Does Downtown Need Improvement? Retailers, Officials Continue Debate

Matthew Hersh

As downtown Princeton Borough continues to expand,a debate intensifies over whether to assess businesses to finance a maintenance agent in the central business district.

As it stands, the soon-to-be-completed Witherspoon House next to the Princeton Public Library, and soon-to-be-built housing units along Paul Robeson Place and on the Tulane Street surface lot, means that the Borough will, in that fraction of a square mile, have 177 more places to live, and will, in turn, get somewhat more crowded.

This kind of growth combined with the overall bustle that already exists in the Borough, has gotten some members of Borough Council thinking about establishing a Special Improvement District, or a SID, that provides services such as sidewalk maintenance, lighting, marketing and business promotion, and graffiti removal. A SID functions by having a local management association collect assessments from local businesses. And SIDs have led to vast improvements in such municipalities as Red Bank -Borough and Westfield Township.

But SIDs can be expensive. Borough Administrator Robert Bruschi illustrated a possible scenario of a SID operating cost of about $400,000 – not necessarily what it would cost to establish and maintain such an entity.

In his example, the Princeton Record Exchange on Tulane Street would pay about $707 a year, but One Palmer Square, which houses PNC Bank and several offices and businesses, would incur a $24,606 yearly cost, with the Nassau Inn not far behind at $21,936.

But does Princeton Borough need such a function? That was the discussion at Princeton Future's Community-Based Neighborhood Retail Initiative meeting at Mediterra on Friday. The meeting, which was held primarily for discussion, was for the benefit of business owners, of whom only a few were in attendance.

Palmer Square Management would likely object to being involved within a SID designation because it already has a private service that maintains appearance and security.

"Without Palmer Square in this, if they opted out, and we funded the same budget, the assessment would be upped by about 40 percent," Mr. Bruschi said. "So that's critical." In addition, Princeton University was not factored in the exercise. "Even if we pretended those buildings were all office space, my estimate would only reduce the taxable portion of this thing probably by 15 or 20 percent – so they're not a significant player in this," Mr. Bruschi said, when pointing to buildings that would otherwise front a SID-designated area like Nassau Hall and Firestone Library.

But Mr. Bruschi did say that either Princeton University or Palmer Square would need to be involved, because otherwise, "this plan becomes really expensive."

Mr. Bruschi said if a SID were considered, a majority of property owners would have to be on board with a plan, because it is the property owners who are assessed, and not the businesses themselves. As such, property owners like Princeton Record Exchange owner Barry Weisfeld, who owns both the Record Exchange building and the building that houses Panera Bread and Ricky's Candy, Cones and Chaos, would be assessed more than just the value of his business. Mr. Bruschi speculated that property owners, once assessed for a SID payment, would pass at least part of that burden down to the tenants, who would see a rise in rent.

"It's really the landlords that would pay it and then eventually us," said Kathie Morolda, owner of Cranbury Station Gallery and president of the Borough Merchants of Princeton. "I don't hear any merchants begging their landlords to pay more to keep things clean."

Kristin Appelget expressed concern that, according to Mr. Bruschi's model, about a quarter of the SID funding would go to cover overhead costs, with about $75,000 going to pay a staff. "To me, that's a lot of money, just for overhead expenses," she said.

She also worried that a SID association would usurp responsibilities currently handled by the Borough Merchants, such as holiday decorations. "I think in effect you would be destroying the Borough Merchants group, and I don't think that's necessarily a good thing."

"I look at this and I think Œthere's got to be a better way of doing this with existing funds for a much smaller amount of money and assessment," said Pam Hersh, director of the Office of Community and State Affairs at Princeton University. "The problems that we have in the downtown are relatively minor in terms of garbage and street cleaning. I don't see how the costs justify the results."

David Newton, vice president of Palmer Square Management, who was also in attendance, said that Palmer Square already provides in essence the services of a SID. "This is something we do already, and I can't imagine us voluntarily being part of this effort," he said.

"The SIDs had a wonderful effect in Westfield and Red Bank, I knew both those towns before their resurrections, and they needed it," he said, adding that Princeton has been successful in sustaining itself.

Michael LaPlace, former executive director of the Westfield SID, said that municipalities need to be clear regarding the impact of a SID and how it would affect the community. He added that a SID would only be an augmentation to existing services maintained by the municipality, such as landscaping.

"This is a business improvement district: a community needs to be very serious about what it wants to accomplish and be very clear on its own objectives," Mr. La Place said, adding that the main goal "should" be to create an improved business environment for the downtown merchants. "That's what business improvement districts are all about," he said. "They're not supposed to be set up as these semi-governmental, quasi-planning agencies; they're supposed to help a business district stay healthy – that's what it's all about."

While Princeton is not a ghost town, nor is it as bleak as some of the other towns that have since benefitted from a SID, New Jersey's density and competitive landscape are the key factors here, Mr. LaPlace said.

"If a downtown doesn't make itself as attractive as possible and constantly promote itself, constantly improve its look and try to be more customer friendly, improve parking, and all those other good things, it's going to lose its competitiveness.

"You don't have to go to Westfield; you don't have to go to Princeton; People in New Jersey have unlimited options as to where to shop and eat," he said.

But while Mr. La Place said that he feels almost any downtown environment could be helped with the services a SID provides, he emphasized that there needs to be a purpose, something that he wasn't sure Princeton had yet identified.

"You know when you want to start a business and the bank's not going to give you any money unless you have a business plan? I feel it's the same approach."