InterCap and the transit village took center stage as the Town Council and an audience of 20 West Windsor residents listened to a preliminary fiscal impact analysis presented by L. Carson Bise, president of TischlerBise, a Maryland-based fiscal, economic, and planning consulting firm. Following Bise’s presentation, members of the public as well as council members raised questions about the clarity of the report, its objectives, and facts and figures that were on display.
The Town Council requested a detailed fiscal analysis from the administration on August 1 so there would be time to review the study ahead of its vote on settlement ordinances on Monday, September 19. After Bise heard input from the public and the Council, he said mutually agreed upon revisions will be included, as well as input from the school board, which has not reviewed the report.
No date has been set for submission of a follow-up study or additional information.
The transit village marks the first time West Windsor has reviewed a fiscal analysis before undertaking a project, Mayor Shing-Fu Hsueh says that more specific numbers are always reserved for the site plan review stage and that this study, a rough-cut analysis, should satisfy the Council’s requirements at present.
“We need this fiscal analysis as well as regional infrastructure analysis. But we are at the settlement stage. If we don’t support this settlement, what will be the consequence? Remember Toll Brothers as the example — the judge only cares about an agreement,” he said.
Unlike an economic impact analysis, a fiscal impact analysis projects cash flow to the public sector and not the private sector. For this report Bise was hired by InterCap Holdings as a consultant, and information and data was supplied by West Windsor’s administration and the WW-P school district since 2007. Some additional information from years past was considered, including former School Board member Stan Katz’s comments to the Council and recommendations made by the old redevelopment finance committee.
The study includes assumptions based on information from InterCap: the development schedule, plans for retail and residential developments, and the marketable rates of each sector. Bise’s study based its calculations on 100,000 square feet of retail for $30 a square foot in rental or $300 a square foot in market value. TischlerBise calculated new demand units that the transit village project would generate, including a population of 1,704, 250 retail employees, and 224 students into the school system.
Bise’s first scenario calculations included an average cost of $450,000 per unit and an average of .28 students per unit. His report also factored in variables of a $245,000 average unit cost and .60 students per unit, a figure more than double what is projected, he said.
According to Bise’s presentation a net surplus would be generated for the township and the school district in every year of the 20-year analysis period (2014-2034). The presentation shows the township’s annual net surpluses would initially be close to $328,000 in years when development is taking place, while on the back end surpluses would be over $785,000 annually. Bise explained that the back end would be substantially larger due to the cumulative nature of net surplus.
“If the development is built out over the first 10 years then net surplus would have its cumulative effect over the last 10 to 12 years of the analysis period,” he said.
The same type of financial relationship would take place with the school district. For the first 10 years the average annual net surplus would be $2.9 million and on the back end the number would go up to $4.6 million. The 20-year average would be an estimated $3.8 million.
Bise said the project would generate an additional $1.27 million in annual property tax for the township. Bise says the transit village housing is a relatively small-scale development, adding to the projected revenues he calculated. No expansion of municipal facilities or parks would be needed.
In this case the project also benefits from the assumption that there is sufficient classroom capacity within West Windsor’s current facilities based on the school district’s projected decline in system-wide enrollment.
“This results in no marketable school-related capital costs as students would be serviced by existing schools. Even if we assume 100 percent of the school costs are variable the net would still be a positive in all three scenarios,” Bise said.
Councilwoman Linda Geevers brought up the price range of the planned apartment units as questionable because Bise’s presentation gave separate scenarios for units with average costs of $450,000 and $245,000. Geevers found the difference of $205,000 striking, and she compared these sums to current real estate prices in West Windsor.
“Two bedroom, one baths or two bedroom, two baths that have sold in the past year have ranged from $195,000 up to $257,500. Above that, from $280,100 all the way up to $563,000 has been spent for townhouses with two and three bedrooms. Using $450,000 as an average would appear to be very high,” she said.
Business Administrator Robert Hary then said he felt the same when the fiscal impact analysis first started and he had wanted to question InterCap CEO Steve Goldin about this early on but the township was involved with litigation that prevented it. When he finally did talk to Goldin about the unit prices, Goldin replied that if he could not secure an average of at least $400,000 then funding for the project would be highly unlikely.
“I couldn’t believe it was that high as well. John A. Madden, our planner, forwarded me an E-mail at [Planning Board attorney] Gerry Muller’s request that said for a transit-oriented development the $400,000 range would be acceptable.
Bise said that in the Washington, D.C., area units in transit oriented developments (TODs) do sell for higher prices.
Council members Charles Morgan and Diane Ciccone both questioned whether Bise was able to accept feedback from the public or from the Council and revise his plan. Morgan told Bise the Council’s main objective was to review fiscal analysis for the benefit of West Windsor, therefore the mayor’s statements on it being tax-positive needed to be addressed more thoroughly in the report. Ciccone would like Bise to take everything into account.
“My hope is that this can be a dialogue and that you can do some rethinking and re-analysis and come back. If the answer is yes I’ll be here for a while. If not we should all go home,” she said.
Morgan, referring to the original purpose of the fiscal impact analysis in assessing the financial gains or losses for West Windsor, submitted a memorandum to Bise on Wednesday, September 7. In this he outlined the need for data to accurately reflect expenditures and redevelopment costs from 2004 onward. Bise’s presentation showed net gains for the township and school district only for the 20-year period beginning in 2014.
Bise said he understands that the district is at or approaching capacity at this time. It was also assumed that the school district would have adequate staff to serve the students.
“We’re not assuming that growth-related school costs are variable on a one-to-one basis like it would be if this was a larger redevelopment and you’re actively building elementary, middle, and high schools to accommodate new residents,” Bise said.
“Based on our discussions with the school board a few years ago the growth related variable cost is estimated at 20 percent. In other words, if the per-pupil cost of teachers is normally $500 you’re taking 20 percent of that because you’re not actively expanding the district’s schools or buildings,” Bise said.
Information gathered by Hsueh’s office from the Windsor Haven development, which features one to four-bedroom units, shows that .26 school students per unit have been generated. Therefore as a starting point TischlerBise calculated fiscal impacts from an average of .28 students per unit, a total of 224 from all 800 housing units that are planned (702 condominiums, 98 affordable housing units).
Bise said that multi-family housing such as apartments and condominiums have lower student generation rates than single family housing. In 2007 TischlerBise calculated the number of .28 using census data. He maintained this was a high number given what his firm has studied in areas around the country. Bise said .60 was high for a single family unit.
“In my opinion we are using higher demographics given the type of units. We have seen in various places around the country that TOD units tend to have lower persons per household and lower student generation rates,” Bise said.
Alison Miller of Windsor Drive disagreed with the notion that families with children would not be suited to living in transit village housing. She recognized that most units in the development would be for sale and said fewer students come from for-rent housing than for-sale condos and townhouses.
“One of the assumptions that Stan Katz made (in 2007) is that fewer students would be generated since the transit village would not have child-friendly amenities to draw in families with children. He was talking about tot-lots and pools and similar play areas. However, the last time I attended a council meeting and the TOD was discussed somebody got up and said they wanted to live there because they wanted to be able to walk to shops and to have transportation right at their doorstep. I said to myself that sounds a lot like what teenagers in West Windsor say,” Miller said.
In the 1990s Miller’s children would ride bikes to the train station and take the Dinky line into Princeton. She said the .28 number of children per unit is too low.
Several residents spoke after dissecting the report over the Labor Day weekend. John Church offered to share some of his own spreadsheet calculations. Pete Weale of Fisher Place did not review the data, but he questioned how many clients among the hundreds of municipalities Bise has advised had actually been told not to pursue a development.
Bryan Maher, who recently announced his candidacy for Town Council, disputed the dollar amounts associated with Bise’s projections for the number of students that would enter the school district. Using .28 kids per unit, and an average of $15,000 per student per year, he noted that “West Windsor is built for the number of kids in the budget, not at some 20 percent variable cost. Whereas we may have the physical structures now to support these kids, if in fact these studies are true, if you add what goes on with growth in schools and growth with the train station, you may get to the point where you have to add a new school,” Maher said.
In the best case scenario looking at just the projected finances for the school district, Maher stated a positive impact of $1.5 million would be generated. For scenario two with .28 children per household and an average of $245,000 per unit, Maher said a loss of $350,000 per year would be the outcome. For .6 kids per unit at an average of $450,000 a unit Maher said he calculated a loss of $2.3 million a year.
