A preliminary 10-year financial plan projection (with an additional two years of actuals) indicating self-support program that will fund the project with revenues, expenditures, reserves, etc., included in the financial plan. Draft plans and project cash flow projections due to Financing & Treasury. Please contact Rosa H. Renaud,
[email protected] for questions and assistance.
The Five-Year Capital Outlay Plan (Five-Year Plan), required by Education Code 67501, represents the universities’ forward thinking long-term development program. Its primary focus is to address the capital improvement needs of universities over a rolling five-year period. The Five-Year Plan prioritizes, plans, and allocates resources for critical infrastructure and capital improvement projects to ensure the universities meet the evolving needs of students, faculty, and staff. Capital priorities are presented in the order in which the universities intend to initiate projects, aligning institutional needs with the Board of Trustee’s priorities.
The five-year plans for all 22* universities are compiled into a single document and presented annually to the Board of Trustees for approval and then submitted to the Department of Finance and the Legislative Analyst’s Office capital improvement needs for five years beyond the period covered by the latest Governor’s Budget each year, as required by statute.
Prior Five-Year Plans from previous planning cycles are maintained for reference and historical context. Previous Five-Year Plans can be accessed here:
Five-Year Capital Outlay Plan
The primary objective of the Five-Year Capital Outlay Plan (Five-Year Plan) for the California State University (CSU) is to provide facilities appropriate to the CSU’s approved educational programs to create environments conducive to learning, and to ensure that the quality and quantity of facilities at the 22* universities serve the students well.
The universities and the CSU Office of the Chancellor (Chancellor’s Office) have enlisted broad participation by administrators, faculty, and students in the development of the Five-Year Plan.
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General
In November 2014, the CSU Board of Trustees approved revisions to the CSU Policy for Financing Activities (RFIN 03-02-02) to implement capital financing authorities granted by state statute in June 2014 (Education Code Section 89770). The authority enables broader use of operating funds to pay for, or finance, capital outlay projects. It also establishes a streamlined process for the state and legislature’s review of proposed projects. While authority was increased, there were limited new revenues provided to the CSU to pay for the backlog of deferred maintenance and capital outlay needs across the 22-university system.
To enable the CSU to finance academic and instructional support projects, the authority permits the CSU to pledge its annual general fund support appropriation and any other revenues to secure CSU debt issued pursuant to the State University Revenue Bond Act of 1947 (Bond Act). Under this provision, CSU can use the existing Systemwide Revenue Bond (SRB) program in support of all forms of capital improvements and to refinance State Public Works Board bond debt. The prioritization of university projects eligible for financing under the new authorities will remain a centrally managed function of the Chancellor’s Office, which will evaluate university needs and provide recommendations to the Board of Trustees on project priorities.
The Board of Trustees has authorized two multi-year financing plans to support CSU’s ongoing capital improvement program; one in November 2016, and one in November 2018. These multi-year financing plans will provide up to $2.1 billion dollars toward funding projects. The projects included in this Five-Year Plan will exceed the total Board-approved funding levels.
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Project Funding
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Academic Projects – On-campus and off-campus projects, including academic, administrative, and infrastructure support projects may be approved as funded with CSU designated reserves or debt financing. Projects may be financed through a multi-source structure under the authority of the Bond Act. Per Board of Trustees policy, universities are encouraged to contribute at least 10 percent of project costs from reserves to help stretch the system’s limited resources to fund deferred maintenance and capital improvement needs, help to expedite completion of the project design and/or facilitate a project’s inclusion in a future bond sale. University funds may be used to co-fund project design (preliminary plans and working drawings), construction and/or provide furnishings, fixtures and/or movable equipment. A university president may also propose academic projects financed by donor or grant funds, or with an auxiliary organization or third-party financing.
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Self-Support Program – To use the resources of CSU in the most cost effective and prudent manner, all revenue-based on-campus student, faculty, and staff rental housing, parking, student union, health center, and continuing education capital projects will be financed by the Board of Trustees using a broad systemwide multi-source revenue pledge under the authority of the Bond Act in conjunction with the respective authority of the Board of Trustees to collect and pledge self-support revenues. Projects that primarily serve student support functions and are supported by mandatory fees, user charges, gifts, and bonds issued by the Board of Trustees or auxiliary organizations are classified as Self-Support projects in the Five-Year Plan. Planning guidelines for self-support projects require financial plans and market studies, when applicable, to establish the operational viability of proposed self-support funded capital outlay projects.
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Fund Types – The Five-Year Plan may thus propose project funding from multiple sources including designated campus maintenance and capital reserves funds, state funds, donor funds, third-party funds and/or self-support program funds. The list of categorical fund types has been expanded to help track the various fund sources. The expanded list incorporates the use of university reserves designated for capital use per the change in CSU’s funding authority in June 2014.
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Categories of Project Funds
To help track the various types of available funding sources, we have expanded the number of categories. The Fund codes now include:
ASH
| Student Housing Grants – State |
| ASI | Associated Students Incorporated |
| Aux | Auxiliary/Foundation |
| Campus-I | Designated Campus Reserves – Improvements |
| Campus-M | Designated Campus Reserves – Maintenance |
| CE | Continuing Education |
| CSU | CSU Reserves |
| DM | Deferred Maintenance – State |
| Don | Donor |
| Eng | Energy/Power Purchase Agreements |
| FH | Faculty/Staff Housing |
| Gra | Grants |
| Hlth | Health Center |
| OTS | One-Time State Funding |
| Pkg | Parking |
| PPP | Public-Private/Public Partnership |
| S | General Obligation Bond and Public Works Board Revenue Bond – State |
| SH | Student Housing |
| SRB-AP | Systemwide Revenue Bonds – Academic Program |
| SRB-SS | Systemwide Revenue Bonds – Self-Support |
| TRP | Total Return Portfolio |
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Delegation of Capital Outlay Project Approval and Schematic Design Approval
In March 2018, the Board of Trustees revised its Standing Orders for delegated authority for capital outlay projects to include the following:
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Authorize the chancellor to approve the capital outlay project scope, budget, and schematic design for projects with a value of $40 million or less.
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Authorize the chancellor to approve the schematic design for all remodels, parking structures, and utilitarian projects, regardless of cost, unless the project requires an Environmental Impact Report (EIR) or includes significant unavoidable environmental impacts.
The university shall submit all major capital projects up to $40 million to the Assistant Vice Chancellor, Capital Planning, Design and Construction, for consideration of delegated review and approval of scope, budget, schematic design, insurance coverage, master plan revision, California Environmental Quality Act (CEQA) action, and amendment to the annual capital program, as applicable.
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Categories and Criteria to Set Capital Outlay Plan Priorities
Each year the trustees approve categories and criteria used to prioritize academic projects for funding. This prioritization assures that limited resources are applied to the most critical needs within the system. Capital Planning, Design, and Construction (CPDC) and campus planners work together to identify the appropriate categorization for proposed projects.
General Criteria
Capital priorities will be determined based upon the strategic needs of the system in consideration of existing deficiencies of campus space to serve the academic master plan. Priority will be given to projects that address critical seismic and infrastructure deficiencies, including fire/life safety, utility infrastructure critical to campuswide operations, reductions in GHG emissions, and deferred renewal in existing facilities. Projects to modernize existing facilities or construct new replacement buildings in response to academic needs or enrollment demand will be considered on a case-by-case basis. Universities are encouraged to identify funding sources for projects that reduce total project financing costs to receive priority consideration; however, additional funding does not guarantee a higher prioritization for the project based on the strategic needs of the system.
A university may submit a maximum of one major debt financed academic facility or academic support project and up to three self-support projects for the 2027/2028 action year. For the 2028/2029 through 2031/2032 planning years, a university may have a maximum of two major debt financed academic facilities or academic support projects, including health and safety projects. The remaining lower priority projects will be included in the plan as future projects to be undertaken outside of the five-year planning window. This approach aims to encourage universities to identify their facility needs and not impose a one-project limit across all five years that may inadvertently understate the true funding level needed for academic and self-support project funding.
Projects submitted for inclusion in the systemwide Infrastructure Improvements program, equipment, seismic strengthening, donor-funded projects, certain public-private-partnerships, and reserve-funded projects are excluded from the project limits. Exceptions to these limits will also be considered on an individual project basis. Seismic strengthening projects will be prioritized according to recommendations from the CSU Seismic Review Board.
Approval of multi-phase projects may require the project funding to be allocated over more than one year. Universities are encouraged to use designated capital reserves to co-fund projects. University requests for preliminary plans, working drawings, and construction (PWC) lump sum funding will be considered on an individual project basis based on its complexity, scope, schedule, and the availability of university funds to co-fund the project.
Current Board of Trustee-approved physical master plan enrollment ceilings apply to on-campus seat enrollment only. These numbers are to be used as the basis of comparison for justifying capital projects that address enrollment demand to be accommodated on campus. Enrollment estimates that exceed these figures should be accommodated through distributed learning, state-supported summer session, and other off-campus instructional means. Campus utilization of space, along with relative deficits of space, demand for space and/or deficiencies of space will also be considered.
Individual Categories and Criteria
Projects will be placed within each category based on the established criteria and predominant purpose of the project.
I. Existing Facilities/Infrastructure
A. Critical Infrastructure Deficiencies – CD (Critical Deficiencies)
These projects correct structural and health and safety code deficiencies by addressing fire and life safety problems and promoting code compliance in existing facilities and accessibility (ADA) improvements to remove barriers. Projects include seismic strengthening, correcting building code deficiencies and failing infrastructure, and addressing regulatory changes which impact campus facilities or equipment. This category also includes the systemwide Infrastructure Improvements program.
B. Modernization/Renovation – FIM (Facilities Infrastructure/Modernization)
These projects modernize existing facilities or construct new replacement buildings in response to academic and support program needs; and replace utility services/building systems to improve facilities and the campus infrastructure. This category includes group II equipment (furnishings) to make remodeled and replacement facilities operable.
II. Growth/New Facilities – ECP (Enrollment/Caseload/Population)
These funds eliminate instructional and support deficiencies to support university growth, including new buildings and their group II equipment, additions, land acquisitions, and site/infrastructure development.
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Review and Approval Processes
Determining which academic projects are to be included in the five-year plan is an iterative process with the university and Capital Planning, Design, and Construction (CPDC) at the CSU Chancellor’s Office. Once the university submits its initial draft plan, CPDC reviews the submittal for comprehensiveness and consistency with systemwide goals. Projects that renew and extend the useful life of existing buildings and infrastructure are considered favorably. CPDC provides feedback on the proposed campus plan to best align campus and systemwide needs, resulting in a prioritized list of projects to be presented to the trustees each year. The project order is based on several factors, including need (renewal and/or instructional capacity), and project readiness as demonstrated by a thorough feasibility study.
For self-support/debt-financed projects, once the university submits its initial draft plan, CPDC reviews the submittal for comprehensiveness and consistency with systemwide goals. Simultaneously a financial plan should be submitted to Financing and Treasury (F&T) at the CSU Chancellor’s Office for financial review. CPDC and F&T provide feedback on the proposed campus plan to best align campus and systemwide needs, resulting in a prioritized list of projects to be presented to the trustees each year. Support for the project order is based on several factors, including need (renewal and/or capacity), and project readiness as demonstrated by a thorough feasibility study and financial plan.
Action-year (year 1) projects are reviewed by appropriate divisions within the Chancellor’s Office before inclusion on the action-year priority list and presentation to the Board of Trustees (BOT), recommending that the capital outlay proposal be approved as a part of the budget (action) year capital outlay program.
BOT-approved academic projects are then forwarded to the Department of Finance (DOF) and the Legislative Analyst’s Office (LAO) for review and approval. Legislative budget hearings take place during the spring of each year, and site visits with DOF and LAO may be scheduled to review program proposals and evaluate the project scope and location.
Out-year projects included in the Five-Year Plan and presented to the trustees are not considered to be approved until the project is submitted as an action-year project. Projects should be evaluated and re-submitted each year until included in the action-year and approved for funding by the Board of Trustees.
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View Five-Year Capital Outlay Plans
Click
here to view the current and past CSU Five-Year Plans.
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