University quadruples funding for Borough

After a long and heated discussion of the downtown redevelopment plan currently under consideration, the Borough Council last night approved a five-year agreement with the University that will lead to a fourfold increase in the University's voluntary annual contribution to the Borough over the next four years.

Under the agreement, the University's contribution, a voluntary payment in lieu of taxes, will be $110,282 in 2002, will go up to $200,000 in 2003, and then will increase to $300,000 in 2004, $350,000 in 2005 and $400,000 in 2006, Councilman Roger Martindell said. In past years, the payment has always been less than $100,000, he added.

If no new agreement is negotiated in 2006, the University donation in subsequent years will increase at the same rate as the municipal tax rate, according to a University press release.

The Borough Council passed the agreement by a vote of five to one, and some expressed dissatisfaction with the payments.

Councilman David Goldfarb voted against the agreement, saying that the payments are far too low.

"This is ridiculous . . . the University's got to step up," former council member Mark Freda added.

Martindell was more optimistic, saying that the agreement is "a good first step" and it "raises the bar for the next round of negotiations which will probably begin two or three years from now."

Councilman Joseph O'Neill said that both Harvard and the Massachusetts Institute of Technology give in the range of $1.5 million per year in voluntary donations to the city of Cambridge, Mass., a much higher contribution than that of the University to the Borough.

In response to these comments, University Director of Community and State Affairs Pam Hersh said that Princeton is the only Ivy League university that pays taxes on its residential properties. "We pay full taxes on any house that puts students in the school system," she said.

The council's understanding of the agreement is that the University will continue to make additional contributions to the Borough for special projects as they are planned, Martindell added.

"We will certainly continue to talk to the town according to its needs," Hersh said. "As evidenced by this contribution, we are committed to the vitality of this town," she added.

The University also will continue its voluntary annual contribution to the Borough on behalf of McCarter Theatre.

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The Borough Council passed a resolution approving this agreement without opposition.

This contribution is equivalent to the municipal portion of the property taxes that would be paid if the building were on the tax rolls, Hersh said. For 2002, the amount will be $59,000, according to a press release, but it will go up with increases in the municipal tax rate and in the assessed valuation of the facility, which is currently being expanded.

In addition to these voluntary payments, the University pays some property taxes to the Borough, which last year exceeded $1.9 million, making it the largest Borough taxpayer. The University also pays other fees, including sewer charges, building permits and affordable housing payments, which last year amounted to more than $2.5 million, Hersh said in an email.

Additionally, the University has made a number of special project contributions, such as those given in recent years for the public library, the school board and the first aid and rescue squad, she said.

The new agreement was formulated by a special committee in which the University was represented principally by Hersh and Vice President for Public Affairs Robert Durkee '69, according to a press release.

The University has been making annual financial contributions to the Borough since 1973, and has been making voluntary contributions on behalf of McCarter Theatre since 1988, when the facility was removed from the tax rolls.