Local taxes: Housing rules put burden on local taxpayers
NJ’s Council on Affordable Housing rules are placing a huge burden on the Borough, and hinder the development of affordable housing. The Princeton Packet explains
Here’s why: Under the old COAH rules, every municipality had to adhere to a formula — based on a number of factors, including residential development and population growth — to provide a certain percentage of low- and moderate-income units for each market-rate unit built. But under the new rules, the affordable-housing obligation is based on several new factors, including employment growth and square footage of all new development, not just residential development.
For some communities, this change may make little difference. For Princeton Borough, where the only significant remaining parcels of undeveloped land are on the Princeton University campus, the difference is enormous. Consider just two examples.
Whitman College, a sixth residential college under construction in the heart of the campus between Baker Rink and Dillon Gym, will add 270,000 square feet of living space for university undergraduates. The Frank Gehry-designed Lewis Library, under construction at the corner of Washington Road and Ivy Lane, will add 87,000 square feet of working space for university professors, researchers and staff. That’s a total of more than 350,000 square feet of construction in Princeton Borough — not one inch of which will contribute one penny in property taxes to the borough, but every square foot of which will add to the borough’s affordable-housing obligation.
Add in the expansion of Princeton High School, John Witherspoon School and the four district elementary schools — none of which pay property taxes, but all of which are adding 115,000 square feet of new construction — and the burden becomes even more onerous. With the average Princeton Borough home assessed at about $350,000 — meaning it has a market value more in the neighborhood of $550,000 — the cost to the taxpayers of subsidizing each new unit of affordable housing is staggering. And it’s doubly painful if the development that’s driving this cost isn’t even contributing to the tax base.
Please note that no matter how much housing the University adds for graduate students and post-docs, who would qualify as low-income tennants, that housing doesn’t qualify under COAH.
The cost to the taxpayer is only going to increase.