During recent Providence mayoral debates, incumbent Mayor Smiley and challenger Rep. David Morales clashed over the city’s “payment in lieu of taxes” (PILOT) agreements with tax-exempt universities, particularly Brown University. Mayor Smiley claimed Providence’s PILOT deal with Brown was more favorable than New Haven’s with Yale, asserting Brown pays more than Yale or Harvard pay to their cities. Morales disputed this, saying Yale pays New Haven more than Providence’s universities pay the city. Fact-checking shows Yale’s payments exceed Brown’s by a significant margin and will continue to do so, disproving Smiley’s claim. Smiley’s office clarified his comparison was based on payments relative to university endowments, but he did not mention this during debates.

Providence faces a challenge with nearly 44% of its real estate tax-exempt, placing a heavy tax burden on other property owners. Brown’s real estate is valued at $1.3 billion, saving the university about $55 million annually in taxes. Under a 20-year PILOT agreement negotiated by Smiley in 2023, Brown’s payments will increase from $5 million in 2024 to $8 million in 2043, supplemented by community contributions and a separate $46 million payment over 10 years tied to property swaps and development concessions. However, these payments include conditions and possible discounts, complicating the overall financial picture.