0038: FLOOR ANALYSIS (2-26-04) (2-26-04) - STATE BUILDING AUTHORITY RESOLUTIONS

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<TITLE>0038: FLOOR ANALYSIS (2-26-04) - STATE BUILDING AUTHORITY RESOLUTIONS</TITLE>

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<a name="3"></a>STATE BUILDING AUTHORITY RESOLUTIONS - H.C.R. <a name="1"></a>38-43: FLOOR ANALYSIS

House Concurrent Resolutions <a name="2"></a>38 through 43 (as reported without amendment)

Sponsor: Representative <a name="4"></a>Scott Shackleton

House Committee: <a name="5"></a> Appropriations

Senate Committee: Appropriations

CONTENT

The Joint Capital Outlay Subcommittee (JCOS) has approved House Concurrent

Resolutions 38 through 43, which would convey land and establish lease agreements

among the State, the State Building Authority (SBA), and several colleges and

universities. The lease agreements create a contractual obligation requiring the State

to make rental payments to the SBA on behalf of the institutions for use of the

facilities. The SBA will use the rental payments to make debt service payments on

bonds that will be sold to finance construction.

The projects have met the planning and approval requirements of the JCOS, the

Management and Budget Act, and the State Building Authority Act. The estimated

annual rental amount is provided pursuant to the requirements of the SBA Act. An

actual rental amount will be determined by an appraiser once the facilities are

complete. Legislative approval of the resolutions would commit the State to make

annual rental payments for the projects until the SBA debt obligations are satisfied.

House Concurrent Resolution 43 would revise a previously approved lease agreement

(HCR 18) to correct an error in the legal description of the property. No other changes

are being made to this lease.

FISCAL IMPACT

Annual rental (debt service) payments for the current fiscal year are appropriated in

the Capital Outlay budget at $266 million. These projects represent new bond debt

obligations by the SBA of $60.3 million. Approval would require the State to make

annual rental payments to the SBA estimated between $4.6 million and $5.9 million.

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<td class="table1column1" width="38%" style="padding-top: 0.04in" align="center" valign="bottom">Project

</td>

<td class="table1column2" width="13%" style="padding-top: 0.04in" align="center" valign="bottom">HCR

No.

</td>

<td class="table1column3" width="16%" style="padding-top: 0.04in" align="center" valign="bottom">Total

Authorized Cost

</td>

<td class="table1column4" width="16%" style="padding-top: 0.04in" align="center" valign="bottom">SBA Share

</td>

<td class="table1column5" width="17%" style="padding-top: 0.04in" align="center" valign="bottom">Estimated

Annual

Rental

Range

</td>

</tr>

<tr>

<td class="table1column1" width="38%" style="padding-top: 0.04in" valign="top">Northern Michigan

University - Student

Services Building. This

project includes the

renovation and reuse of the

former Hedgecock Fieldhouse

building into the new Student

Services Building.

Construction authorization

was granted in PA 161 of

2002.

</td>

<td class="table1column2" width="13%" style="padding-top: 0.04in" valign="top">HCR 38

</td>

<td class="table1column3" width="16%" style="padding-top: 0.04in" valign="top">$15,750,000

</td>

<td class="table1column4" width="16%" style="padding-top: 0.04in" valign="top">$11,812,500

</td>

<td class="table1column5" width="17%" style="padding-top: 0.04in" valign="top">$900,000 to

$1,150,000

</td>

</tr>

<tr>

<td class="table1column1" width="38%" style="padding-top: 0.04in" valign="top">Northern Michigan

University - Fine and

Practical Arts Project. The

project includes an addition

and renovations for the art

and design studios and

classroom space for the

music program. The total

project includes over

124,000 sq. ft. of space.

Construction authorization

was granted in PA 161 of

2002.

</td>

<td class="table1column2" width="13%" style="padding-top: 0.04in" valign="top">HCR 39

</td>

<td class="table1column3" width="16%" style="padding-top: 0.04in" valign="top">$21,230,000

</td>

<td class="table1column4" width="16%" style="padding-top: 0.04in" valign="top">$15,922,500

</td>

<td class="table1column5" width="17%" style="padding-top: 0.04in" valign="top">$1,210,000

$1,550,000

</td>

</tr>

<tr>

<td class="table1column1" width="38%" style="padding-top: 0.04in" valign="top">Mid Michigan Community

College - Student

Assessment Center. The

project entails the renovation

of nearly 6,700 sq. ft. of

space as well as 13,700 sq.

ft. of new construction to

support student services

programs and a library

expansion. Construction

authorization was granted in

PA 530 of 2002.

</td>

<td class="table1column2" width="13%" style="padding-top: 0.04in" valign="top">HCR 40

</td>

<td class="table1column3" width="16%" style="padding-top: 0.04in" valign="top">$3,165,000

</td>

<td class="table1column4" width="16%" style="padding-top: 0.04in" valign="top">$1,582,500

</td>

<td class="table1column5" width="17%" style="padding-top: 0.04in" valign="top">$120,000 to

$155,000

</td>

</tr>

<tr>

<td class="table1column1" width="38%" style="padding-top: 0.04in" valign="top">Michigan Technological

University - Center for

Integrated Learning and

Information Technology

Project. The project entails

the construction of a new

Computer Science Classroom

Building that will attach to

the expanded and renovated

Van Pelt Library.

Construction authorization

was granted in PA 560 of

2002.

</td>

<td class="table1column2" width="13%" style="padding-top: 0.04in" valign="top">HCR 41

</td>

<td class="table1column3" width="16%" style="padding-top: 0.04in" valign="top">$33,838,700

</td>

<td class="table1column4" width="16%" style="padding-top: 0.04in" valign="top">$25,000,000

</td>

<td class="table1column5" width="17%" style="padding-top: 0.04in" valign="top">$1,900,000

$2,430,000

</td>

</tr>

<tr>

<td class="table1column1" width="38%" style="padding-top: 0.04in" valign="top">Monroe County

Community College -

Instructional Center for

Business Training and

Performing Arts Building.

The project entails the

construction of a 54,000 sq.

ft. facility that includes a

600-seat auditorium.

Construction authorization

was granted under PA 530 of

2002.

</td>

<td class="table1column2" width="13%" style="padding-top: 0.04in" valign="top">HCR 42

</td>

<td class="table1column3" width="16%" style="padding-top: 0.04in" valign="top">$12,000,000

</td>

<td class="table1column4" width="16%" style="padding-top: 0.04in" valign="top">$6,000,000

</td>

<td class="table1column5" width="17%" style="padding-top: 0.04in" valign="top">$460,000 to

$580,000

</td>

</tr>

<tr>

<td class="table1column1" width="38%" style="padding-top: 0.04in" valign="top">TOTALS

</td>

</td>

<td class="table1column3" width="16%" style="padding-top: 0.04in" valign="top">$85,983,700

</td>

<td class="table1column4" width="16%" style="padding-top: 0.04in" valign="top">$60,317,500

</td>

<td class="table1column5" width="17%" style="padding-top: 0.04in" valign="top">$4,590,000 to

$5,865,000

</td>

</tr>

</table>

Date Completed: 2-26-04 - Fiscal Analyst: <a name="10"></a>Mike HansenSAS\S0304\shcr38sa</p& gt;

This analysis was prepared by nonpartisan Senate staff for use by the Senate in its deliberations

and does not constitute an official statement of legislative intent.

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