Princeton University and the town of Princeton have reached a seven-year agreement on voluntary contributions.
Under the agreement, the university will make voluntary unrestricted financial contributions to the municipality totaling $21.72 million, and will also make one-time contributions valued at $2.59 million to several identified municipal projects.
In 2014, the university’s voluntary unrestricted contribution will be $2.75 million, an increase of more than 10 percent over its 2013 contribution. In each subsequent year of the agreement, through 2020, the school plans to increase its contribution by 4 percent per year.
PU also plans to contribute an additional $90,000 for the purchase of a new Free-B vehicle.
Over the course of the agreement, the University is set to make the following one-time contributions to several municipal projects. These contributions include $250,000 toward construction of a new storage facility for the town’s Department of Public Works equipment, $500,000 toward construction of a new Princeton First Aid and Rescue Squad facility on municipal land, $250,000 toward the expansion of the Witherspoon Fire Station, and $500,000 toward the purchase of fire-fighting apparatus.
The university will also donate to the municipality for its use the University-owned parking lot on Franklin Street that has been valued in the range of $1 million.
Representing PU in agreement discussions were vice president and secretary Robert Durkee and director of Community and Regional Affairs Kristin Appelget. President Christopher L. Eisgruber participated in the initial meeting between the representatives of the university and the town. The town of Princeton was represented by council president Bernie Miller, councilman Patrick Simon and administrator Bob Bruschi.
Miller said the agreement embodies three principles: First that it “achieves fiscal stability between the university and the municipality.”
“Second, the unrestricted voluntary contributions by the university will increase annually at a rate greater than permitted for the municipal property tax under New Jersey State law. Third, the University will make one-time contributions to projects that were agreed to be of mutual benefit to the University and the town.” Miller said in a statement.
The specific year-by-year unrestricted contributions under the agreement are as follows (the 2013 contribution was
In addition to the contributions described in the agreement, the university makes additional voluntary contributions each year by following a longstanding practice of leaving certain properties, such as non-dormitory graduate student housing, on the tax rolls even though they could qualify for exemption from property taxes under New Jersey law.
In 2013 the University paid $2.98 million in taxes on these properties that could qualify for exemption, with $659,000 going to the town of Princeton and $1.43 million going to the Princeton Public Schools. The agreement indicates the university’s intent to continue this practice, and its intent if it modifies this practice to make additional voluntary payments to the municipality and the schools at the levels they would have received if the properties had remained on the tax rolls.
The university’s total property tax payment in Princeton in 2013 was $8.35 million, with $1.85 million of that total going to the town. PU’s property tax payments are expected to increase significantly in future years when its Lakeside graduate student housing and Merwick/Stanworth faculty/staff housing projects are completed.
A resolution memorializing the agreement is set to be presented to Princeton Council for its approval on Monday, April 28. The agreement was developed through a series of meetings that began late last fall and, as stated in the agreement, is “entered into in recognition of shared interests and in a spirit of mutual respect.”