Analysis of the 2004-05 Budget Bill Legislative Analyst's Office February 2004

Department of General Services (1760)

The budget includes requests totaling $3.3 million of general obligation bond funds for the Department of General Services (DGS) capital outlay program. This amount includes:

• $0.1 million for management of design and construction for previously funded seismic retrofit projects to improve the earthquake safety of state buildings.
• $815,000 to evaluate seismic risk associated with various state buildings. These studies may identify future costs for which bond funding may or may not be available to complete the project. In order for these projects to be constructed, an unknown amount of funding from the General Fund would be required in the future.
• $3.1 million for design and construction of one seismic retrofit project.

Infrastructure Plan

For the 2003 California Five Year Infrastructure Plan, DGS identified $2.3 billion of infrastructure needs for the five-year period 2003-04 through 2007-08 (see Figure 1). This amount includes $2.1 billion for the renovation or construction of 20 state office buildings, $160 million to upgrade the central plant in Sacramento, $107 million for structural seismic retrofits to 16 state facilities, and $44 million for a new public safety radio system.

State Building Construction Program

The State Building Program is based on regional facility plans that outline the most appropriate means for housing state office operations in a defined area. The DGS, through the regional facilities plans, identifies current and future space demand for state agencies and ensures that facilities adequately meet the programmatic needs of the agencies. In determining the space needs of the various state agencies, DGS considers changes to the number of employees in an agency, benefits of consolidating fragmented agencies, and location requirements necessary to best meet program delivery needs.

Many state agencies currently occupy expensive leased space, and the State Building Program encourages the construction of new state office buildings and the renovation of existing state-owned buildings, with the understanding that state-ownership of a building, as opposed to long- term leases, will ultimately result in savings to the state through the avoidance of ongoing lease payments. While state office building projects are not critical fire, life safety projects, they do result in state agencies being consolidated into single buildings to achieve operational efficiencies and cost savings.

Budget Request. The 2004-05 Governor's Budget does not propose any new office building projects in 2004-05. According to the 2004-05 Governor's Budget Summary, the administration is evaluating various alternatives to reorganize and streamline state government. As such, it would be premature to propose new projects at this time. However, it should be noted that seven authorized office building projects, and a renovation of the central heating and cooling plant in Sacramento, are currently in progress.

State Building Seismic Retrofit Program

The DGS administers the state's building seismic retrofit program in order to decrease the risk to life resulting from major earthquakes by rehabilitating state-owned buildings. In June 1990, the voters passed Proposition 122—the Earthquake Safety and Public Buildings Rehabilitation Bond Act—that provided $300 million in general obligation bonds for the purpose of constructing earthquake safety improvements. The act allocated $250 million for state buildings (excluding higher education programs) and $50 million for matching grants for local government buildings. Provisions of the bond act specify purposes for which the proceeds can be used—including the retrofit, reconstruction, repair, replacement, and relocation of state and local buildings found to be seismically deficient.

Seismic Retrofit Project Selection. Projects are selected for funding based on consideration of seismic stability and risk-to-life issues, building occupancy, and seismic activity characteristics for the building site. In the past, projects have been assigned a risk level between I (lowest risk) and VII (highest risk). Historically, projects with a seismic risk level V have been completed before risk level IV projects because they pose a greater risk to life.

Budget Request. The funding included in the budget would provide funding to (1) continue administration of currently authorized retrofit projects, (2) fund one new retrofit project, and (3) study additional facilities for future retrofit projects.