Capital Planning and Budgeting Process

Olivia Yang – Interim Vice President for Finance & Administration

Joan King – Associate Vice President/Chief University Budget Officer

March 24-25, 2016

Background

• Requests for state funded new buildings were for individual colleges, therefore many needs are still waiting

• State funding for "major" projects typically take three biennia (six years) if each phase funded consecutively

• No funding for state minor capital program renewal forlast three biennia

• State funding for annual facility operations and maintenance (O&M) costs does not have inflation escalator

• Situation: “haves” and “have nots”

• Typical of universities across the country, deferred maintenance backlog continues to grow

Physical Facilities Situation

• Facilities condition assessment

• VFA study

• Three phases completed in Pullman(represents 87% of state-funded Pullman campus)

• Starting limited assessment for other campuses

Physical Facilities Situation – Conditions Curve

Physical Facilities Situation - continued

STATE FUNDING OF OPERATIONS & MAINTENANCE(O&M)

Typical request per facility: $10/SF

Typical funding received: $ 5/SF

Campus Average: $1.90/SF

Strategy

• Clearer alignment of capital investment withstrategic plan

• "Even out" capital investment in physical facilities

- Need renovation or demolition as serious options

“A building is a gift that keeps on taking”

Actions Taken in the Last Ten Months

Call for needs across the institutions (all campuses)

• Identify all the needs• “Bucket” needs and prioritize

Priorities from Deans (Pullman)

1. Life Sciences/Physical Sciences

2. Material Science/Chemistry

a. Data Center/IT Infrastructure

b. Computational Data Sciences

4. Energy and Environment

5. Collaborative and Maker Spaces

Actions Taken in the Last Ten Months - continued

Campus PrioritiesWSU Vancouver

• Vancouver Life Sciences Building• Vancouver Library 2nd Floor Conversion• Vancouver Business Building• Vancouver Sciences Building

WSU Tri-Cities (includes non-state needs)• Tri-Cities Academic Building• Tri-Cities Student Housing• Preservation: East Building, CIC Building, Gateway Project, Signage & Sidewalks• Athletic Facilities – Fields and Gym• Hotel Conference Center & Incubation/Distillery• Outdoor Performing Arts Amphitheater• Food Processing Engineer & Technology Lab• Welcome and Interpretative Center• Facilities Building

WSU Spokane (includes non-state needs)• Inter-professional Clinical & Res. Learning Space• Event Space• Fitness & Recreation Facility• Administrative Offices• Laboratory Space• Classroom Expansion for Active Learning

Actions Taken in the Last Ten Months - continued

Parameters for state capital requests

• Multidisciplinary facilities

• Teaching and research

• Integrate programmatic needs with physicalcondition needs

• A budget driven model

State Request for 2017-2019

Characteristics

• A budget driven model

• Major vs mini majors

• Transitional: 2015-17 commitments

State Request for 2017-2019 - continued

2015-2017 commitments

Life science/physical sciences

• Pullman pre-design• Vancouver pre-design

Mini majors

• Rolling STEM teaching (renovations of parts ofbuildings)

• One time card key (active shooter lock downcapability)

State Request for 2017-2019 - continued

Project Name Prior $ 2017-2019 2019-2021

2015-17 Committed ProjectsPullman Plant Sciences (REC5) $7,100,000 $ 58,900,000 ---

Pullman Global Animal 2 $1,900,000 $ 38,100,000 $21,300,000

Tri-Cities Academic Building $ 400,000 $ 3,000,000 $27,000,000

Minor Capital Improvement (MCI/Eq) --- $ 21,750,000 $22,000,000

Minor Capital Preservation (MCR) --- $ 42,500,000 $43,000,000

Proposal Process Projects

STEM Teaching Labs/BuildingInfrastructure Upgrades

--- $ 4,900,000 $ 4,900,000

Pullman Life/Physical Sciences Building --- $ 3,500,000 $52,000,000

Vancouver Life Sciences Building --- $ 500,000 $ 5,900,000

Pullman Security-Building Card Key Access --- $ 4,750,000 ---

Data Center Renovation --- $ 4,950,000 ---

Pullman Life/Safety/BAS Building Systems --- $ 4,900,000 $ 4,900,000

Spokane Interprofessional Clinic --- $ 4,990,000 ---

2017-2019 TOTAL $192,740,000

Related Effort

• Capital cost initiative, collaboration with University ofWashington

• Work by other entities: Intel, WSDOT

• Premised on questioning assumptions- Small working group consisting of WSU, UW and contractors

& architects

Capital Cost Initiative Takeaways

• 100 year building redefined: adaptable, “plug and play”

• Impact on design standards

• Governance- Internal building committee: composition and charge

- External partners: contractual relationships and riskallocations

Plan is to identify key premises to pilot on WSU and UW capital projects

WASHINGTON STATE " UNIVERSI1Y