Nearly $2 billion appears headed toward building new schools in New Jersey's poorest districts after lawmakers on June 29 approved legislation linked to a record-high budget.

The money they approved for the New Jersey Schools Development Authority (SDA), the agency in charge of school construction, was formally appropriated the next day with Gov. Phil Murphy's signature as part of the fiscal year 2023 budget.

NorthJersey.com reported that the SDA, which was out of money for new projects and needed an estimated $6.5 billion to address overcrowded and outdated schools throughout the state, will receive approximately $1.9 billion. The funding includes $1.55 billion to pay for school facilities projects, emergent needs and capital maintenance in the state's 31 SDA districts, while $350 million would pay for construction in non-SDA school districts, according to budget documents.

It would be the largest infusion of cash into the authority since the borrowing of more than $12 billion more than a decade ago. Taxpayers are still paying down that debt to the tune of $1 billion annually.

The new money will come from a so-called debt defeasance fund Murphy and the state's lawmakers set up in 2021 using money they borrowed early in the COVID-19 pandemic but ended up not needing because revenues did not fall as much expected. The state also could not immediately pay it back, so the defeasance fund is dedicated to capital construction for things like schools and mass transit.

Prior to the governor's go ahead on June 30, Edythe Maier, a spokesperson of the SDA, told NorthJersey.com., "if this proposed funding is approved, it would allow for the advancement of additional projects."

SDA Identifies ‘Highest-Priority Needs'

The influx of money comes after the SDA approved spending $200 million in new funding in April — for the first time since Murphy took office in 2018 — to construct new schools in Bridgeton, Elizabeth and Garfield. That was the first significant step taken by the state to address longstanding problems in outdated and overcrowded schools after a political patronage scandal in 2019.

The state named those locations as having "the highest-priority needs" among the SDA districts, Chief Executive Officer Manny Da Silva said at the time.

But the SDA's proposals may still be in jeopardy, according to NorthJersey.com.

The New Jersey Supreme Court assigned a "special master," retired Superior Court Judge Thomas Miller, to produce a detailed cost analysis of major construction projects in SDA districts as part of a legal challenge that said the state has broken its constitutional obligation to students by not spending enough on school construction.

A high court ruling in the case has the potential to upend the administration's current funding plan.

When Murphy named Lizette Delgado-Polanco to lead the SDA in 2018, her chief responsibility was to draft a long-term plan and secure support from lawmakers for another round of borrowing that would be paid back by taxpayers over many years, but a nepotism scandal forced her out and led to reforms at the authority.

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