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Presidents of Private Colleges Live in Luxury Homes for Rent

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By : John Cutts    99 or more times read
Some of the private universities and colleges in Massachusetts offer luxury homes for rent to their presidents as part of their compensation packages. The estimated monthly rent for the homes of college presidents were revealed following the Internal Revenue Service’s request to higher education institutions to include nontaxable perks in reporting the compensations received by their executives.

According to reports, the president of Harvard lives at Tory Row in Cambridge in a Colonial residence with an estimated monthly rental value of $8,000. Meanwhile, the Northeastern president lives at Beacon Hill in a five-story town house with an estimated monthly rent of little over $6,000, while his MIT counterpart occupies a home near Charles River which rents for $5,800 per month.

According to the IRS, the new rule aims to present a more transparent picture of the way school administrators are rewarded. However, an examination by Globe shows that colleges vary in the way they interpret the IRS requirement. Some schools assessed the value of entire luxury homes for rent, while others considered only the portions that qualify as private residences.

The variation happens because some college presidents’ houses reserve the ground floor for entertaining students, alumni, faculty and visiting dignitaries and is considered public space. As an example, Boston University president Robert Brown describes his home as an apartment located above a restaurant because the house serves as venue for university functions every week. Brown’s home is considered the most expensive, with an estimated monthly rent of over $20,000.

The instructions from the IRS, according to universities, did not specify the portions of the houses that should be included when executive compensations are added up. Most private colleges admitted that they just decided to value the entire property without considering which parts serve as their presidents’ personal living quarters.

Some local realtors who specialize in luxury homes for rent have argued that some universities have undervalued the rental rates for their top executives’ homes. They also asserted that most of these homes would fetch significantly higher rents in the open market than what the schools reported.
John Cutts has been educated in the finer points of the foreclosure market over 5 years.

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