TITLE: CONCERNING THE PROHIBITION ON THE COLORADO SCHOOL OF MINES' LEASING PROPERTY TO SOCIAL ORGANIZATIONS.

Fiscal Impact Summary	FY 1999/2000	FY 2000/2001
State Revenues Cash Fund Exempt
State Expenditures Cash Funds Exempt
FTE Position Change	0.0 FTE	0.0 FTE
Other State Impact: None.
Effective Date: 90 days after adjournment, unless a referendum petition is filed.
Appropriation Summary for FY 1999-2000: None.
Local Government Impact: None.

The bill repeals the Colorado School of Mines' statutory prohibition against leasing any portion of its college grounds to any fraternity, sorority, or other social organization.

The Board of Trustees of the Colorado School of Mines (the board) intends to sell bonds for the purpose of improving campus housing. Under current statutes the board is prohibited from including in that bond issue funds for the purpose of improving fraternity or sorority houses. Elimination of the prohibition would permit the board to include in the planned housing-related bond issue funds sufficient to 1) construct a new fraternity house; 2) make improvements to at least one fraternity house; and 3) make improvements to college-owned student housing. The total bond issue could be as high as $8.0 million.

The board's bonding authority derives from Section 23-41-104 (3), C.R.S. Subsection (4) goes on to say that the board's authority to enter into leases and to borrow funds shall not be done in any way that creates any debt or obligation upon the State of Colorado.

Any fraternity or sorority houses constructed or improved from bond proceeds would be considered student housing provided by, and under the control of, the Colorado School of Mines. The school would charge occupants a housing fee sufficient to pay the debt service associated with the planned improvements. In the event that a fraternity or sorority does not have a sufficient number of members to occupy all planned beds, the school would retain the right to assign space to the general student population.

Pursuant to the provisions of Section 23-5-101.5, C.R.S., student services have been classified as an enterprise, which means that revenues associated with the function are exempt from the provisions of TABOR. Housing is considered a student service.

The school is formulating a plan to sell $8.0 million of revenue bonds for the purpose of improving selected student housing. If approved by the board, the expenditure of bond proceeds would qualify as cash funds exempt spending for the purpose of improving auxiliary facilities. These expenditures would be exempt from state spending limitations.

The bill does not require the school to engage in a lease with a fraternity, sorority, or other social organization. The possibility that increased revenues and expenditures could result from a future action by the Board of Trustees through the authorization to issue the revenue bonds leads to the conditional fiscal impact assessment.

This fiscal note implies that no additional spending authority or appropriation would be required in FY 1999-00 to implement the provisions of the bill.