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First Substitute H.B. 370

Representative Stephen D. Clark proposes the following substitute bill:


             1     
CAPITAL PROJECT AMENDMENTS

             2     
2010 GENERAL SESSION

             3     
STATE OF UTAH

             4     
Chief Sponsor: Stephen D. Clark

             5     
Senate Sponsor: Curtis S. Bramble

             6     
             7      LONG TITLE
             8      General Description:
             9          This bill amends capital development provisions.
             10      Highlighted Provisions:
             11          This bill:
             12          .    requires the State Building Board to establish a rule to govern the disposition of real
             13      property;
             14          .    postpones the effective date of the provision prohibiting the Legislature from
             15      funding developments without funding improvements; and
             16          .    addresses the director's supervision of capital improvement projects.
             17      Monies Appropriated in this Bill:
             18          None
             19      Other Special Clauses:
             20          None
             21      Utah Code Sections Affected:
             22      AMENDS:
             23          63A-5-103, as last amended by Laws of Utah 2008, Chapter 382
             24          63A-5-104, as last amended by Laws of Utah 2009, Chapters 2 and 183
             25          63A-5-206, as last amended by Laws of Utah 2008, Chapter 382


             26     
             27      Be it enacted by the Legislature of the state of Utah:
             28          Section 1. Section 63A-5-103 is amended to read:
             29           63A-5-103. Board -- Powers.
             30          (1) The State Building Board shall:
             31          (a) in cooperation with state institutions, departments, commissions, and agencies,
             32      prepare a master plan of structures built or contemplated;
             33          (b) submit to the governor and the Legislature a comprehensive five-year building plan
             34      for the state containing the information required by Subsection (2);
             35          (c) amend and keep current the five-year building program for submission to the
             36      governor and subsequent legislatures;
             37          (d) as a part of the long-range plan, recommend to the governor and Legislature any
             38      changes in the law that are necessary to insure an effective, well-coordinated building program
             39      for all state institutions;
             40          (e) in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act,
             41      make rules:
             42          (i) that are necessary to discharge its duties and the duties of the Division of Facilities
             43      Construction and Management; [and]
             44          (ii) to establish standards and requirements for life cycle cost-effectiveness of state
             45      facility projects; and
             46          (iii) to govern the disposition of real property by the division and establish factors,
             47      including appraised value and historical significance, in evaluating the disposition;
             48          (f) with support from the Division of Facilities Construction and Management,
             49      establish design criteria, standards, and procedures for planning, design, and construction of
             50      new state facilities and for improvements to existing state facilities, including life-cycle
             51      costing, cost-effectiveness studies, and other methods and procedures that address:
             52          (i) the need for the building or facility;
             53          (ii) the effectiveness of its design;
             54          (iii) the efficiency of energy use; and
             55          (iv) the usefulness of the building or facility over its lifetime;
             56          (g) prepare and submit a yearly request to the governor and the Legislature for a


             57      designated amount of square footage by type of space to be leased by the Division of Facilities
             58      Construction and Management in that fiscal year; and
             59          (h) assure the efficient use of all building space.
             60          (2) In order to provide adequate information upon which the State Building Board may
             61      make its recommendation under Subsection (1), any state agency requesting new full-time
             62      employees for the next fiscal year shall report those anticipated requests to the building board
             63      at least 90 days before the annual general session in which the request is made.
             64          (3) (a) The State Building Board shall ensure that the five-year building plan required
             65      by Subsection (1)(c) includes:
             66          (i) a list that prioritizes construction of new buildings for all structures built or
             67      contemplated based upon each agency's, department's, commission's, and institution's present
             68      and future needs;
             69          (ii) information, and space use data for all state-owned and leased facilities;
             70          (iii) substantiating data to support the adequacy of any projected plans;
             71          (iv) a summary of all statewide contingency reserve and project reserve balances as of
             72      the end of the most recent fiscal year;
             73          (v) a list of buildings that have completed a comprehensive facility evaluation by an
             74      architect/engineer or are scheduled to have an evaluation;
             75          (vi) for those buildings that have completed the evaluation, the estimated costs of
             76      needed improvements; and
             77          (vii) for projects recommended in the first two years of the five-year building plan:
             78          (A) detailed estimates of the cost of each project;
             79          (B) the estimated cost to operate and maintain the building or facility on an annual
             80      basis;
             81          (C) the estimated number of new agency full-time employees expected to be housed in
             82      the building or facility;
             83          (D) the estimated cost of new or expanded programs and personnel expected to be
             84      housed in the building or facility;
             85          (E) the estimated lifespan of the building with associated costs for major component
             86      replacement over the life of the building; and
             87          (F) the estimated cost of any required support facilities.


             88          (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             89      State Building Board may make rules prescribing the format for submitting the information
             90      required by this Subsection (3).
             91          (4) (a) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act,
             92      the State Building Board may make rules establishing circumstances under which bids may be
             93      modified when all bids for a construction project exceed available funds as certified by the
             94      director.
             95          (b) In making those rules, the State Building Board shall provide for the fair and
             96      equitable treatment of bidders.
             97          (5) (a) A person who violates a rule adopted by the board under Subsection (1)(e) is
             98      subject to a civil penalty not to exceed $2,500 for each violation plus the amount of any actual
             99      damages, expenses, and costs related to the violation of the rule that are incurred by the state.
             100          (b) The board may take any other action allowed by law.
             101          (c) If any violation of a rule adopted by the board is also an offense under Title 76,
             102      Utah Criminal Code, the violation is subject to the civil penalty, damages, expenses, and costs
             103      allowed under Subsection (1)(e) in addition to any criminal prosecution.
             104          Section 2. Section 63A-5-104 is amended to read:
             105           63A-5-104. Capital development and capital improvement process -- Approval
             106      requirements -- Limitations on new projects -- Emergencies.
             107          (1) As used in this section:
             108          (a) "Capital developments" means a:
             109          (i) remodeling, site, or utility project with a total cost of $2,500,000 or more;
             110          (ii) new facility with a construction cost of $500,000 or more; or
             111          (iii) purchase of real property where an appropriation is requested to fund the purchase.
             112          (b) "Capital improvements" means a:
             113          (i) remodeling, alteration, replacement, or repair project with a total cost of less than
             114      $2,500,000;
             115          (ii) site and utility improvement with a total cost of less than $2,500,000; or
             116          (iii) new facility with a total construction cost of less than $500,000.
             117          (c) (i) "New facility" means the construction of a new building on state property
             118      regardless of funding source.


             119          (ii) "New facility" includes:
             120          (A) an addition to an existing building; and
             121          (B) the enclosure of space that was not previously fully enclosed.
             122          (iii) "New facility" does not mean:
             123          (A) the replacement of state-owned space that is demolished or that is otherwise
             124      removed from state use, if the total construction cost of the replacement space is less than
             125      $2,500,000; or
             126          (B) the construction of facilities that do not fully enclose a space.
             127          (d) "Replacement cost of existing state facilities" means the replacement cost, as
             128      determined by the Division of Risk Management, of state facilities, excluding auxiliary
             129      facilities as defined by the State Building Board.
             130          (e) "State funds" means public monies appropriated by the Legislature.
             131          (2) The State Building Board, on behalf of all state agencies, commissions,
             132      departments, and institutions shall submit its capital development recommendations and
             133      priorities to the Legislature for approval and prioritization.
             134          (3) (a) Except as provided in Subsections (3)(b), (d), and (e), a capital development
             135      project may not be constructed on state property without legislative approval.
             136          (b) Legislative approval is not required for a capital development project if the State
             137      Building Board determines that:
             138          (i) the requesting higher education institution has provided adequate assurance that:
             139          (A) state funds will not be used for the design or construction of the facility; and
             140          (B) the higher education institution has a plan for funding in place that will not require
             141      increased state funding to cover the cost of operations and maintenance to, or state funding for,
             142      immediate or future capital improvements to the resulting facility; and
             143          (ii) the use of the state property is:
             144          (A) appropriate and consistent with the master plan for the property; and
             145          (B) will not create an adverse impact on the state.
             146          (c) (i) The Division of Facilities Construction and Management shall maintain a record
             147      of facilities constructed under the exemption provided in Subsection (3)(b).
             148          (ii) For facilities constructed under the exemption provided in Subsection (3)(b), a
             149      higher education institution may not request:


             150          (A) increased state funds for operations and maintenance; or
             151          (B) state capital improvement funding.
             152          (d) Legislative approval is not required for:
             153          (i) the renovation, remodeling, or retrofitting of an existing facility with nonstate funds;
             154          (ii) a facility to be built with nonstate funds and owned by nonstate entities within
             155      research park areas at the University of Utah and Utah State University;
             156          (iii) a facility to be built at This is the Place State Park by This is the Place Foundation
             157      with funds of the foundation, including grant monies from the state, or with donated services or
             158      materials;
             159          (iv) a capital project that:
             160          (A) is funded by:
             161          (I) the Uintah Basin Revitalization Fund; or
             162          (II) the Navajo Revitalization Fund; and
             163          (B) does not provide a new facility for a state agency or higher education institution; or
             164          (v) a capital project on school and institutional trust lands that is funded by the School
             165      and Institutional Trust Lands Administration from the Land Grant Management Fund and that
             166      does not fund construction of a new facility for a state agency or higher education institution.
             167          (e) (i) Legislative approval is not required for capital development projects to be built
             168      for the Department of Transportation as a result of an exchange of real property under Section
             169      72-5-111 .
             170          (ii) When the Department of Transportation approves those exchanges, it shall notify
             171      the president of the Senate, the speaker of the House, and the cochairs of the Capital Facilities
             172      and Administrative Services Subcommittee of the Legislature's Joint Appropriation Committee
             173      about any new facilities to be built under this exemption.
             174          (4) (a) (i) The State Building Board, on behalf of all state agencies, commissions,
             175      departments, and institutions shall by January 15 of each year, submit a list of anticipated
             176      capital improvement requirements to the Legislature for review and approval.
             177          (ii) The list shall identify:
             178          (A) a single project that costs more than $1,000,000;
             179          (B) multiple projects within a single building or facility that collectively cost more than
             180      $1,000,000;


             181          (C) a single project that will be constructed over multiple years with a yearly cost of
             182      $1,000,000 or more and an aggregate cost of more than $2,500,000;
             183          (D) multiple projects within a single building or facility with a yearly cost of
             184      $1,000,000 or more and an aggregate cost of more than $2,500,000;
             185          (E) a single project previously reported to the Legislature as a capital improvement
             186      project under $1,000,000 that, because of an increase in costs or scope of work, will now cost
             187      more than $1,000,000; and
             188          (F) multiple projects within a single building or facility previously reported to the
             189      Legislature as a capital improvement project under $1,000,000 that, because of an increase in
             190      costs or scope of work, will now cost more than $1,000,000.
             191          (b) Unless otherwise directed by the Legislature, the State Building Board shall
             192      prioritize capital improvements from the list submitted to the Legislature up to the level of
             193      appropriation made by the Legislature.
             194          (c) In prioritizing capital improvements, the State Building Board shall consider the
             195      results of facility evaluations completed by an architect/engineer as stipulated by the building
             196      board's facilities maintenance standards.
             197          (d) The State Building Board may require an entity that benefits from a capital
             198      improvement project to repay the capital improvement funds from savings that result from the
             199      project.
             200          (e) The State Building Board may provide capital improvement funding to a single
             201      project, or to multiple projects within a single building or facility, even if the total cost of the
             202      project or multiple projects is $2,500,000 or more, if:
             203          (i) the capital improvement project or multiple projects require more than one year to
             204      complete; and
             205          (ii) the Legislature has affirmatively authorized the capital improvement project or
             206      multiple projects to be funded in phases.
             207          (5) The Legislature may authorize:
             208          (a) the total square feet to be occupied by each state agency; and
             209          (b) the total square feet and total cost of lease space for each agency.
             210          (6) (a) Except as provided in Subsection (6)(b) or (c), the Legislature may not fund the
             211      design or construction of any new capital development projects, except to complete the funding


             212      of projects for which partial funding has been previously provided, until the Legislature has
             213      appropriated 1.1% of the replacement cost of existing state facilities to capital improvements.
             214          (b) (i) As used in this Subsection (6)(b):
             215          (A) "Education Fund budget deficit" is as defined in Section 63J-1-312 ; and
             216          (B) "General Fund budget deficit" is as defined in Section 63J-1-312 .
             217          (ii) If the Legislature determines that an Education Fund budget deficit or a General
             218      Fund budget deficit exists, the Legislature may, in eliminating the deficit, reduce the amount
             219      appropriated to capital improvements to 0.9% of the replacement cost of state buildings.
             220          (c) The requirements under Subsections (6)(a) and (b) do not apply to the 2008-09,
             221      [and] 2009-10, and 2010-11 fiscal years.
             222          (7) (a) If, after approval of capital development and capital improvement priorities by
             223      the Legislature under this section, emergencies arise that create unforeseen critical capital
             224      improvement projects, the State Building Board may, notwithstanding the requirements of Title
             225      63J, Chapter 1, Budgetary Procedures Act, reallocate capital improvement funds to address
             226      those projects.
             227          (b) The State Building Board shall report any changes it makes in capital improvement
             228      allocations approved by the Legislature to:
             229          (i) the Office of Legislative Fiscal Analyst within 30 days of the reallocation; and
             230          (ii) the Legislature at its next annual general session.
             231          (8) (a) The State Building Board may adopt a rule allocating to institutions and
             232      agencies their proportionate share of capital improvement funding.
             233          (b) The State Building Board shall ensure that the rule:
             234          (i) reserves funds for the Division of Facilities Construction and Management for
             235      emergency projects; and
             236          (ii) allows the delegation of projects to some institutions and agencies with the
             237      requirement that a report of expenditures will be filed annually with the Division of Facilities
             238      Construction and Management and appropriate governing bodies.
             239          (9) It is the intent of the Legislature that in funding capital improvement requirements
             240      under this section the General Fund be considered as a funding source for at least half of those
             241      costs.
             242          Section 3. Section 63A-5-206 is amended to read:


             243           63A-5-206. Construction, alteration, and repair of state facilities -- Powers of
             244      director -- Exceptions -- Expenditure of appropriations -- Notification to local
             245      governments for construction or modification of certain facilities.
             246          (1) As used in this section:
             247          (a) "Capital developments" and "capital improvements" have the same meaning as
             248      provided in Section 63A-5-104 .
             249          (b) "Compliance agency" has the same meaning as provided in Subsection 58-56-3 (4).
             250          (c) (i) "Facility" means any building, structure, or other improvement that is
             251      constructed on property owned by the state, its departments, commissions, institutions, or
             252      agencies.
             253          (ii) "Facility" does not mean an unoccupied structure that is a component of the state
             254      highway system.
             255          (d) "Life cycle cost-effective" means, as provided for in rules adopted by the State
             256      Building Board, in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking
             257      Act, the most prudent cost of owning and operating a facility, including the initial cost, energy
             258      costs, operation and maintenance costs, repair costs, and the costs of energy conservation and
             259      renewable energy systems.
             260          (e) "Local government" means the county, municipality, or local school district that
             261      would have jurisdiction to act as the compliance agency if the property on which the project is
             262      being constructed were not owned by the state.
             263          (f) "Renewable energy system" means a system designed to use solar, wind, geothermal
             264      power, wood, or other replenishable energy source to heat, cool, or provide electricity to a
             265      building.
             266          (2) (a) (i) Except as provided in Subsections (3) and (4), the director shall exercise
             267      direct supervision over the design and construction of all new facilities, and all alterations,
             268      repairs, and improvements to existing facilities if the total project construction cost, regardless
             269      of the funding source, is greater than $100,000[.] unless there is memorandum of
             270      understanding between the director and an institution of higher education that permits the
             271      institution of higher education to exercise direct supervision.
             272          (ii) A state entity may exercise direct supervision over the design and construction of
             273      all new facilities, and all alterations, repairs, and improvements to existing facilities if:


             274          (A) the total project construction cost, regardless of the funding sources, is $100,000 or
             275      less; and
             276          (B) the state entity assures compliance with the division's forms and contracts and the
             277      division's design, construction, alteration, repair, improvements, and code inspection standards.
             278          (b) The director shall prepare or have prepared by private firms or individuals designs,
             279      plans, and specifications for the projects administered by the division.
             280          (c) Before proceeding with construction, the director and the officials charged with the
             281      administration of the affairs of the particular department, commission, institution, or agency
             282      shall approve the location, design, plans, and specifications.
             283          (3) Projects for the construction of new facilities and alterations, repairs, and
             284      improvements to existing facilities are not subject to Subsection (2) if the project:
             285          (a) occurs on property under the jurisdiction of the State Capitol Preservation Board;
             286          (b) is within a designated research park at the University of Utah or Utah State
             287      University;
             288          (c) occurs within the boundaries of This is the Place State Park and is administered by
             289      This is the Place Foundation except that This is the Place Foundation may request the director
             290      to administer the design and construction; or
             291          (d) is for the creation and installation of art under Title 9, Chapter 6, Part 4, Utah
             292      Percent-for-Art Act.
             293          (4) (a) (i) The State Building Board may authorize the delegation of control over
             294      design, construction, and all other aspects of any project to entities of state government on a
             295      project-by-project basis or for projects within a particular dollar range and a particular project
             296      type.
             297          (ii) The state entity to whom control is delegated shall assume fiduciary control over
             298      project finances, shall assume all responsibility for project budgets and expenditures, and shall
             299      receive all funds appropriated for the project, including any contingency funds contained in the
             300      appropriated project budget.
             301          (iii) Delegation of project control does not exempt the state entity from complying with
             302      the codes and guidelines for design and construction adopted by the division and the State
             303      Building Board.
             304          (iv) State entities that receive a delegated project may not access, for the delegated


             305      project, the division's statewide contingency reserve and project reserve authorized in Section
             306      63A-5-209 .
             307          (b) For facilities that will be owned, operated, maintained, and repaired by an entity
             308      that is not a state agency or institution and that are located on state property, the State Building
             309      Board may authorize the owner to administer the design and construction of the project instead
             310      of the division.
             311          (5) Notwithstanding any other provision of this section, if a donor donates land to an
             312      eligible institution of higher education and commits to build a building or buildings on that
             313      land, and the institution agrees to provide funds for the operations and maintenance costs from
             314      sources other than state funds, and agrees that the building or buildings will not be eligible for
             315      state capital improvement funding, the higher education institution may:
             316          (a) oversee and manage the construction without involvement, oversight, or
             317      management from the division; or
             318          (b) arrange for management of the project by the division.
             319          (6) (a) The role of compliance agency as provided in Title 58, Chapter 56, Utah
             320      Uniform Building Standards Act, shall be provided by:
             321          (i) the director, for projects administered by the division;
             322          (ii) the entity designated by the State Capitol Preservation Board, for projects under
             323      Subsection (3)(a);
             324          (iii) the local government, for projects exempt from the division's administration under
             325      Subsection (3)(b) or administered by This is the Place Foundation under Subsection (3)(c);
             326          (iv) the state entity or local government designated by the State Building Board, for
             327      projects under Subsection (4); or
             328          (v) the institution, for projects exempt from the division's administration under
             329      Subsection (5)(a).
             330          (b) For the installation of art under Subsection (3)(d), the role of compliance agency
             331      shall be provided by the entity that is acting in this capacity for the balance of the project as
             332      provided in Subsection (6)(a).
             333          (c) The local government acting as the compliance agency under Subsection (6)(a)(iii)
             334      may:
             335          (i) only review plans and inspect construction to enforce the building codes as adopted


             336      by the Uniform Building Codes Commission; and
             337          (ii) charge a building permit fee of no more than the amount it could have charged if
             338      the land upon which the improvements are located were not owned by the state.
             339          (d) (i) The use of state property and any improvements constructed on state property,
             340      including improvements constructed by nonstate entities, is not subject to the zoning authority
             341      of local governments as provided in Sections 10-9a-304 and 17-27a-304 .
             342          (ii) The state entity controlling the use of the state property shall consider any input
             343      received from the local government in determining how the property shall be used.
             344          (7) Before construction may begin, the director shall review the design of projects
             345      exempted from the division's administration under Subsection (4) to determine if the design:
             346          (a) complies with any restrictions placed on the project by the State Building Board;
             347      and
             348          (b) is appropriate for the purpose and setting of the project.
             349          (8) The director shall ensure that state-owned facilities, except for facilities under the
             350      control of the State Capitol Preservation Board, are life cycle cost-effective.
             351          (9) The director may expend appropriations for statewide projects from funds provided
             352      by the Legislature for those specific purposes and within guidelines established by the State
             353      Building Board.
             354          (10) (a) The director, with the approval of the Office of Legislative Fiscal Analyst,
             355      shall develop standard forms to present capital development and capital improvement cost
             356      summary data.
             357          (b) The director shall:
             358          (i) within 30 days after the completion of each capital development project, submit cost
             359      summary data for the project on the standard form to the Office of Legislative Fiscal Analyst;
             360      and
             361          (ii) upon request, submit cost summary data for a capital improvement project to the
             362      Office of Legislative Fiscal Analyst on the standard form.
             363          (11) Notwithstanding the requirements of Title 63J, Chapter 1, Budgetary Procedures
             364      Act, the director may:
             365          (a) accelerate the design of projects funded by any appropriation act passed by the
             366      Legislature in its annual general session;


             367          (b) use any unencumbered existing account balances to fund that design work; and
             368          (c) reimburse those account balances from the amount funded for those projects when
             369      the appropriation act funding the project becomes effective.
             370          (12) (a) The director, the director's designee, or the state entity to whom control has
             371      been designated under Subsection (4), shall notify in writing the elected representatives of local
             372      government entities directly and substantively affected by any diagnostic, treatment, parole,
             373      probation, or other secured facility project exceeding $250,000, if:
             374          (i) the nature of the project has been significantly altered since prior notification;
             375          (ii) the project would significantly change the nature of the functions presently
             376      conducted at the location; or
             377          (iii) the project is new construction.
             378          (b) At the request of either the state entity or the local government entity,
             379      representatives from the state entity and the affected local entity shall conduct or participate in
             380      a local public hearing or hearings to discuss these issues.
             381          (13) (a) (i) Before beginning the construction of student housing on property owned by
             382      the state or a public institution of higher education, the director shall provide written notice of
             383      the proposed construction, as provided in Subsection (13)(a)(ii), if any of the proposed student
             384      housing buildings is within 300 feet of privately owned residential property.
             385          (ii) Each notice under Subsection (13)(a)(i) shall be provided to the legislative body
             386      and, if applicable, the mayor of:
             387          (A) the county in whose unincorporated area the privately owned residential property is
             388      located; or
             389          (B) the municipality in whose boundaries the privately owned residential property is
             390      located.
             391          (b) (i) Within 21 days after receiving the notice required by Subsection (13)(a)(i), a
             392      county or municipality entitled to the notice may submit a written request to the director for a
             393      public hearing on the proposed student housing construction.
             394          (ii) If a county or municipality requests a hearing under Subsection (13)(b)(i), the
             395      director and the county or municipality shall jointly hold a public hearing to provide
             396      information to the public and to allow the director and the county or municipality to receive
             397      input from the public about the proposed student housing construction.


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