Town Topics — Princeton's Weekly Community Newspaper Since 1946.
Vol. LXI, No. 24
 
Wednesday, June 13, 2007
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Borough Discusses Cottage Club as Options Reveal Themselves

Matthew Hersh

Borough Hall, facing a potential tax crisis in light of last month's court ruling granting the University Cottage Club historic site designation, leaving the municipality on the hook for five years of back taxes, is now looking at ways that could potentially offset the tax burden on Borough taxpayers.

Members of Borough Council last Tuesday entertained several options — including state legislation, municipal ordinances, and political leveraging — to help soothe the impact of paying roughly $320,000 back to the privately-owned Prospect Avenue eating club, as well as facing what could amount to a three-cent hike in the municipal tax rate.

"They have a responsibility to pay their taxes," said Councilman Andrew Koontz, who urged his colleagues to draft a local code putting pressure on the Cottage Club, saying that the club paying full taxes is "the only morally responsible thing to do."

On May 29, an appellate division of the state Supreme Court ruled that the club deserves to be classified as a certified historic site, and that the club, which serves members of Princeton University's student and alumni population, should receive county, school, and municipal back taxes dating to 2001, when the club sought the tax-exempt tag from the state.

The decision overturns a 2004 ruling by then-New Jersey Department of Environmental Protection Commissioner Bradley Campbell, who denied the club's application for historic site certification. The club first sought the designation in 1998, and a subsequent tax-exempt tag in 2001. The ruling effectively requires Princeton Borough to return the taxes to the club.

Mr. Campbell at that time denied historic status to the Cottage Club because of its limited public access. Looking to prevent other establishments from receiving similar designation, the state Legislature, in December 2004, enacted a law creating more stringent public access requirements — at least 96 days a year — for historic sites seeking tax-exempt status. That legislation, however, followed the Cottage Club's application submittal.

Mr. Koontz said that municipal pressure could come in the form of laws that require eating clubs to apply for licenses for alcohol distribution, as well has requiring the Cottage Club trustees to seek a permit for alcohol-related events.

"This is not a cemetery, church, hospital, or museum," Mr. Koontz said. "They have a responsibility to pay their taxes."

Cottage Club attorney Thomas Olson has maintained that the courts ruled according to the law in place pre-2004, and that the club has announced its dates for public access.

But Councilman Roger Martindell argued that if the club were to be open for the required 12 days, "then the Borough should use the building for the 12 days a year it's open." He added that Borough Hall could use the issue as a bargaining chip with Princeton University in helping offset financial costs. Princeton University is legally unaffiliated with its eating clubs. "I think we should be fairly aggressive about this," Mr. Martindell said. "We pay for the club, but we can't go there."

Former Borough Mayor Marvin Reed, who was mayor during the Cottage Club's 2001 application for historic certification, said he would not have negotiated with the club because "if we had, all of the eating clubs would be knocking at our door, and we would have set a legal precedent. And it wouldn't have just been the eating clubs, it would have been the Nassau Club, as well as individual citizens with multi-million-dollar houses.

"The line would have formed right outside the door, and the only thing we can do now in this situation is to stand firm," Mr. Reed said.

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