Proposed Borough tax hike spurs uproar

A proposed 20-percent tax hike has set off a flurry of criticism from Borough homeowners and thrown elected officials on the defensive.

"I'm outraged," said Charlotte O'Connell, a Patton Avenue resident. "They knew this was going to happen."

The Borough Council voted last week to introduce a $21.8 million budget that taxes residents 86 cents for every $100 of assessed property. That represents a 14-cent increase over last year.

"This is the largest increase in a very, very long time," Borough Mayor Joe O'Neill said.

The average Borough resident would pay an additional $486 in 2004 under the proposed budget.

Councilwoman Peggy Karcher said the Borough's budget woes stemmed from "a perfect storm"; the increasing costs associated with debt service, health insurance and sewer maintenance were expected, she said, just not all at the same time.

One of the other major factors affecting Borough revenues is current construction on campus.

The University paid $800,000 in fees in 2002, Mayor Joe O'Neill said. But, "with the recession, the University cut back on spending, and the fees going to the Borough cut in half to $447,000 in 2003," he said.

Roger Martindell, another council member, explained his longterm outlook on the issue.

"Princeton Borough is pretty much built out, which is why we can't rely on University funding projects as valid sources of revenue in the future," he said. "The University continues to be a big gorilla on the block and we would be grateful if that big gorilla would throw a few more peanuts our way."

Longterm outlook

Karcher suggested that this year's confluence of fiscal setbacks represented a onetime event, citing steps the Borough has already taken to save money in the long term.

For example, Karcher said, the Borough has taken advantage of current low-interest rates by converting the short-term bond notes issued to cover recent capital spending into thirty-year bonds.

Get the best of the ‘Prince’ delivered straight to your inbox. Subscribe now »

"The cost for next year spiked because the first payment on the thirty-year bonds is due in 2004," Karcher said. "But this is going to save the Borough about a million dollars over the long term," by locking in the current low interest rates.

Karcher likewise said the increase in health insurance costs would come under control once the Borough joined an insurance group for New Jersey public employees next year. A handful of catastrophic illnesses drove up costs this year, she added.

Karcher joined her Borough Council colleagues last week in voting for a resolution that set a target of zero spending growth for next year's budget. But critics like O'Connell were not appeased with what he called a 20 percent tax increase.

"We've had year after year of seven-percent increases, O'Connell said, which he described as already "way beyond the cost of living."

Some Borough residents have made O'Connell's criticisms look mild by comparison. Mark Alexandridis, who made an unsuccessful bid for a seat on the Borough Council last year, blasted the Council at last week's meeting.

"Princeton Borough is not a wealthy community, nor is it a Petri dish for social engineering," Alexandridis said, according to The Princeton Packet. He accused the Council of embarking on a capital spending spree, citing recent improvements to the Princeton Public Library, Borough Hall and the Suzanne Patterson Senior Center.

Karcher acknowledged that the projects have contributed to the Borough's debt load.

"Those are all capital improvements, no question about it," she said. "Yeah, he's right that we did all these things. But these were decisions we made as a community."

Of Alexandridis, Karcher said, "I think he's well-intentioned. But I think he doesn't grasp the big picture and so he hones in on the part of it that seems the most obvious to him and criticizes us for that."

Karcher said she wanted to hold public forums to help Borough residents "understand better that these expenditures are linked to services we give to the community." But she admitted that the proposed increase was asking a lot of taxpayers.

"None of us are happy to do this," she said, predicting that the Borough Council would ultimately approve the budget at a meeting slated for April 27. "If it gets five votes" — four are needed for passage — "they will be reluctant votes."