Should tax exempt universities and non-profits pay their "fair share?"

Are municipalities and tax exempt universities or non-profits "misunderstood fiscal opponents," as reported in on January 31, 2010 article appearing in The Chronicle of Higher Education? The article (which is viewable to subscribers online), "Payments in Lieu of Taxes: ' Contributions,' Say the Towns; 'Extortion,' Say the Colleges," explores the notion that when a municipality has a "shortfall," then universities and non-profits should pay their "fair share."

Some universities around the country have been making payments in lieu of taxes for years. The journal reported on a survey of 30 research universities in the same issue of the journal. The amounts that universities reported range from the University of Virginia's most recent payment of  $151,537 to the $7,500,000 that Yale University dishes out. Each amount is determined based on unique factors and agreements, according to the report.

Other universities don't make these payments but they contribute funds and in-kind services to their towns in others ways, according to their report. In our state, The University of Michigan agreed to pay to 78% of the planned new transit center. The U of M has supported the Ann Arbor Transportation Authority, the fire department, and Ann Arbor SPARK with contributions, and the U of M Health System is in partnership with the Washtenaw Heath Plan "to provide low-cost health care to thousands of residents, in addition to providing indigent health care at no cost," they report.

Some people think these solutions bridge the town-gown gap. Others have serious beef with the idea of making non-profits pay. What is your take on what is "fair?