Agency: Capital Budget

Line Item: Capital Development

Function

Capital developments include renovations or other projects costing $2,500,000 or more, new facilities costing $500,000 or more, or real property purchases needing an appropriation for financing. The Legislature uses this line item to appropriate funds for construction of new capital developments. The Legislature divides capital developments into two types: state-funded developments, and "other"-funded developments.

STATE-FUNDED CAPITAL DEVELOPMENTS

For purposes of capital developments, statute defines "state funds" as public monies appropriated by the Legislature.

Each October the State Building Board meets to fulfill its statutory responsibility to determine its capital development priorities and recommendations on behalf of all state agencies and institutions. The Board's top ten priorities for the 2009 General Session include:

1. USDB Building Purchase/Renovation, $6,500,000
2. DHS State Hospital Buildings, $57,286,000
3. SLCC Digital Design Center, $26,490,000
4. MATC North Utah County Building, $20,800,000
5. U of U School of Business Building, $25,815,000
6. OWATC Health Technology Building, $24,212,000
7. Ogden Juvenile Courthouse, $30,266,000
8. GOED World Trade Center, $36,000,000
9. USU Business School, $39,946,000
10. National Guard Armories Upgrades, $4,000,000

The Legislature has adopted a policy to approve operations and maintenance (O&M) funding at the same time it approves state-funded capital development projects. Such O&M funding is appropriated in ongoing funds, but with one-time negative offsets until the projects are completed.

There is no "queue" for projects - each year projects are prioritized based on merit. This avoids lining up projects that may or may not meet changing state or institutional priorities.

"OTHER"-FUNDED CAPITAL DEVELOPMENTS

For purposes of capital developments, statute defines "state funds" as public monies appropriated by the Legislature. By extension, "other funds" include revenue bonds (although these must be approved by the Legislature) and any monies from non-state sources, such as donations.

Each October the State Building Board hears and determines its recommendations for all "other"-funded requests submitted by higher education institutions and state agencies. While many of the projects bring value to the state by using donations, fees, restricted funds, or federal funds, they also represent new revenue bond commitments (in some cases), operations costs, fuel and power costs, and assets to maintain while the state's current assets carry maintenance backlogs.

Some "other"-funded buildings take years to complete, and some never start construction, usually due to slow or unsuccessful fundraising. For these types of projects, the Legislature waits to appropriate monies for O&M until the projects are completed. The chairs of the Capital Facilities and Government Operations subcommittee communicate anticipated O&M costs to chairs of other subcommittees who oversee the budgets of affected agencies.

Since "other" funds are funds not appropriated by the Legislature, the Legislature approves these types of projects in a bill other than an appropriations act.

Funding Detail

During the 2008 Second Special Session the Legislature replaced $30 million in ongoing state funds (General Fund or Education Fund) in this line item with one-time funds. The Legislature also takes advantage of restricted funds, federal funds, bonds, and donations to pay for projects.