The University’s steady expansion into Urbana over the last 20 years recently prompted the city to take action. However, both the University and Urbana have struggled with a solution to the problems that have accompanied this growth.

Two weeks ago, Bruce Walden, chief administrative officer of Urbana, showed a presentation to the city council about the city’s tax base erosion.

The University’s expansion, Walden alleged, has come at a cost to Urbana. His presentation described relative inequity between Champaign and Urbana: the development of Research Park and other properties in Champaign has helped the city collect $8.5 million in taxes, while the University’s development in Urbana has cost that city $7.5 million.

University land is tax exempt, preventing Urbana from collecting on previously taxable land accumulated by the University.

“There has been joint development in Champaign, but none in Urbana,” said Libby Tyler, the Community Development director and city planner in Urbana. “The tax revenue-generating parts of the University are all in Champaign.”

University Trustee Marjorie E. Sodemann explained that, “having been a township supervisor, I understand how the taxing districts feel.”

“The University is making every effort to be fair with Urbana,” she said.

Chancellor Richard H. Herman said that Urbana has not taken everything into consideration.

“There are various points of time where one development helps one community and not the other,” he said.

He also believes that Urbana has not recognized the economic benefit of having the University in the city.

The University receives about $350 million in grants every year and 46 percent is spent on salaries, Herman said.

“The people who are on salary here pay taxes, support schools and buy real estate,” he said.

Herman acknowledged Urbana’s tax base problem, and said he is not sure “whether (Walden) feels the University is an economic plus or an economic negative.”

“You can’t have it both ways,” Herman said.

Tyler has been watching the University’s expansion.

“The loss of our growth area in the south concerns me,” said Tyler, speaking about some of the University’s recent acquisitions.

But Herman contended that he hadn’t forgotten about Urbana. He presented the Urbana Campus Strategic Plan to University President B. Joseph White earlier this month.

“I’ve been talking about developing Orchard Downs,” Herman said.

Orchard Downs is a 160-acre property southeast of the University.

“I’m talking about the possibility of building a new community here,” Herman said. “The improvements to the land would be taxable. It would increase the tax base considerably.”

The city also recommended developing Pomology tract, a 100-acre area located south of Windsor Road and west of Philo Road.

“The University needs to be in a community that is strong on both sides,” Tyler said.