Oregon University System (OUS) campus buildings and property represent 50% of all state-owned facilities and have a $3.5 billion replacement value. The 2009-20011 Governor's Recommended Budget (GRB) for OUS Capital Construction proposes to make significant increases in key areas that will improve student access, and protect and enhance the value of its existing facilities, and create nearly 20,000 construction and related jobs in Oregon.
Total investment in capital construction is $980 million for 36 projects, including facilities repair, deferred maintenance, and new projects at all campuses; this includes a total of $18 million in General Fund. This compares to $761 million in 2007-2009.
Education & General (E&G) (General Fund, Article XI-G bonds, Lottery, COP, Gifts/Others) projects are the only types of facilities eligible to receive State General Fund revenues and Article XI-G bonds. E&G facilities provide the basic instructional space, administrative and campus support facilities necessary for the university. Examples include libraries, classrooms, and physical plants.
Auxiliary (Article XI-F(1) bonds, Gifts/Other) projects are self-financing and self-supporting. These facilities include Campus Housing/Dining, Parking and Athletics. Funding is primarily received through the use of Article XI-F bonds, repaid through revenues generated by operations.
Systemwide (State Energy Loan Program, SELP) projects support academic modernization, code, deferred maintenance and capital repair projects from the other three facility categories (E&G, Aux, SBF). Therefore, the funding sources for systemwide projects are the same funding sources available to the facility category under which the supported facility is classified.
Student Building Fee (Student Building Fee, Article XI-F(1) bonds) projects are student-related facilities such as recreation centers or student unions. The Student Building Fee Debt Service Reserve serves as the source of debt repayment on Article XI-F(1) bonds issued to finance the construction and renovation of major student facilities These projects are in a category of their own because they have a dedicated fund source.
Oregon University System follows Oregon Revised Statutes Chapter 351 and Oregon Administrative Rule 580-50 when submitting the capital budget. ORS Chapter 351 provides guidance to the OUS specific to higher education. Specifically, ORS 351 establishes OUS procurement authority separate from the state, releasing OUS from operating under ORS 279. OAR 580-50 establishes the rules and procedures OUS follows in campus planning, capital construction and use of property. One of the most prominent policies OUS now follows is that all newly constructed buildings must be LEED/SEED certified. Leadership in Energy & Environmental Design (LEED) is a green building rating system. Please view 'Seismic & Sustainability' on the left for more information. This requirement ensures that new OUS buildings are energy efficient, helping to reduce operating costs in the future.
The capital construction budget request must go through a comprehensive, multi-level review process of assessments, edits, and approvals. First, the budget starts out with the campuses working hand-in-hand with the Oregon University System. The campuses assess their current facilities, forecast their future enrollment, and anticipated the facilities needs of their programs while engaging their students, faculty, and staff. Next, the capital budget goes to the State Board of Higher Education for review. After the Board makes its recommendation, the budget is then submitted to the Governor's staff for review. The Governor then compiles his recommended budget for submission to the State Legislature.
General Fund - a pool of resources used to support a wide range of state services. These include K-12 schools, higher education, state police, state prisons, assistance and medical services for the needy.
Article XI-G bonds - defined by XI-G of the State Constitution, Article XI-G bonds may be issued to support E&G projects as long as they are matched equally by the General Fund (including Lottery Funds), Building Use Credits, or gift funds placed in a legislatively approved Donation Account. Debt service is paid from the State General Fund within the operating budget. No appropriations are received for debt service in the biennium in which the bonds are approved.
Article XI-F(1) bonds - defined by XI-F(1) of the State Constitution, Article XI-F(1) bonds may be issued for projects that are self-liquidating and self-supporting. Each campus and auxiliary is responsible for their share of the debt service. Projects not selling bonds within two years may request reauthorization in succeeding Legislative sessions.
Lottery - Oregon 's Lottery proceeds are used to support education, economic development, and natural resources programs. Lottery Bonds are administered by the Department of Administrative Services, with State Lottery revenue pledged to pay the debt service.
Certificates of Participation - Tax-exempt government securities used to raise funds to improve and construct buildings or purchase equipment. Certificates of Participation (COP) are used to finance capital costs related to construction or acquisition and may not be used to finance ongoing operating costs. In return, the investors receive COP payments, which include interest income that is exempt from federal and Oregon income tax.
Gifts/Other - These include various gifts and grants. Gift funding typically consists of donations. Grant funding is present at the federal, state, and local level.
State Energy Loan Program (SELP) – This program offers low-interest, long-term loans for any qualified Oregon project that invests in energy conservation, renewable energy, alternative fuels, or creating products from recycled materials. These Oregon general obligation bonds support the loans used to fund a majority of the OUS capital renewal backlog as proposed in the GRB. The loans would be structured so that energy savings and General Funds would cover the loan payment.
Student Building Fee – This fee is established by the State Legislature and is currently $45 a term. These funds, collected from students for the Student Building Fee Debt Service Reserve, serve as the source of debt repayment on Article XI-F(1) bonds issued to finance the construction and renovation of major student facilities such as recreation and fitness centers, student unions, and child care centers.