Harvard is Not New Balance
Requests for Harvard to cover the cost of building West Station are inappropriate and unrealistic
Cash-strapped, passed over for other transportation projects, and with a completion date decades away, West Station, the MBTA’s new commuter rail station in Allston, faces many challenges. Politicians have now asked Harvard to pay the entire cost of the station—covering a bill of roughly $100 million.
In 2014, Harvard pledged to pay one-third of the cost to build West Station. Recently, several Massachusetts politicians signed a letter requesting the University foot the entire bill. One state representative, Michael J. Moran, went so far as to make an example of the company New Balance, which financed the entire $20 million cost of the Boston Landing commuter rail station in Brighton.
The comparison is grossly inappropriate and wholly unfair. New Balance is a private corporation focused on maximizing its revenue. Harvard is a nonprofit university whose goal is to educate its students and society. New Balance had a compelling business interest in building Boston Landing, which was a part of the company’s dramatic transformation of Brighton. And it paid only a fifth of what Harvard is now being asked to pay.
Yes, as we have opined, the University has previously had difficult town-gown relations. It could do more to help sustain and support the community whose home it shares, particularly by actively publicizing and sharing the results of its continuing construction projects with Allstonians. Harvard would do well to contribute to the West Station project; the benefits of a new transit stop cannot be understated, especially for Allstonians, who have historically lacked access to the same transit systems that commuter rail stations provide to other parts of the Boston area. Indeed, other schools have helped their communities in similar ways. Princeton, for example, developed an entirely new train station complex in an initiative to help improve public infrastructure and promote the arts. Following this example, Harvard should contribute to the development of West Station in some capacity.
However, the request for Harvard to defray the entire $100 million cost of constructing West Station is inappropriate, especially given the state of the University’s finances over the past couple of years. Yes, Harvard may have an endowment of nearly $38 billion. Yet not all of this wealth is readily at hand—and poor returns like those Harvard Management Company, the group in charge of Harvard's endowment, has seen in recent years have prompted concern that University budgets could be "significantly constrained" for years to come. In 2017, Harvard's endowment returns were outpaced by all other Ivy League schools, and HMC is undergoing a dramatic internal restructuring. Now is the time for the University to be as conservative as possible with its finances.
Additionally, the new tax bill passed in December under the Republican-led Congress imposes an excise tax of 1.4 percent on returns for certain large endowments, which Harvard must now pay. This tax further limits the University’s financial flexibility.
Given these factors, Harvard is being as generous as it can with its proposed contribution of approximately $33 million to build West Station. What these lawmakers fail to understand is that Harvard does not have infinite resources, and is a nonprofit, educational institution rather than a company. Especially given the current state of its investment portfolio, the University should not be asked to pay more.
Harvard, after all, is not New Balance.
This staff editorial solely represents the majority view of The Crimson Editorial Board. It is the product of discussions at regular Editorial Board meetings. In order to ensure the impartiality of our journalism, Crimson editors who choose to opine and vote at these meetings are not involved in the reporting of articles on similar topics.
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