NJ Colleges, Universities Want to Know When State Will Deliver Promised Funds

Tara Nurin | February 4, 2014 | Education
Some $100 million in bonds have been sold -- out of $750 million -- but schools haven't seen a penny

Camden County College is in line to receive funds.
Although New Jersey’s colleges and universities are enjoying a succession of groundbreakings on major new facilities this fall and winter, they’re still waiting for the state money that’s going to pay for the bulk of the work.

Touting that “education is the key to advancement,” since September Gov. Chris Christie has publicly celebrated at least two higher-education construction sites made possible by a $750 million bond approved by the electorate in the summer of 2012. But so far, the institutions haven’t received one cent of promised funding from this bond or four others totaling $1.3 billion that were renewed or reauthorized last year.

After a one-month application window closed last March, Christie’s office informed more than two dozen public and private schools that they’d been selected to share in the “Building Our Future Bond Act” (the “GO Bond Act”), the first statewide, voter-approved bond program for higher education in 25 years. A total of $100 million worth of bonds were sold last year but not distributed, and some of the approximately 70 preliminarily approved projects face potential delays if the money doesn’t come soon.

Playing Favorites?

And even though the office of the secretary of higher education officially made the selections, critics are accusing Christie of playing favorites with the choices.

Emotions have run high over the awarding process for both GO Bonds and the four others. With the last massive statewide infusion of capital financing coming in 1988, these institutions aren’t sure when it will come again. That’s led Christie critics, including former House Speaker Sheila Oliver (D-Essex) and former gubernatorial candidate Barbara Buono, to imply that he played politics with the awards.

Of particular concern: more than $11 million to two private religious training academies ($10.6 million in GO Bond funds to the Beth Midrash Govoha college for Talmudic study and $642,000 to the Princeton Theological Seminary) and $37 million to University Hospital, which ceased to be an institution of higher education when it was taken over by Rutgers and Rowan as part of the Higher Education Health Sciences Restructuring Act of 2012.

The governor’s press office didn’t respond to emailed questions; neither did the secretary of higher education.

Controversial or not, the legislature approved the winners list as is, and now what’s left to do is sign the contracts, put the remaining bonds on the market, and distribute the funds as needed.

“We’re still waiting for final confirmation, but everything we hear is that the approval to begin spending will be issued shortly,” said Camden County College President Raymond Yannuzzi.

Setting the Pace

The pace is set by the Secretary of Higher Education and the Educational Facilities Authority (EFA), an independent state agency that brokers construction bonding for the state’s colleges and universities.

According to John Wilson, president of the Association of Independent Colleges and Universities of New Jersey, the EFA put bonds on the market for two of the additional programs last month, and staffers at the agencies are scrambling to write contracts for the financing of each construction project before they release the funds to the award recipients or put any more bonds on the market.

“Things are moving forward according to schedule,” he saidlate last month, one week after meeting with the executive director of EFA and the treasury secretary. “Bond council had to make sure all the i’s were dotted and the t’s were crossed. My expectation is this will all come to fruition this spring.”

But Camden County College (CCC) is one institution that’s up against a deadline: If it doesn’t complete a purchase of the Settlement Music School in Camden by June, construction workers will be pressed to turn the building into an urban workforce development facility in time for the fall semester. The college is using existing funds to perform environmental testing of the building but needs its promised $1.6 million from the GO bonds to move forward.


“We’ll have to wait to go out on bond,” said Edward Carney, CCC’s executive director of safety and facilities. “Our deadline is probably June (to settle) or we’d be pushing it.”

Because under Go Bond requirements, institutions must match 25 percent of the state’s funding, they’ve typically saved enough money to pay at least some upfront costs while they wait for their grants to materialize. So all projects researched by NJ Spotlight remain on schedule, for now.

“We do have enough capital on hand as part of the match for Blackwood,” said Carney of a planned “one-stop” student services center at CCC’s main, Blackwood, campus, funded in part by $4.6 million in GO bonds. The college used its own matching funds to break ground, as scheduled, in October, and will collect reimbursements once the state is ready to release the money.

At Kean University, spokesman Terry Golway is pleased about a $41 million GO Bond award, which will fund three large-scale projects. A grant from one of the four pre-existing “contract” bonds that the GO Bond Act supplements will fund a new environmental conservation center in the Highlands.

“It’s really important to show prospective students we have 21st century facilities,” he said. “The environmental center extends Kean’s footprint. It will be centerpiece of our undergraduate program.”

Monumental Transformations

Kean and CCC are two schools using the funding to complete monumental physical transformations of their campuses. Kean’s new buildings join a newly minted science building and an academic classroom facility that opened this month. CCC has spent almost $100 million to modernize and add to its campus over the past decade.

As an advocate for the bond program, Christie joined New Jersey Institute of Technology (NJIT) officials in Newark in September as they as they broke ground on a renovation that will turn a former high school into a science technology engineering and math (STEM) teaching and learning hub. The state awarded a total of $86.3 million, with $30.6 million coming from GO bonds and the rest coming from contract bonds.

NJIT officials wrote in their September 2013 Institutional Profile Report, “With the award . . . from the state of NJ the project is now advancing rapidly and we anticipate completion by 2016.”

The following month Christie joined Rutgers University leaders in Camden to break ground on a nursing school that will train 1,000 students at a time in a $62.5 million facility. Of that funding, $46.9 million comes from GO bonds.

In Glassboro, Rowan University administrators aren’t waiting until their reimbursement checks are ready to be written either, before breaking ground on their engineering and business school buildings. They expect to do so by late this fall.

“Those two buildings will allow us to double enrollment in those two programs,” said Interim vice president for University Relations Joe Cardona. “We can’t wait until those funds are available. There’s too much need out there.”

The state awarded $86.3 million in Go bond funds for the two Rowan projects, plus $33.4 million in other funding for several smaller ones. It did not, however, approve an application for a widely anticipated College of Health Sciences building in Camden, which was to house state-mandated collaborative programs between Rowan and Rutgers-Camden. Cardona says the two universities will launch programs without a building and figure out their capital needs at a later time.

Ramapo College’s president also got less than he’d requested and is lamenting that his $20 million award (none of which comes from GO bonds) falls far short of the $37 million he asked for.
“I feel as president of Ramapo College that my institution hasn’t received its fair share of the bond money,” he told Inside Higher Ed last May. “We have received less than our contemporaries, and that is not satisfactory.”

Wilson says the treasury secretary and EFA’s executive director told him they expect to sell more GO bonds once they’ve disbursed the first $100 million and put up bonds from two of the four ancillary programs as soon as next week.

Other than the time it takes to draft and sign the contracts, they’re intentionally pacing their actions to get the most for their money.

“You don’t want to flood the market and you want to make sure the rates are advantageous,” he said.

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