By Stephen Neukam
Rider’s latest tax forms give a clearer picture of its recent decision making, showing a dramatic increase in spending on legal services and construction fees, with the prolonged battle over Westminster Choir College (WCC) and capital investments to campus infrastructure spurring the spikes.
As Rider fought in court to sell WCC to a Chinese education company, a move that eventually fell through, the costs associated with legal services shot up. In the university’s latest IRS report, which compiles financial data from 2017 and 2018, the school spent nearly $1.5 million on legal expenses, an increase of over $330,000 from the previous year. In the three years before 2017, Rider spent a total of just under $1 million on legal expenses.
Pepper Hamilton, the national law firm retained by the school, more than doubled the amount it made from Rider in 2018, hauling in over $830,000. Associate Vice President of University Marketing and Communications Kristine Brown said that the law firm provides legal services on many different matters for the school.
The prolonged litigation also coincided with a five-figure raise for Vice President of Legal Affairs and General Counsel Mark Solomon. The latest forms showed an $84,321 increase in his compensation from the previous year, making him the fifth-highest paid employee at the university.
As part of the school’s capital investments into the Lawrenceville campus, Rider also paid over $2.2 million to Grace Construction Management, a Wall Township, New Jersey, firm. The company completed major renovations of the Bart Luedeke Center.
In court, the university’s counsel has, thus far, cleared the way for Rider’s plans with WCC. After a court granted the school’s motion to dismiss two lawsuits against it in March, the decision has been appealed by the Westminster Foundation, the alumni and faculty group working to stop the movement of the school. The first brief in the appeal is due in early September.
Brown refused to disclose the full costs of legal fees related to the failed sale and subsequent consolidation of WCC. Instead, she asserted that the administration “had to use our resources for legal fees to defend false claims instead of more directly using those dollars in support of our mission – serving our students.”
Constance Fee, the president of the Westminster Foundation, refuted Brown’s characterization of events, saying, “There would be no need for Rider administration to spend funds on legal fees if they had not embarked on a multi-year effort to dismantle one of the world’s most renowned music schools, first in a failed effort to sell it and then to try to shut it, wasting tens of millions of dollars invested in a world-class performance and cultural center.”
The costs associated with the university’s sale of WCC did not stop at the legal fees. PricewaterhouseCoopers, a global consulting firm, was paid over $380,000 to help market the Princeton property and complete the sale contract with the Chinese company that was set to purchase the school.
Over the next five years, it will also cost the university over $26 million to service its annual debt requirements, much of which has been used to finance construction projects, according to a 2019 audit.
In 2017 and 2018, the university paid over $400,000 to Kaufman, Hall and Associates, a national consulting firm out of Skokie, Illinois, for what Brown said “was related to the acquisition and implementation of budget software for the University, which was a component of the strategic plan.”