Graphic by Riley LeBlanc, Photographer.
Being a college town comes with benefits. It also comes with a bill. In Orange, disagreements over who should pay it have put Chapman and city officials at odds.
Chapman generates over $631 million in reported economic activity for the city, bringing students, employees, visitors and business into the surrounding community. But city officials argue that the university’s economic presence does not necessarily translate into direct financial support for the public services needed to sustain it. Chapman’s presence is also thought to significantly raise the value of homes near the school.
As a private nonprofit institution, much of Chapman’s property is exempt from property taxes. The City of Orange, however, remains responsible for providing police, fire and infrastructure services to the people who live, work and spend time in the community, including those on and around campus.
The tension has fueled years of discussions over a proposed Payment in Lieu of Taxes (PILOT) agreement, under which Chapman would voluntarily contribute money to help pay for city services.
A PILOT is ultimately a negotiated agreement and annual payment a property owner pays to a local government, rather than paying a full-rate property tax.
Relations between the city and the university soured following a rejection by former President Daniele Struppa and President Matt Parlow’s office's refusal to meet with city officials on the matter.
“I don't think the new president and the wider university community understands how angry our residents are about this,” former city Councilmember Arianna Barrios said. “They are angry, and they've had it with how Chapman treats the community.”
Bob Hitchcock, Chapman’s director of strategic communications, said that the university is not pursuing an expanded PILOT program.
However, Barrios has been among the advocates for such an agreement. She argues that as Chapman has grown, its relationship with the city needs to evolve as well.
“When you have a very large organization such as Chapman taking up so much physical land in the city and taking that off of our property tax rolls, it puts a much bigger burden on other businesses who do not have that protected status, and residents,” Barrios told The Panther.
Barrios said she first brought the idea of a PILOT program to the City Council nearly four years ago. She worked with an ad hoc committee — a temporary group for a specific project that included residents — to research property tax structures and similar voluntary contribution programs on the East Coast. The group also interviewed mayors from other college towns to understand how universities and cities had structured their financial relationships.
About two years ago, a meeting between the city and Chapman leadership was arranged. The meeting included then-President Daniele Struppa, the university’s chief financial officer (CFO), Barrios, City Manager Tom Kisela and Mayor Dan Slater to discuss and negotiate a plan.
According to Barrios, Chapman's CFO brought a draft agreement to the meeting, which initially appeared to move negotiations forward.
The draft agreement shared during the October 2024 negotiations proposed an annual payment of $50 per full-time-equivalent undergraduate student enrolled at Chapman's Orange campus, increasing to $100 per student in the second year and $150 by year three, before the agreement would be reassessed. The payments would be designated for police, fire and paramedic services, separate from Chapman's existing $500,000 annual contribution to the city's general fund.
But the proposed agreement extended beyond public safety funding. It also included provisions that would prevent the city from imposing certain development and mitigation fees on Chapman during the term of the agreement. The city would also agree not to penalize the university if enrollment exceeded 8,700 students, or a higher limit authorized through Specific Plan Amendment No. 7.
The agreement tied Chapman's payment obligations to the approval of the development plan, which Chapman would retain the discretion to approve in its final form.
“I’m sorry, this was supposed to be a discussion, not like you bring me a piece of paper and tell me what you will agree to,” Barrios said. “It doesn’t work that way, and the terms were completely onerous. If not, I will be frank: illegal.”
Struppa did not respond to requests for comment.
Due to issues with the agreement, a second meeting was scheduled. According to Barrios, this meeting included additional Chapman staff, such as Alisa Driscoll, the vice president of community outreach. At the meeting, Barrios raised several talking points, including issues with the Undie Run finals-week tradition and its effects on the surrounding community.
Following the meeting, Barrios said Struppa communicated that Chapman can not agree to the proposed terms.
With Struppa stepping down, Barrios said city officials were ready to continue the discussion with the incoming president, Matt Parlow. For months, Barrios attempted to schedule a meeting with Parlow, leaving emails and voicemails.
Barrios explained that Parlow eventually responded through a representative, saying they were ultimately not interested in moving forward.
Parlow did not respond to requests for comment.
Chapman, meanwhile, has pointed to its existing financial contributions and broader economic impact as evidence of its investment in Orange.
“Chapman supports thousands of jobs and creates millions of dollars in essential tax revenues at the state and local levels, and contributes to stable economic growth for the City of Orange,” said Hitchcock. “We also sponsor numerous cultural and artistic programs and provide social services that enrich the lives of those in our neighborhood.”
According to Hitchcock, Chapman generates approximately $500 million in annual economic output, contributes approximately $130 million annually in student and visitor spending, invests approximately $1.2 million each year in the preservation and maintenance of Old Towne Orange properties and offers more than $300,000 annually to support Orange-based nonprofits.
Chapman has also voluntarily contributed $500,000 annually to the city’s general fund since 2014, following its acquisition of property that became Panther Village student housing.
Chapman also reports contributing about $52,000 annually towards additional Orange Police Department staffing during periods of increased campus activity — such as graduation — and $43,000 toward maintenance at Hart Park and El Camino Real Park, which Chapman athletics often use.
Those contributions, however, differ from the proposed PILOT payment, which would have established a separate, dedicated contribution toward public safety services.
Hitchcock said that this type of matter requires thoughtful consideration and evaluation. He also added that these programs are voluntary and rare, generally only supported by Ivy League and Ivy-Plus institutions.
According to the Lincoln Institute of Land Policy, the Northeast accounts for roughly 75-80% of PILOT activity, with the largest share in Pennsylvania and Massachusetts. Many major universities that implement a PILOT program include Harvard University, Yale University and Brown University.
While not pursuing a PILOT program, Hitchcock says the university remains committed to supporting Old Towne Orange and is optimistic about its partnership with the city.
“We’re proud to be an active partner in supporting the vitality of our community, and we value our longstanding relationship with the City,” Hitchcock said.
For Barrios, the disagreement is ultimately about more than the amount of money Chapman contributes. It is about what she believes a university’s responsibility should be to the city it calls home.
“It's about partnership,” said Barrios. “You can't just abuse somebody over and over and over again and say, ‘Oh, we're a great, great partner.’ Well, okay, why do I have a black eye then?”