Harvard To Offer Home Sales At Last

One year ago, Crimson articles on the University's ownership of single-family homes in the Harvard area touched off what Daniel Steiner '54, general counsel to the University, calls a "minor hurricane" in Mass Hall. This September the 29 houses involved remain under Harvard's stewardship, although promises to "divest" the property are closer to realization.

The Crimson pieces cited a possible conflict-of-interest in the University's plan to sell the homes, most of which Harvard rented--and still rents--to faculty and administration tenants. President Bok and three of his vice presidents--Charles U. Daly, Hale Champion, and Chase N. Peterson '52--all lived and live in such homes and a proposal to offer the houses for sale to their tenants suggested that University officials who might be in the background of such decisions were wearing two hats.

With the release of the Long-Range Planning Committee's interim report this summer, Harvard restated its commitment--first set forth in the Daly Report to the Cambridge Community 18 months earlier--to sell the homes to tenants, while preserving a buy-back option on the property for itself. This program, dubbed the "Purchase Option Plan," is now the responsibility of Russell E. Hill, director of real estate, who says the specifics of the arrangement should be worked out within a month.

Just why Harvard wants to divest the houses is not clear. Most of the homes lie within the boundaries of the University's acquisition map, and Harvard clearly does not want to, nor feels any obligation to, relinquish the land to the "community." Just so, the Purchase Option Plan will insure that none of these properties leaves University control. If an owner wishes to sell, Harvard will have first crack at the house, and if a tenant ends his employment with the University, he must relinquish the house.

Russell Hill says that Harvard is drawing up the plan because certain tenants have expressed interest in owner-occupancy and because outside ownership relieves Harvard of taxes and maintenance costs and apparently increases the tenant's care for the homes. Hill says that he realistically doesn't expect more than six of the 30 involved tenants to opt for owner-occupancy initially.

This is where last year's phantom of "conflict-of-interest" once again rears its head. Hill says that Daly, Peterson, and Champion will all be treated just like other tenants when he finally sits down with them to discuss the plan. This is, of course, only a verbal promise from Hill, but it is probably more than coincidental that Hill, the man who is in charge of the arrangement, works for Stephen S.J. Hall, vice president for administration and the only one of Bok's top financial aides who does not live in a Harvard-owned house.

Hale Champion, vice president for financial affairs, is toeing the line himself. Champion said earlier this month he would decide whether to buy his University-leased house "only when the University comes with a proposal." He added, "I am having nothing to do with the setting of policy here."

Peterson, vice president for alumni affairs and development, said he might consider buying his house at 95 Irving St.--which he sold to the University in 1968--when the purchase option plan is announced. As for the establishment of the plan, he said, "I have intentionally stayed ignorant of the whole thing just because I happen to live in such a house."

Further assurance comes from Steiner, who said last week that independent appraisals from two outside assessors will keep the sale-prices honest. These appraisals were made separately by Dwight Andrews of Ellis and Andrews and Peter Baldwin of Dudley and Borland.

However, Hill says that these estimates were executed only for Harvard's information, to update figures from the Cambridge Assessor's Office. Since all the homes are valued at more than $50,000, and most of them in excess of $75,000, Hill says that Harvard could not realistically offer the homes at market value to the tenants.

"As it turns out, these houses are rather high in value," Hill said. "In our judgement most of the occupants could not afford the fair market value. My main problem now is that we have to devise some type of legal means wherein the prices could be lowered."

Hill says that offering homes to faculty at reduced prices is a policy that is "standard employer-employee relationship" in educational institutions. It is also in Harvard's interest to maintain a population of academics in the immediate area.

As for remaining concerns over conflict-of-interest, Steiner said, "The problem in a sense is whether Harvard can do anything with Harvard. Administrators have to set administrators' salaries."

Harvard's property policy might become inequitable by shutting out the use of University resources to house faculty to the detriment of "community" buyers or in by using its status as an educational institution to take such property off the tax-rolls. However, of the 29 single-family homes involved, all but the houses of Presidents Bok and Horner and of Krister Stendahl, dean of the Divinity School, are taxed. (Cambridge City Council promised last year to examine the tax-exempt status of the three non-taxed houses.) As for expansion, Harvard attempts to contain its student population so that it won't flood the Cambridge apartment market, and since the 1972 Daly Report it has limited its new purchases.

It would appear that not much has changed since last year's crisis. Harvard is still only in the planning stages of its Purchase Option Plan, the Bok aides who rented University houses still rent them, and a possible conflict of interest is still something that cannot be ignored. But the only storm that has enveloped Russell Hill's office blew in when confused tenants thought "purchase option" meant they were going to be evicted. Not much has changed since last year's hurricane, except the weather.