The Minnesota State Colleges and Universities system is an Equal Opportunity employer and educator.

Minnesota State College Student Association – Business MeetingMesabi Range Community and Technical College – VirginiaSeptember 14, 2013

Capital Planning UpdateBrian YolitzAssociate Vice Chancellor – Facilities

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Purpose Overview of the FY2014 capital bonding

request System facility resources and planning Be available to answer any questions in

the facilities portfolio

Overview Background

System Facilities Infrastructure

Process overview

2014 capital bonding details Process

Program

The way ahead Opportunities for your involvement

Upcoming events

Questions and Discussion

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Facility Space – Square Footage 27.8 million total gross

square feet of facility space 5 Mall of Americas Roughly 1/3 of the State of

Minnesota’s facility space 54 Campuses:

Largest: St Cloud State University 3.258 million sq ft

Smallest: Riverland Community

College – Owatonna 27,600 sq ft

21.687

4.843

1.025 0.112 0.167

Academic Revenue Fund Revenue Fund - Ramps

Mothballed Others

Gross Square Footage(Millions)

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Facility Space – By Campus

Alexan

dria

Anoka-Ram

sey - C

ambrid

ge

Bemidji S

tate

Centra

l Lak

es - B

rainerd

Centu

ry Colle

ge

Fond du La

c

Hennep

in Tech

nical -

Eden

Prairie

Lake

Superi

or

Metropolit

an St

ate

MN State

South

east

Tech

nical -

Winona

MN West

- Gran

ite Fa

lls

MN West

- Pipest

one

M-State

- Detr

oit Lak

es

M-State

- Moorh

ead

MSU M

oorhea

d

NHED - H

ibbing

NHED - M

esabi R

ange

- Eve

leth

NHED - R

ainy R

iver

Norman

dale

Northlan

d - East

Grand Fo

rks

Pine Tec

h

Ridgewate

r - Hutch

inson

Riverla

nd - Albert

Lea

Riverla

nd - Owato

nna

South

Centra

l - Fa

ribau

lt

South

west M

innesota

State

St. Cloud Te

chnica

l0

500,000

1,000,000

1,500,000

2,000,000

2,500,000

3,000,000

3,500,000

Academic Revenue Fund Ramps Mothballed Other

Gro

ss

Sq

ua

re F

oo

tag

e

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1880 1885 1890 1895 1900 1905 1910 1915 1920 1925 1930 1935 1940 1945 1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010 20150

1,000,000

2,000,000

3,000,000

4,000,000

5,000,000

6,000,000

Gross Square Footage Constructed - 5 year Groupings

Squ

are

Foo

tage

Source: FRRM report, Report 2.12, Academic Buildings

The year represents new sq. ft. constructed that year and prior 4 years (i.e. 2010 = 2006, 2007, 2008, 2009, 2010)

System Buildings Are Middle Aged

Source: FRRM 2012, Report 2.10

Middle Aged Buildings

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Facility Space – Total Value $7.3 billion replacement

value Total Backlog: $818M Total 5-Year Renewal: $523M Facility Condition Index:

Academic: .113 Revenue Fund: .086

Investment avenues Capital bonding

HEAPR and Major Projects Revenue Fund Local campus funding

$6,232.28

$1,225.04

$72.46 $29.35 $38.86

Academic Revenue Fund Revenue Fund - Ramps

Mothballed Others

Replacement Value ($ Millions)

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Total Capital Investment History

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013$0

$50

$100

$150

$200

$250

$300

Capital Projects HEAPR Revenue Fund

Mill

ions

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Operating Funds – R&R Campuses, on average, have exceeded the recommended

$1/sq. ft. annual R&R guideline for academic spaces: 5 year average: $29.5M

Potential annual funding: $30M

2008 2009 2010 2011 2012 2013$20$22$24$26$28$30$32$34

$27.5$25.8

$28.8

$32.6 $33.0

Annual R&R Investment ($M)

Annual R&R Investment ($M)

Goal: $21.7M

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Program Development BoardAction

LegislativeSession

Campus Tours

LegislativeSession Design and Construction

Bonding:• HEAPR and Projects

2012

2014

2016

Revenue Fund:

2011

2013

2015

2012

2012

2013

2013

2014

2014

2015

2015 2016

Basic Capital Timelines

Fiscal Year:

Calendar Year:

Program Development Design and ConstructionBoard

ActionBondSale

Program Development Design and ConstructionBoardAction

BondSale

Design and Construction

Program Development BoardAction

LegislativeSession Design and ConstructionCampus Tours

Today

2014 CAPITAL BONDING DETAILS

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2014 Capital Budget TimelineSystem Strategic Plan

Facilities Master Plans

Facilities Requirements• Maintain, Repair, Renovate,

Renew, Demolish, New • HEAPR• Capital Bonding• Revenue Fund• Other

Project Predesign• Basic Information• Scope• Cost• Schedule• Strategy

• Contracting• Design and Construct• Design then Construct

Board Capital Budget Guidelines

• Each biennium • Program focus• Size• Criteria elements

Capital Project Scoring• Cross functional teams

• Campus and Staff• Admin and faculty

• Project Predesign data• Board Guidelines• Individual Project Scores

Chancellor Review and Analysis

• Scoring team results• Presidential feedback• Program adjustments• Chancellor’s

Recommendation:• Project list• Priority

GovernorApproval

Legislative Action• House and Senate Capital

Investment Committees• Conference Committee• Capital Bonding Bill

Board Approval• Committee and

Board Hearing• Testimony• Projects and Priority

Approval• Initial Direction for

the future planning

MMB Review• Review and

adjustment• Integration with

other state agency requests

• Support legislative visits

• Governor Recommendation development

June 2013

March – May2013

January2013

April 2012

July 2013 – January 2014February – May 2014

May 2014

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State Capital Budget Priorities State established budget priorities under Minn. Stat. 135A.034:

(1) maintenance and preservation of existing facilities;

(2) completion of projects that have received funding;

(3) updating facilities to meet contemporary needs;

(4) providing geographic distribution of capital projects; and

(5) maximizing the use of non-state contributions.

Board Guidelines for 2014 Overarching Principles:

Take care of what we have

Make campus space more efficient and flexible

Mothball or demolish what is no longer viable in terms of conditions, operating costs, and programs, and

Only consider new square footage if the requirement meets the three priorities in the strategic framework

Strategic Framework: Access to an extraordinary education

Partner of choice

Highest value/most affordable option

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Capital Project Scoring Scoring mechanism built on Board Guidelines

Access to an extraordinary education – 30% Classroom redesign, 4-year program in metro, success of

underrepresented students, college/university collaboration, academic program demand

Partner of choice – 20% Emerging and sustained workforce and community needs, STEM

programming, increased recruitment, retention, completion and transfer within system

High value/most affordable option – 50% Reduced or sharing of costs, asset preservation/backlog reduction,

space use, projects costs, campus R&R investment history, financial impacts, CFI, utility/resource conservation

Prior approval and Institutional priority – +10 Points for each Executed by representatives from across the system16

Higher Education Asset Preservation and Replacement (HEAPR) Authorized in 135A.046 – Asset Preservation and Replacement

Number 1 priority to take care of what we have Used for:

Preservation of building interiors and exteriors Renewal Code Compliance Energy efficiency improvements

Keep Up / Catch Up Strategy: Address anticipated needs Reduce backlog by 50% over 10 years Calls for $110 million in HEAPR investment per biennium

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Keep Up / Catch Up Keep Up: Address annual renewal needs :

$414M/5 = $83M annually

Catch Up: Reduce backlog by 50% in 10 years: $705M X 50% / 10 = $35M annually

Total required asset preservation investment: $118M annually

Available resources/funding streams: Operating Funds – R&R

Capital Investment – Major renovation and repair projects

Capital Investment – HEAPR

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Investment Needs Available resources/funding streams:

Annual R&R: Goal of $1/sq. ft. = $21.7M 5 year average: $29.5M Assume: $25.5M

Major renovation and repair projects: Assume $37.5M Based on capital project funding:

$154.3M in major projects = roughly $77M annually Assume 50% of projects HEAPR/HEAPR-like = $37.5M

HEAPR requirement: $118M - $25.5M - $37.5M = $55M annually -> $110M over a biennium

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Investment in Minnesota Asset preservation:

110 HEAPR Projects at 47 campuses 53% improves building exterior integrity: roofs, walls, windows 40% building infrastructure systems: HVAC, electrical, plumbing 5% code and standard compliance

Improves existing educational and student support space Renovates and renews 743,000 sq. ft. at 26 campuses

Select expansion to meet workforce needs STEM, allied health, transportation, general studies and workforce

skills 2 universities and 5 colleges

Replacement or elimination of obsolete space: Within capital projects at 6 campuses Demolition initiative at up to 16 campuses

Board Approved 2014 Capital Program General Obligation funding: $227.7 million System financing: $58.8 million Total Capital Program: $286.5 million Major elements:

$130.6 million – HEAPR and Demolition

$155.9 million – Capital project design and construction

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FY2014Capital Budget Request

2014 2016 New Renovate RenewalDemo/

Mothball

1 HEAPR SystemwideSystem

wideHigher Education Asset Preservation and Replacement

D/C $130,576,000

2 Metropolitan State University St. Paul MetroScience Education Center new construction

C $35,865,000 65,712 3,500

3 Bemidji State University BemidjiNorth West

Memorial, Decker, and Sanford Hall renovation, demolition; design, post-demolition Hagg Sauer

D/C $13,790,000 4,000 46,700 11,800 17,000

4 Lake Superior College DuluthNorth East

Allied Health ('86 Wing) Revitalization renovation

D/C $5,266,000 36,500 4,500

5Minneapolis Community & Technical College

Minneapolis MetroWorkforce Program Phase 2 renovation

D/C $3,600,000 90,470

6Saint Paul College (Initiatives)

St. Paul MetroInitiatives: Culinary Arts Lab, and Machine Tool renovation

D/C $1,500,000 16,773 10,777

7Minnesota State College - Southeast Technical (Initiatives)

Red Wing, Winona

South East

Initiatives: Welding/Indust. Labs, Science Labs, and Multipurpose Classrooms renovation

D/C $1,700,000 14,250

8 Central Lakes College StaplesNorth West

Campus Rightsizing renovation D/C $4,581,000 7,435 56,895 17,810

9Minnesota State University, Mankato

MankatoSouth East

Clinical Science Building new construction, renovation

C $25,818,000 $4,444,000 55,717 13,191 8,584

10Minnesota State Community & Technical College

MoorheadNorth West

Transportation Center addition D/C $6,544,000 22,630 23,186 2,900

11Rochester Community and Technical College

RochesterSouth East

Design, post-demolition Plaza, Memorial & Art buildings

D $1,000,000 13,530

12Minnesota West Community and Technical College (Initiatives)

Jackson, Canby

South West

Initiatives: ITV Classrooms, Powerline Training Facility, and Geothermal System renovation

D/C $3,487,000 10,900 44,090 18,000

13Dakota County Technical College

Rosemount MetroTransportation & Emerging Technologies lab renovation

C $7,586,000 42,580 22,970

14Century College (Initiatives)

White Bear Lake

Metro

Initiatives: Digital Fabrication, Kitchen space, and Solar Panel System renovation

D/C $2,020,000 6,000 1,700

15Northland Community Technical College

Thief River Falls

North West

Aviation Maintenance Facility Expansion demolition and addition

C $5,864,000 20,410 5,790 21,680

16(NHED) Northeast Higher Education District (Capital and Initiatives)

Itasca, Hibbing,

Rainy River, Vermilion

North East

Initiatives, Capital: Science Labs (3), Art Classroom, Biomass renovate; Rightsizing /Demolition

D/C $3,344,000 $8,600,000 20,000 19,371 8,500 46,805

17 Winona State University WinonaSouth East

Education Village, Phase I, renovation

D/C $5,902,000 $18,697,000 1,000 18,816

18Anoka Technical College (Initiatives)

Anoka MetroInitiatives: Manufacturing Technology Hub, and Auto Tech Lab renovation

D/C $1,500,000 42,025

19 Saint Paul College St. Paul MetroHealth & Science Alliance Center addition

D/C $14,482,000 36,770 3,248 8,000

20 Century College White Bear

LakeMetro

Classroom and Workforce Alignment addition

D $1,000,000 $12,432,000 25,584 4,000 1,000

21 South Central CollegeNorth

MankatoSouth East

STEM and Healthcare Workforce renovation

D/C $7,467,000 19,765 71,125

22 St. Cloud State University St. Cloud CentralIntegrated Student Health and Academic Programs renovation

D $865,000 $15,000,000 15,562 43,291

23Minnesota State Community and Technical College (Initiatives)

Fergus Falls,

Wadena

North West

Initiatives: Campus Rightsizing, and Center for Student Success renovation

D/C $1,385,000 21,832

24Northland Community and Technical College (Initiative)

East Grand Forks

North West

Initiative: Laboratory renovation D/C $749,000 754 4,450

25Winona State University (Initiative)

WinonaSouth East

Initiative: Psychology Lab - Phelps Hall renovation

D/C $591,760 3,703

$286,482,760 $59,173,000 278,285 540,800 202,301 132,195

$130,576,000

Appeared on 2013 Capital Budget Bonding List $155,906,760

$51,968,920

Square Footage

Previous Appropriation (2008-2012)

Project Type

Project CostDesign OR

Construct

First Time Submittal

Project Type Legend FY2014 - 2019 Major, HEAPR, and Demolition GRAND TOTAL:

Projects:

HEAPR:

user (MnSCU) Financing:

Priority Institution Campus/ Location

Region Project Title

2014 Capital Budget Projects Locations

Program impact on space Reflects impact of priority capital projects and demolition Does not reflect HEAPR as these funds are facility system

focused

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Square Footage % of 2014 Program

Change in Square Footage

Renovation 540,800 34.7% 0Renewal 202,301 13.0% 0New Facilities 278,285 17.9% +278,285Total Demolition 535,645 34.4% -535,645Total Impact 1,557,031 100.0% -257,360

HEAPR Highlights $110 Million request 47 campuses have projects on the HEAPR list 110 individual projects Nearly 90% have an energy savings component 2-3% for future design 1.25-1.5% for storm water compliance

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HEAPR Highlights

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Roof Repairs/ Replacement

Heating, Ventilation, & Air Conditioning

Exterior - Walls, Windows & Doors

Building Interior PlumbingElectricalLife Safety Codes

Fire Safety Site work Utility Infrastructure

Demolition Highlights System-wide demolition/relocation of space – $20.6 million

Fiscal and facility sustainability

Eliminate backlog (demand for HEAPR) operating expenses

Target removal of obsolete space: Mothballed

Chronically underutilized

Called out in campus facilities master plan

Demolish and mend campus facilities Manage within HEAPR May require legislative work to best incentivize program

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Capital Projects Programmatic Impact of $155.9 million investment

STEM: $48.0 million

Metropolitan State, NHED, Northland, South Central, and WSU

Allied Health: $45.5 million

Lake Superior, MSU, Mankato, and Saint Paul

Technical Programs: $38.4 million

Anoka, Central Lakes, Century, DCTC, MCTC, MnWest, MState, Northland, Southeast Technical, and Saint Paul

Business and Education: $21.7 million

Bemidji State, Century, RCTC, and Winona State

Student Support and Services: $2.3 million

MState and St Cloud State

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Opportunities For Your Involvement Today: Capital Bonding Advocacy Tours

Voice of the user – powerful influence

Thanks for the facilities you have

Needs for the future:

Future: Master planning phase:

Vision, needs and desires

Funding strategies and priorities

Predesign and Design

Basic requirements

Scope, cost, and schedule

Delivery strategies

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Campus Tours Legislators and staff, MMB Some visits are touring capital projects; others part of a

broader visit Some using campus as hearing location Capital investment committees highlighted Senate Capital Investment developing schedule

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Committees/Entities Legislative Entities: House Capital Investment House Higher Education and Policy Senate Capital Investment Senate Higher Education and Workforce Development

Executive Branch: Minnesota Management and Budget to help establish

Governor’s recommendation

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Confirmed Legislative ToursHouse Capital Investment:

September 17 – Anoka Technical, Central Lakes (Brainerd) September 18 – Bemidji State University September 19 – Minnesota State Community and Technical College,

Moorhead September 24 – Century College, Lake Superior College September 25 – Hibbing Community College September 26 – Itasca Community College October 8 – Winona State University, Rochester Community and

Technical College October 9 – MSU, Mankato October 29 – Saint Paul College , Metropolitan State University

Senate Capital Investment: October 2 – Hibbing Community College October 3 – Central Lakes College (Staples)

Questions and Discussion

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2015 Revenue Fund Basics Odd-year cycles (2011, 2013, etc) System issues bonds (not state) Fee revenue is payment mechanism

2015 Projects Early stages $60 million projected 5 campuses (MSU Moorhead, MSU, Mankato, Century,

Inver Hills, NHED - Vermilion)