Outcome Of University's Tax Exemption Trial Could Have Big Impact On Princeton Taxes

Princeton, NJ -- If a group of residents succeeds in its challenge of Princeton University’s tax exempt status in a highly anticipated trial set to begin Thursday in Trenton, residents of the town could see a big decrease in their tax bills, the Princeton Packet reports.

Former Borough Councilman Roger Martindell told the newspaper tax bills would go down by about a third if the university loses the case completely. He also said he doesn’t think that outcome is “likely.”

He said a number of the university’s properties could be returned to the tax rolls, at which point the question becomes “how many properties and how does that value reduce the tax burden to the taxpayers of Princeton,” according to the report.

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

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

The municipality has remained neutral on the issue, but council will hold a closed session meeting on the issue to get an update from its attorney Tuesday morning, according to the report.

Judge Vito Bianco has also ruled the residents won’t have to pay additional court fees related to the case, and has denied attempts by the university to have the case thrown out.

Bianco, who ruled last year that Morristown Medical Center was not tax exempt for three years.

After Bianco ruled the medical center was no longer tax exempt, it agreed to pay $15.5 million in taxes to the town over the next decade.

The university has also disputed a ruling that it bears the burden of proof that it should be tax exempt. It contends that it is the defendant, and that the burden of proof should rest with the plaintiffs.