AFFECTED SCHOOLS
The initial group of dormitories that would be privatized is located on eight campuses:
School, existing beds; planned beds
- Georgia State University (Atlanta), 2,322; 700
- Abraham Baldwin Agricultural College (Tifton), 1,324; 0
- Armstrong Atlantic State University (Savannah), 1,239; 0
- Columbus State University (Columbus), 444; 500
- College of Coastal Georgia (Brunswick), 352; 200
- University of North Georgia (Dahlonega), 314; 400
- East Georgia State College (Swainsboro), 200; 200
- Dalton State College (Dalton), 0; 300
Source: University System of Georgia
The University System of Georgia wants to get out of the student housing business, and officials want a tax exemption to help them do it.
The plan would involve the University System’s Board of Regents shifting a collection of campus dorms to a private company in a long-term lease deal. The system would retain ownership of the buildings and land, but the company would operate and maintain the facilities.
To sweeten the deal, the University System is pushing for an extension to private companies of the property tax exemption that currently exists for the properties on the campuses of the state’s public institutions. Extending that exemption — which is part of the overall plan to privatize student housing — would require a statewide referendum.
Legislation is expected to be filed on Tuesday to begin the process of getting the exemption issue on the November ballot.
The plan initially includes eight institutions, including Georgia State University in downtown Atlanta.
It’s too soon to tell if the plan will result in savings for students, said Susan Ridley, associate vice chancellor for fiscal affairs. Some other systems implementing similar models around the country have set caps on the rents that the operating companies have been able to charge. University System officials have about 200 investors who are interested in the project, Ridley said.
“Investors view student housing as a safe, long-term investment,” Ridley said. “It’s similar to the military that has outsourced its housing.”
The proposal follows a growing national trend as colleges deal with declining revenue. System officials say the move allows schools to focus on educating students, and at the same time, removes millions of dollars in debt from the University System’s ledgers.
The state’s Board of Regents currently has $3.8 billion of liability on its books; this proposal is slated to remove a minimum of $275 million.
However, they could face lawmakers who have been leery of offering tax breaks to private businesses.
Under Georgia’s plan, the University System would seek a company to operate current and future residential facilities at the eight initial institutions. The initial offer includes about 6,000 existing beds and about 2,000 beds to be built at the schools later. During the long-term agreement, which could extend up to 65 years, the operating company would get the first rights on development of future residential construction.
State Rep. Lynne Riley is sponsoring the legislation on behalf of the system for the exemption extension.
The bill puts the responsibility of housing Georgia students into the hands of entities that are experts in that area, said the Johns Creek Republican.
Asked whether the provision sets a precedent for other private businesses working with state education agencies, Riley said that’s a conversation worth having.
The tax bill is expected to be assigned to the House Ways and Means Committee.
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