In an effort to get a partial property tax exemption for faculty homeowners, Stanford University is suing Santa Clara County arguing that the subdivision of these homes on campus is a “college interest” and should lower the homeowner’s tax bill.

Stanford University announced this week said it is initiating legal proceedings to gain clarity on property tax issues that are creating significant financial uncertainty and hardship for many of the faculty members who own long-term” lease homes on campus. The tax issue has been a long-running debate between county leaders who want to see more tax money from the university with the largest endowment in the country and Stanford which wants to protect its mission to keep the university private and grow its influence.

At the center of the lawsuit are Stanford’s roughly 900 homes in the faculty subdivision —  691 of which are single-family homes and 222 are condos — particularly one home at 828 Cedro Way. The university contends homeowners overpaid taxes when the property changed hands in 2018.

Like other residential homes in Santa Clara County, faculty homes on Stanford’s campus — most of them located on winding suburban streets west of the main quad — have been assessed property taxes based on the purchase price of the property which reflects their ownership interest. But the university said in its statement that the county assessor has increased the assessed value of some newly purchased faculty homes on Stanford’s campus to levels well above the faculty purchase prices.

The reassessment has created “unexpected and substantial financial difficulty for some faculty homeowners,” the statement said. And the reassessment, the university argues, does not account for the fact faculty homes are “leaseholds” — meaning homeowners do not have a full property interest in these homes — and that Stanford “retains an interest in the properties and places restriction on faculty sales, ownership and use of these properties” noting that they are “in effect… support” for the “education mission of the university.”

“Stanford is seeking a partial property tax exemption based on the value of the minority interest in the property retained by Stanford as the underlying property owner,” Stanford said in a statement. “If the university’s legal case is successful, faculty homeowners will continue to pay full property taxes based on their majority ownership interest in the property.”

Because homeowners have an agreement to lease the land from Stanford, the university says in its lawsuit that the value of the property should …read more

Source:: The Mercury News


Stanford University sues Santa Clara County to give tax relief to faculty homeowners

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