While most Princeton residents have been busy going about their daily business and shoveling snow, two Princeton entities that declare “financial sustainability” as an important goal have been focused on the significantly less sustainable objective of raising our property taxes yet again. Princeton Council has introduced an ordinance to exceed the New Jersey municipal property tax increase cap with up to a 3.5 percent tax increase (the original estimate was 6 percent!) and the Princeton School Board just voted for a $95 million budget that includes a 4.7 percent increase, using waivers to far exceed the 2 percent cap on increases.
The school budget represents about 50 percent of our property tax bills and the municipality about 22 percent. If the remaining components of property tax increase by the same amount, the tax bill for the average house in Princeton could go up by $500 to $1,000. Neither governing entity appears to be capable of the sort of budgetary and fiscal responsibility that would lead to financial sustainability.
While the municipality heard public comment at the Council meeting on March 27, the School Board has avoided the former practice of local taxpayers voting on the school budget by moving school elections from the spring to the November ballot, thereby removing the nuisance of having to obtain specific public approval of the budget.
Both the Princeton municipal budget and the Princeton Public Schools (PPS) budget have common problems: they are bloated with salary, benefit, and pension expense and weighted down with significant debt service payments. In proposing tax increases, both groups are also depending upon waivers to increase their budgets well above New Jersey caps.
In its tradition of deflecting responsibility for constantly rising school taxes, this year the PPS Board has found a convenient scapegoat — the Princeton Charter School.
New Jersey property taxes are already double the national average and based on the lack of local fiscal restraint, and no relief of any kind appears to be on the horizon for Princeton. From 2012, the last year before Consolidation, until 2016, our average total property Taxes went from $15,000/$16,000 (Borough/Township) to more than $18,000.
This rate of growth of the already highest property taxes in the nation is NOT sustainable. Last year, the NJBIA released the results of a study titled “Outmigration by the Numbers, How do We Stop the Exodus?” It noted that between 2004 and 2013, more than 2,000,000 people left New Jersey, taking more than $18 billion in net adjusted gross income with them.
The exodus spans all age groups, with millennials leaving in droves as well as the wealthy (who can afford to move). The reasons for leaving are always the same: higher property taxes, more regulation, and budgetary excess. As a result of outmigration, revenues are down as well.
Apparently, our local elected officials and school board plan to continue supporting the exodus.
Nassau Street, Princeton