School board discusses University funding

The Princeton board of education is currently facing a $2 million deficit in its operating budget and is examining ways to close the gap, including extending a six-year payment in lieu of taxes agreement with the University that is set to expire this year.

As an educational institution, the University is not required to pay property taxes on its academic, administrative or athletic facilities, though it does pay taxes on some Township and Borough properties and school taxes on some non-dormitory housing.

“The University voluntarily keeps all of our non-dormitory housing on the tax rolls and these properties pay full property taxes (local taxes, county taxes, school taxes, etc.),” University spokeswoman Emily Aronson said in an e-mail. “This practice is based on a longtime University policy of voluntarily leaving on the tax rolls property where school children might live.”

According to a 2008 study by the University, there were approximately 85 school children enrolled in the school district living in University housing, who were educated at an estimated cost of $1.4 million though the University paid $3.4 million to the district in school taxes that year.

The University is the single largest taxpayer in the Borough and the Township.

According to a Bloomberg report, the University also made a $1.2 million payment in 2009 to support the community under the PILOT program.

According to the Bloomberg report, the University also pays $35,000 a year to support the First Aid & Rescue Squad and $100,000 a year to cover a salaried position at the fire department. The University has also helped pay for a free jitney service for local residents and the restoration of the Garden Theatre, and provides free access to the University’s art museum and the Cotsen children’s library.

Extending the current PILOT program could provide a viable way to ease the financial burden of the local school board. At a recent board meeting to discuss the budget gap, one solution offered was to ask the University to renew the PILOT for students residing on University property who attend schools in the Princeton Regional School system.

“We are looking for any way [to close the gap] that is not cutting programs or staff,” board member Molly Chrein said.

“The fact that the University doesn’t pay taxes [on all of its facilities] definitely affects the property taxes for residents,” Chrein noted, adding that the negative consequences for area residents are the reason that the University is asked for payments.

However, there are also advantages to the University and town’s symbiotic relationship, she said. The University does attract businesses and residents to the area, and its presence heightens the desirability of local real estate.

According to a 2008 report issued by the University, the University employs around 5,300 people and helps generate more than $1 billion in economic activity each year.

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In addition to its agreement on taxes with the University, the district has also faced an issue with charter schools. Charter schools receive public funding through the school district while remaining immune to much of the scrutiny public schools receive, Chrein explained.

“[They’re] a financial drain on the district,” she explained. “When you compare students at a charter school to a populace, it is not reflective of the spending population … Charter schools reflect a smaller portion of the population and hurt those who can’t afford to attend.”

To combat the financial problems, grassroots organizations such as Save Our Schools New Jersey have been created with the aim of supporting New Jersey public schools in spite of the cutbacks. SOS NJ has taken issue with charter schools for not adequately serving the population of their district, displaying a lack of transparency, and ignoring input from the local populace when making decisions.

The board’s budget gap can also be partially attributed to the administrative policies of Governor Chris Christie, whose sweeping state budget cuts have placed financial burdens on public school systems, according to Chrein. “What Governor Christie is doing is making it easier and easier for charter schools,” she said.

Correction

The original version of this article incorrectly implied that the University does not pay property taxes when, in fact, it voluntarily keeps several of its properties on the tax roll. This article has been updated to reflect these changes.