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Living Up to a Promise 

Distrust of UPMC will linger

Let's say this up front: Thanks, UPMC. And not just for the $100 million.

The money's great, of course: Your pledge to help fund the Pittsburgh Promise, a college scholarship program for city students, is a big deal. It's even bigger now that you've dropped a controversial effort to tie the money to tax credits, which would have protected your finances should the city ever be allowed to tax you.

But the uproar over the Promise has taught a very valuable lesson before the scholarships are even funded:

We are on to you.

You're probably still befuddled by the outrage. You pledged $100 million, and all you asked in return was protection from taxes the city can't levy, and probably never will. Yet some of us are still looking askance at the Promise, and whether it will reduce your voluntary -- but paltry -- support of the city's finances. (Your most recent statement on the Promise, for example, notes that UPMC "has also agreed to make a $1.5 million contribution [to city tax coffers] in 2008, providing a transitional year." A "transition"? Sounds like the Promise will be costing the city after all.)

The low point came when your attorney, Ralph Cindrich, tried to explain things to City Council on Dec. 18.

"Don't look a gift horse in the mouth," he instructed council.

It was a real "let 'em eat cake" moment -- the sort of statement that lives forever because it sums up an attitude of paternalistic contempt. Maybe your first scholarship should be for a Dale Carnegie course.

But don't blame Cindrich for the bad press. Or even Mayor Luke Ravenstahl, who botched things by pressuring council to grant your conditions at the last minute. The problem isn't what you did; it's what you are.

Universities and hospitals, they say, are the steel mills of postindustrial Pittsburgh. And yeah, you're Pittsburgh's biggest local employer: Way to go. According to your financial statements, you need more than 100 financial advisers just to manage your money.

But Pittsburghers remember the steel industry's dark side. Big Steel bought and sold politicians, held lavish society functions and warped the law to get huge tax breaks. Any of that sound familiar?

You also have an additional burden: You're the local poster child for a health-care system that is bankrupting the country.

Even the warm fuzzy feeling created by the word "nonprofit" is wearing off. In his book Microtrends, political guru Mark Penn notes that employment in the nonprofit sector has been growing faster than anywhere else. What's more, he notes, "[B]etween 2004 and 2005, the median compensation of the nation's largest nonprofits' chief executives ... rose faster than the bosses' pay at the nation's 500 biggest companies."

But Penn also notes that those executives can "[e]xpect greater government scrutiny as well. As the nonprofit sector grows in dollars, people, and impact ... expect more resources to be devoted to checking out whether all [nonprofits] are truly ... deserving of their tax-exempt status."

That isn't new. Populists like former city Controller Tom Flaherty warned about the rise of nonprofits a decade ago. And anyone paying attention knows that you and other "nonprofit" hospitals retain the state's most free-spending lobbyists. (According to state disclosures, the state Hospital Association spent $1.2 million on lobbying in the first nine months of 2007 alone.)

So why did the Promise promote such outrage? Because your big money met Pittsburgh's small-town politics.

Look: We realize the politicians are in your back pocket, and that your bill collectors are reaching toward ours. Rubbing our face in it, though, isn't smart.

Last summer, you paid for Ravenstahl's ticket to a charity golf outing. And you plan to put your name up in lights atop the USX Building, where it will be a constant reminder of your presence.

I assume you air those TV ads, and boast of your benevolence, to put a good spin on your wealth and influence. All it's doing, though, is making your wealth and influence impossible to ignore. If you want your logo in the skyline next to Mellon's, fine. Just don't be surprised when people start treating you like a bank.

So the lesson here is this: We will look a gift horse in the mouth ... on the theory that if the Trojans had done the same, they'd have avoided a lot of heartache. We're not taking your good will for granted any more. Don't take ours for granted, either.

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