Joint Committee Committee on Capital Development (08/13/2012)

Final
STAFF SUMMARY OF MEETING

COMMITTEE ON CAPITAL DEVELOPMENT

Date:	08/13/2012	ATTENDANCE

Time:	09:03 AM to 10:07 AM	Brown	X
		Renfroe	*
Place:	SCR 356	Schwartz	E
		Vigil	X
This Meeting was called to order by		Sonnenberg	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:
Mines Cash Requests CSU Revised Two-Year Projection of Cash Need CPW Real Property Transaction Update and Discussion about Draft Legislation Update about Unspent COP Proceeds Update about State Capitol Geothermal Project Other Business		Pass Pass Recommend Support Witness Testimony and/or Committee Discussion Only Witness Testimony and/or Committee Discussion Only Witness Testimony and/or Committee Discussion Only Pass

09:04 AM -- Colorado School of Mines Cash Requests

The committee was called to order. A quorum was present. Mr. Joe Trubacz, Senior Vice President for Finance and Administration, and Mr. Chris Cocallas, Director of Capital Planning and Construction, both representing the Colorado School of Mines, presented a revised two-year projection of cash need and several cash projects subject to the higher education revenue bond intercept program. Mr. Trubacz began his presentation by giving an overview of the revised two-year projection of cash need list. Committee members received a copy of the revised projection, prepared by Legislative Council Staff (Attachment A). Committee members also received descriptions of three project requests for cash funds spending authority, all prepared by Legislative Council Staff, including: (1) the Elm Street Residence and Dining Hall (Attachment B); (2) the Mines Services Building (Attachment C); and (3) the Student Center Renovation Phase I (Attachment D).


BILL:	Colorado School of Mines
TIME:	09:09:06 AM
MOVED:	Sonnenberg
MOTION:	Approve the Colorado School of Mines Two-Year Projection of Cash Need. The motion passed on a vote of 5-0.
SECONDED:
		VOTE
	Brown	Yes
	Renfroe	Yes
	Schwartz	Excused
	Vigil	Yes
	Sonnenberg	Yes
	Bacon	Yes

Final YES: 5 NO: 0 EXC: 1 ABS: 0 FINAL ACTION: PASS


BILL:	Colorado School of Mines
TIME:	09:10:37 AM
MOVED:	Sonnenberg
MOTION:	Approve cash funds spending authority for the Elm Street Residence and Dining Hall project ($31,000,011 CF). The motion passed on a vote of 5-0.
SECONDED:
		VOTE
	Brown	Yes
	Renfroe	Yes
	Schwartz	Excused
	Vigil	Yes
	Sonnenberg	Yes
	Bacon	Yes

Final YES: 5 NO: 0 EXC: 1 ABS: 0 FINAL ACTION: PASS


BILL:	Colorado School of Mines
TIME:	09:10:58 AM
MOVED:	Sonnenberg
MOTION:	Approve cash funds spending authority for the Mines Services Building project ($6,000,001 CF). The motion passed on a vote of 5-0.
SECONDED:
		VOTE
	Brown	Yes
	Renfroe	Yes
	Schwartz	Excused
	Vigil	Yes
	Sonnenberg	Yes
	Bacon	Yes

Final YES: 5 NO: 0 EXC: 1 ABS: 0 FINAL ACTION: PASS


BILL:	Colorado School of Mines
TIME:	09:11:17 AM
MOVED:	Sonnenberg
MOTION:	Approve cash funds spending authority for the Student Center Renovation Phase I project ($9,600,002 CF). The motion passed on a vote of 5-0.
SECONDED:
		VOTE
	Brown	Yes
	Renfroe	Yes
	Schwartz	Excused
	Vigil	Yes
	Sonnenberg	Yes
	Bacon	Yes

Final YES: 5 NO: 0 EXC: 1 ABS: 0 FINAL ACTION: PASS

09:12 AM

Following the votes, Ms. Kori Donaldson, Legislative Council Staff, clarified why separate votes were required for three of the four new projects listed on the Colorado School of Mines Two-Year Projection of Cash Need list.

09:11 AM -- Colorado State University Revised Two-Year Projection of Cash Need

Mr. Rich Schweigert, Chief Financial Officer, Colorado State University System, presented a revised two-year projection of cash need for Colorado State University. Committee members received a copy of the projection, prepared by Legislative Council Staff (Attachment E). The projection was revised to add one project: Moby Training Room Expansion. Mr. Schweigert addressed a question from the committee about the source of funding for the project.


BILL:	Colorado State University
TIME:	09:14:52 AM
MOVED:	Brown
MOTION:	Approve the Colorado State University Two-Year Projection of Cash Need. The motion passed on a vote of 5-0.
SECONDED:
		VOTE
	Brown	Yes
	Renfroe	Yes
	Schwartz	Excused
	Vigil	Yes
	Sonnenberg	Yes
	Bacon	Yes

Final YES: 5 NO: 0 EXC: 1 ABS: 0 FINAL ACTION: PASS

09:15 AM -- CPW Real Property Transaction

Mr. Grady McNeill, Resource Support Section Manager, Ms. Anne Kelson, Real Estate Unit Supervisor, and Mr. Bill Devergie, Area Wildlife Manager, all representing the Department of Natural Resources, Colorado Parks and Wildlife (CPW), presented one real property transaction: the Tuttle Ranch Perpetual Conservation Easement. Committee members received a packet of summary information about the transaction, submitted by the CPW (Attachment F), and a proposal revised to reflect the inclusion of federal funds (Attachment G). In response to a question, Mr. Devergie provided more information about the proposed reintroduction of the black-footed ferret to the property. Discussion ensued on this topic.


BILL:	Colorado Parks and Wildlife
TIME:	09:20:38 AM
MOVED:	Sonnenberg
MOTION:	Recommend support for the acquisition of a perpetual conservation easement on the Tuttle Ranch property (15,076 acres, $4,243,680 CF). The motion passed on a vote of 4-1.
SECONDED:
		VOTE
	Brown	Yes
	Renfroe	No
	Schwartz	Excused
	Vigil	Yes
	Sonnenberg	Yes
	Bacon	Yes

Final YES: 4 NO: 1 EXC: 1 ABS: 0 FINAL ACTION: PASS

09:21 AM -- Update and Discussion about Draft Legislation

Ms. Esther van Mourik, Office of Legislative Legal Services, provided an update about draft legislation concerning the qualification and addition of information technology projects to the statutory definitions of controlled maintenance. She explained that she is waiting for additional information from the Governor's Office of Information Technology before she can proceed with drafting the legislation. Ms. van Mourik next discussed the possibility of drafting a bill to clean up various capital construction statutes. She said the draft bill would also include the addition of information technology projects to the definition of capital construction. Members of the committee commented on the potential draft legislation. Ms. van Mourik addressed a question about why certain capital construction processes and practices are not currently reflected in statute.

09:30 AM -- Update about Unspent COP Proceeds

Ms. Donaldson provided an update about the status of refunds to two higher education institutions authorized by House Bill 12-1357. She next discussed the status of certificates of completion filed on behalf of the various projects funded through the 2008 sale of certificates of participation (COPs) to be repaid from Federal Mineral Lease (FML) revenues. Ms. Donaldson said that according to Office of the State Controller calculations, there is expected to be about $6.05 million available to spend from unspent proceeds from the COP issuance. Some project funds are still encumbered or unexpended, but the $6.05 million amount takes this into account. Ms. Donaldson explained that the committee has 30 days to make a decision about how to spend the remaining proceeds after receiving final information from the Office of the State Controller and the State Treasurer's Office about the amount available to spend, and that the committee is scheduled to meet again September 5 to take action on this matter.

Committee members received a list of the FY 2012-13 Level II controlled maintenance projects in scores 12 and 14 that have been identified as eligible for funding from the unspent proceeds by bond counsel (Attachment H). Committee members also received project descriptions for three projects authorized, but not included, for funding through the FML COP and one FY 2012-13 capital renewal request (Attachment I). Ms. Donaldson walked the committee through Attachments H and I.

Mr. Brett Johnson, Deputy Treasurer, State Treasurer's Office, came to the table to address questions from the committee. In response to a question, Mr. Johnson confirmed that paying down the principal with the unspent proceeds is not the most effective use of the available funds. Discussion turned to the possible funding scenarios and the information included in Attachments H and I. Ms. Donaldson reminded the committee that the remaining funds must be spent by November 5, 2013. Discussion turned to the increased cost of deferred maintenance.

09:44 AM

Mr. Rod Vanderwall, Manager of Energy Programs, Office of the State Architect, came to the table to address a question about increased costs for deferred maintenance projects. Discussion returned to the role of the committee in making a decision about the unspent proceeds. Ms. Donaldson addressed a question about the amount of FML dollars projected to be available for capital projects as shown in the most recent economic forecast.

09:48 AM -- Update about State Capitol Geothermal Project

Mr. Alex Parillo, Business Development Manager, and Mr. Jim Edwards, Senior Project Engineer, both representing Chevron Energy Solutions, and Mr. Lance Shepherd, Department of Personnel and Administration, presented an update about the geothermal project currently underway at the State Capitol. Mr. Parillo outlined the goals of the project, including modernizing a historic building, making indoor space more comfortable (e.g. providing cooling in the House and Senate chambers), and improving energy performance. He next described the technology associated with the project. Mr. Parillo said the water table will not be impacted in any way by the project. Mr. Edwards provided additional details about the scope of the project, including the planned replacement of individual air handling units and parts of the steam heating system. The project will drill two 900 foot wells to circulate water at a constant temperature of 65 degrees from the Arapahoe aquifer. Mr. Edwards also outlined the project schedule.

09:57 AM

Mr. Parillo and Mr. Edwards addressed questions from the committee about the number of wells drilled for the project, performance testing, and potential future energy savings. Mr. Shepherd responded to a question about legislative parking in the circle drive surrounding the State Capitol building. In response to a question, Mr. Edwards said the project is on-time and on-budget.

10:02 AM -- Other Business

The chair explained that Representative Randy Baumgardner's appointment to serve as the Capital Development Committee representative on the State Capitol Dome Renovation Fund-raising Task Force expires this month. He recommended that Representative Baumgardner by reappointed until after the November 2012 election.


BILL:	Other Business
TIME:	10:03:27 AM
MOVED:	Sonnenberg
MOTION:	Reappoint Representative Randy Baumgardner to serve as the Capital Development Committee representative to the State Capitol Dome Renovation Fund-raising Task Force until the first meeting after the November 2012 election. The motion passed on a vote of 5-0.
SECONDED:
		VOTE
	Brown	Yes
	Renfroe	Yes
	Schwartz	Excused
	Vigil	Yes
	Sonnenberg	Yes
	Bacon	Yes

Final YES: 5 NO: 0 EXC: 1 ABS: 0 FINAL ACTION: PASS

10:04 AM

Mr. Larry Friedberg came to the table to talk briefly about the scheduled tour that will follow the meeting. The committee adjourned.