Cambridge City Councilor Kevin P. Crane '73 said last night he will propose a bill in the state legislature to provide cities with state compensation for property taxes not collected from tax-exempt institutions.

"We all know how this would assist Cambridge with its substantial college holdings," Crane said, nothing that 52 per cent of all land in Cambridge is owned by hospitals or institutions of higher learning. Harvard is the principal tax-exempt landowner in Cambridge.

Crane said he plans to contact Harvard officials in the near future to seek the University's cooperation in the matter.

Harvard voluntarily pays about $400,000 annually to Cambridge in lieu of tax payments, Cambridge City Manager James L. Sullivan said last night.

Connecticut Law Similar

Crane said the legislation he plans to introduce is based on a law passed in Connecticut last year. That law stipulates that the state must give communities with tax-exempt institutions 25 per cent of what the city would receive if those institutions were taxed at normal rates.

The Massachusetts law "would require no money out of Harvard's pocket," Crane stressed, adding that he plans to submit the bill to the state legislature before December.

Michael F. Brewer, Harvard's director of government relations, was unavailable for comment last night.

City councilors questioned last night said they would support Crane's effort.

Cambridge Mayor Thomas W. Danehy submitted a similar resolution seeking federal aid for communities like Cambridge to the U.S. Conference of Mayors which met in Atlanta in June.

In his resolution, Danehy called for "greater aid to those communities allowing a preponderance of their land to be utilized for the public good." The conference did not act on the motion.

Bonnie Flynn, Danehy's aide, said last night the mayor would also support Crane's proposal.

Councilor David Wylie noted that although he did not think tax-exempt institutions could afford to pay normal taxes, he "would like to see them pay more."

Vanishing Resources

"Since the large institutions such as Harvard and MIT are a public resource--if not a national one--a city that is saddled with an undue amount ought to get outside assistance." Wylie said.

Councilor Alfred E. Vellucci said he would like to see Harvard pay according to normal tax rates but added that he is "afraid Harvard will dump the whole thing on tuition costs and then only the rich kids will be able to attend--kids from working class families won't have a chance."

"Who the hell wants a college where only millionaires' kids go to school?" he added