Township holds off tax increase

The Township held off a tax increase in part due to the University’s contribution of $500,000 to its operating budget and by accepting a salary freeze for all non-union employees for the second year in a row. This year is the first that the University has paid the Township a voluntary contribution and the first time in three decades that the Township’s budget has not included a tax increase.

Township committee members and administrators have said that the University’s contribution was key to allowing the Township to maintain its current tax rate without making cuts in personnel or services.

“The fact that the Township was able to use it to adopt a budget that requires no tax increase suggests that it did have a meaningful impact,” University Vice President and Secretary Bob Durkee ’69 said in an email. “But I would add that in our discussions with Township officials last year we were impressed by the diligence and determination with which they were working to address their financial challenges and bring their costs under control and their budget into balance. This gave us confidence that our contribution would be used wisely and well.”

Scott Sillars, chairman of the Township’s Citizens’ Finance Advisory Committee, said that negotiations with the University began in early 2010, though the subject had been discussed for several years.

The Township estimated the University’s cost to the community in essential services based on the share of the Township’s population represented by the University population. Sillars said the Township’s initial estimate was just shy of $1 million, and that the figure was lowered during negotiations with the University.

“We felt that they were using more than the essential services that they were paying for, and the point that they were making was that they were already significant supporters of the Township through properties that they already have on the tax rolls and some properties that they voluntarily keep on the tax rolls, such as graduate student housing,” Sillars explained.

Some of the Township properties that the University keeps on its tax rolls qualify for tax exemption. The University chooses to keep those properties, which are largely graduate student housing, on its tax rolls because graduate student housing could house children who may attend community public schools.

“Most of our graduate student housing is in the Township, so in a sense we have been making a voluntary contribution to the Township for about 50 years,” Durkee explained.

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The University has paid an annual voluntary contribution to the Borough since 1972. This year, its contribution was $1.1 million. An agreement of escalating contributions made with the Borough six years ago expires at the end of this year. Since 2009, the University has also made an annual $50,000 contribution to West Windsor Township.

Durkee has previously said that the University will not begin negotiations on next year’s contribution with either the Borough or Township until the municipalities make a decision about consolidation, which is currently being examined.

Borough councilman Roger Martindell, who at Tuesday’s Borough meeting requested that the University enter into negotiations over its contribution to the Borough, said the University’s decision to make its first contribution to the Township this year suggests that the University should increase its contribution to the Borough next year. Martindell argued that the University should also increase its annual contribution to the Borough by twice the increase in its contribution to the Township.