Hasty Pudding Faces Fiscal Difficulties Owes Over $150,000 in Taxes, Debts

The Hasty Pudding Club, the oldest college club in the nation, currently faces severe financial difficulties--owing over $150,000 in back taxes, mortgates, and delinquent payments--and may lose its clubhouse if at least some of the taxes on the building are not paid soon.

The Pudding currently owes a total of about $1000 in personal property taxes and $13,273 in real estate taxes for fiscal years 1978-79 and 1979-80, David O'Connor, attorney in the City of Cambridge's delinquent tax unit, said yesterday. An additional $16,165 for real estate is due and payable by May 1.

"We have been in some communication with the club and (have) for a while deferred tax taking," O'Connor said. But he added. "We will not do it much longer. If the club does not pay everything within a few months, we will file a lien against the property."

If the city took this action, the Pudding would have six months to make full payment on the taxes before Cambridge could foreclose. An article in the club's original declaration of trust stipulates that if the Pudding ever leaves its location the building will revert to Harvard, so the University would have the option of paying the taxes and taking over the building.

Otherwise "we would simply sell it at public auction," O'Connor said, adding "It'd be sad--it's such an historic institution--but we have to preserve our own interests in case there are other creditors clamoring for payment."

Robert A. Emmons '52, president of the Pudding's graduate board, said yesterday he sent a letter to alumni asking for contributions to help pay the taxes, and added that the believes the club will be able to hold on to the building. "We have about 10,000 alumni and they've always been very generous in the past," he said.

The Pudding's inability to pay its taxes is only one aspect of far greater financial difficulties threatening the club. Emmons estimated yesterday that the Pudding operates with an annual deficit of $50,000-60,000 if the income drawn from alumni support and the Hasty Pudding's annual show is discounted.

"At one time the graduates were able to pull out their checkbooks and make it up on the spot," Robert A. Humphreville '80, the club's office manager, said yesterday. "Now, with tax advantages not quite as attractive as they used to be and money not quite as available, the graduates can't make up the difference," he added.

In order to make ends meet, the club has taken out mortgages on its building totalling about $125,000, Emmons said yesterday. In addition, the Pudding has let other debts slide.

As of the end of February the club owed Harvard nearly $25,000 for steam heating, telephone costs, and work done by Buildings and Grounds and the Alumni Records Office, a spokesman in the Office for Accounts Receiveable, said yesterday. Of this total debt. $21,000 was over 150 days delinquent.

"An account that size is very, very, very unusual," the spokesman said, adding, "The average balance for an account here is $50-75. You could count on one hand the number of organizations with deficits that large."

The spokesman, who asked not to be identified, said the office has not acted on the account because of a "hands-off" policy dictated by Archie C. Epps III, dean of students, "Dean Epps has told us not to do anything with any Harvard student organization," he added.

Epps said Wednesday he is aware of the Pudding's debts and has "worked out a schedule with the club to help turn things around." He added that the organization made a payment last month, retiring 25 per cent of its debts to the University.

"In this situation, because of what the Pudding is, there is double duty to meet the debts to the University and to save the organization," Epps said.

Although Harvard may allow the club to postpone its payments, the Pudding has had problems in other quarters. In the past, when the club's budget ran into the red, the organization increased its mortgages on the clubhouse. But a year ago the banks told the club that it would have to start making ends meet, Emmons said.

The Pudding has already taken steps in this direction. On March 19 the club closed its dining room, eliminating a services which has lost money steadily.

Pudding officials are planning a capital fund drive and organizing a series of parties and "Grog and Grill" nights to help raise revenue. They are also considering a number of other long-term solutions.

One proposal, supported by Emmons, is to once again merge the social and theatrical portions' of the Pudding, giving those involved with the production of the show greater control of the club, while including some of the building's operating costs in the shows' budget.

A second solution, which Emmons said is already being discussed with the University is to allow. The American Repertory Theater to use the building during part of the year.

Although these solutions will not get the club out of its immediate financial difficulties, Pudding officers do not think the club will go under. As Humphreville said, "How can a place that started in 1770, a place that many alumni associate with Harvard--how can a place like that fold under the shadow of the (Capital fund drive) campaign?