Imagine how much more money we could have for vital social programs for our nation if we taxed endowments? Harvard’s is $53 billion and, because it’s invested in the stock market, growing tax-free. Yale’s endowment grew by 40 percent this year, making it worth more than $42 billion. “Tax-free” makes it sound like there are no costs to such endowments, but they’re actually tax subsidized by us, the taxpayers.

Students have for years called on the wealthy private university to make payments in lieu of taxes, called PILOTs, to the city. Recently, faculty and staff members joined them. The $10 million per year outlined in Tuesday’s pledge is lower than the estimated $40 million per year that PILOT advocates requested, and significantly lower than what the university would owe the city if it were subject to property taxes.

More than 1,000 faculty and staff members at the University of Pennsylvania are calling on the Board of Trustees to pay a portion of what the university would owe in property taxes to the city of Philadelphia if the institution paid property taxes.

The debate over whether institutions like the University of Pennsylvania should be tax exempt focuses far more on the economic than the civic role they play, writes Matthew Fernandez.