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The state-appointed monitor overseeing the finances and governance of New Jersey City University has reportedly directed the public institution to work with other universities to get on better financial footing. The report was released Tuesday..
New Jersey congressman approve a law Last year, the state's higher education minister was allowed to assign monitors to financially struggling public institutions to help them avoid serious budget failures. This law was enacted a year after the founding of the City University of New Jersey. declared a financial emergency We are experiencing a deficit of approximately $23 million.
State Superintendent Henry Amoroso said partnerships range from sharing academic programs and administrative services with other public institutions to fully integrating them. Under his plan, New Jersey City University should begin seeking an advisory firm by mid-May to help find a partner institution.
According to the statute, Amoroso's powers range from overseeing the university's financial management to the ability to veto the administration's proposals to hire or fire employees.
City University of New Jersey must have a relationship with one of the state's financially stable public institutions and meet all governance standards before its supervisors terminate their oversight duties, the report said.
Andrés Acebo, interim president of City University of New Jersey. In a statement Wednesday, the agency said it will fully review its plans and looks forward to receiving additional guidance from the state Department of Higher Education regarding financial monitoring laws.
“We appreciate Monitor’s interest and cooperation as we continue our work to strengthen NJCU’s mission and honorably serve those we are privileged to serve.” holly said. “I am confident in the resilience of our community and its brilliant promise for the future.”
What did the monitor discover?
The City University of New Jersey is located in Hudson County, one of the most urban areas in the state. This 97-year-old university enrolls many underprivileged students. About one-fifth of undergraduate students are black and nearly half are Hispanic or Latino, according to federal data.
Amoroso pointed to these characteristics in his report, writing that the institution provides “a high-quality education that is accessible to a diverse student body.” But the City University of New Jersey has faced major obstacles over the past few years, including declining enrollment and “questionable financial management decisions,” he wrote.
The university's enrollment decreased 23.1% from 8,504 students in fall 2016 to 6,539 students in fall 2022. According to Amoroso's report, the decline in tuition revenue coupled with the end of federal pandemic relief funds has brought the university's board of trustees to the attention of the institution's dire financial situation.
In previous reports State Auditor's Office It alleges that high-ranking university officials illegally used pandemic relief funds for scholarship programs and failed to inform the board of trustees about the growing budget gap.
Sue Henderson, then the university's president, resigned in June 2022, the same day the board declared a financial emergency. The agency has since been led by an interim president.
Last year, New Jersey lawmakers threw out colleges. 10 million dollar lifeline. But the university was also the first to be supervised by a state-appointed monitor. Amoroso began monitoring the agency in September, and his report covers his findings through mid-March.
When Amoroso began monitoring the agency, he discovered that the administration had already implemented cost-cutting measures that had begun to reduce the deficit. The university also reduced spending on salaries and wages from $88.6 million in the fiscal 2022 budget to $73.8 million in the fiscal 2024 budget.
Still, these measures are not enough to address the agency's financial problems without “significant additional state investment,” Amoroso wrote. He concluded that New Jersey City University would face serious financial difficulties as an independent institution.
Amoroso wrote: “Going that route would require far more state investment than is currently being provided, and the university would be plagued by serious financial problems for many years,” he wrote.
First, the university has about $287.1 million in debt, an amount that undermines its financial stability, the report said. Amoroso also noted that from fiscal year 2020 through fiscal year 2024, the university's expenses consistently exceeded its revenues, leading to chronic deficits.
“This reality has led NJCU to take the swift action many other institutions have taken: negotiating and implementing strategic relationships with partner institutions from which both universities can reap immediate and long-term benefits,” he wrote.
Amoroso made several other recommendations, including improving university governance. He wrote that the board's committee structure is outdated and that members do not meet often enough to provide adequate oversight of the agency's budget.
To resolve this issue, he recommended delaying the search for a permanent president until the board of directors is reorganized.
He also recommended that the board replace at least four board members, arguing that few members are currently invested in quickly turning the agency's finances around. According to the university's website, the board currently has eight members, including one non-voting student member.
“An infusion of new talent, interest, expertise and passion will prepare this key governance body to address and complete the committee assignments and other board work necessary to quickly achieve and permanently sustain NJCU’s financial turnaround,” said Amoroso. “You can,” he wrote.