Capital Budget Overview
The State of Minnesota issues general obligation bonds to finance capital construction and remodeling projects for higher education facilities. The Minnesota State Colleges and Universities have statutory authority to issue revenue bonds for construction of student housing, parking, student unions and day care facilities.
The Governor initiates the state budget process in Minnesota. The Department of Finance coordinates the development and production of the state's capital budget in each even-numbered year. The Department of Finance issues budget instructions to all state agencies and higher education systems with guidelines. The Board of Trustees of the Minnesota State Colleges and Universities also issues coordinated, but more detailed, guidelines for capital budget development to its campuses.
Each campus submits its capital budget request to the Chancellor's office. The Chancellor, in a consultative process with the campuses and system office, develops a preliminary budget, which is approved by the Board of Trustees and forwarded to the Governor. The Governor makes recommendations on capital expenditures to the legislature. Unlike state agency budgets, the higher education systems' requests are not subject to edit, but are fully displayed in the budget document, whether or not any receive the Governor's recommendation. The legislature holds hearings. Both the Senate and House of Representatives pass a capital improvement (or bonding) bill, which is negotiated in a conference committee, and then sent to the Governor for signature sometime in April of each even-numbered year. The Governor has line-item veto authority.
Since the early 1990's the legislature has issued general obligation bonds to support allocations to the higher education systems for deferred maintenance. Capital budget appropriations for Higher Education Asset Preservation and Replacement (HEAPR) totaled:
$43 million in the 1998 legislative session
$30 million in the 2000 legislative session
$60 million in the 2002 legislative session
No bonding bill was passed in the 2004 legislative session = $0 dollars allocated to basis preservation.
$41.5 million in the 2005 legislative session
$40 million in the 2006 legislative session
In addition, both higher education systems allocate funds within their operating budgets for facilities maintenance, and repair and betterment. Minnesota State Colleges and Universities inventories its facilities yearly and reported deferred maintenance needs of $646 million in 2006.
(From NASBO information brief)
If you have questions, comments please e-mail us (facilities@so.mnscu.edu) or refer to the staff directory link at the top of this page for additional contact information.
