(The Center Square) — New Jersey Gov. Phil Murphy has thrown his support behind proposals aimed at improving fiscal accountability at the state’s public colleges and universities.
The Democratic-led proposals, if approved by the Legislature, would set new fiscal reporting and disclosure requirements for higher education institutions, while requiring governing board members to receive regular training to ensure that they are equipped to manage operations and deal with potential fiscal crises.
“When institutions are in financial distress, it is often the students and staff who are subjected to the greatest turbulence and uncertainty,” Murphy said. “As public institutions of higher education, these schools are accountable to both the government and the taxpayers of our state.”
One proposal would require public colleges and universities to submit an annual fiscal monitoring report to the Secretary of Higher Education and undergo a comprehensive audit every three years. It would also authorize the secretary to order additional audits and appoint a monitor to oversee an institution’s fiscal operations and governance, if audits show fiscal instability.
Another bill would require schools to post a copy of their annual fiscal monitoring report and financial report or statements to their website in a “manner understandable” to the public.
A third proposal to win Murphy’s early support would require board members at public colleges to undergo training to “clarify their role and duty” as a board member with respect to the financial management of the institution. The new training requirements would be a condition of serving on the governing boards.
New Jersey’s public colleges have a collective debt of $6.7 billion and recent financial scandals have highlighted the issue of fiscal accountability and transparency.
Last year, William Paterson University in Jersey City announced layoffs to address a $30 million deficit, which some attributed to mismanagement by the public school’s senior leadership.
In August, the Office of the State Comptroller initiated an investigation into a fiscal crisis at New Jersey City University after its board of trustees announced a $20 million deficit.
The proposals are expected to face pushback from university trustees and presidents, who opposed previous versions of the bills in the state Assembly several years ago.
But lawmakers who filed the bills said the changes, if approved, would bring more oversight and accountability to the finances of New Jersey’s colleges and universities.
“The taxpayers who help support higher education, and the students and families who pay the bills to attend these schools, need to know that their investments are used responsibly and effectively,” said state Sen. Joseph Cryan, D-Union. Financial accountability in the operations of our public colleges and universities is a key part in maintaining educational excellence and affordability.”