Union officials and Union County officials are deeply concerned that Kean University has begun the process of exercising their right of first refusal to buy the 50-acre Merck property on Morris Avenue. Kean’s right to buy the property goes back to 1986 when the former owner, Schering-Plough put it in writing that if the property was ever sold, Kean would have first dibs on it.
Apparently, Kean notified the township earlier this month that they were beginning the process of buying the property but there was no word on what the university might plan to do with the site — a site that is almost double the size of the current university property.
According to a source with information about this process, the Kean Foundation actually had the right of first refusal to buy the Merck acreage, but because they did not have the funds, they assigned the right to the Kean University Board of Trustees.
However, according to this source, three Kean board members knew nothing about the transaction, noting this was not done with the full approval of the board.
News that the university — which has seen a decline `in enrollment over the last several years and is more than $354 million in debt — was going to acquire the land surprised Union Mayor Clifton People, who admitted the loss of this tax base would be difficult for property owners to bear.
“This is a serious problem we are facing here,” said the mayor Tuesday, adding that what Kean is proposing is taking 50 acres of prime property on Morris Avenue and the township cannot do anything about it.
“We are not going to get a penny from it because state colleges and universities do not have to pay taxes,” People said, pointing out that while the township has tried to meet with Kean officials to try and work something out, “basically they are ignoring us.”
The assessed value of the Merck property was $24.2 million in 2009. That number has since dropped to $6.7 million after numerous tax appeals. According to Tammie Kopin, the assistant township administrator of Union, this is the assessed value, “which is much lower than the true value.
The mayor was gravely concerned about the additional loss of tax revenue.
“The sad part about this,” the mayor said, “is we previously were getting $4 million in taxes and now we are going to lose the less than $1 million we are getting.”
The mayor said the entire governing body is concerned about the university overdeveloping the area along Morris avenue adjacent to Kean because this thoroughfare already is congested by significant traffic. This, coupled with the fact Kean does not have to abide by local zoning or planning board rules, has made it more than difficult to keep up with the huge amounts of development taking place at the university.
“It would be respectful if Kean came to us and just let us know what they are doing over there but they never do,” said the mayor, adding that he is frustrated by the fact the township contacted Kean in an effort to meet with them regarding the Merck site and loss of taxes but they have not responded.
“They are building monuments over at Kean, and hopefully we can sit down with them and discuss this,” said People.
Township Administrator Ron Manzella was quite blunt about the situation, asking “what use does the university have for 50 acres when they have a shrinking enrollment?” adding that this particular parcel of land is in a bustling area with a positive energy and could be developed in a more aggressive manner privately.
The Township Committee was so concerned about the possibility that University President Dawood Farahi will be erecting more buildings that end up not occupied that they passed a resolution on April 22 confirming their resolve to fight the state institution.
The resolution noted that losing taxes on this particular parcel of land “creates a financial hardship on the taxpayers of Union” by removing property from the tax rolls. The resolution also noted that Kean has significantly expanded its campus and seen debt triple from $124 in 2003 to $353 million along with their bond rating being downgraded by Moody’s Investor Services.
“The township is the one who bears the burden of this aggressive overdevelopment and we need to sit down with the university and try to work out something so taxpayers don’t have all the burden,” the mayor said.
The resolution passed by the governing body argued that even though the township has attempted to work with the administration at Kean to lessen the impact development has had on taxpayer’s quality of life, they have had “no success” in doing so.
The resolution, which stresses the township opposes any additional expansion at Kean, was forwarded to all 21 municipalities in the county, the county freeholder board, Union legislators, the governor and Kean University.
The county quickly followed in the steps of the township by passing a similar resolution, albeit not as strong as Union’s. The county resolution did mention that further development at Kean could result in a financial hardship for both the county and residents of the township.
They stressed that as “a steward of public funds” the county has an obligation to ensure the county tax base is secure and the proposed action by Kean could negatively impact the tax base.
The county also strongly encouraged Kean officials to “meet and discuss this matter,” noting that they would host this gathering, but only sent a copy of the resolution to Kean University, not to any legislators or the governor.
Ironically, only five of the nine freeholders were able to vote on the resolution, with four others abstaining, including Freeholder Chairman Christopher Hudak, who works at Kean, Mohamed Jalloh, who is an adjunct professor there and Vernell Wright and Sergio Granados, whose affiliation with the university is unknown.
This left Bruce Bergen, Linda Carter, Angel Estrada, Bette Jane Kowalski and Alexander Mirabella to agree to the resolution.
In other municipalities with universities, there are examples colleges and universities being good neighbors.
According to an article published online at www.newsworks.org on April 24, Princeton University agreed to voluntarily “contribute nearly $22 million over the next seven years to the town of Princeton.”
“The university and town officials frame it as a way to resolve an age-old issue in college towns where much of the land is university-owned and thus exempt,” the article stated.
Kean has had its share of publicity in the last several years, including problems with tenured staff who gave a no confidence vote in the president after it was discovered he falsified his academic records, mismanaged federal aid, academic probation, NCAA suspensions, a poor bond rating and a very costly satellite campus forged with China, among other things. Add to that a shrinking enrollment that went from 16,000 in 2011 to slightly over 14,000 last year.
Meanwhile university professors were gravely concerned that the university president was too focused on development at Kean and not enough on finding a way to retain students once they are registered. According to statistics supplied by Kean University, the retention rate for students is one out of five.
In addition, State Assemblyman Joseph Cryan, D-Union, recently introduced 20 pieces of legislation designed to bring down the cost of public higher education. One of the bills, if passed, would require the closing of 4-year state schools that do not have six year graduation rates of at least 50 percent. This would include Kean, Cryan said last week.