Consideration of Draft Committee Legislation
COMMITTEE ON CAPITAL DEVELOPMENT
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07:33 AM -- Consideration of Draft Committee Legislation
The committee was called to order. Mr. Jeremiah Barry, Office of Legislative Legal Services (OLLS), presented a redraft of legislation concerning flexibility for capital construction projects at state institutions of higher education. Committee members received a third draft of the proposed legislation dated March 30 (3/30) (Attachment A), a side-by-side comparison of the second and third drafts of the legislation (Attachment B), both prepared by OLLS, and an e-mail summarizing suggested changes to the existing review process for higher education cash projects made by the Department of Higher Education (DHE) and the Governor's Office of State Planning and Budgeting (OSPB), prepared by DHE (Attachment C). Mr. Barry walked the committee through Attachment A and highlighted changes between the second and third drafts of the legislation. He expressed some concern with the title of the draft legislation because of the inclusion of changes to the bidding process for all capital construction projects, not just projects at higher education institutions.
Mr. Barry addressed questions about electronic participation in future CDC meeting by committee members, and the use of student fees for higher education capital projects. Discussion ensued. Ms. Lisa Esgar, Deputy Director, OSPB, and Mr. John Karakoulakis, Director of Legislative Affairs, DHE, spoke to Attachment A, and said that any project that may require future state funds for controlled maintenance should be reviewed. Ms. Esgar said there is concern that projects that have not been reviewed may use the state's bond rating. Mr. Karakoulakis walked the committee through Attachment C. In response to a question, Mr. Barry said the 3/30 draft legislation does not include an OSPB review of cash-funded higher education projects. Mr. Barry also said that the 3/30 draft legislation addresses the concern about institutions using the state's bond rating without a formal review of projects. Discussion ensued.
Ms. Esgar summarized the existing review process for higher education cash projects and said that OSPB recommends a streamlined process that requires a review by DHE for projects that may require future state funds for controlled maintenance. Senator Bacon expressed concern about removing the legislative review of cash projects. Mr. Barry reminded the committee that in earlier meetings a suggestion was made to allow for simultaneous review of projects by the various entities involved. Senator Bacon suggested that projects be forwarded to the committee by OSPB and/or DHE and the CDC would then be responsible for approving the projects. Discussion ensued. Mr. Karakoulakis addressed questions about Attachment C. Discussion continued about Attachment C and whether the language suggested by OSPB and DHE could be integrated into the 3/30 draft legislation.
Ms. Esgar addressed a question about collaboration between representatives of higher education institutions, OSPB, and DHE regarding the 3/30 draft legislation. Ms. Esgar summarized the position of OSPB regarding a streamlined process for higher education cash projects. Mr. Barry outlined the suggested changes to the 3/30 draft legislation made by the committee, including:
1) Allow OSPB and DHE to give input to 2-year plans for cash projects and amendments to program plans before they are sent to the CDC.
2) Allow CDC member to participate electronically in meetings during the interim.
3) Amend Page 7, line 11, of the 3/30 draft legislation (Attachment A) to replace "solely" with "majority."
4) Integrate the final paragraph of Attachment C into the 3/30 draft legislation.
Discussion ensued about whether or not to include language in the bill allowing for electronic participation in meetings by committee members during the interim. Mr. Barry explained that the existing draft allows program amendments to pass unless the CDC objects so it may not even be necessary for the committee to meet to approve amendments to program plans.
Discussion continued about whether to allow electronic participation by committee members. Several committee members expressed concern about not meeting to approve projects. The committee decided to add language to the bill that would require the CDC to meet to approve cash projects. Ms. Esgar addressed a question about the template used for cash project submissions. Ms. Kelly Fox, Interim Vice-President of Budget and Finance, University of Colorado System, said she would like to work with DHE and OSPB to determine how and what information will be submitted. Senator Schwartz said she wants to be sure that if a project is financed by student fees that it is eligible for future controlled maintenance. Discussion ensued about Page 7, lines 5-16, of the 3/30 draft legislation.
Discussion continued about page 7, lines 5-16, of the 3/30 draft legislation. Mr. Barry addressed a question about the origin of the language on page 7 of the 3/30 draft legislation. Ms. Fox returned to the table to discuss the use of future state dollars for operating and maintenance expenses for buildings constructed with student tuition and fees. She then addressed a question about the use of gifts, grants, and donations to construct new buildings. Mr. Barry asked for further clarification regarding the definition of academic building. The committee directed Mr. Barry to include language in the proposed legislation stating that academic buildings may be eligible for future operating and controlled maintenance expenses.
The committee decided to look at a final draft of the proposed legislation at its next meeting, Tuesday, April 7. The committee adjourned.