Joint Committee Committee on Capital Development (02/05/2009)

Final
STAFF SUMMARY OF MEETING

COMMITTEE ON CAPITAL DEVELOPMENT

Date:	02/05/2009	ATTENDANCE

Time:	07:35 AM to 08:33 AM	McFadyen	*
		Penry	A
Place:	SCR 356	Schwartz	*
		Sonnenberg	X
This Meeting was called to order by		Bacon	X
	Representative Riesberg	Riesberg	X

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

Bills Addressed:		Action Taken:
Colorado School of Mines FY 2009-10 State-Funded Requests Overview of Exemption Process for Frozen Capital Projects Public Health and Environment FY 2009-10 Cash-Funded Request Labor and Employment FY 2009-10 Cash-Funded Requests		Pass Witness Testimony and/or Committee Discussion Only Pass Pass

07:35 AM -- Colorado School of Mines FY 2009-10 State-Funded Requests

The meeting came to order. A quorum was not present, but the chairman decided to begin the meeting because action was not required on the first agenda item. Senator Schwartz and Representative McFadyen joined the committee shortly after the meeting began, constituting a quorum.

Ms. Kirsten Volpi, Senior Vice-President for Finance and Administration, and Dr. Thomas Boyd, Dean of Graduate Studies, both of the Colorado School of Mines, came to the table to present two FY 2009-10 state-funded capital construction requests. Committee members received summaries of the Meyer Hall Replacement project (Attachment A) and the Earth Energy Institute (Attachment B), both prepared by Legislative Council Staff, and an overview of the Earth Energy Institute, prepared by the Colorado School of Mines (Attachment C). Ms. Volpi briefly described both projects and indicated that there is potential for the school to receive federal money as part of a stimulus package for energy-related opportunities, including these projects. She said the school has provided a list of these opportunities to Congressman Perlmutter, at his request. For the Earth Energy Institute, there is also a private donor interested in providing funds for the project. Ms. Volpi said the school hopes to replace state funds for both requests with any federal funds received, in addition to funding that will be provided from institutional sources and student funds. However, if federal funds are not made available, the school expects to request state funds for both projects. She explained that the school wants the projects to be ready to go with state approval so there are no delays when a federal stimulus package is delivered to the state, and so that these projects do not lose potential federal money because they are not ready to proceed. Dr. Boyd described the mission of the Earth Energy Institute and noted some of its accomplishments.

07:44 AM

Dr. Boyd and Ms. Volpi responded to questions from the committee concerning the school's capital priorities, specifically the Marquez Hall project, which received state funding in the 2008 Long Bill and cash funding through certificates of participation issued in November 2008 and paid with federal mineral lease (FML) revenue. Discussion continued about what other states are doing about energy-related issues addressed by the institute, and whether there are organizations looking to donate funds to energy-related projects. Discussion turned to whether federal money will be allocated to states as a block grant or for specific projects. The committee expressed concern about approving these two projects if federal funds are allocated as state block grants. Several committee members voiced a desire to be able to prioritize projects eligible for any block grant the state receives. The committee made it clear that, by approving these projects, it does not move them to the top of the committee's priority list ahead of other projects, but it simply authorizes the projects to move forward if these specific projects are awarded federal funds. Representative McFadyen commented that approving the projects moves them one step closer to being ready to begin, which may actually help secure federal funding for the projects.


BILL:	Colorado School of Mines FY 2009-10 State Requests
TIME:	07:46:50 AM
MOVED:	Sonnenberg
MOTION:	Approve cash funds spending authority for the Meyer Hall Replacement project and the Earth Energy Institute project, contingent on receipt of federal funds allocated to the projects, in place of state funds requested for the projects, as shown in Attachments A and B. The motion carried on a 5-0 vote, with one member absent.
SECONDED:
		VOTE
	McFadyen	Yes
	Penry	Absent
	Schwartz	Yes
	Sonnenberg	Yes
	Bacon	Yes
	Riesberg	Yes

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

07:58 AM -- Overview of the Governor's Exemption Process for Capital Projects Subject to the January 15 Spending Freeze

Ms. Lisa Esgar, Deputy Director, Governor's Office of State Planning and Budgeting (OSPB), provided an overview of the exemption process for capital projects identified in the Governor's January 15, 2009, spending freeze. Committee members received OSPB's capital construction freeze guidelines and the list of frozen projects, prepared by OSPB (Attachment D). Ms. Esgar said this exemption process is similar to the process implemented with the October 2008 capital spending freeze. According to Ms. Esgar, OSPB identified potential projects for the January 2009 spending freeze based on the State Architect's December 2008 report of the status of all active capital projects, and projects that were not under construction were frozen. Then, on January 29, 2009, OSPB gave agencies guidelines that allow them to request an exemption if a project: (1) was already under construction on January 15, 2009; (2) involves urgent life-safety issues; or (3) cannot be shut down and fulfill all legal obligations without additional expenditures. Ms. Esgar explained how OSBP estimated budget savings from the list of projects. She told the committee that exemption requests are due to OSPB on February 6, 2009, and OSPB will communicate with the CDC as soon as possible about the total savings from the capital spending freeze. Ms. Esgar noted that OSPB will also ensure that expenditures reported by agencies match the accounting records in the State Controller's office, before OSPB proceeds with a final list of frozen projects.

08:05 AM

Representative Riesberg re-stated his understanding from Ms. Esgar's presentation, that agencies are expected to file a request for an exemption if they feel they meet one of the exemption criteria. Committee members were provided with a status report on the Homelake Domiciliary Renovation project, prepared by the Department of Human Services (DHS) (Attachment E), and Senator Schwartz described some of her concerns with freezing the project's appropriation, as noted on Attachment E. Representative McFadyen commented on the need to continue another DHS project, the Suicide Risk Mitigation project, to address issues raised in a prior lawsuit and to avoid future lawsuits. In response to questions from the committee, Ms. Esgar clarified that she will first provide the CDC with a list of projects for which an exemption has been requested, then a list of projects approved by OSPB to be exempted from the spending freeze, and an updated final report of the uncommitted balance of remaining frozen projects.

08:14 AM -- Department of Public Health and Environment FY 2009-10 Cash-Funded Request

Mr. Gary Baughman, Division Director, Hazardous Materials and Waste Management Division, Department of Public Health and Environment, came to the table to present a FY 2009-10 cash-funded capital construction request. Committee members received a description of the Brownfields Cleanup Program request, prepared by Legislative Council Staff (Attachment F). Mr. Baughman described the project and noted the funding source. He responded to questions from the committee regarding specific projects on the list in Attachment F, and the process for expending the $250,000 appropriation for these projects.


BILL:	Department of Public Health and Environment FY 2009-10 Cash-Funded Request
TIME:	08:19:36 AM
MOVED:	Bacon
MOTION:	Approve the Brownfields Cleanup Program request ($250,000 CF). The motion carried on a vote of 5-0, with one member absent.
SECONDED:
		VOTE
	McFadyen	Yes
	Penry	Absent
	Schwartz	Yes
	Sonnenberg	Yes
	Bacon	Yes
	Riesberg	Yes

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

08:20 AM -- Department of Labor and Employment FY 2009-10 Cash-Funded Requests

Mr. Mike Cullen, Director of the Unemployment Insurance Program, Division of Employment and Training, Department of Labor and Employment, came to the table to present two FY 2009-10 cash-funded capital construction requests. Committee members were provided with descriptions of the Internet Self-Service project and the Roof Replacement project at 251 East 12th Avenue, both prepared by Legislative Council Staff (Attachment G). Mr. Cullen described both projects, and responded to comments from the committee. Representative Sonnenberg expressed support for the projects, but voiced concern about approving cash spending authority for work that is not urgent and can wait. He stated that agencies should make sure that cash funds are spent on work that is truly necessary at this time.


BILL:	Department of Labor and Employment FY 2009-10 Cash-Funded Requests
TIME:	08:25:21 AM
MOVED:	Bacon
MOTION:	Approve the Internet Self-Service project ($2,883,316 CF) and the 251 East 12th Avenue, Roof Replacement project ($475,832 FF). The motion carried on a 5-0 vote, with one member absent.
SECONDED:
		VOTE
	McFadyen	Yes
	Penry	Absent
	Schwartz	Yes
	Sonnenberg	Yes
	Bacon	Yes
	Riesberg	Yes

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

08:26 AM

Representative McFadyen expressed concern with receiving a draft letter from the Department of Personnel and Administration, which was distributed to committee members (see Attachment H), in response to a request for information about the Department of Corrections' bid for a new central office in Colorado Springs. She suggested that the committee request additional and more detailed information about the bid process. Ms. Esgar returned to the table and explained that a full review of the bid process was never completed, but was stopped mid-stream because the project was withdrawn. Ms. Esgar offered to work with Representative McFadyen to provide the information.

08:33 AM

The committee adjourned.