HARVARD, OF course, is no stranger to town-gown trouble. But Mary Power, the senior director of the Office of Community Relations at Harvard, defends the university’s management of its commercial property. Its vision has remained, she says, " in sync " with that of the local community. " We seek to maintain a mix of tenants that cater to our population and the larger population. We see the Square as a special place, and I think our policies are consistent with this view. "

Spiegelman, of HPRE, concurs: " Yes, there are stories like the Pudding, where the community is unhappy. But in the past 15 years, Harvard has been on the same side as the [Harvard Square] Defense Fund and other groups more often than not. " She adds that HPRE approaches its negotiations in " a fair manner. " That means that Harvard officials routinely offer five- and 10-year agreements to allow for stability in the neighborhood. It means that they negotiate below-market rates for small, unique, and long-standing establishments. Although Spiegelman acknowledges that Harvard has charged " aggressive " rates for some tenants, she is quick to note that the university " does not charge anywhere near the top of the market. "

Because of these practices, Spiegelman argues, Harvard’s presence has actually slowed down the undesirable change. " Just look at our tenants, " she says. The school’s property is dominated by some of the funkiest, oldest businesses around. Many of the one-of-a-kind shops along Mass Ave — Bartley’s Burger Cottage, the Harvard Book Store, photography specialist Ferranti-Dege, and tobacconist Leavitt & Peirce — pay rent to HPRE. Other enduring tenants include the Grolier, Club Passim, and the Globe Corner Bookstore — places that have been in business for a combined 130 years. Spiegelman believes these tenants show that " Harvard has been a force resisting the mall-ification of the Square. " By contrast, some of the establishments most frequently decried as evidence of that process — Abercrombie & Fitch, Pacific Sunwear, and the Gap — do not rent from Harvard.

Officials say that even when the school’s needs trump those of its tenants, the university has tried to help. Harvard agents, according to Power, worked to identify alternative sites for the Pudding on Harvard property. But for a variety of reasons, she says, " the spaces were not considered to be acceptable for a restaurant operation. " Officials intend to provide similar assistance to Skewers and the Pro. Spiegelman says Harvard recognizes that it’s disrupting other people’s livelihoods. " These types of transitions are not easy choices for us to make, " she says.

Some of the Square’s small businesses might not even exist these days were it not for Harvard. Solano, who owns the Grolier, readily admits that her quirky hole-in-the-wall has lasted solely because Harvard has kept her rent at a level she will describe only as " remarkably low. " Says Solano, " This store has survived by the grace of Harvard. " Her sentiments are echoed by Frank Kramer, who owns the 50-year-old Harvard Book Store. Kramer declines to specify the going rate for his space — three storefronts on a prime stretch of Mass Ave. Yet he is convinced he pays " less than what Harvard could get. " Adds Kramer, " I have never had any feeling that [HPRE officials] are going for the last dollar. "

Cambridge mayor Anthony Galluccio says he hasn’t heard too much grumbling about Harvard’s treatment of local establishments, apart from the mourning of the Pudding. In his eyes, the school’s presence has yielded " enormously positive " results. Harvard and the Square " are intertwined in my mind, " he says. " It’s wonderful to have a university that brings in residents every year from all over the world. "

Robin Lapidus, the director of the 400-member Harvard Square Business Association, also applauds Harvard’s role. She recognizes that the university’s actions have brought " unfortunate " closures and departures, but she says such cases are not " emblematic of any trend. " The business community, she explains, has begun discussing how to preserve the Square’s distinctive character, and Harvard has taken " a leading role in this dialogue. " Observes Lapidus, " It’s easy to point fingers at the big fish in the pool. But from my perspective, Harvard has been right there at the table. "

IN THE eyes of the critics, however, Harvard seems to do good things only when it suits the school’s needs. After all, it does not support every small-business owner; it supports those that serve its own population and image. " Harvard officials, " notes Riverside resident Joyce Singer, " always have their best interests at heart. " And even some stores that have endured because of Harvard have also faced a grueling fight. Consider the Grolier, one of just two all-poetry bookstores in the country. The last time its lease came up for renewal, in 1995, Harvard threatened to boost rent so high that Louisa Solano anticipated eviction. She says the university had considered replacing her shop with a pizza parlor. But outraged customers — some of them professors — wrote to HPRE, touting the Grolier as a " prize " worthy of protection. Harvard backed down. " They must have realized it was worth more to let me stay, " Solano says. " People were clear about how unhappy they would be if this place was forced to leave. "

Such experiences might explain why the vast majority of Harvard tenants refuse to discuss their relationships with their landlord. Gifford, of the HSDF, finds the silence among shop owners along Mass Ave — many of whom must renew leases with HPRE in upcoming years — to be " terrifying. " She says, " Harvard may screw these guys and they wouldn’t say anything for fear of retribution. It’s as if Harvard has a life-and-death hold over its tenants. "

Compare Harvard’s behavior with the way Columbia University, in the heart of New York City, treats local enterprises. Columbia has gained a national reputation for what bookseller Michael McIntyre calls " bending over backwards " to lure and keep businesses that that foster a college-town feel — cafés, bookstores, diners, and theaters. When Chris Doeblin, the owner of Labyrinth Books — a store similar to McIntyre and Moore — considered setting up shop near Columbia, he and his partner Cliff Simms appealed to university faculty, who petitioned provost Jonathan Cole. The provost, Doeblin says, phoned Colombia real-estate officials, who found space in one of their own construction projects. Today, the real-estate office charges the store what Doeblin calls " reasonably low " rent.

Critics complain that Harvard should be giving small businesses just this type of deal to preserve the Square — but hasn’t. Too often, they say, Harvard forgets all that it reaps as a nonprofit institution. The school does pay more than $4.1 million per year in taxes on its commercially used property. But according to a recent city study, Harvard would owe Cambridge as much as $32.8 million more if it paid taxes on its institutionally used parcels. Instead, it pays $1.58 million in lieu of taxes. Given what Harvard gets from Cambridge, says Jinny Nathans, the president of the HSDF, the university has an obligation to give back to the local community. " And if that means continuing to subsidize small businesses, " she says, " then so be it. Harvard has the resources. " It certainly seems to: according to a September 27 article in the Crimson, the university added $300 million in new gifts to its already staggering $18.3 billion endowment last year. Critics see no reason for an institution with that kind of money to refuse bookstores the $200,000 they’d need to stay. They see no reason for the school to profit from long-standing tenants — or any tenants.

Perhaps Cambridge resident and Harvard math professor Robert Winters, who has frequented the area for the past 23 years, sums up the sentiment best: " Harvard is not some podunk college absolutely dependent on the cash flow of commercial property to stay afloat. It shouldn’t behave like a podunk college either. "

Elizabeth Kline would agree. The director of the sustainable-communities program at Tufts University, she has been studying Harvard Square as part of a project about revitalizing urban centers. To Kline, it’s not enough for Harvard to subsidize some rents. As a nonprofit institution that owns a considerable amount of the commercial space in Harvard Square, the school should be leading the charge to ensure that the neighborhood remains " exciting, distinctive, and full of services and products " for the community. That means that Harvard should buy property to rent at reduced rates to small-time proprietors. It means the school should help area landlords recruit the right mix of tenants. And it means Harvard should help small businesses understand and market to the ever-changing customer base. Adds Kline, " The school lacks a real recognition that they are a community leader. Harvard could do amazing things with its finances and stature. It has the ability ... to make a real difference, not just in maintaining the Square, but in restoring its character. "

Galluccio says he’d have no qualms about reminding Harvard of its " higher sense of responsibility " as a commercial real-estate holder. About a year ago, the mayor voiced such concerns to university officials after residents got wind that Harvard Law School might kick out the businesses on Harvard-owned property on Mass Ave just north of the Square, where Crimson Cleaners and Three Aces Pizza hold court. " I’ve conveyed that this is an essential block of retail, and that those businesses should remain, " Galluccio says. Harvard, he explains, can do more to ensure that its property offers a well-balanced mix; it can do more to treat local businesses " with a soft hand. " He adds, " Both Harvard and the city would acknowledge that we can have more consistent and open dialogue around Harvard’s needs and the community’s needs. That is an area that we all can improve upon. "

Harvard officials may recognize merit in these arguments. The university, Spiegelman says, " would be open to creative options. " But it’s unrealistic, officials contend, to think that Harvard will run its commercial portfolio without an eye to economic criteria. ( " We are part of the marketplace, " Spiegelman says. " We do have a fiduciary responsibility " to cover operating costs.) It’s unreasonable, they say, to expect the university to put its tenants ahead of its academic interests. And it’s unfair, they argue, to say Harvard has not already taken steps to preserve the Square. Says Power, " We do realize that we have a different obligation than other commercial landlords. It should be clear from our policies that Harvard takes special care to promote what is widely viewed as unique and special to Harvard Square. "

To Cambridge residents, however, such statements look like nothing but foot-dragging. Many of them wonder why Harvard cannot see that it’s in its self-interest to take the lead. For the sake of Harvard Square — indeed, for the sake of its own image — the university must do better.

Kristen Lombardi can be reached at klombardi[a]phx.com