RYE CONNECTIONS: The History of Free Tuition at Cooper Union

Note: Current headline news, interestingly, is sometimes connected to people and events in the history of the Rye area.

May 18, 2015
5 min read

cooper-thNote: Current headline news, interestingly, is sometimes connected to people and events in the history of the Rye area.

By Paul Hicks

CooperNote: Current headline news, interestingly, is sometimes connected to people and events in the history of the Rye area.

A recent article in The New York Times begins, “Cooper Union has offered not to renew its president’s contract to try to address an inquiry into the college’s finances and a lawsuit over its decision to charge undergraduates tuition for the first time in more than a century.” The Times article reported that “returning the school to financial health and restoring free tuition is going to take a dramatic change in the way Cooper Union is run,” according to a lawyer who is representing a group of faculty, alumni, and students called the Committee to Save Cooper Union in a lawsuit challenging the tuition.

Now for some history, which starts with Peter Cooper, one of New York City’s most illustrious citizens of the nineteenth century. Cooper was the epitome of an entrepreneur, combining a talent for invention with business skills that made him successful in various manufacturing, commercial and real estate ventures during his long life (1791-1883). He turned the mundane manufacture of glue into a highly profitable enterprise and multiplied his earnings through a wide range of investments.

He is best remembered, however, for founding the Cooper Union for the Advancement of Science and Art as a tuition-free institution of higher learning. From the outset, it enrolled both male and female students from the working classes without regard to race or religious affiliation. The cornerstone of Cooper Union was laid by Cooper in 1853, but it took another six years and nearly $700,000 to complete the original building (multiply all dollar amounts by roughly 20).

To assure that his plan started on a sound legal basis Cooper turned to his young lawyer, John E. Parsons, who was not yet 30 when Cooper became his client. A native of Rye, whose family home still stands on the Post Road, Parsons prepared a deed of trust in April, 1859 by which Peter Cooper and his wife donated the building and other property to a board of trustees (which included Parsons). In that same month, the New York State Legislature passed a law granting a corporate charter to Cooper Union. A key clause of the statute and charter provided:

“The premises and property mentioned in said deed, and which at any time shall belong to or be held in trust by the corporation hereby created, or by the trustees thereof, including all endowments made to it, shall not, nor shall any part thereof, be subject to taxation while the same shall be appropriated to the uses, intents and purposes hereby and in the said provided for.”

The statutory exemption from taxation drafted by Parsons and contained in the charter would prove enormously beneficial over the years in realizing Cooper’s goal for Cooper Union to provide education that was, in his words, “as free as air and water.” Cooper imagined the institution not just as a college but as a “union” where the city’s workers as well as their children could attend meetings and lectures as well as enroll in classes. Running both evening and daytime sessions, Cooper Union provided the first example of continuing education.

In addition to classrooms, the main building included a public reading room, stocked with the latest newspapers and periodicals, which by the 1880s had a daily attendance of more than 1,500. Another major attraction was the Great Hall in the basement of the building, which was for many years the largest meeting room in the city for free lectures as well as public meetings. Shortly after the building opened it made history when Abraham Lincoln delivered a key speech there at the start of his campaign for the presidency in 1860.

During his lifetime, Peter Cooper gave nearly $1,500,000 to Cooper Union and contributed an additional $200,000 in his will. His children donated another $400,000 to pay for structural repairs to the building in the 1880s. Despite these gifts, the trustees decided to begin an unprecedented appeal for donations from the public in 1884. The largest and most significant of these donations came in two stages from Andrew Carnegie.

In 1900, he gave $300,000 to establish a free polytechnic day school, completing Peter Cooper’s original educational plan. Two years later, Carnegie gave an additional $300,000, and his total gift of $600,000 was matched by an equal amount distributed from a trust established by Peter Cooper for his children and grandchildren.

The circumstances were recorded in the minutes of the Board of Trustees meeting on February 4, 1902: “In order, therefore, that Mr. Carnegie’s second gift might be met by an equivalent from Mr. Cooper’s family, they have agreed to convey property known as the Vanderbilt Flats, constituting the trust property above referred to, valued at six hundred thousand dollars…”

At the time of the transfer, that property was occupied by what The New York Times described as “a monotonous looking row of five-story brownstone buildings on East Forty-third Street, known as the Vanderbilt Flats….” This complex transaction was crafted by Parsons as legal adviser for both the family and Cooper Union. The income derived from this property and from the Carnegie endowment added $30,000 per year, allowing Cooper Union to continue the founder’s policy of not charging tuition.

When Cooper Union was unable to have the Vanderbilt Flats property removed the New York City tax rolls in 1903, Parsons and his law firm challenged the tax assessment in the state courts. In 1905, the New York Court of Appeals held, without a written opinion, that it was illegal for the city to assess a tax on the property conveyed to Cooper Union as part of its endowment.

The tax exempt income from the Vanderbilt Flats property was very important to maintaining free tuition at Cooper Union, but it became substantially more valuable when the Chrysler Building was erected on the site in 1930. Most of Cooper Union’s Chrysler Building income has since come from what are called tax-equivalency payments, equal to what would normally be paid in property taxes. Estimates of the present value of that future stream of income range into billions of dollars.

Honoring John E. Parsons after his death in 1915, his fellow trustees (Andrew Carnegie, R. Fulton Cutting, Peter Cooper Hewitt, and J. P. Morgan) passed a resolution that said in part: “This institution is particularly indebted to him and his law partners for the success with which they defended the provision of the Union’s Charter granting it immunity from taxation when the city’s authorities attempted to impose taxation upon it.” They could not imagine how much Cooper Union would benefit in the years to come from preserving the tax exemption that Parsons had so firmly established at its incorporation in 1859.

 

 

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