, but are they really when they make you and me pay MORE in taxes?

I would love nothing more then to have CMU succeed and prosper but it is harder and harder to say that Balist, if US Steel or Mellon grew by 300% we would all get a "prosperity dividend" from them through the tax base, if CMU's Collaborative Innovation Center grows by 300% it could lead us on a path to bankruptcy.

Again though I will express my happiness that UPMC will finally pull its weight with being a true taxpaying corporate citizen, at least with their "non profit" offices.

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PGHUSA, The CIC is NOT a CMU building, even though it is on campus and managed by CMU. It is abuilding, I believe, jointly controlled by the state and the city governments. So if they are not paying taxes on the building that is the government's doing NOT CMU. Also, all those employees and the company still have to pay payroll taxes and such. The city is still making money where there wasn't any before.

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UPMC could not be affiliated with Pitt and still be non profit, as with most hospitals.

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balist,

I agree that having Google and Apple and the like here does add to the tax base (besides adding to the critical mass of tech industry here) as far as payroll and the like, but why not just have them come in like a US Steel or USAirways would and pay property taxes and school taxes? Even if they give a few tax breaks to them, they'd pay more of their way. I did not realize that the building was state and city owned, do you have a link or documentation on that? I have searched but info is hard to come by, even on the Allegheny County Property Assesment website. If the state and city are indeed helping to pick up the tab for the Apples and Googles here by providing officespace and lab space, then for as much as the city needs CMU, CMU needs the city/state. It is the most benevolent relationship one can hope for between school and people. :thumbsup:

~~~

Mj,

Interesting comment, never heard of that before. What I was referring to is what anyone could see with their own eyes, UPMC is the "University of Pittsburgh . . ." it is on the campus of Pitt, uses the University's logo etc. etc. I do realize that the actual relationship of the two is limited to only the highest levels and that on every day issues UPMC is running its own ship. I would be interested on learning more of what the seperation should be between NFP hospital and university, other univerisites have even closer relationships to their "not-for-profit" hospitals from what I have seen (though none are 1/10th the size of a UPMC network). Any link or documentation or personal experience that would shed some light on that rule?

It puzzles me why UPMC just doesn't go for-profit, or even public and be like a Humana etc. Highmark as well. CMU and Pitt would not be excluded from that, Pittsburgh's own EDMC will sell you its stock (Art Institute).

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PghUSa,

Here is an old article:

http://www.cmu.edu/cmnews/extra/050725_apple.html

This is the important part:

"The Collaborative Innovation Center was funded with state capital and Department of Community Development funds, Carnegie Mellon financing, and support from the City of Pittsburgh and the Regional Industrial Development Corporation (RIDC).

Governor Rendell was introduced by Carnegie Mellon's social Robot GRACE.

"As Carnegie Mellon's first effort to create space on campus for joint research with industry, the building is a celebration of the goals of the KIZ program. The building creates a nexus for industry, federal and university research-supporting start-ups, enhancing competitiveness for federal research funding and creating a landing zone for companies," Kamlet said. "

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Nice find balist!

Leads to a few interesting questions though.

Isn't the state and city as influential in luring the Googles and Apples here as CMU, I would think then that the community needs CMU as much as CMU needs the community?

If not, if the intent was to have a kind of "clearinghouse" so companies would have a doorway into CMU and Pitt and the PSC but be on taxable (both county, muni and school) land, then CMU is once again getting almost all the benefit on the backs of almost all the taxpayers--payroll and income taxes aside?

I should clarify that my mission with threads like these is not to put down the great work and great contribution institutions like UPMC and CMU make to our region but to ask wether under the current setup having these "great" things grow and grow and grow makes our region a better place or worse place. One would think better but if you have millions and millions more going to something you can't tax or can't tax fairly, you don't have a great economy, you have an institutional welfare state and the PRODUCTIVE members of that region start to flee en mass.

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CMU was the main reason for Google etc. Perhaps the state stepped into to offer incentives after interest was known, but there is no doubt that CMU is the reason - they are partnering with CMU, not with the State.

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I couldn't say it any better, mjcatl2. The city/state needs CMU much more than CMU needs them.

Plus PGHUSA, I think your conclusion about a welfare state is misguided. CMU creates new businesses and brings in world renowned companies to Pittsburgh WITHOUT GETTING PAID A PENNY.

Pittsburgh has the Allegheny COnference to promote the region and attract new businesses. As taxpayers, WE PAY THEM. Yet, CMU has a much more proven and successful track record.

I think we can afford to let them have their non-profit status.

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