Thomas Breen photos
High Street between Chapel and Elm: So long cars.
Mayor Elicker and Yale President Salovey at Wednesday’s presser.
Yale and the city announced a deal Wednesday to increase the university’s voluntary contributions by a total of $52 million over the next six years, while creating a Yale-managed pedestrian plaza on High Street and establishing a new “inclusive growth” center to pursue town-gown fiber optic or green-energy projects.
Yale President and Mayor Justin Elicker announced the deal at an hour-long City Hall press conference that began at noon.
The deal, which will now go before the Board of Alders for review, includes:
• Yale’s annual voluntary contribution to the city will rise from $13.2 million to $23.2 million this fiscal year; and up to $24.3 million in year five of the deal. It will then drop to $16.6 million in year six. The increased contribution comes as Yale’s endowment has skyrocketed: In the year ending June 30, it grew by $12.1 billion.
“Yale will be contributing more to the city in the next six years” than it has in the past 20, Elicker proclaimed at the announcement.
• The city will close off another block of High Street to car traffic, between Elm and Chapel streets.
In deals struck in 1990 and in 2013, the city sold portions of High Street and Wall Street to Yale, which later closed them off to cars.
This time, with the next block of High, the city will retain ownership of the street. Public access to the block will be maintained, including for pedestrians and cyclists who don’t have Yale IDs.
“Yale will lead the development of the design, subject to the approval of the City Plan Commission and New Haven Traffic Authority. After design approval, Yale will fund and manage the establishment and maintenance of the public space,” the deal states.
Press and attendees on the second floor of City Hall.
• For the next six years, whenever Yale takes a new property off the tax rolls, the university will pay the city 100 percent of the taxes that would have been owed for the first three years. Then the payments will scale down for the next ten.
• Yale will front $5 million over five years to create a new Center for Inclusive Growth to study ways town and gown can work together on projects of mutual self-interest, such as, perhaps, fiber-optic internet infrastructure or clean power generation (the two specifics mentioned at Wednesday’s announcement). The goal is to “identify economic and social development initiatives that will bolster growth throughout our community.”
This element of the deal also echoes an element of the 1990 deal, when Yale seeded a center to study joint long-term policy initiatives; in that case, the money went instead to one-time short-term uses like summer youth programming. The new version of that center envisioned in the deal announced Wednesday would have far more money to start. It is to be overseen by Yale School of Management Dean Kerwin Charles. “There is much to be learned from genuine collaboration,” Charles said at Wednesday’s announcement.
Mayor Elicker and Yale President Salovey.
Mayor Elicker and lead negotiator Henry Fernandez.
The deal announced Wednesday was more than a year in the making. During the height of the Covid-19 shutdown, a Yale team led by university Senior Vice-President Jack Callahan negotiated virtually with a committee of city officials led by former city development chief Henry Fernandez. At Wednesday’s press conference, Salovey singled out Fernandez, a Yale law grad, for moving the deal forward.
The final announcement of the deal was delayed while two related agreements were finalized: one with the state to boost Payment in Lieu of Taxes (PILOT) funding to the city; another with Yale’s unions on a new five-year workplace contract. The latter was essential because Yale unions control the Board of Alders, which must approve the new Yale-city deal. Board of Alders President Tyisha Walker-Meyers, who is also a UNITE HERE Local 35 official, attended Wednesday’s press announcement, as did State Senate President Martin Looney, a critical player in the PILOT change; they both blessed the new Yale-city deal.
State Sen. Prez Martin Looney.
Board of Alders President Walker-Myers (center) with Elicker and Salovey.
“This is truly a historic day,” proclaimed Looney, who has helped lead the charge for three decades to press Yale to contribute more to the city in light of its property tax exemptions. He revealed that Salovey promised to “respond in kind” earlier this year if the state significantly upped its PILOT contributions, which it did.
Walker-Myers described Wednesday’s deal as “historic” because “we had unions, elected officials, and community members all working together over a number of years saying: ‘Yale, please hear our cry. We have needs that really need help addressing.’ And Yale stepped up and said, We’re hearing you. We’re listening.”
UNITE HERE issued a statement Wednesday noting that the deal “follows years of campaigning” by the union and its affiliated citizen action group, New Haven Rising.
“We have come a long way from when Yale used to line up residents by the dumpsters outside of Woolsey Hall to select who would get work for the day. We are confronting over 80 years of segregated development and decades of New Haven taxpayers subsidizing Yale,” the release quotes organizer Scott Marks as saying. “Our work is not done, but this year we have won important victories that move Yale closer to giving our residents fair opportunities and contributing its fair share.”
Local 35 President Bob Proto both praised the agreement and called it just a start to the work needed to be done: “New Haven could have the world’s best public schools if leaders at Yale made this a priority. It shouldn’t have taken so much from the community to get to this deal, but it is an important first step and an important victory for New Haven.”
“The new commitments we announce today were informed by decades” of town-gown interactions, Salovey stated.
“Yale and New Haven have a bond that has been tested by time and strengthened by shared purpose,” he said. He said he is “proud” of the deal and of helping to “build a community that creates sustained growth across every neighborhood.”
Lead negotiator Henry Fernandez.
“Other universities should see this as a new standard” for community engagement, Fernandez said on Wednesday.
“The simple idea is that we can build a city that grows” both Yale and the community.
Will there be barriers to prevent drunk or fleeing drivers from bursting onto the soon-to-be-closed block of High Street? New Haven Register reporter Mark Zaretsky asked at the press conference.
“That’s why we wanted to do this” — to protect people on that narrow street, Salovey responded. “I don’t know the details … but we’ll make it very clear that this isn’t a place where we want to see cars. It is a place where we want to see walkers and bikes.”
Why Only $10M?
Some of the lead negotiators in the city-Yale talks, including Salovey, Yale Senior Vice-President Jack Callahan, and City Budget Director Mike Gormany.
During a virtual press conference held after Wednesday’s City Hall announcement, Salovey, Callahan, and Elicker were asked about how the two parties landed on a $10 million annual increase to Yale’s voluntary payment to the city — particularly in light of the university’s recent $12 billion increase to its own endowment.
Salovey noted that the majority of the university’s $41 billion-plus endowment funds are “restricted.”
He also stressed how the endowment’s size fluctuates depending on the market, while this new $10 million bump to Yale’s annual voluntary payment to the city is assured.
“We want to be able to support the city in a predictable way that isn’t dependent on market performance,” Salovey said, “and we wanted to make a significant increase on what we are already doing now.”
Callahan added that the endowment’s contribution towards running the university this fiscal year is roughly $1.6 billion.
Around a quarter of that is “unrestricted,” he said.
That means that the city’s voluntary payment to the city comes out of “less than $400 million of discretionary, unrestricted funds” made available through the endowment. That pot of money is also used to support student financial aid.
Callahan described this year’s planned voluntary payment to the city of $23 million as “a pretty significant commitment.”
“This is the number that we landed upon and could agree upon,” Elicker said. “We set the bar high.”
He described how the university has contributed roughly $134 million to the city in voluntary payments over the past 20 years. That number will total roughly $135 million over the next six years.
“This is a very, very significant step up from where we were,” Elicker said.
According to a press release detailing the new city-Yale deal, Yale’s annual voluntary payment to the city will increase from $13.2 million to $23.2 million this fiscal year; to $23.5 million in year two of the deal; to $23.8 million in year three; to $24 million in year four; to $24.3 million in year five; and then down to $16.6 million in year six.