Stanford University

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NEWS RELEASE

10/15/91

CONTACT: Stanford University News Service (415) 723-2558

County considers utility tax on Stanford, campus homeowners

The Santa Clara County Board of Supervisors is considering a utility user's tax that would affect Stanford University and campus homeowners.

The proposed 5 percent tax would be on electricity, gas, water, cable television, telephone, telegraph and sewer services. It would cost the university an estimated $377,000 a year. The cost to each homeowner is unknown, but one county official estimated that the tax would be about $50 a year.

A public hearing on the issue was held on Oct. 8, after which the board postponed its decision until Oct. 22.

President Donald Kennedy wrote to the county board on Oct. 5, reporting that Stanford must cut $40 million from its budget in the next three years. He also noted the university's historic exemption from property and income taxes, its provision of its own municipal services, and the contributions the institution makes to the regional economy.

Stanford public safety officers write $300,000 to $500,000 worth of parking citations a year, Kennedy said, all of which are sent to the county for collection without any reimbursement.

Recognizing that the supervisors appear to be "not inclined" to grant an exemption to the university, Kennedy asked the supervisors to limit the total tax from any one non-profit in the unincorporated area to $150,000 a year.

"That would still require a significant payment from us," he wrote, "but it would grant us some relief at this difficult time in our history."

Ray Bacchetti, vice president for planning and management, told the board on Oct. 8 that "we know of no single entity in Santa Clara County that would pay as much as the university."

"Universities such as Stanford contribute to their regions in innumerable ways," Bacchetti said. "In that regard, we believe that this new tax upon a non-profit, tax-exempt educational institution would be highly counterproductive."

State legislation passed last year authorized counties to enact the utility tax. Public agencies, including school districts, and co-generation facilities would be exempt from the tax.

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