Murphy Administration Approves $450M in School Construction Funding

Use of $350M in State Debt Prevention Funds Will Save Taxpayers Millions

TRENTON – Today (Sept. 7) the New Jersey Department of Education (NJDOE) and the New Jersey Schools Development Authority (SDA) announced the approval of nearly $450 million in school construction funds to address critical facilities needs in 261 school districts throughout the state (including Cape May City – estimated project cost: $6.4 million, state share: $2.6 million; and Ocean City – estimated project cost: $10.5 million, state share: $4.2 million).

Of this $450 million in construction, $350 million will come from the State’s Debt Defeasance and Prevention Fund, which was established two years ago to help pay down existing debt and avoid incurring new debt by funding projects outright rather than incurring new borrowing. This move is expected to save the State and taxpayers roughly $350 million in total as opposed to issuing 30-year bonds at current interest rates.

“This funding is part of a state and local partnership that will invest in hundreds of school projects while saving a significant amount of taxpayer dollars. Coupled with an infusion of local funding, this collaboration will generate more than $1 billion in important upgrades to schools throughout New Jersey,” said Governor Phil Murphy. “Ensuring our students receive a world-class education in a first-rate learning environment while relieving the pressure on local taxpayers is a top priority of my Administration.”

“This funding demonstrates our ongoing commitment to providing safe, modern learning environments,” said Dr. Angelica Allen-McMillan, Acting Commissioner of Education. “In addition, improving the physical and safety conditions of school buildings improves working conditions for teachers and elevates the pride and support of the school community as a whole. This funding will benefit countless students in hundreds of schools throughout New Jersey.”

“The advancement of these projects further ensures high-quality learning environments for students and staff, addressing issues that can affect health and safety including replacement of leaky roofs and inefficient boilers,” said Manuel Da Silva, SDA Chief Executive Officer. “This grant funding impacts hundreds of local communities around the state by helping districts leverage resources to pay for important school facility projects while continuing to bolster the State’s construction industry.”

The NJDOE determined the selection of school projects receiving grant funds, and the grants are administered by the Schools Development Authority. School projects were identified by need, such as essential building systems upgrades like the repair or replacement of structural components, mechanical/heating and cooling, and electrical systems; building roofs; and to resolve building code issues. The funding will provide for numerous high-priority upgrades including 320 HVAC systems, 79 boilers or water heaters, and 211 roofs.

Besides the $449.9 million in state funding, local contributions totaling $598.5 million are estimated to bring the total cost of construction to more than $1 billion. The state-funded grants represent at least 40 percent of eligible costs for projects in the Regular Operating Districts (RODs) to address health and safety issues and other critical needs.

Funding for the school construction initiative was made possible through legislation signed in 2022 and grant funding from SDA allocations.

For a list of districts receiving state construction funding, click here.

“Where we invest taxpayer money reflects our priorities and we will always put our kids first,” said Senate President Nicholas Scutari. “Now, with the help of union workers, our schools will be safer, and more inviting for our children and teachers.”

“This critical funding is the latest investment we are making in New Jersey’s school districts,” said Assembly Speaker Craig J. Coughlin. “By providing financial support for these construction projects, our school districts can focus on investing in our children and our teachers, without worrying about allocating funds for costly building repairs. This is another example of how our prudent fiscal management is enabling us to give money back to local communities. This funding serves as local tax relief. Without it, the costs for these necessary repairs would otherwise come from local taxpayers.”

“With schools closing early all over the state this week due to the heat, it is clear our educational infrastructure is not only dated and deteriorating but also ill equipped to handle our changing climate,” said Senate Majority Leader Teresa Ruiz. “While it is just a start, it is wonderful to see money getting out the door to allow districts to make much needed improvements to their facilities. I look forward to seeing the impact these projects have on the children of New Jersey.”

“This investment affirms our commitment to provide all New Jersey students with a high-quality education,” said Assembly Majority Leader Louis D. Greenwald. “We know that a safe and comfortable learning environment is critical for student focus. These construction projects are essential for our school facilities to continue to live up to the high standards we have set for our best-in-the-nation public education system. I’m thrilled for the hundreds of communities across the state that will benefit from today’s announcement.”

“Schools are the centers of children’s lives and they deserve buildings and facilities that encourage progress during this critical time in their development,” said Senator Paul Sarlo, Chair of the Senate Budget and Appropriations Committee. “In collaboration with our local partners, we are making much needed investments in the classrooms and other physical spaces that will support their academic growth.”

“Many New Jersey schools are in need of serious improvements and repairs, whether it be a new roof or the installation of central air conditioning,” said Senator Gopal, Chair of the Senate Education Committee. “This funding will go a long way in ensuring our children can continue to receive the high quality education we’ve come to expect.”

“Today’s announcement demonstrates our commitment to working together with the Governor to advance school improvement projects throughout New Jersey,” said Assemblywoman Pamela Lampitt, Chair of the Assembly Education Committee. “These funds are a result of collaborative efforts in the most recent budget and beyond.  We look forward to seeing districts utilize this funding to help complete critical repairs so that administrators and teachers can focus on providing the best possible education for our children.”