The state government has agreed to fund the Tamworth's UNE campus without direct Commonwealth contribution, according to Deputy Prime Minister Barnaby Joyce.
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The federal government has provided multi-millions in support for the University of New England, but none will directly go to bricks and mortar for the scheme.
State government committed $26.6 million on the project in 2019 - on condition of direct federal government support.
Mr Joyce said the two governments have reached an agreement.
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"We've put our shoulder to the wheel and now the NSW government has accepted that the Commonwealth has contributed their $10 million. In fact we've contributed vastly, vastly more, like three times than that amount.
"This is really important in us making sure that we get this university started."
Mr Joyce said his elevation from the backbench back to the position of Deputy Prime Minister had helped achieve the breakthrough.
"Your rank goes up, and of course, as your rank goes up, to be quite factual there's times where people are going to need you," he said.
"It does help."
He said the second university campus will be a political "legacy".
"In your political career, it would be just not telling the truth to say you don't look at things at times and go if it wasn't for the work I put into that it wouldn't have happened," he said.
"This would be one of those things. I want to look back on my time with the incredible honour of being Member for New England, being more than just a lousy, noisy person on radio but a person who actually delivered things."
The Commonwealth will offer multi-millions of dollars in government-supported student placements for the new university, among other financial aid, Mr Joyce said.
UNE Vice-Chancellor Brigid Heywood last week revealed the second campus project could cost the university and the taxpayer as much as $60 million.
It's about $20 million more than the project was originally budgeted for, and reflects an expanded scope of the plan.
Professor Heywood told a public meeting on Monday that the government's had "agreed the way forward" and were translating the agreement into a formal document.
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