Capital Outlay—California State University

The budget proposes to spend $341 million on 12 CSU capital projects by using various existing general obligation bonds and issuing $325 million in new lease–revenue bonds. The proposed funding would support additional phases of seven projects previously funded by the state and five new projects. With the exception of the equipment phases of the projects funded with lease–revenue bonds, each of the proposed projects would be fully funded in the budget year and would not require additional appropriations to complete in subsequent years.

Costs for New Projects Inflated to Support Sustainable Design

The five new projects proposed in the Governor’s budget include supplemental funding to support sustainable design. As shown in Figure 24, this supplemental funding represents approximately 3 percent of each project’s total cost. Sustainable building practices are meant to reduce the negative environmental effects associated with the construction and operation of buildings. Designing new buildings and renovating existing buildings to be more sustainable is one part of the state’s efforts to improve energy efficiency and meet the goals of AB 32. (See the nearby box for more background on the state’s actions concerning sustainable building practices.) Sustainable buildings typically have higher upfront costs to accommodate alternative materials, new technologies and energy–efficiency upgrades. These costs are usually recovered over the life of the building through lower utility and operating costs.

In 2006, the CSU Board of Trustees adopted specific guidelines for sustainable building within the CSU system. Under these guidelines, CSU has constructed state–funded and nonstate–funded facilities to meet an internally developed standard for sustainability. The standards are similar to other certification standards for sustainable buildings, such as the Leadership in Energy and Environmental Design (LEED) certification administered by the United States Green Building Council. The CSU developed their own standards to better reflect the needs of California’s climate and individual campuses. However, a number of these buildings have qualified for LEED certification at its silver and gold standards.

Although CSU’s sustainable building policy appears consistent with state policy for decreasing energy usage and greenhouse gas emissions, it is not clear that additional funding is needed to meet those policies. Given that CSU has already completed sustainable buildings with state funds and has additional state–funded sustainable buildings under construction, we question whether additional augmentations are necessary for the proposed projects to meet sustainable standards. In fact, CSU proposed these same projects last year without supplemental funding for sustainable measures. Since that time, CSU has not changed its sustainable building policy—for example, it has not set higher certification standards—and UC, which has a similar sustainable building policy, has not requested augmentations for sustainability in its projects. Therefore, we recommend the Legislature withhold the supplemental funding for sustainable building in the Governor’s proposal unless CSU provides additional information that justifies the increases in cost.

Reduce Equipment Funding for Three Replacement Buildings to Encourage The Reuse of Current Equipment

The Governor proposes equipment purchases to fully furnish three replacement buildings. In each case, the existing departments or programs moving into the replacement buildings already have useable equipment in their current locations. Not all of the existing equipment will be transferable. Some of their current furniture could be worn and need replacement, and certain instructional or lab equipment could need replacement or be obsolete due to changing technology. The layout of the new facilities could also warrant new equipment—for example, new cubicle workstations or specialized lab equipment. However, we believe it would be realistic to expect that some furniture and equipment could be reused in the new facilities. This would be similar to a CCC policy which does not provide state funding for equipment in renovation or replacement projects that support existing programs. Therefore, we recommend the Legislature reduce equipment funding for the following three replacement projects by 50 percent in recognition that a portion of existing equipment can be reused:

• Peterson Hall 3 Replacement Building, Long Beach. We recommend reducing the equipment costs by $2.4 million.
• Science Replacement Building, Los Angeles. We recommend reducing the equipment costs by $2.1 million.
• Corporation Yard and Public Safety, Los Angeles. We recommend reducing the equipment costs by $383,000.

Reduce Scope and Cost for Science II, Phase 2 at CSU Sacramento

The Governor’s budget proposes $98 million for the planning and construction of a new science complex at the Sacramento campus. The facility would replace two existing buildings which would be demolished as part of this project and allow the biological sciences and chemistry departments to relocate into more modern laboratory space. While we agree that the existing buildings are in need of replacement or renovation, we have concerns that this project would add unneeded capacity to Sacramento’s campus. Specifically, we take issue with the following space elements in the project:

Inclusion of Planetarium Results in Excess Lecture Space. The proposed project would include a 100–seat lecture hall equipped with federally funded planetarium equipment. The hall would mostly be used as a lecture facility for the general campus since the astronomy department only offers three to four courses per semester. Due to its use as a planetarium, however, CSU classified the space as “other instructional space” rather than lecture space. This means that the proposed building includes excess lecture space—the lecture space CSU Sacramento normally would be allocated based on its forecasted enrollment plus the planetarium space. As a result, we recommend that the Legislature remove space for 100 lecture seats from the science complex to recognize that the planetarium would mostly serve as lecture space.

Increase in Laboratory Space Unjustified. Replacing the existing buildings with the proposed science complex would create additional laboratory capacity for the campus. Additional capacity at the campus is not justified since facilities are currently underutilized in the summer. The campus reports it only enrolls about 1,200 FTE students in the summer compared with over 23,000 FTE students in the fall term. If campus instructional facilities were utilized year round, several thousand more students could be accommodated without the need to expand physical capacity.

Gallery Space Is Not a Programmatic Priority. In view of other statewide needs in higher education, we question the expenditure of limited funds on a science gallery and atrium for the entrance to the science complex. The proposed science gallery would provide space for students and visitors to view biological specimens. Although there is a programmatic need for storing and displaying specimens in the biological sciences department, the proposal already includes 1,500 asf of museum space in other sections of the building. The science gallery and atrium, on the other hand, appear more focused on providing public spaces for visitors to the planetarium, which is not consistent with the university’s core mission nor the university’s stated intention to use the planetarium space mainly for instruction as opposed to public performances. Rather than a building entrance consisting of an atrium and science gallery that is not suited to the needs of the university, we believe the students and the state budget’s interests would be better served with traditional museum space—shelves and cabinets for storing specimens combined with a classroom for viewing. We recommend, therefore, removing the 2,400–asf science gallery from the scope of the project. Instead, we would recommend adding 1,000 asf to the already programmed museum space to offset the loss of the gallery space, resulting in an overall decrease of 1,400 asf.

These changes—reducing lecture space to account for the usage of the planetarium as lecture space, maintaining laboratory capacity at its current level, and eliminating the science gallery and atrium at the entrance—would reduce state spending on the project by an estimated $7.3 million.

Reduce Scope and Cost for Taylor II Replacement Building at CSU Chico

The Governor’s budget proposes $57.2 million in lease–revenue bonds to construct a replacement building for the 42–year–old Taylor Hall on the Chico campus. Taylor Hall’s mechanical systems are obsolete and the building requires renovations to meet current instructional requirements. While we agree with the need to replace Taylor Hall due to its physical condition, we have concerns about the size of the replacement building.

Currently Taylor Hall and Yuba Hall (the two buildings being demolished) total approximately 26,000 asf, while the replacement building will be 67,000 asf and add instructional capacity for 751 FTE students. Some of this additional space may be necessary to move certain programs from off–campus leased space and to support programmatic changes—such as the recital hall and dance studios. However, even accounting for these necessary increases, the replacement building adds significant capacity above what is being replaced. Such additional capacity is not justified at Chico’s campus since facilities are not being used in the summer. The campus reports it only enrolls 402 FTE students in the summer compared to over 15,800 FTE students in the fall term. If campus instructional facilities were utilized year round, several thousand more students could be accommodated without the need to expand physical capacity. We recommend reducing the scope of the project by 5,050 asf to limit the excess capacity in the facility and encourage greater use of campus facilities in the summer. This reduction in scope would reduce the state’s costs for the facility by an estimated $4.2 million.