Like an old married couple, Millersville borough and Millersville University have forged a pretty comfortable relationship.
But it could always be more comfortable.
State dollars would make it so.
Money for the borough and for other State System of Higher Education hometowns would go a long way toward easing the burden of hosting the universities.
That's the gist of a groundbreaking study commissioned by the state Department of Community and Economic Development and released last November by the Pennsylvania Economy League.
The voluminous report for the first time quantified the economic effect of State System schools on the communities they inhabit.
Four other town-and-gown sites besides Millersville (also home to Penn Manor High School) were examined by researchers, including the City of Lock Haven, the Town of Bloomsburg and the boroughs of Edinboro and West Chester.
The report cited both good and bad impacts from the schools in those communities, said Gerald Cross, executive director of the Pennsylvania Economy League's central division.
Overall, he said, "The presence of a university is positive for a region" culturally, socially and economically.
However, the study found that host towns are disproportionately burdened because they alone shoulder the cost of supporting the schools.
"They are really nice municipalities," Cross noted. But they are also a microcosm of a state in which many traditionally prosperous town centers are staggering under the increased cost of providing such services as streets, sewer and police.
Universities don't singlehandedly cause this "common municipal stress," Cross said, and they might have historically helped insulate their host towns from it.
But the schools are growing, and more single-family homes are being converted to student housing.
As the larger population grays, and as suburban sprawl siphons residents from older, landlocked towns with shrinking tax bases, the trends are catching up.
The state schools exacerbate fiscal strain mostly because they own large chunks of tax-exempt property and because students often take low-paying, part-time jobs and contribute relatively little to local tax coffers.
Millersville Mayor Dick Moriarty said the PEL study "finally puts down in black and white" the long-term concerns of community leaders.
But solutions remain elusive.
The key Economy League recommendation that the state make payments to host municipalities in lieu of taxes has yet to find legs in Harrisburg.
In the meantime, MU and the borough that cradles it have long pursued another PEL-endorsed strategy.
They're collaborating. They're trying to work things out.
That's common sense, according to Mary Ann Gerber.
As president of the Millersville Borough Council and treasurer of the MU Alumni Association, Gerber added, she has a foot in both town and gown.
And an allegiance to the big picture.
"I think what we're trying to do is recognize the fact that we all have a stake in this little community."
Out of whackPEL measured host towns against nearby "control" municipalities that did not have universities.
Perhaps the most telling statistic distinguishing the two groups was the large gap in per capita revenue from earned income and real estate taxes.
Host municipalities averaged a total of $175 per resident while their control counterparts collected $296, according to PEL.
At the same time they realized less revenue, college towns spent more on public safety and parks and recreation.
Expenditures and revenues varied considerably among the host communities. So did town-gown economic structures.
Edinboro University in Erie County, for example, owns 43.5 percent of the property in its borough while MU occupies 22 percent of Millersville.
In a 2006 report to Edinboro University, Edinboro borough projected a $300,000 shortfall. Officials, who had considered axing the police force to cut costs, laid the problem at the feet of the university. They noted that middle-class residents have moved away as taxes have ballooned to more than twice the amount levied by the neighboring township.
PEL said Edinboro's population fell by 10.2 percent from 1990 to 2000.
Millersville borough saw the next largest drop in that period, 4 percent, even as the Lancaster County population shot up by 11.3 percent.
Of the communities scrutinized, meanwhile, MU had the highest percentage of people, 31.7, living in group quarters (dormitories).
PEL officials say hard-pressed university host towns have few options under state law other than raising taxes and trying to improve efficiency.
In 2004, according to published reports, Millersville borough projected a 2005 budget deficit of $350,000 to $400,000 and consequently jumped real estate taxes by 50 percent.
Officials also launched a drastic round of belt tightening.
Police chief John Rochat trimmed $3,000 from his training budget and declined to fill a $65,000 position that opened when a police officer resigned in March.
Manager Ed Arnold pared the municipality's operating costs by 14 percent.
Council members blamed fiscal woes in part on the cost of hosting the university.
Each college town studied by PEL has tried to bump up revenue in various ways.
Edinboro shifted some of its revenue burden to non-real estate tax under a home-rule charter that set the earned income tax rate at 1.5 percent.
A mercantile and business priviledge tax in Bloomsburg and Lock Haven has reaped extra tax dollars for those communities.
An affluent Philadelphia suburb, downtown West Chester has in recent years revitalized, with many new shops, bars, restaurants and businesses.
Millersville's tax on apartment rental units is unique among the host communities in the report.
In 2004, according to newspaper records, that tax, coupled with income from increased zoning and building fees and the addition of a new carrier on the borough's cell tower, brought in $75,000.
The rental unit levy cleared a Lancaster County Court hurdle in 2005 but is now being appealed by real estate interests.
This year, said Gerber, the borough council president, taxes are going up just 1 percent.
The community is in better shape now, Gerber said, thanks to a recent reassessment, and to the pending development of commercial land along Wabank Road.
"We're getting every bang out of our buck," she said.
PEL officials applaud such efforts but consider them stopgaps at best.
The real problem in Pennsylvania is that "the way we finance [education] is out of whack," said the PEL's Cross.
Two-thirds of the real estate tax in the state goes to school districts that are often well endowed with sports stadiums and swimming pools, he explained. Meanwhile, the municipalities that host the districts are often struggling to provide basic services.
"Call the school district fire department," he suggested wryly. "Ain't going to happen."
Not even in relatively well-off communities such as West Chester.
Local economic growth does not automatically "translate into local tax dollars," the PEL report emphasized.
Nor does the annual influx of college students.
"You always bring 18-to-23-year-olds into your community," Cross said. "That's the product." But its members do not typically work as many hours as the rest of the population. And what earned income tax they do generate usually goes back to their home communities.
Seeking balanceWhat's the solution?
One PEL recommendation is state money for specific services such as fire and police.
Direct compensatory payments in lieu of taxes (PILOT), an approach used in some other states, is a second avenue.
PEL director of research Kerry Moyer said he thinks PILOT would be "the most straightforward" course in Pennsylvania.
New legislation would be needed to realize either remedy.
State Rep. Scott Boyd, a West Lampeter Township Republican, has been pursuing just that with House Bill 1418.
The statute establishes a formula for apportioning $3 million to the 14 communities that host State System schools in Pennsylvania.
Boyd said Millersville borough would get about $231,000 under the arrangement.
But a formula is meaningless without funding, added Boyd, who said he has testified on the plan before the House Appropriations Committee with state Rep. Carl Mantz of Kutztown.
The state has never adopted the proposal as part of its final budget.
Boyd said "It's an uphill battle" for Millersville borough, where tax-exempt property owned by MU, Penn Manor School District and other nonprofits, such as churches, totals about 31 percent.
According to PEL, all the schools it studied voluntarily contribute to their host towns' public service budgets, especially fire and police.
But donations vary, according to PEL, and municipalities cannot always count on them.
PEL recommends mandated agreements between the parties, with provisions for long-range planning and communication to back them up.
Local officials say they have the communication part down cold.
Together with MU and Penn Manor, borough officials regularly hold "Vision 20/20" meetings that involve a student representative, as well.
"There's this really cool give-and-take that I think works," said Janet Kacskos, a spokeswoman for the 152-year-old university.
Arnold, the borough manager, said a recent statutory change allows the borough's 12-member police department to more freely, and formally, collaborate with the school's security force.
"We work very closely with the university" to control student partying and drinking-related violations, Arnold said.
Too, he added, the university has been generous financially.
Arnold noted that Student Lodging Inc., a nonprofit corporation that provides services for the university, has voluntarily placed its dormitory properties on the tax rolls.
He said that adds more than $300,000 a year to the borough budget, which is $2.7 million in 2007.
Officials pointed out that the university also makes regular donations to the fire department.
Everyone contacted for this story agreed that MU and Millersville borough make a model couple.
However, the marriage might again be tested in the future.
A separate PEL study recently listed Millersville as one of three county communities, along with Columbia and Lancaster Township, that suffered serious fiscal health declines from 1970 to 2003.
But Moriarty, the Millersville mayor, said he's excited by the PEL report.
He and other community officials hope it will finally move Harrisburg to act on the PILOT idea.
"The problem is," Moriarty said, "this little borough here; how can we get assistance?"
Jon Rutter is a staff writer for the Sunday News. His e-mail address is jrutter@lnpnews.com.
