Harvard has long had an important influence on the city that surrounds it. In fact, when the University was founded in the early settlement of Newtowne, the town changed its name to Cambridge in honor of the English university Harvard hoped to emulate. Three hundred fifty-two years later, the University, as the city's largest employer and its biggest landlord, still plays a major role in shaping the surrounding community.

Critics complain that Harvard makes excessive demands on city residents because while it gives many of them jobs, it also raises the cost of living in Cambridge. Even those city officials who have bitterly criticized the University concede that Harvard contributes prestige and jobs to the community, as well as indirect economic boosts that have grown from practical applications of its research.

Of Harvard's 11,500 workers, about 3200 live in Cambridge. According to University releases, Harvard adds more than $100 million to the city's economy annually.

"A lot of Cambridge people work at Harvard, and for that we appreciate it," says Cambridge Mayor Alfred E. Vellucci, who has suggested using Harvard Yard as the site for a parking lot, a city carnival and emergency homeless shelters.

Although it is a non-profit institution and therefore exempt from most taxes. Harvard is still the city's largest taxpayer. The University pays millions of dollars in property taxes on its non-academic land holdings--including property managed by Harvard Real Estate--and also makes a voluntary tax payment of approximately $950,000 on its academic land and buildings.

"Harvard has an overall positive impact, but on a specific issue by issue basis we do better on some issues than others," says Harvard's Director of Planning Kathy A. Spiegelman. She acknowledges that the University "makes it hard for people to live and work here" by pushing up the local cost of living.

But Jacqueline O'Neill, associate vice president for state and community relations, says, "The presence of the University is on balance a major plus."

Vice Mayor Alice K. Wolf says Harvard hurts the city most in its role as a real estate developer by raising property values. "Its interests to make money conflict with the interests of the city," she says.

Without Harvard, adds Vellucci, "we'd have plenty of room to build housing for the people."

O'Neill describes battles over issues such as housing as "surface tensions." She says community criticism is often particularly bitter because the University's high academic standing encourages them to apply inordinate standards.

The presence of Harvard's world-renowned science faculty in Cambridge has encouraged many technology, research and professional firms to locate in the city. In addition, the University attracts many talented students to Cambridge, many of whom stay to work in the area after graduation.

The Genetics Institute, a Cambridge-based biotechnology firm, was founded by two Harvard biochemistry professors, Thomas A. Maniatis and Mark Ptashne, in 1980. The company employs approximately 400 people, many of whom are Cantabridgians.

The company chose its Cambridge office in order to be close to Harvard so the founders "could run back and forth" between the two locations. "Cambridge's proximity to Harvard's academic and scientific resources" was one of the major reasons the company chose the city, Maniatis says.

"Cambridge is a very good place for high-tech," he says. "Virtually every biotechnology company in Cambridge is affiliated in some way with Harvard or MIT."

Maniatis says the company "has a direct impact on the city."