University of Utah Student Life Building

Sen. Jenkins asked about the removal of the three statutory requirements relating University of Utah Student Life Building.

Sen. Adams stated that the restrictions were placed on the University at a time when there was a question about student life buildings in general. Since that time, multiple student life buildings have been built throughout the state in other universities without any restrictions. Sen. Adams commented that according to the Division of Facilities Construction Management (DFCM) those restrictions are perhaps outdated. Sen. Adams suggested the EAC may need to apply the restrictions equally among all of the institutions.

Sen. Jenkins referred to a legislative performance audit of mandatory student fees at the University of Utah which raises some question on whether or not the fees would be managed correctly.

Ms. Barbara Snyder, Vice President of Student Affairs, University of Utah, stated that the University is committed to being a good steward of student fee money. She explained that the University was asking for the removal of the requirement to raise $15 million in donations prior to bonding because the University cannot move forward with bonding without the full $15 million converted into cash. Ms. Synder stated that the University will continue to raise money toward this end but will not raise the student recreation fees to more than $60 per semester.

Sen. Jenkins asked for some reassurance that the University has student fees under control.

Ms. Synder stated that the University took the recommendations of the performance audit very seriously and put a fee committee in place similar to those that have been so widely praised at other campuses. She stated that the University continues to dialogue with the students about fees and is monitoring those funds very carefully.

Rep. Hughes expressed his concern about the precedent that may be set in amending statutes. He asked about the language to remove the limitation on raising student recreation fees more than $60. Ms. Synder stated that the revision was not necessary and that the University did not intend to raise student recreation fees more than $60.

Sen. Romero stated that as a member of the Legislative Audit Subcommittee, it was his recollection that the University appreciated the auditor's review of the student fees and would take appropriate action. He said that he felt comfortable with the University's testimony.

Rep. Dougall asked why the University is building new buildings and not focusing on the existing infrastructure that is in such disarray.

Mr. Jason Perry, Vice President of Government Affairs, University of Utah, stated that the Legislature is helping to fix the infrastructure. He attributed the condition of the infrastructure, in particular, the electrical system, to a policy decision to only fund utility rates at a schedule 9 level rather than a schedule 6 level. Consequently, there has not been any money available to cover depreciation of infrastructure.

Mr. Perry pointed out that the University recently presented some proposals to the Legislature that will ensure maintenance of the infrastructure.

Rep. Dougall commented that this feels like a bail out.

Mr. Perry explained that almost every member of the IGG Appropriations Subcommittee was able to observe first hand the condition of the infrastructure at the University. The subcommittee understood that the infrastructure needed to be taken care of and that the Legislature had not given enough money to the University over the past fifty years.

Rep. Hughes asked for a clarification on which fees the University would not raise. Vice President Snyder stated they are not going to raise any of the fees to fund the Student Life Building.

S.J. Quinney College of Law Building

Rep. Hughes asked about the funding source for the Board of Regents revenue bonds to build the College Law Building.

David W. Pershing, President, University of Utah, clarified that the University is asking for a $60.5 million revenue bond which will be secured with $25 million in donations, building fees paid by law students who benefit from the building, and a small amount of institutional funds.

Rep. Dougall asked President Pershing if a building that was funded by the state, by student fees, or by private donations, belonged to the state or to the University. President Pershing stated that every building on campus is a state building.

Sen. Niederhauser commented that there needs to be a long term solution for infrastructure that also includes hot water heating systems.

Mr. Gregg Buxton, Director, DFCM, explained that the division attempts to include upgrades to existing systems when new buildings are built. He stated that the University's infrastructure is old and has reached its life expectancy. Capital improvements have only been funded at 25 percent of the need year after year.

Sen. Niederhauser asked about including infrastructure into the budgets of new buildings. Mr. Buxton pointed out that Weber State University had included money for infrastructure in the new Elizabeth Hall Building. Mr. Buxton stated that is only a matter of time before the infrastructure at other institutions will require attention.

Mr. Buxton presented some background information regarding the statutory requirements on the Student Life Building.

Sen. Niederhauser asked for some reassurances that institutions will not come back for O & M or look for O & M elsewhere.

Mr. Buxton commented that the authorization process is getting better each year as evidenced by recent project requests to the Building Board.

HPER Parking Terrace and Health Sciences Center Parking Terrace

Sen. Hillyard asked about the costs for the HPER Parking Terrace and Health Sciences Center Parking Terrace.

Mr. Michael Perez, Associate Vice President of Facilities, University of Utah, stated that the HPER Parking Terrace and the Health Sciences Center Parking Terrace are budgeted for $20,000 to $21,000 per stall. He noted that there are four potential locations for the two parking terraces, which will have about 900-1,000 stalls per terrace.

Further Committee Discussion

Co-Chair Hillyard asked how much of the $15 million had been raised for the Student Life Building. Ms. Snyder stated that over the last four and one half years, the University had raised more than $6 million in private donations. They hoped to secure a gift that would take them closer to the $15 million.

Co-Chair Hillyard asked why the University wanted to remove the restriction of only using student funds for bond payments. President Pershing stated that faculty and staff would like to use the Student Life Building as well. Vice President Snyder noted that the total cost of the building, $42.5 million, would be paid for through student fees - $27 million and donations - $15 million.

Co-Chair Hillyard inquired about increasing the maximum bonding authorization from $20 to $30 million for the U of U Dee Glen Smith Athletic Center and how the bond payment would be paid back. President Pershing stated that the bond would be paid back with television revenues and other donations.

Co-Chair Hillyard asked about the revenue bond authorization for the S.J. Quinney College of Law Building. President Pershing indicated that the University currently has $25.5 million in firmly committed donations including about $7 to $8 million in cash. The balance of the $60.5 million revenue bond will be paid for through students fees. He indicated that O & M would have to come out of student fees.

Rep. Menlove asked if any of the dollars requested for infrastructure repair will be used to maintain existing parking terraces. President Pershing stated that the request for infrastructure funding will be used for electrical and hot water pipe upgrades on campus buildings. Rep. Menlove asked how the University

plans to replace and maintain the new parking terraces. President Pershing indicated that those costs are built into the fee structure and that the University will not be coming back for O & M.

President Waddoups inquired about the locations of the new parking terraces. President Pershing stated that the parking terraces would be built on an existing parking lot or raw ground. He stated that the ideal location would be to build the terraces on a slope.

Dental School Building

President Waddoups asked about the need for the Dental School Building.

Mr. Lynn Powell, Interim Dean for Dental Education, University of Utah, stated that the Dental School Building will allow the University to convert the existing one-year program to an in-state four-year program, which will save the students and the state a considerable amount of money in tuition. The state subsidizes Utah students paying out-of-state tuition elsewhere. Mr. Powell indicated that the number of students participating in dental education will remain the same.

President Waddoups suggested that rather than removing the requirement on using only student funds for bond payments for the Student Life Building, adding the words "or with faculty and staff contributions or funds." President Pershing agreed with President Waddoup's suggestion.

Rep. Dougall asked how much revenue is generated on the parking stalls. Mr. Perez stated that he would be happy to provide him with that information. Rep. Dougall asked Mr. Perry to find out the cost of a student parking pass. Mr. Perez stated that faculty and staff must also purchase parking passes, which amounts to several hundred dollars per year.

Co-Chair Hillyard asked how many additional students the College Law School Building will accommodate. President Pershing projected about 400 students by 2013 and about 450 to 500 students over the period of the building construction.

SUU Museum of Arts

Co-Chair Hillyard inquired about the request to remove the prohibition in statute (2010) from the SUU Museum of Arts asking for state funding for O & M and capital improvements.

Mr. Dorian Page, Vice President of Financial Services, Southern Utah University, explained that the SUU Museum of Arts building will be used for instructing students who will manage and operate the museum. The museum is not a revenue producing building. The total cost of the building is $12.5 million and SUU has commitments for $9 million including $1.5 million cash in the bank. Mr. Page noted that Iron County and Cedar City have also committed funds to this project. There is also a $2 million revenue bond that will be paid for with student fees. Mr. Page stated that SUU had not expected that the request for O & M would require a statute change.

Rep. Hughes stated that SUU is not the only institution of higher learning that began a process of building buildings without the need for, or the request for O & M. In researching the authorization request to build the SUU Museum of Arts, Rep. Hughes stated that on February 3, 2010, President Michael Benson indicated that he could cover the O & M from other areas of the budget and from an additional student fee.

Rep. Hughes noted that when the Legislature approved the authorization in 2010, there were other institutions that had also requested building authorizations. Not only did statute state that SUU may not request state funds for O & M, but the same statute was written for other institutions' buildings as well.

Rep. Hughes asked if the Legislature chooses to accommodate SUU's request for O & M, what would preclude the other institutions from wanting the same opportunity? He asked why the Legislature should change statute if it was comfortable with the language at the time it was written?

Mr. Page stated that at the time the statutes were written, the state of the economy was not conducive to funding O & M. The institutions were expected to cover O & M on their own. The sentiment may have been as the economy improved, the institutions might be able to come back to the Legislature and ask for those funds.

Rep. Hughes stated that those are the rules that were set. He cautioned that if the Legislature wants to explore a policy change, there will be a line of institutions that will want the same opportunity.

Sen. Adams added that capital improvement funds have been used for remodels in previous years. For next year, the IGG Appropriations Subcommittee has restricted capital improvement funds to be used only on infrastructure. There are some institutions, however, that do not have infrastructure issues and have asked to use those funds elsewhere. Co-Chair Hillyard commented that Dixie State College had talked about using capital improvement funds for other projects rather than for infrastructure.

Co-Chair Hillyard asked about the $2.5 million cap on capital improvement projects. Sen. Adams stated that infrastructure projects can be costly and may be prudent to raise the spending limit.