State College/University Legislative Priorities 2009-2010

Increase Flexibility in the Selection of Trustees

Since 2000, the state colleges and universities have been authorized to have up to three out-of-state residents serve as trustees, provided they are alumni of the institution.  As the state colleges and universities continue to mature and attract support from across the country, there should be more flexibility in the choice of board members. 

The Association has supported legislation that would loosen the residency restrictions.  On bill allows that, of the three non-state residents who may serve on each of the boards of trustees of the nine state colleges and universities, only one of the three would be required to be an alumnus or aluma of the institution.

Increase Facilities Construction Flexibility; Allow Design-Build Contracts

The State College Contracts Law (N.J.S.A. 18A:64-52 et seq.) restricts the ability of the state colleges and universities to enter construction contracts that are innovative and cost-effective.  Under current law (N.J.S.A. 18A:64-76.1), the institutions typically commission an architect or engineer to prepare drawings and specifications under a design contract.  The institutions then select a construction contractor to build the facility.  Costs can increase because of change orders derived from errors and omissions as the project moves from design to construction.

It is ASCU's position that the state colleges and universities should be able to enter design-build contracts, under which a single entity performs both architectural/engineering services and construction under one contract.  The design-build method has many advantages regarding cost containment, risk management, and timely completion of projects.

Recent development:  New legislation signed by the Governor in July 2009, provides the opportunity for colleges to partner with private firms to build, economically, structures needed by the colleges and universities to increase educational and public service and help grow the economy.  The legislation suspends the State College Contracts Law for 18 months under these partnerships.

Evaluate State Higher Education Governance Proposals Based on Effective Trustee Governance Practices

Some opinion leaders have blamed the state's lack of support for higher education and accountability problems with higher education on the lack of a higher education "czar."  Periodically, there are legislative proposals to exert more central control on institutions from Trenton.

State colleges and universities have made significant accomplishments under the autonomy they received beginning over two decades ago.  However, they do recognize the need to provide the public assurance that dollars are well spent.  The state colleges and universities have explained to state leaders and the public, through the media and face-to-face meetings, accountability practices they have put in place, ones which are modeled on national best practices.  They have also voiced the need for steps to assure accountability to Trenton without the political influence that often comes with central control. 

Each legislative proposal to centralize governance is analyzed on the basis of consistency with well established standards of effective and accountable trustee governance.  With this in mind, ASCU supports the amendments made to Senate Bill No. 1609 and Assembly Bill No. 3245.

Enact Workers' Compensation Reform Making State Colleges and Universities Independent of Treasury's Bureau of Risk Management

Treasury's Bureau of Risk Management administers the state colleges' and universities' workers' compensation claims, and the Attorney General represents the institutions before the workers' compensation court.  The Bureau charges the institutions quarterly for money paid by the state to administer their workers' compensation claims.  These payments, along with Sick Leave Injury payments, have continuously escalated and have become a serious financial concern.

The state colleges and universities have insufficient administrative control over this system.  Moreover, the institutions often receive insufficient information about their workers' compensation claims.

Consistent with the autonomy granted since 1986 over fiscal and personnel matters, it is ASCU's position that the state colleges and universities should be allowed to manage their own workers' compensation program through a risk management fund modeled on the one established by the county colleges in 1985.  The institutions would obtain necessary services while minimizing their expenses, and the state would no longer need to administer the state colleges' and universities' claims.

Enact a Higher Education Facilities Bond Referendum for Voter Approval

The state colleges and universities have joined with the other senior public universities, community colleges and independent colleges and universities to request that the governor and legislature enact legislation as soon as possible to provide for a $2.7 billion higher education facilities bond.  If feasible for the state to do so, it would be an extremely important strategic investment for New Jersey in order to achieve our opportunity, workforce, economic, prosperity, and competitiveness agenda.

Justification for the bond or some other major effort to provide facilities funding includes unprecedented demand, inadequate current capacity, and $5.8 billion statewide in capital needs.  Not since 1988, has there been a general obligation bond for all the state's higher education facilities needs.

A record number of 100,000 students are enrolled at New Jersey's colleges and universities.  This is about 20,000 more than 10 years ago, and will likely remain at this level.  Between 2000-2001 and 2005-2006, the number of public high school graduates in New Jersey increased 18.3%, the 5th highest in the country.  The number of graduates -- about 90,000 -- will remain virtually unchanged through 2018-2019.  New Jersey has the highest percentage of high school students graduating in four years, and the highest percentage attending college immediately after graduation.

Reauthorize Revolving Funds for Campus Infrastructure Needs

There is currently over $500 million in critical infrastructure needs at senior public institutions.

Bond funds for New Jersey (senior) public institutions approved over 15 years ago were intended to be revolving funds, and they should be renewed:

• 1993 Equipment Leasing Fund (ELF) of $100 million for scientific, technical, computer, communications, and instructional equipment;

• 1994 Higher Education Facilities Trust Fund (HEFT) of $220 million to finance construction, reconstruction, development, extension, and improvement projects for instructional, laboratory, communications, and research facilities.

Make Accountability Improvements, But Not a Big Bureaucracy

Legislation such as Senate Bill No. 1609 follow up on recommendations made by the Association to the State Commission of Investigation.  The Association supports legislation that will ensure greater accountability and address legislative concerns without entailing regression to bureaucratic control and its higher costs.

One of the state colleges' and universities' suggested approaches to ensuring accountability includes implementing Sarbanes-Oxley best practices (already in place at all nine institutions) and strengthening the appointment and support for effective boards of trustees.

Restore Higher Education Incentive Funding

The Higher Education Incentive Endowment Program was established in September 1999 to build partnerships between private business leaders and New Jersey's colleges and universities.  Under the program, the state provided matching dollars for significant donations and endowment contributions.  The state's institutions of higher education and their students greatly benefitted from this program.  Four-year public colleges and universities received a 100% match over 10 years for endowment contributions of at least $1 million, and a 10% match for donations of at least $1 million.  Two-year colleges and independent colleges and universities also received benefits for securing significant endowment contributions and donations.  Institutions receiving Higher Education Incentive funds earmarked them to help stabilize tuition and provide scholarships, attract talented faculty, and build new classrooms and research facilities.

Funding for this program has been eliminated.   ASCU supports restoring this program with its added benefit of helping public institutions help themselves in fundraising and expanding their endowments.