I think you are asking about the Vatican Observatory. It's one of the oldest astronomical observatories in existence. They have had it so long for the same reason many ancient peoples studied astronomy; they wanted to get their religious calendars right.

The modern observatory is actually outside the Vatican, because there was too much light pollution in Rome, and it is on a hill some miles to the south.

The Vatican somewhat apologized for its treatment of Galileo a few hundred years later, although I did not feel it was very complete or sincere.
Source(s):
http://vaticanobservatory.org/History_p1.html


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