LAS VEGAS, N.M. — The New Mexico Highlands University Board of Regents on Monday approved a takeover of the College of Santa Fe, less than two months after the college floated the idea of state incorporation of the school.

The decision moves the struggling college closer to becoming a public institution, though the deal will have to be approved by the Legislature, which must agree to additional funds for the school. The Higher Learning Commission, which accredits both schools, also will have to OK it.

The regents voted 3-0 on a letter of intent — the college's board of trustees approved the letter Jan. 9 — that outlines the takeover process and also approved an initial purchase of about 20 acres of CSF property.

Terms of the letter of intent include, among other things:

• A 120-day option period, in which the college can decide to go forward with the transaction.

• An option to purchase all real and personal property of the college.

• An agreement for both schools to cooperate in refinancing the college's debt, which totals about $35 million, $25 million of which is in revenue bond debt.

• Purchase of the 20-acre plot, for a maximum of $5.2 million.

• Prior approval by Highlands of the college's spring budget and an agreement to minimize the college's spring expenditures.

• That the Christian Brothers of Lafayette be deeded a piece of the college's property.

The letter also states that Highlands will work with Santa Fe Community College so as not to duplicate any programs offered at SFCC. That might include the community college offering courses at the College of Santa Fe campus.

The purchase of the 20 acres of property, Highlands President Jim Fries said, will free the college from $2.2 million in debt owed to Laureate Education Inc. The college was in partnership talks with the for-profit organization until the deal fell through in late November. The college mortgaged the property in exchange for operating money.

The sale also will provide an additional $3 million to help the college operate through the end of the spring semester, Fries said.

Fries said specifics of the takeover — which programs will be offered and tuition rates, for example — have not yet been worked out. He said, again, that the college's focus on arts education would not be abandoned as part of a Highlands takeover. Instead, they would be incorporated into Highlands' offerings, such as business and social work.

Now both schools will have to wait and see whether the Legislature, already facing an approximately $450 million budget shortfall, will agree to fund what is essentially a new school. Estimates put the yearly cost at about $16 million.

And because the state's higher-education funding formula operates on a two-year lag — the formula awards funds based on the number of credit hours taken — the Legislature would have to provide two years worth of startup money.

Javier Gonzales, president of Highlands' board, said he thinks Santa Fe legislators, at least, are supportive of the plan. But, he said, there are still questions about how the school will be funded.

Contact John Sena at 986-3079 or jsena@sfnewmexican.com.