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I ax haven - 1 he Yale Herald <br />the $100 million dollars it would be compelled <br />to pay if it were a for - profit institution. If you <br />asked a critic of the University, he would say <br />the city lost out on over $90 million in <br />potential tax revenue this past year. As a <br />means of mitigating this cost of Yale's <br />presence in New Haven, Connecticut <br />established a program called Payment in Lieu <br />of Taxes. <br />In theory, the PILOT program works by <br />evaluating the total amount of revenue that <br />Connecticut cities lose each year as a result of <br />the tax - exempt properties within their <br />boundaries — nonprofits like hospitals, <br />universities, government buildings, and <br />churches. Then, in theory, the state <br />compensates these municipalities for their <br />missing receipts. In practice, though, the <br />system has deteriorated over the course of the <br />last decade, failing to fully reimburse cities <br />while creating friction between municipal <br />governments around the state as they fight for <br />a piece of this pool of funds. <br />In 1999, Connecticut committed to a 77 <br />percent reimbursement for New Haven's lost <br />tax revenue, according to an analysis of <br />Connecticut's PILOT funding conducted by the <br />University of Connecticut. And when Robert <br />Smuts, SM '01, started working for the city in <br />Mayor DeStefano's office in 2001, he said the <br />Page 8 of 18 <br />http: / /yaleherald.com/homepage -lead- image /cover- stories /tax - haven/ 10/23/2014 <br />