Joint Committee Committee on Capital Development (01/26/2012)

Final
STAFF SUMMARY OF MEETING

COMMITTEE ON CAPITAL DEVELOPMENT

Date:	01/26/2012	ATTENDANCE

Time:	08:05 AM to 08:46 AM	Brown	X
		Renfroe	X
Place:	SCR 356	Schwartz	E
		Vigil	X
This Meeting was called to order by		Sonnenberg	E
	Senator Bacon	Bacon	X

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

Bills Addressed:		Action Taken:
Discussion of HB 12-1011 Consideration of Two-Year Projections of Cash Need		Witness Testimony and/or Committee Discussion Only Passed (4)

08:05 AM -- Discussion of HB 12-1011

The committee was called to order. A quorum was present. The committee removed draft legislation from its consideration. The committee discussed House Bill 12-1011, concerning the codification of the fifteen-year rule for controlled maintenance funding eligibility for state facilities. Ms. Esther van Mourik, Office of Legislative Legal Services, explained that the bill codifies in law certain current practices pertaining to controlled maintenance spending, and discussed why this change may be beneficial. Mr. Larry Friedberg, State Architect, provided background on how the current policy for controlled maintenance spending was put in place, and discussed the benefits and drawbacks of both the policy and codifying it in statute.

08:16 AM

Mr. Friedberg responded to questions regarding who would have approval authority over controlled maintenance under House Bill 12-1011. Discussion ensued as to whether the current controlled maintenance policy could be misinterpreted if it is not codified in law. Discussion followed regarding the potential for the legislation to allow the Capital Development Committee flexibility in altering the controlled maintenance policy. The committee then discussed the Emergency Controlled Maintenance Account, as it is created in the bill, and the overall codification of current practices pertaining to capital construction. Ms. Kori Donaldson, Legislative Council Staff, provided input on the current status of accounting for emergency controlled maintenance spending. Discussion followed regarding how best to account for this emergency spending under state law. Representative Brown suggested an amendment to the bill before it is heard in the House Finance Committee. Discussion ensued on this point, and the potential for drafting new legislation to address the committee's concerns. Mr. Friedberg mentioned that controlled maintenance emergency spending is the highest priority for the Office of the State Architect. The committee discussed additional items for the committee's February 2nd meeting agenda.

08:30 AM -- Consideration of Two-Year Projections of Cash Need

Ms. Donaldson provided background on approving the two-year projection of cash need lists from the following higher education institutions or systems: Community Colleges, Colorado Mesa University, Colorado School of Mines, and the University of Northern Colorado. Committee members received a packet of two-year projection of cash need lists for these institutions (Attachment A). Discussion ensued regarding certain projects on these lists that are subject to the Higher Education Revenue Bond Intercept Program. Mr. Dan Krug, Director of Assets and Compliance, Department of Higher Education, provided input regarding the process for raising funds for and initiating the capital construction projects that are on an approved two-year projection of cash need list. He also responded to questions regarding the approvals required for higher education institution capital projects to be eligible for the bond intercept program. Ms. Donaldson clarified the process by which higher education institutions access the bond intercept program, and further explained the committee's oversight of this process. Discussion ensued about the bond intercept program process and the program's oversight. The committee also discussed the potential for amending its motion to approve a two-year list to require additional committee approval should a project's funding status change with respect to the bond intercept program. Mr. Mark Superka, representing Colorado Community Colleges, responded to questions regarding funding for the projects on the community colleges two-year list, and the process by which Community Colleges finance constituent institutions and accumulate institutional financial reserves.

08:44 AM

Discussion continued regarding the community colleges system financing arrangements, and the potential for including community colleges that are funded through mill levies in the state's capital construction process.


BILL:	Consideration of Two-Year Projections of Cash Need
TIME:	08:45:00 AM
MOVED:	Brown
MOTION:	Approve the two-year projection of cash need list for the Community Colleges and Occupational Education System, while requiring additional future approval by the committee for projects that undergo a change in funding arrangements. The motion passed on a vote of 3-1.. The motion passed on a vote of 3-1.
SECONDED:
		VOTE
	Brown	Yes
	Renfroe	No
	Schwartz	Excused
	Vigil	Yes
	Sonnenberg	Excused
	Bacon	Yes
Final YES: 3 NO: 1 EXC: 2 ABS: 0 FINAL ACTION: PASS


BILL:	Consideration of Two-Year Projections of Cash Need
TIME:	08:45:53 AM
MOVED:	Brown
MOTION:	Approve the two-year projection of cash need lists for Colorado Mesa University, Colorado School of Mines, and University of Northern Colorado, while requiring additional future approval by the committee for projects that undergo a change in funding arrangements. The motion passed on a vote of 4-0.. The motion passed on a vote of 4-0.
SECONDED:
		VOTE
	Brown	Yes
	Renfroe	Yes
	Schwartz	Excused
	Vigil	Yes
	Sonnenberg	Excused
	Bacon	Yes
Final YES: 4 NO: 0 EXC: 2 ABS: 0 FINAL ACTION: PASS

08:46 AM

The committee adjourned.