New Jersey finance officials voted Wednesday to approve Newark Public Schools’ nearly $500 million lease agreement for a new elementary school, advancing a controversial proposal despite concerns about its cost.
The state’s Local Finance Board approved the $498.4 million agreement 4-2 after a contentious meeting in which Republican lawmakers urged members to reject it and some board members questioned whether the school could be built more cheaply.
The decision moves Newark closer to opening a school for 667 elementary students in the city’s overcrowded East Ward, where aging facilities and limited space have made it difficult to accommodate students. But the agreement would commit New Jersey’s largest school district to three decades of payments to a private developer, raising questions about the project’s cost and the potential trade-offs for the district’s budget.
The proposed Riverfront Elementary School would be built at 56 Freeman St. and is expected to open in spring 2029, said School Business Administrator José Fuentes. The Newark Board of Education unanimously approved a resolution to pursue the lease in March.
Under the agreement, Newark would pay about $11.3 million in base rent during the first year, with payments increasing 2.25% annually. Payments would begin after the school is substantially completed and other required conditions are met. The district would also have the option to purchase the building for $1,000 at the end of the 30-year lease, Fuentes said.
The cost gave some Local Finance Board members pause. One member, Robert Jackson, said he voted “reluctantly” in favor despite believing the project could be financed more affordably, hoping the approval would push state officials to offer Newark a cheaper alternative.
Republican Assembly members Dawn Fantasia, Paul Kanitra, and Brian Bergen joined Wednesday’s public comment period to oppose the lease, criticizing its cost and the district’s financial management. Fantasia and Kanitra also raised concerns about reported political contributions connected to developer Scott Fields, including donations to Newark Mayor Ras Baraka’s gubernatorial campaign. Baraka has denied any involvement in arranging the deal.
Kanitra called the proposal “one of the most outrageous uses of taxpayer money” he had seen since taking office.
State Sen. Declan O’Scanlon, a Republican who serves on the Senate Budget and Appropriations Committee, also urged the board to reject or delay the agreement in a letter Tuesday, calling for the state to release its financial reviews of the project before taking a vote.
The opposition comes less than two weeks after a state audit identified millions of dollars in excess state aid, questionable spending, and weaknesses in Newark’s financial management. Auditors also referred unspecified matters to New Jersey’s Division of Criminal Justice.
Superintendent Roger León disputed accusations of financial mismanagement and defended the lease as necessary to address overcrowding. He said Newark would cover the payments by reallocating existing funds rather than requesting additional state money.
“There are going to be major sacrifices,” León said, referring to the district’s budget decisions. He said rejecting the lease would leave hundreds of students traveling to schools outside their neighborhoods.
Wednesday’s vote clears one of the state approvals needed for the lease. A state Department of Education spokesperson told Chalkbeat Wednesday that the Commissioner of Education is still reviewing the lease agreement. The State Comptroller’s office has not announced whether it has completed its review. Newark school board President Hasani Council said in March that the district would finalize the lease terms and hold another vote after receiving state approval.