Boston Mayor Wu gets Wentworth Institute to commit to cash PILOT payments after pandemic pause

The Wu administration has brokered a five-year deal with Wentworth Institute of Technology, which will see the tax-exempt Boston nonprofit resume making voluntary PILOT payments in cash after years of not paying any money to the city.

The deal, approved by the Boston Planning and Development Agency Board on Thursday, will see Wentworth Institute commit to paying $5.6 million in cash and so-called community benefits to the City of Boston over the next five years.

Only $400,000 of that deal will be required to be paid in cash, however, starting with $50,000 this fiscal year, FY26, and increasing to $125,000 in FY30.

Wentworth Institute had stopped making cash payments to the city for “the last several years due to financial challenges brought about by the pandemic,” Mayor Michelle Wu’s office said. Her office added that the new deal represents the first written PILOT agreement with that tax-exempt college in “more than 20 years.”

“This five-year PILOT agreement builds on our new approach to work with institutions to establish a predictable schedule boosting annual cash payments and community benefits at a time when our Boston taxpayers need relief,” Wu said Thursday in a statement, referencing this year’s 13% tax hike for homeowners.

The community benefits include support for public education, community organizations, neighborhood development and housing, Wu’s office said.

Wentworth is the second Boston college to enter into a new PILOT, or Payment in Lieu of Taxes, agreement with the the City of Boston in the last four months.

The Wu administration inked a five-year deal with Northeastern University, one of the city’s biggest tax-exempt nonprofits, last November.

That agreement totals more than $49 million in cash and community benefits and saw Northeastern increase its annual cash payment incrementally by 36.8%, from $1.9 million in FY25 to $2.6 million in FY30. It includes $37 million in community benefits.

The Northeastern deal was the first to come out of the Wu administration’s more than year-long negotiations with nine of the biggest nonprofits in Boston to ink long-term PILOT payments to help ease the tax burden on homeowners and businesses.

Once most of those deals are secured with the “Big 9,” other tax-exempt institutions in the city are expected to fall like dominoes.

Along with Northeastern, the Wu administration is targeting Harvard University, Boston University, Boston College, Mass General-Brigham Hospital, Beth Israel Hospital, Boston Children’s Hospital, Dana Farber Cancer Institute, and Tufts Medical Center.

Wentworth is not part of that so-called “Big 9,” but has been a part of the city’s PILOT program since it was launched in 2012.

In fiscal year 2024, the last PILOT data provided by the city, participating educational, medical and cultural institutions collectively met just 76% of their requested $128.79 million PILOT payment. Just $34.85 million of the $98.52 million total contribution was paid in cash.

The lack of full compliance from many of the participating institutions has long been a source of contention. While advocates and some elected officials have argued that wealthy nonprofits are not paying their “fair share,” the nonprofit sector has pointed to the community benefits its institutions provide.

Wu relieved six tax-exempt cultural institutions from their PILOT duties in 2024, in part, because the museums have partnered with the city on a program that provides free access for city schoolchildren and their families on certain Sundays.

The Wu administration sees the five-year agreements with Wentworth and Northeastern — and potential deals with the city’s other biggest nonprofits — as a way to create a “predictable and reliable schedule” for PILOT payments.

In FY24, Wentworth Institute met 50% of its requested PILOT payment. It contributed $934,984 in community benefits and nothing in cash.

Under the PILOT program, private institutions with tax-exempt property in excess of $15 million make voluntary payments amounting to roughly 25% of what they would have paid in real estate taxes. Payments are split between cash and community benefits credits.

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The program has largely operated under the same guidelines since it was created in 2012. The Wu administration’s negotiations to update the PILOT program come amid threats and efforts from President Donald Trump to withhold federal funding from schools and hospitals, and take away Harvard’s tax-exempt status.

“Even with threats to higher education and research under this federal administration, our anchor institutions continue to engage and partner with us to support our communities and move Boston forward,” Wu said.

Community benefits eligible under the program — and which have to be approved by the city — include those that directly benefit the City of Boston, are not included in other arrangements or agreements, and are not part of the core mission and services of the institution.

Wentworth and the city have committed to renewing the five-year agreement upon its expiration on June 30, 2030.

The BPDA board also approved an amendment to Wentworth’s institutional master plan that Wu’s office said will “deliver more student housing sooner than expected, increase public open space, and continue investments in college and career pathways for Boston Public Schools students.”

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