H.B. 226 Enrolled

LEGISLATIVE APPROVAL FOR CAPITAL
PROJECTS
2004 GENERAL SESSION
STATE OF UTAH
Sponsor: David Ure

LONG TITLE
General Description:
This bill clarifies approval requirements for capital development and capital
improvement projects.
Highlighted Provisions:
This bill:
. defines the term "state funds" in order to clarify which capital projects require
legislative approval;
. clarifies the scope of existing exceptions to legislative approval requirements;
. exempts certain capital projects from legislative approval requirements; and
. makes technical corrections.
Monies Appropriated in this Bill:
None
Other Special Clauses:
None
Utah Code Sections Affected:
AMENDS:
63A-5-104, as last amended by Chapter 15, Laws of Utah 2002, Fifth Special Session

Be it enacted by the Legislature of the state of Utah:
Section 1. Section 63A-5-104 is amended to read:
63A-5-104. Capital development and capital improvement process -- Approval
requirements -- Limitations on new projects -- Emergencies.

(1) As used in this section:
(a) "Capital developments" means any:
(i) remodeling, site, or utility projects with a total cost of $1,500,000 or more;
(ii) new facility with a construction cost of $250,000 or more; or
(iii) purchase of real property where an appropriation is requested to fund the purchase.
(b) "Capital improvements" means any:
(i) remodeling, alteration, replacement, or repair project with a total cost of less than
$1,500,000;
(ii) site and utility improvement with a total cost of less than $1,500,000; or
(iii) new facility with a total construction cost of less than $250,000.
(c) (i) "New facility" means the construction of any new building on state property
regardless of funding source.
(ii) "New facility" includes:
(A) an addition to an existing building; and
(B) the enclosure of space that was not previously fully enclosed.
(iii) "New facility" does not mean:
(A) the replacement of state-owned space that is demolished, if the total construction cost
of the replacement space is less than $1,500,000; or
(B) the construction of facilities that do not fully enclose a space.
(d) "Replacement cost of existing state facilities" means the replacement cost, as
determined by the Division of Risk Management, of state facilities, excluding auxiliary facilities as
defined by the State Building Board.
(e) "State funds" means public monies appropriated by the Legislature.
(2) The State Building Board, on behalf of all state agencies, commissions, departments,
and institutions shall submit its capital development recommendations and priorities to the
Legislature for approval and prioritization.
(3) (a) Except as provided in Subsections (3)(b), (d), and (e), a capital development
project may not be constructed on state property without legislative approval.

- 2 -

(b) Legislative approval is not required for a capital development project if the State
Building Board determines that:
(i) the requesting [agency or] higher education institution has provided adequate
assurance that:
(A) state funds will not be used for the design or construction of[,] the facility; and
(B) the higher education institution has a plan for funding in place that will not require
increased state funding to cover the cost of operations and maintenance to, [and] or state funding
for, immediate or future capital improvements to the resulting facility; and
(ii) the use of the state property is:
(A) appropriate and consistent with the master plan for the property; and
(B) will not create an adverse impact on the state.
(c) (i) The Division of Facilities Construction and Management shall maintain a record of
facilities constructed under the exemption provided in Subsection(3)(b).
(ii) For facilities constructed under the exemption provided in Subsection (3)(b), a higher
education institution may not request:
(A) increased state funds for operations and maintenance; or
(B) state capital improvement funding.
(d) Legislative approval is not required for:
(i) the renovation, remodeling, or retrofitting of an existing facility with nonstate funds;
(ii) facilities to be built with nonstate funds and owned by nonstate entities within research
park areas at the University of Utah and Utah State University; [or]
(iii) facilities to be built at This is the Place State Park by This is the Place Foundation
with funds of the foundation, including grant monies from the state, or with donated services or
materials[.];
(iv) capital projects that are funded by the Navajo Trust Fund Board from Navajo Trust
Fund monies and the Uintah Basin Revitalization Fund that do not provide a new facility for a
state agency or higher education institution; or
(v) capital projects on school and institutional trust lands that are funded by the School

- 3 -

and Institutional Trust Lands Administration from the Land Grant Management Fund and that do
not fund construction of a new facility for a state agency or higher education institution.
(e) (i) Legislative approval is not required for capital development projects to be built for
the Department of Transportation as a result of an exchange of real property under Section
72-5-111 .
(ii) When the Department of Transportation approves those exchanges, it shall notify the
president of the Senate, the speaker of the House, and the cochairs of the Capital Facilities and
Administrative Services Subcommittee of the Legislature's Joint Appropriation Committee about
any new facilities to be built under this exemption.
(4) (a) The State Building Board, on behalf of all state agencies, commissions,
departments, and institutions shall by January 15 of each year, submit a list of anticipated capital
improvement requirements to the Legislature for review and approval.
(b) Unless otherwise directed by the Legislature, the building board shall prioritize capital
improvements from the list submitted to the Legislature up to the level of appropriation made by
the Legislature.
(c) In prioritizing capital improvements, the building board shall consider the results of
facility evaluations completed by an architect/engineer as stipulated by the building board's
facilities maintenance standards.
(5) The Legislature may authorize:
(a) the total square feet to be occupied by each state agency; and
(b) the total square feet and total cost of lease space for each agency.
(6) (a) Except as provided in Subsection (6)(b), the Legislature may not fund the design or
construction of any new capital development projects, except to complete the funding of projects
for which partial funding has been previously provided, until the Legislature has appropriated
1.1% of the replacement cost of existing state facilities to capital improvements.
(b) (i) As used in this Subsection (6)(b), "operating deficit" means that estimated General
Fund or Uniform School Fund revenues are less than budgeted for the current or next fiscal year.
(ii) If the Legislature determines that an operating deficit exists, the Legislature may, in

- 4 -

eliminating the deficit, reduce the amount appropriated to capital improvements to 0.9% of the
replacement cost of state buildings.
(7) (a) If, after approval of capital development and capital improvement priorities by the
Legislature under this section, emergencies arise that create unforeseen critical capital
improvement projects, the State Building Board may, notwithstanding the requirements of Title
63, Chapter 38, Budgetary Procedures Act, reallocate capital improvement funds to address those
projects.
(b) The building board shall report any changes it makes in capital improvement
allocations approved by the Legislature to:
(i) the Office of Legislative Fiscal Analyst within 30 days of the reallocation; and
(ii) the Legislature at its next annual general session.
(8) (a) The State Building Board may adopt a rule allocating to institutions and agencies
their proportionate share of capital improvement funding.
(b) The building board shall ensure that the rule:
(i) reserves funds for the Division of Facilities Construction and Management for
emergency projects; and
(ii) allows the delegation of projects to some institutions and agencies with the
requirement that a report of expenditures will be filed annually with the Division of Facilities
Construction and Management and appropriate governing bodies.
(9) It is the intent of the Legislature that in funding capital improvement requirements
under this section the General Fund be considered as a funding source for at least half of those
costs.

- 5 -