THE SCHOOLS Construction Corporation (SCC) said last week that it would reduce the number of school-facilities projects that will

"Because of the absence of new funding, we have to take this decision of holding back construction activity for some of these projects," says Scott Weiner, CEO of the Schools Construction Corporation in Trenton. The SCC was created in 2002 after the state Supreme Court ruled in 1998 that the state's poor, urban districts should be entitled to safe and adequate school buildings. The agency is responsible for the financing, design and construction of school facilities projects in the state.

Having already put 315 projects on hold two years ago, the SCC decided last week that work would proceed on 32 of its 59 currently funded projects, while 27 projects would be financed only through the design phase and preparation of bid documents.

Even as the number of stalled SCC projects continues to mount, policy experts say it is premature to determine whether or not the program will ultimately survive. "It's probably too soon to even evaluate," says James Hughes, dean of the Edward J. Bloustein School of Planning and Public Policy at Rutgers University in New Brunswick.

The increasing delays have already placed some construction firms in a bind. "It's affected us very badly because we had a substantial number of employees that were assigned to schools-construction work," says Nancy Myers, president of QWIC (QualifiedWomen/Minorities in Construction) in Palmyra. QWIC has worked as a contractor for various project-management firms that oversee school construction projects from start to finish.

Myers says that three years ago, SCC-related projects accounted for close to 50 percent of QWIC's business; they now make up only about 20 percent. To compensate for the loss, Myers has cut staff and says the company has taken more work outside of the state on light-rail construction in locations including Texas, Oregon and Arizona.

"It's so difficult to get work in New Jersey," she says. "You have a contract in hand, but you don't get the notice to proceed, or... you're on call for a year or two years, but you don't get any calls."

Some school districts have also been left in a state of limbo because of the SCCs financial troubles. The City of Vineland's Middle School No. 2, which was one of 27 projects that will be delayed, has been held up for a year and a half.

In 2005, the former SCC administration, which was then headed by Chairman Alfred Koeppe and acting CEO Peter Maricondo, canceled a contract with New York City-based architectural firm Perkins & Will, but then failed to hire a new design consultant, according to Wayne Weaver, executive director of facilities at Vineland Public Schools. Vineland is one of 31 Abbott Districts, sonamed after a series of state Supreme Court rulings from the 1990s that require the state to provide extra assistance to "poorer urban districts" or "special-needs districts." All Abbott Districts receive full funding from the SCC for their school-construction projects. Regular operating districts have access to debt service through the state's Department of Education to help fund their projects.

"Not getting that second [middle school] building has certainly had some impact on how we operate the school district," says Weaver. "Middle School No. 2 is very critical to our overall reduction of overcrowding in the school district." He notes that the completion of newer, updated school buildings would help the city to lower energy and utility costs by allowing the closure of smaller, older and less-efficient facilities.

But Weaver says that Vineland has fared well compared with other school districts. It has seen eight projects completed in five years under the SCC, including a new 74,000-square-foot elementary school and anew 119,380-square-foot middle school, both of which opened last year.

The SCC says that since its inception, it has completed 30 new schools and 26 major additions or renovations, while an additional 32 projects are currently under construction. But it has suspended design work on 97 projects and 218 more projects remain in preliminary stages.

In 2005, the SCC, facing a cash shortage, decided to advance 59 projects while delaying about 300 others, according to Weiner. Those 59 projects, which became the basis for the corporation's July 2005 Capital Plan, were financed with about $1.4 billion in remaining funds.

But in early 2006, the Interagency Working Group, which was charged last year with overseeing reforms at the SCC, discovered that the money allocated for school construction during the early years of the SCC was insufficient to build all of the projects. It identified a deficit of more than $400 million. That gap widened to around $600 million by the end of 2006, as a result of inflation, project delays and other rising costs.

Last September, the group recommended that the Legislature allocate an additional $3.25 billion in funding to the SCC. But when the new funding did not appear forthcoming, the SCC came up with a deferral plan for a portion of the 59 projects earlier this year. "It became apparent that the Legislature wasn't going to be acting immediately," says Weiner.

Part of the problem, he explains, is that the state is facing its own budget crunch and has not yet determined how it will fund capital projects in the future. "It is that process of identifying that source of funding that is taking policymakers time right now," he notes.

Last year, a Project Prioritization Task Force, which included members of the SCC and other state agencies and organizations, developed a scheme for choosing which of the 59 projects to continue funding. Each project was evaluated according to the educational needs of the district, followed by its ability to benefit early childhood education and alleviate overcrowding.

But the SCC has not been the only determining factor in whether a district's school construction program will fail or succeed. One key issue is how the district approached the application process. "Some of the schools that needed [the SCC funding] the most didn't move fast enough," says Myers. She recalls that some school boards were uninformed about construction and financing issues and required more time to make decisions. Other schools, meanwhile, acted more quickly and were able to secure funding before it was exhausted.

Myers adds that some school boards failed to work together as a team. "There's just a lot of disagreement in some communities on how they should proceed, and that just holds everything up," she says.

Land issues can slow down a project as well, adds Weaver. In many districts, especially in the northern part of the state, developable land is both scarce and expensive, and many sites are contaminated. "That certainly gives the SCC some stumbling blocks to deal with."

All of these issues acting together make it difficult for school officials and builders to determine the future of schools construction in the state.

"What is uncertain is when that funding will occur," Weiner notes. "It could occur very soon; it could take longer."