How Would Library Tax Affect Corporate Giving?

How Would Library Tax Affect Corporate Giving?

Recommendation Three by the Public-Private Task force concerned with the finances of the Carnegie Libraries of Pittsburgh said this: "provide the citizens of Pittsburgh an opportunity to vote on whether dedicated funding support should be provided to the library". All reports point in the direction that there will be a ballot question in November asking voters if the City’s millage rate should increase .25 of a mill to support the libraries.

Of course, the impact of a voter-supported tax increase goes far beyond those who get to pull the lever. Much of the property value in Pittsburgh is tied to commercial uses, and that includes corporations that may donate voluntarily to the library system. For instance, the ten largest property taxpayers in the City are commercial in nature, accounting for $1.6 billion, or 12% of the total taxable assessed value in the City.

The 2010 annual report for the Carnegie system shows that "unrestricted corporate donations" were $129k, and the overall total from corporations was $818k. How will this giving be affected if a dedicated property tax were to be levied? Will there be a "side effect" on other charitable organizations that receive money from those that give to the libraries voluntarily?

The quarter mill proposed tax increase would raise just under $3 million, of which $2 million would come from non-residential sources (based on previous work on City market values and land use). It is possible that some corporations might view a compulsory tax as a substitute for their voluntary giving. It is also possible that some corporations might keep committing to restricted giving for specific projects while focusing less on unrestricted or general contributions. How the corporate community at-large comes down on the issue of a tax increase will be determined at the time the merits of the tax are discussed.