A New Jersey Tax Court judge last week rejected a claim made by Princeton University that the burden of proof in a case regarding its tax-exempt status should be with the four residents challenging the exemption.

Judge Vito Bianco ruled that the burden of proof for granting a tax exemption rests on the organization seeking the exemption, and would only be the responsibility of the residents if they were taking issue with the assessments for properties owned by the University. Challenging the University’s tax exemptions is a different issue, meaning the same burden of proof would not apply.

“Normally, plaintiffs have the burden of proof,” said attorney Bruce Afran, who is representing the four residents. “The judge is saying that in this instance the reverse applies. The party that owns the land has to prove they’re entitled to the exemption. That’s always been the law. The University tried to shift that burden.”

The four residents have filed two lawsuits. The first challenges the tax-exempt status of University-owned properties in the 2011 tax year, and the second in the 2014 tax year. The suits contend that the University should pay property taxes on its buildings that are tax exempt, because those buildings have various commercial uses including ticketing, food retail establishments, and patents earned from research. The school argues that it should remain exempt because the money it earns goes toward its academic mission.

The University makes a payment in lieu of taxes (PILOT) to the municipality, and does pay taxes on houses and stores it owns in Princeton. But the tax-exemption on the remainder of its properties translates into higher taxes for Princeton residents, Mr. Afran said.

Judge Bianco’s decision last Thursday was the fifth in a series of procedural setbacks for the University in these cases. Earlier this year, Judge Bianco rejected the University’s request to have the case challenging the 2014 tax exemption dismissed.

A statement from the University issued last week reads, “The University was seeking clarification regarding the burden of proof, recognizing that it is usually the plaintiffs who need to prove their claims, especially in cases where they are challenging government action, as the plaintiffs are doing in this case. We now move forward to prepare for trial under the rules as they have now been clarified.”

The case has been closely watched because it could affect other universities which have non-profit status but have some commercial uses.