Look at the property tax logs of college towns nationwide and you'll see one common feature. The college or university-which also tends to be one of the largest landowners in a community-is exempt from property taxes as a nonprofit educational institution. Not in NH. New Hampshire, says Tom Horgan, president of the NH College and University Council, is the only state in the nation that allows towns to tax private colleges. The tax does not apply to all school buildings, only to dorms, dining halls and kitchens.

This little known fact has a big effect on town budgets. Take Hanover, where Dartmouth College pays $5.33 million, making it the town's largest taxpayer, far ahead of second-place Kendal at Hanover at $1.1 million.

Dartmouth College is not alone in being the top taxpayer in its town. Similarly in Rindge and Goffstown, Franklin Pierce University and Saint Anselm College each pays about $500,000 in property taxes, according to school and town officials, making each the top taxpayer in its respective community. The tax was created in 1913 and applies to the value of those dorms and dining halls valued above $150,000.

For towns with public colleges and universities, or nonresident colleges, the situation is different. The University of NH is the largest landowner in Durham, but public colleges don't pay property taxes. Instead, the town and university recently negotiated a $200,000 annual payment to cover road repairs, police department expenses and any other town services the university benefits from above and beyond money paid for municipal services. In total, the University System of NH negotiated payments of about $3 million in FY 2010 to Durham, Keene, Manchester and Plymouth, including for fire protection services.

All Stories