On May 24, 2012, Nova Scotia's Department of Advanced Education announced the province was loaning Acadia University $2.7 million to renovate a student residence on campus.

But while the news release from that day left the impression the money to renovate rooms for 300 more students in Cutten House was coming from the department's budget, that was not the case.

Unknown to the public, the funding had been quietly secured from an agency of the Department of Community Services that deals primarily with affordable housing — the only time such a loan has been given to a Nova Scotia university.

Details of the five-year loan come from documents obtained by CBC News through freedom-of-information laws, and follow significant criticism last year about favourable financial measures for the Wolfville-based Acadia, including millions of dollars in secret bailouts.

The backyard of Acadia University's Cutten House. (Acadia University Communications)

While the loan, which was paid back by Acadia last year, was approved by the former NDP government, there are calls for the current Liberal government to explain why the money came from the housing budget but was disguised as funding from another department.

"Their silence speaks volumes," said Karla MacFarlane, the interim leader of Nova Scotia's Progressive Conservative Party.

"Why the secrecy around it? Do Nova Scotians necessarily believe it's the best use of housing money to build or make renovations to a university residence when, again, we have struggling Nova Scotians that are looking for safe and affordable housing?"

Emails obtained by CBC News show the money came from the Nova Scotia Housing Development Corp., now called Housing Nova Scotia. The provincial agency deals with affordable housing for low-income families and households, although its mandate also includes students and some elderly people.

Emails show that Acadia University needed the loan to demolish and rebuild Cutten House's existing washroom facilities, remove asbestos and bring the building up to code.

This, university officials explained, would bring in more revenue through an additional 300 beds available on campus.

Interim PC leader Karla MacFarlane speaks to reporters in December. (Jean Laroche/CBC)

Acadia began asking the Department of Advanced Education for a loan in 2011. The school originally made the request through the Strategic Opportunities Fund Incorporated (SOFI), which had already provided the school with $7 million.

That $7 million is the same loan that was forgiven by the provincial government last summer, a move that sparked outcry from other schools, including Cape Breton University, whose own pleas for an extension on repayments went unanswered.

It was also revealed last summer that Acadia had received an annual increase of $3.5 million to its operating grant starting in 2012-13, bringing to $24.5 million the total in bailout money the province had quietly spent on the school.

Acadia had hoped to repay its loan for Cutten House over 10 years, but such a plan was not in accordance with SOFI at the time and that avenue was denied.

Parts of the emails detailing the government's discussions are redacted.

The first time Nova Scotia Housing Development Corp. is mentioned in an unredacted section is in a May 2011 email from Margaret MacDonald, with the Department of Finance.

"You should assume Housing Development Corp is the source of funding," she said in an email to an official in Advanced Education.

Five days later, a meeting was held between the Finance, Advanced Education and Justice departments and Housing Development Corp. to discuss the loan.

A month later, Advanced Education's Gregory Ells told Acadia that if it borrowed from the Nova Scotia Housing Development Corp., the government couldn't budge on annual payments and the university would need to provide "some wording … that explains how you could manage the annual payment."

"Sorry about all of this, but we have limited choice of vehicles to do this, and for very good reasons which I will not go in to there is not a willingness to venture outside of the established practices," Ells writes in the email.

Acadia has paid back the $2.7 million it borrowed to upgrade one of its residences. (Elizabeth McMillan/CBC)

By July 2011, it was agreed that Nova Scotia Housing Development Corp. would provide the money from its capital budget, while Advanced Education would ensure the repairs and upgrades were completed on time.

A contract between Acadia and the Nova Scotia Housing Development Corp. was signed in December 2011. The agency agreed to loan the $2.7 million and Acadia agreed to pay it back by April 1, 2017.

In May 2012, Advanced Education issued its news release announcing money. There is no mention of the Department of Community Services or the Nova Scotia Housing Development Corp.

"Why would a government go out and make an announcement from a different department? As I understand, it was Labour and Advanced Education that made the announcement about this wonderful funding, and yet we all know now that it came out of the housing budget and Community Services," MacFarlane said. "Why?"

Only Acadia received this kind of loan

No other school ever received such funding.

Cape Breton University, Dalhousie University, Saint Mary's University, NSCC, Mount Saint Vincent University, St. Francis Xavier University, the University of King's College, Nova Scotia College of Early Childhood Education, Université Sainte-Anne and NSCAD University all confirmed they have never received a loan from Community Services for residence funding.

Scott Roberts, spokesperson for Acadia University, said the loan was advanced to Acadia on March 30, 2012, and repaid in full by April 1, 2017, when it was due. The Department of Community Services confirmed the loan was repaid on time.

"The source of the funding for us was the Government of Nova Scotia so any questions you might have about departmental sourcing should be directed to the government," Roberts said in an email.

'Help address a gap in student housing'

A spokesperson for the Department of Advanced Education declined to provide an interview and issued a statement.

"At that time, the government of the day looked at all of the lending instruments available, which is common practice, and the decision was made for the loan to come from Housing Nova Scotia," Chrissy Matheson said. She referred further questions to the agency.

CBC News began asking Housing Nova Scotia about the loan in October 2017. The department's former spokesperson, Heather Fairbairn, said no additional loans were provided to Acadia by Housing Nova Scotia.

She said the previous NDP government made the loan to "help address a gap in student housing, in Wolfville, at the time."

"The renovations and reopening of Cutten House meant that up to 300 more students would have access to safe and comfortable on-campus accommodations," she said in an email.

"Under its mandate, Housing Nova Scotia supports various organizations that promote the provision of more adequate and improved housing, including students."

A spokesperson for the Department of Community Services said Minister Kelly Regan would not do an interview. (CBC)

Fairbairn said Community Services Minister Kelly Regan would not do an interview and was unable to comment about actions taken by a previous government.

The current spokesperson for Community Services, Bruce Nunn, provided nearly the same answer this week and again declined CBC's request for an interview.

"We see a government that stands up, over and over, and continues to have messaging go out about the past government and what they did. They talk about all the time the NDP," MacFarlane said.

"So why are they not being transparent and mentioning this situation?"

While the loan was made by the previous government, MacFarlane said the Liberals "do have a hand in this file."

"The loan has been paid off under their watch," she said.

"[To] the Nova Scotians that are struggling for affordable and safe and comfortable housing for their families, I think they should be told why this happened."