Agreement Reached In Princeton University Tax Exemption Case

Princeton, NJ -- Princeton University has come to an agreement with a group of residents that were suing the university over its tax exempt status, Planet Princeton reports.

The university agreed to contribute $2 million next year and $1.6 million for each of the next five years to a fund that will help lower income residents pay their property tax bills, according to the report.

It will also make three contributions to the Witherspoon Jackson Development Corporation each year, for the next three years, according to the report.

The university will also make contributions to the town in 2021 and 2022, the two years after the current seven-year agreement between the municipality and the school expires, according to the report.

There is a provision that calls for 50 percent of the benefits to be pulled back if there is another challenge to the university’s tax exempt status, the Princeton Packet reports.

After six years, if the sides can’t reach an agreement to extend or replace the tax relief program, there could be a lawsuit from the university, according to the report.

The agreement was announced days before the trial was slated to begin, on Oct. 17.

The lawsuit challenged the tax-exempt status of some of the University’s buildings that are used for commercial use, such as eateries.

The University was also being accused of acting like a for-profit institution, including holding a licensing agreement for a chemotherapy drug.