Project Title:How Use of a Non-profit Can Improve a Public University’s Bottom LineInstitution Name:Richard Stockton College of New Jersey
Innovation Category:Research and Regional Stewardship
Project Director:Matthew Altier, Vice President of Administration & Finance; and President, Stockton Affiliated Services, Inc.Contact Information:609-652-4381,
Project Description:RSC created a self-supporting non-profit corporation that operates outside the constraints of public contracting law to negotiate favorable long-term contracts for auxiliary services and find private partners to pursue revenue-generating projects to support the College’s mission. This model allows SASI to leverage contracts to increase investment of private corporations in College facilities and achieve off-campus penetration, national branding, and increased scholarship levels. SASI generates revenues for operations through its master management contract with the College for all auxiliary services, and projects with both private developers and public entities for acquisition, construction and management of income-producing investments.
- Increase revenues through leveraging contracts to garner private investment in college projects and by forming joint ventures with private entities to generate new income streams.
- Support enrollment plans through acquisition of investment properties, and partnerships with municipalities, non-profits for educational and cultural venues.
- Improve student support services through negotiation of long term auxiliary contracts to attract national vendors, and purchase of shuttles (as substitute for purchase of services from government transportation authority) to expand transportation services.
- Form public-private partnerships to advance academic programming, support FTE, increase new revenue sources and expand internship opportunities.
- College income compared to previous income generated by College management of these auxiliary functions; amount of capital investment in College facilities resulting from long-term vendor contracts.
- Acquisition and lease of 7 off-campus graduate houses.
- Development of academic center in Hammonton; lease of Dante Hall (theater in Atlantic City) to support an arts district.
- Contracts with 5 national brands to increase sales of food/retail items.
- Purchase of 5 shuttles yielded increased ridership.
- Acquisition of Seaview resort (297 room hotel & golf resort) will support expansion of hospitality management program; create new student residences; increase internships; increase revenue through hotel/golf/conference bookings.
Challenges/Problems Encountered:A major challenge SASI faced was the legal authority to form a non-profit to act outside of NJ State College Contracts Law so it could disband contract term limits and some public bidding requirements that stifled investment by private entities. This required legal research and outside counsel. In the present economy, SASI’s efforts to form a partnership with outdoor advertising companies for revenue-sharing on billboard rents failed for lack of market interest. In contrast, SASI has been able to capitalize on poor market conditions to acquire investment property central to its mission far below its value.
Evaluation Approach:There are two key issues in evaluating the success of SASI. First, has the College improved its financial status through additional income and added investment in facilities? Second, are services and programmatic improvements being provided to the students that could not have been provided in the absence of SASI?
Potential for Replication:Public colleges need to research the governing laws in their jurisdictions to determine if the formation of a non-profit corporation is permitted to act as an independent self-supporting entity that can establish new income streams. Stockton’s Board approved formation of the non-profit and modified its investment portfolio, allowing up to 10% investment in loans to SASI, providing the necessary first-year seed money and funding for its initial acquisitions for revenue-producing property and commercial vehicles.
CEO-to-CEO Contact:Herman J. Saatkamp Jr.
, Presidentpresident@stockton.eduDate Published: Tuesday, March 29, 2011