Section 112 in the Boston Region: Universities, Hospitals, and Urban Renewal

This digital publication was supported by the Leventhal Map & Education Center’s Small Grants for Early Career Digital Publications program.

Should wealthy nonprofits like universities and hospitals be tax exempt because they serve the public good? Or do they draw on public resources while driving up rents and primarily serving a wealthy elite? Questions like this periodically pop up in the pages of the Boston Globe as the merits of tax exemption are debated and payments in lieu of taxes (PILOTs) are tallied up. Today, there is growing discontent over the leading role that tax-exempt universities and medical institutions have taken in urban development all over the country in recent decades, transforming the neighborhoods around them into exclusive enclaves.¹

Struggles over the influence of nonprofits on the neighborhoods around them are longstanding. During the 1950s and 1960s, buoyed by Cold War research dollars and the expansion of college enrollment (due in part to the coming of age of the baby boomers), universities in Massachusetts and all over the country pursued physical expansion.² Hospitals also pursued expansion and consolidation to modernize their facilities and win national prestige.³

Because of the tax-exempt status of universities and hospitals, instructional expansion plans in the 1950s and 1960s could be in tension with the efforts of planners and politicians to raise the cities’ tax bases in the face of suburbanization. National “urban renewal” legislation created a financial mechanism known as Section 112 to align city governments more closely to the interests of medical and educational institutions, but this did not totally bridge the gap between cities and major non-profit institutions like universities and hospitals.

So-called “Section 112 credits” were involved in three different urban renewal projects in Boston and Cambridge. Looking at how these credits were created and contested illustrates the conflicting drives towards institutional expansion, tax generation, and creating a livable city for its residents. Neighborhood movements, most visible through initiatives like People Before Highways and the reactionary movement against school bussing, put pressure on local government and institutions to abandon plans to transform the cityscape altogether, or at work more closely with communities. Section 112 credits, though not well-known, were involved in several crucial episodes in Greater Boston’s struggles over urban renewal.

Section 112 credits and Urban Renewal

Section 112 allowed for land purchased by universities and hospitals to count as a local “grant-in-aid” to nearby urban renewal projects under certain conditions, triggering a 2-to-1 matching grant by the federal government.⁴ Land purchases could generate credits up to five (and later seven) years after purchase, incentivizing the creation of renewal projects near expanding institutions. Credits could be “pooled” across a city, meaning that a project in one place could benefit the overall renewal program. Further, associated renewal projects were waived from the “predominantly residential” requirement of urban renewal.

In the early 1960s, the city of Boston undertook a wide-ranging urban renewal program intended, in part, to increase the city’s tax base and to attract high-income residents to the city.⁵ The Boston Redevelopment Authority (BRA) was reorganized to take on both planning and development functions, and a nationally-renowned development administrator, Ed Logue, was recruited from New Haven.⁶ Although Logue and Mayor Colins promised to “plan with people,” Collins also tasked Logue to “bring prosperity back to Boston with the politicians and business community working together.”⁷

University and hospital boosters around Boston thought that Section 112 could have a large impact on the city’s urban renewal program because of the large number of institutions in the city. To tally potential Section 112 credits, a 1962 study was created in cooperation with representatives of many of Boston’s leading educational and healthcare institutions. The so-called Levi Report indicated that over $30 million in institutional expenditures in the city had the potential to trigger a $60 million federal match—nearly doubling the size of Boston’s “$90-million-dollar plan” announced the year before.⁸ These figures did not include potential projects outside of Boston proper—although the report’s author (and driving force behind Section 112’s enabling legislation), Julian Levi, consulted in Cambridge as well.

As far as I have found,⁹ only two projects ever actually generated Section 112 credits in Boston, and one in Cambridge: South Cove, Fenway, and Kendall Square. All three projects faced contention around the generation of the credits, and this community resistance would significantly affect the projects’ scale and scope.

Triage in the Fenway

Fenway, Boston’s largest pot of potential Section 112 credits, is home to a complex web of educational and medical institutions. The largest potential generators of credits in this area were Northeastern University, Harvard Medical School and its Affiliated Hospitals, and BU. Lined up against these institutions­—Harvard in particular—was the neighborhood of Mission Hill.

In the early 1960s, residents of Mission Hill were already angry about the Whitney Street renewal project, a non-federally subsided urban renewal project planned in the late 1950s that built high-rises for middle class families.¹⁰ When plans for the Massachusetts Mental Health Center to expand across Fenwood Road were announced (with $697,000 in credits),¹¹ residents of Mission Hill marched to Boston Common en masse to stand silent vigil in front of the State House in December 1964.¹²

While that expansion was cancelled, the struggle was not over. In fact, the Levi Report proposed taking most of the land between the Riverway and Huntington Avenue to build new facilities for Harvard and its Affiliated Hospitals (Section 112 credits: $8+ million). While planners viewed this as a compromise (earlier plans had called for expansion across Huntington Avenue into the heart of Mission Hill), residents did not agree.¹³ Logue had promised them that “planning with people” meant the whole community would be completely excluded from urban renewal if they didn’t want it—and houses along Fenwood Road and Francis Street were considered part of the community.¹⁴

Under pressure from expiring credits as well as the Christian Science Church, which wanted to push its expansion (also part of the Fenway project) forward as soon as possible, the BRA was determined to get its plan approved by City Council before the end of 1965. That is, the plan had to get through public meetings and be approved by City Council less than a year after the demonstration against the Massachusetts Mental Health Center.

To do so, the BRA cut the Harvard expansion out of its plan entirely, sacrificing credits to get the Fenway plan moving.¹⁵ Nevertheless, the project—which still consisted of $7 million credits from Northeastern and smaller sums from other institutions—was criticized as “artificially contrived to include as many ‘112’ credits as possible.”¹⁶

A few years later, Harvard and its Affiliated Hospitals attempted expansion on their own, serving eviction notices to residents in March 1969. This met vigorous resistance from the community, organized, in part by students from Harvard. During the Harvard protests of April 1969, in which students briefly took over the University Hall, among the students’ six demands was one to stop the destruction of Black workers houses from medical school expansion in Mission Hill.¹⁷

While Harvard’s Affiliated Hospital Center was eventually built as Brigham and Women’s Hospital, most houses on Fenwood Road and Francis Street were preserved. The Roxbury Tenants of Harvard, an organization of residents, worked with Harvard to build the Mission Park housing development consisting of both high-rises and townhouses, which opened in the late 1970s.¹⁸

South Cove: One project, or two?

In Boston’s South Cove, the main protagonists in the struggle over Section 112 credits were the Tufts-New England Medical Center (T-NEMC) and Boston’s Chinatown community. T-NEMC had begun to buy parcels in the area in the early 1950s, when the imminent construction of Boston’s central artery both depressed housing prices and cleared a path for the T-NEMC to expand without moving to the suburbs. At the time, the T-NEMC (whose name would change various times) was comprised of several separate institutions in the process of combining, consolidating, and making a bid for national prestige.¹⁹

In the early 1960s, the T-NEMC’s new planner Herman Field used the promise of Section 112 credits to draw the attention of the BRA, which otherwise had bigger fish to fry.²⁰ Footing much of the planning bill itself, the T-NEMC’s expansion promised to generate nearly $5.5 million of Section 112 credits for Boston; that is, $11 million in federal grants.²¹

Particularly appealing was the possibility of generating credits from purchases made before 1957, which should have been impossible due to a time limit on back-dating credits. But the South Cove was not the only urban renewal project in the area. The nearby New York Streets project, an early teardown urban renewal project along the lines of the West End, had already been approved by 1955, and so the BRA and the T-NEMC attempted to claim credits from parcels purchased as far back as 1950.²² Although the New York Streets project had nothing to do with the T-NEMC, it was close enough to potentially generate credits: according to the legislation, school purchases could generate credits if they were within a quarter of a mile of an urban renewal project.²³ Since work on the New York Streets project was mostly complete in 1962, the credits would have directly generated nearly $2 million in grants for the city’s renewal program.

The T-NEMC and the BRA tried to quickly get both an institutional plan and a plan for the South Cove approved by the Boston City Council in the winter of 1962 and 1963. But the plan was delayed by the opposition of the skeptical Chinese Consolidated Benevolent Association (CCBA), which spoke out against the plan, until a memorandum of understanding was signed between the BRA and the CCBA.²⁴ As late as summer 1963, the BRA still hoped to generate credits from the New York Streets project, and even upped their claims to around $1.4 million. But, facing a shortage of appropriations nationally, the New York Streets project eventually closed out without any Section 112 funding.²⁵ The South Cove, on the other hand, did generate credits—although not enough to subsidize other projects around Boston.²⁶

The CCBA memorandum set the stage for the construction of housing, exempted by 112’s legislation, which became the Tai Tung Village. But the agreement only covered a small area south of Kneeland and east of Harrison. Even worse, it was ambiguous about the status of parcels owned by T-NEMC but rented out to residents. These were precisely those parcels which, if repurposed for hospital use, would generate Section 112 credits. Some of these very parcels would become the focal point of conflict between the Chinese community and T-NEMC as the hospital moved to realize its expansion plans from the late 1960s onwards—conflicts which would sometimes center on Section 112 credit-generating parcels, such as Parcel C.²⁷

Kendall Square: The Feds step in

Today, Kendall Square is a well-known neighborhood, synonymous with the Boston region’s innovation economy, like Route 128 was in the mid-century. In the 1950s, suburban research parks began to sprout along what would become known as Boston’s “golden semicircle,” a suburban strip that became an international symbol of innovation while Silicon Valley was still best known for its peaches.²⁸

But Kendall Square was not born yesterday. MIT began planning nearby Technology Square in the late 1950s in collaboration with Cabot, Cabot and Forbes, the developer of many suburban office parks along Route 128. The idea was to bring prosperity back to a then-declining industrial area.

Many Bostonians know that NASA came to Kendall Square in the 1960s, and a recent Globe article unpacks the truth and the myths behind this NASA development.²⁹ What is less well-known is the role that Section 112 credits played in the site. In 1963, Robert Rowland, a BRA planner, began to look for potential NASA locations and landed on Kendall Square—the place where he parked his car to catch the subway to work. Preparing a plan on spec, Rowland suggested paying for the redevelopment of the site using Section 112 credits generated by MIT.³⁰ Boston, too, made overtures to NASA.³¹

Not only would the NASA center directly bring high-paying jobs to Cambridge, but the center was intended to spur private commercial development in a “golden triangle” to the south of the project area. This would supposedly more than offset the fiscal loss from removing the NASA parcels from Cambridge’s tax rolls.³² But the first phase of the NASA project was not completed as planned. After three consecutive years without available construction funding, in late 1969 NASA announced it would close the partially-built facility altogether.³³

Throughout the early 1970s, a complex multi-sided struggle ensued between various parties as to the best development path for Kendall Square’s “surplus NASA land”.³⁴ All the while, the price of the renewal project went up and up. An estimate from 1973 indicated that Cambridge planners expected MIT to certify over $17 million in credits, up from an initial $6 million³⁵—something the school was unwilling and unable to do. MIT clashed with tenant groups and industrial interests, and was accused of playing “power politics” with credit certification as it pushed to develop a luxury mixed-use neighborhood.³⁶

But in the end, MIT wouldn’t have to certify any more credits at all. The project was entirely funded by national legislation. When President Gerald Ford signed a bill that increased national lending limits for mobile homes,³⁷ the second section of the act specified that Cambridge, MA would not have to pay any more than it already had for the urban renewal of Kendall Square—that is, any more than the Section 112 credits that had already been certified.³⁸ While debates about the site’s use would continue, the city was off the hook for funding its transformation.

Conclusion: Section 112 and PILOTs

Following Section 112 credits provides an often-overlooked perspective on nonprofits and urban planning during the 1960s, showing how residents agitated for housing and community control in the face of legislation that incentive government collaboration with institutions, and exempted such projects from housing requirements. Of course, contestation and collaboration between neighborhoods and nonprofits go far beyond universities and hospitals,³⁹ and the Greater Boston’s neighborhood revolts were certainly not confined to these three cases alone.⁴⁰

Section 112 did not completely resolve a core issue between cities and non-profit institutions: the issue of property tax. PILOTs are a hot button issue today, and there is an ongoing push for legislation that would allow cities to require university and hospital PILOT payments of up to 25% of what they would owe if they were not exempt from property tax. This issue, too, was alive in the late 1950s and early 1970s, although it may have been put to sleep by Section 112 for ten years.

Indeed, Cambridge universities first made some sort of PILOT payment in 1928, and in 1959 Boston’s Financial Commission issued a report arguing that Boston’s institutions should do the same.⁴¹ Later, in the early 1970s, a consortium of Boston’s university presidents hired a consultant to argue for the importance of keeping their tax exemption.⁴² In fact, many of the players involved were also involved in shaping the Section 112 program a decade earlier. But that is a tale for another time.

Julian B. Hartman is an Active Learning Initiative Postdoctoral Fellow in the Department of City and Regional Planning. His research examines urban development in the Boston region, tracing how university and medical institutions, entrepreneurial urbanism, and persistent racial inequality have interacted to shape Boston’s emergence as a global city in the past 75 years. He received his Ph.D. from the University of Arizona’s School of Geography, Development, and Environment in 2023.

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1. Davarian L. Baldwin, In the Shadow of the Ivory Tower: How Universities Are Plundering Our Cities (New York, NY: Bold Type Books, 2021). ↩︎

2. Noam Chomsky, David Barsamian, and Howard Zinn, The Cold War & the University (New Press New York, 1997); Margaret O’Mara, Cities of Knowledge: Cold War Science and the Search for the Next Silicon Valley (Princeton University Press, 2004); Richard M. Freeland, Academia’s Golden Age: Universities in Massachusetts, 1945-1970, 1992. ↩︎

3. Isaacs, Sasaki, and Nagel, “Fenway-Parker Hill Area: Its Problems and Potential” (Boston, Massachusetts, October 1958), Administrative Services Department records, Box: 31, Identifier: VII, City of Boston Archives, https://archives.cityofboston.gov/repositories/2/archival_objects/82095; Kevin Lynch, Medical Center in the South Cove: A Study for the Development of the New England Medical Center and Its Neighborhood, 1955, http://archive.org/details/medicalcenterins00lync. ↩︎

4. For the enabling legislation, see “Housing Act of 1959,” Pub. L. No. 86–372, § 418, 35 (1959), 677, https://www.govinfo.gov/content/pkg/STATUTE-73/pdf/STATUTE-73-Pg654.pdf; “Housing Act of 1961,” Pub. L. No. 87–70, § 309 (1961), 169, https://www.govinfo.gov/content/pkg/STATUTE-75/pdf/STATUTE-75-Pg149.pdf. ↩︎

5. For background on this urban renewal program, see Thomas H. O’Connor, Building A New Boston: Politics and Urban Renewal, 1950-1970, Illustrated edition (Boston: Northeastern University Press, 1995); Jim Vrabel, A People’s History of the New Boston (Amherst: University of Massachusetts Press, 2014). ↩︎

6. For a discussion of the BRA’s reorganization and how it was entangled with the development of the Prudential Center, see Elihu Rubin, Insuring the City: The Prudential Center and the Postwar Urban Landscape (Yale University Press, 2012). For a discussion of Logue’s long and controversial career, see Lizabeth Cohen, Saving America’s Cities: Ed Logue and the Struggle to Renew Urban America in the Suburban Age (Farrar, Straus and Giroux, 2019). ↩︎

7. Quoted in John Hull Mollenkopf, The Contested City (Princeton, N.J: Princeton University Press, 1983), 164. ↩︎

8. “The 90 Million Dollar Development Program for Boston” (Boston: Boston Redevelopment Authority, September 24, 1960), Tufts New England Medical Center Planning Office Records Subject Files, 1932-1980, box 1, folder 19: Boston Redevelopment Authority, General, 1962, Tufts University Digital Collections & Archives, https://archives.tufts.edu/repositories/2/archival_objects/4288; Julian H. Levi, “Municipal and Institutional Relations Within Boston: The Benefits of Section 112 of the Federal Housing Act of 1961” (Boston: Boston Redevelopment Authority, October 1962), Boston Redevelopment Authority publications Box 16, City of Boston Archives, https://archives.cityofboston.gov/repositories/2/archival_objects/42540. ↩︎

9. It is possible that there are projects I have missed. If you have ideas or suggestions, let me know! You can contact me at jbhartman12191@gmail.com. ↩︎

10. Mark Joel Winkeller, “University Expansion in Urban Neighborhoods: An Exploratory Analysis” (Ph.D., United States -- Massachusetts, Brandeis University, 1972), 90, https://www.proquest.com/docview/302563574/citation/199323328AEF4CDEPQ/1. ↩︎

11. Levi, “Municipal and Institutional Relations Within Boston,” V. ↩︎

12. Vrabel, A People’s History of the New Boston, 117. ↩︎

13. Levi, "Municipal and Institutional Relations Within Boston," 103; Isaacs, Sasaki, and Nagel, "Fenway-Parker Hill Area: Its Problems and Potential." ↩︎

14. Unlike African American organizations like Freedom which worked with the BRA to plan urban renewal in Washington Park. See Dunning: https://www.leventhalmap.org/articles/mapping-renewal-engaging-residents/ ↩︎

15. Edward J. Logue, “Public Meeting of the Boston Redevelopment Authority with Respect to the Fenway Urban Renewal Project: Statement of Edward J. Logue,” November 19, 1965, Box 824: Fenway Urban Renewal Project, Parker Hill-Fenway Reports, etc., folder: Fenway—Hearings, BPDA Archives. ↩︎

16. Benjamin B. Rodman, “Memorandum to Boston City Council and the Housing and Home Finance Agency of the Reasons Why the Fenway Urban Renewal Plan and Project Should Not Be Approved,” 1965, Edward Joseph Logue papers, series VI, box 156, folder 531, Manuscripts and Archives, Yale University Library, https://archives.yale.edu/repositories/12/archival_objects/1696125. ↩︎

17. William R. Galeota, “300 Storm Pusey’s House After Anti-ROTC Meeting,” Harvard Crimson, April 9, 1969, https://www.thecrimson.com/article/1969/4/9/300-storm-puseys-house-after-anti-rotc/. This version of the demands incorrectly identified the houses as of “black workers” when in fact the neighborhood was of mixed race but largely Irish.” It should read: An updated and expanded version of the demands published on April 22 called for “NO EVICTOIN OF BLACK AND WHITE WORKING PEOPLE”, acknowledging the mixed-race population of the neighborhood. It also called for clemency for those arrested at University Hall, and for the establishment of a Black studies program at Harvard. See: https://www.jstor.org/stable/pdf/community.28015585.pdf ↩︎

18. Richard Sobel, The Politics of Joint University and Community Housing Development: Cambridge, Boston, and Beyond. (Lanham, MD: The Rowman & Littlefield Publishing Group, 2014). ↩︎

19. Lynch, Medical Center in the South Cove. ↩︎

20. Guian A. McKee, “The Hospital City in an Ethnic Enclave: Tufts-New England Medical Center, Boston’s Chinatown, and the Urban Political Economy of Health Care,” Journal of Urban History 42, no. 2 (March 1, 2016): 259–83, https://doi.org/10.1177/0096144215623950. ↩︎

21. McKee; Levi, “Municipal and Institutional Relations Within Boston.” ↩︎

22. “Appendix I: Itemized Section 112 Credits,” Tufts New England Medical Center Planning Office Records Subject Files, 1932-1980, box 1, folder 27: Boston Redevelopment Authority, Section 112, folder 1, 1960–1963, Tufts University Digital Collections & Archives, accessed June 27, 2022, https://archives.tufts.edu/repositories/2/archival_objects/4296. ↩︎

23. N T Adams et al., “The Private Use of Public Power: The Private University and the Power of Eminent Domain,” Vanderbilt Law Review 27, no. 4 (May 1974): 718; “Demonstration Cities and Metropolitan Development Act of 1966,” Pub. L. No. 89–754, 80 (1966), https://www.govinfo.gov/content/pkg/STATUTE-80/pdf/STATUTE-80-Pg1255.pdf. ↩︎

24. McKee, “The Hospital City in an Ethnic Enclave,” 268; “Memorandum of Understanding between the City of Boston, the Boston Redevelopment Authority, and the Chinese Consolidated Benevolent Association of New England,” May 24, 1963, Edward Joseph Logue papers, series VI, box 154, folder 513, Manuscripts and Archives, Yale University Library, https://archives.yale.edu/repositories/12/archival_objects/1696104. ↩︎

25. Boston Redevelopment Authority, “Fact Sheets,” September 1978, Box 12765907, BPDA Archives; Robert G. Hazen, “Inter-Office Communication to Edward J. Logue,” March 2, 1965, Edward Joseph Logue papers, series VI, box 154, folder 505, Manuscripts and Archives, Yale University Library, https://archives.yale.edu/repositories/12/archival_objects/1696104. ↩︎

26. Boston Redevelopment Authority, “Fact Sheets.” ↩︎

27. Michael Liu, Forever Struggle: Activism, Identity, and Survival in Boston’s Chinatown, 1880-2018 (University of Massachusetts Press, 2020); Zenobia Lai, Andrew Leong, and Chi Chi Wu, “Lessons of the Parcel C Struggle: Reflections on Community Layering,” UCLA Asian Pacific American Law Journal 6, no. 1 (2000): 1–43. ↩︎

28. O’Mara, Margaret, The Code: Silicon Valley and the Remaking of America (Penguin Press, 2019). ↩︎

29. Scott Kirsner, “‘Cambridge, We Have a Problem’: The True Story of NASA’s Center in Kendall Square,” Boston Globe, November 24, 2023. ↩︎

30. Thad Tercyak, “Kendall Square Urban Renewal Project: Initial Years, 1963–1982,” Cambridge Civic Journal, June 2013, http://rwinters.com/docs/KendallRenewalInitialYears.htm. ↩︎

31. The NASA Committee, “Inter-Office Communication to Edward J. Logue,” March 27, 1964, Edward Joseph Logue Papers Series VI, Box 186, Folder 930, Manuscripts and Archives, Yale University Library, https://archives.yale.edu/repositories/12/archival_objects/1696393. ↩︎

32. Buderi Chapter 10; Thad Tercyak, “Kendall Square Urban Renewal Project: Six Pivotal Episodes,” Cambridge Civic Journal, 2012, http://rwinters.com/docs/KendallRenewalSixPivotalEpisodes.htm; Thad Tercyak, “Kendall Square Urban Renewal Project: Initial Years, 1963–1982,” Cambridge Civic Journal, June 2013, http://rwinters.com/docs/KendallRenewalInitialYears.htm. ↩︎

33. Urban Land Institute, “Cambridge Center: An Evaluation of the Redevelopment Potential of Cambridge Centere in the Kendall Square Urban Renewal Area” (Cambridge Redevelopment Authority, November 1976), https://static1.squarespace.com/static/51f173a6e4b04fc573b07c0c/t/64ad920037af4a7426280ea4/1689096707197/003_Cambridge_Center.pdf Appendix. ↩︎

34. For two accounts of this struggle, see Buderi, Where Futures Converge; Winling, Building the Ivory Tower. ↩︎

35. Walter L. Milne, “Letter to James L. Sullivan,” July 24, 1974, Contributions of the Massachussets Institute of Technology Through Non-Cash Grants in Aid Under Section 112 of the Housing Act of 1959: Documents and Agreements. ↩︎

36. LaDale C. Winling, Building the Ivory Tower: Universities and Metropolitan Development in the Twentieth Century (University of Pennsylvania Press, 2018) Chapter 5; O. Robert Simha, MIT Campus Planning 1960–2000: An Annotated Chronology (Cambridge, MA, USA: MIT Press, 2003). ↩︎

37. “US Gives Boost to Kendall Sq. Project,” Boston Globe, January 3, 1976. ↩︎

38. John Sparkman, “An Act to Amend Section 2 of the National Housing Act,” Pub. L. No. 95–173, 1453, 1454 42 1 (1975), https://www.congress.gov/94/statute/STATUTE-89/STATUTE-89-Pg1027.pdf. ↩︎

39. See Jeremy R. Levine, Constructing Community: Urban Governance, Development, and Inequality in Boston (Princeton University Press, 2021); Claire Dunning, Nonprofit Neighborhoods: An Urban History of Inequality and the American State, Historical Studies of Urban America (University of Chicago Press, 2022). ↩︎

40. Jim Vrabel, A People’s History of the New Boston (Amherst: University of Massachusetts Press, 2014). ↩︎

41. “Colleges Ought to Pay Boston, Fin Com Says,” Boston Globe, July 14, 1959, Tuesday Morning edition. ↩︎

42. Loring M. Thompson, “Letter to Asa S. Knowles,” September 15, 1971, NU. Office of the President (Knowles) Records (1939-1984), box 18, folder 639: “College Presidents Committee (Greater Boston Area), 1971-1972,” Northeastern University Archives and Special Collections. ↩︎