Joint Committee Committee on Capital Development (03/16/2010)

Final
STAFF SUMMARY OF MEETING

COMMITTEE ON CAPITAL DEVELOPMENT

Date:	03/16/2010	ATTENDANCE

Time:	08:01 AM to 08:30 AM	Kopp	E
		McFadyen	E
Place:	SCR 356	Schwartz	X
		Sonnenberg	X
This Meeting was called to order by		Riesberg	X
	Senator Bacon	Bacon	X

This Report was prepared by
	Kori Donaldson
		X = Present, E = Excused, A = Absent, * = Present after roll call

Bills Addressed:		Action Taken:
Metropolitan State College of Denver Request for Legislation		Pass

08:01 AM -- Metropolitan State College of Denver Request for Legislation

The committee was called to order. A quorum was present. Ms. Stephanie Chichester, North Slope Capital Advisors, and Ms. Dawn Bookhardt, Member, Board of Trustees, Metropolitan State College of Denver (Metro State), presented a request for legislation. Committee members received a summary of the request, prepared by The Capstone Group (Attachment A). Ms. Bookhardt began by giving the committee an overview of Metro State's student population and degree programs. She continued with a description of two previously approved capital projects, including: (1) Student Success Building; and (2) Neighborhood Building. Ms. Bookhardt explained that the college plans to issue bonds for capital projects in June 2010, and explained that Metro State needs to have either taxing power or the power of eminent domain in order to qualify for favorable bond rates. Ms. Chichester explained that it is important for Metro State to qualify as a political subdivision for purposes of issuing bonds. She said this will give the college the same range of financing options as other higher education institutions in the state. Ms. Chichester continued with an explanation of the advantages of using Build America Bonds to finance Metro State's capital projects. She said that using Build America Bonds will enable the college to qualify for more favorable interest rates and will help the college preserve its debt capacity.

08:11 AM

Ms. Bookhardt addressed a question about the need for eminent domain. She explained the other options explored in lieu of eminent domain in order to bond more advantageously, including taxing power and police power. She said eminent domain was the best option. Committee members received a summary of the various financing scenarios considered for the Metro State capital projects, prepared by North Slope Capital Advisors (Attachment B). Representative Sonnenberg expressed his support of giving Metro State taxing authority instead of the power of eminent domain. Discussion ensued. Representative Riesberg asked if the college has any plan to exercise the power of eminent domain should it be granted. Discussion turned to the power of eminent domain held by other higher education institutions. Discussion returned to giving the college taxing authority rather than granting it the power of eminent domain.

08:18 AM

Mr. Jeremiah Barry, Office of Legislative Legal Services (OLLS), came to the table to present draft legislation granting the power of eminent domain to Metro State, "Concerning Necessary Authority for Metropolitan State College of Denver to Access Favorable Financing." Committee members received a copy of the draft legislation, prepared by OLLS (Attachment C). Mr. Barry asked the committee whether the phrase "eminent domain" should be included in the bill title. Discussion ensued. Mr. Barry addressed a question about where in statute taxing authority could be given to Metro State. Ms. Bookhardt and Ms. Chichester returned to the table to address a question regarding how soon Metro State needs eminent domain and/or taxing authority. Ms. Bookhardt said Metro State may want taxing authority instead of the power of eminent domain, but added that it is important to check in with other institutions of higher education. Discussion ensued about the merits of having taxing authority versus the power of eminent domain. Senator Schwartz expressed reluctance in giving taxing authority to only one institution of higher education. Discussion continued. Representative Riesberg suggested that a safety clause be added so that the college can bond for projects in June 2010.


BILL:	Metropolitan State College of Denver
TIME:	08:28:14 AM
MOVED:	Riesberg
MOTION:	Favorably recommend draft legislation granting the power of eminent domain to Metropolitan State College of Denver, "Concerning Necessary Authority for Metropolitan State College of Denver to Access Favorable Financing," to the General Assembly for introduction as a Capital Development Committee bill, with the addition of safety clause. The motion carried on a vote of 4-1-1.
SECONDED:
		VOTE
	Kopp	Excused
	McFadyen	Yes
	Schwartz	Yes
	Sonnenberg	No
	Riesberg	Yes
	Bacon	Yes
Final YES: 4 NO: 1 EXC: 1 ABS: 0 FINAL ACTION: PASS

08:30 AM

The committee adjourned.