TITLE 5 POST-SECONDARY
EDUCATION
CHAPTER 3 POST-SECONDARY
EDUCATION INSTITUTION FINANCES
PART 9 CAPITAL
BUDGETS - PLANNING AND FUNDING RECOMMENDATIONS
5.3.9.1 ISSUING
AGENCY: State of New Mexico Higher Education
Department.
[12/31/98; 5.3.9.1
NMAC - Rn & A, 5 NMAC 3.9.1, 07/31/05]
5.3.9.2 SCOPE:
All public post-secondary educational institutions operating within and
receiving financial support from the state of New Mexico.
[12/31/98; 5.3.9.2
NMAC - Rn, 5 NMAC 3.9.2, 07/31/05]
5.3.9.3 STATUTORY
AUTHORITY: Authority for 5.3.9 NMAC is found in NMSA
1978 Sections 12-1-21.
[12/31/98; 5.3.9.3
NMAC - Rn, 5 NMAC 3.9.3, 07/31/05]
5.3.9.4 DURATION:
Permanent.
[12/31/98; 5.3.9.4
NMAC - Rn, 5 NMAC 3.9.4, 07/31/05]
5.3.9.5 EFFECTIVE
DATE: December 31, 1998, unless a later date is
cited at the end of a section.
[12/31/98; 5.3.9.5
NMAC - Rn & A, 5 NMAC 3.9.5, 07/31/05]
5.3.9.6 OBJECTIVE:
A. The objective of 5.3.9 NMAC is to establish a process by
which the higher education department will review capital outlay funding
recommendation packages developed by institutions and present those to the higher
education department and submit those approved to the legislature annually.
B. The purpose of 5.3.9 NMAC is to provide public higher
education institutions with an equitable process by which the department can
review packages from institutions that contain capital projects, listed in
priority order, that are considered to represent the greatest needs of the
state and of the institutions. The higher education department, will review
requests for capital outlay funding submitted by postsecondary institutions and
special constitutional schools, recommend the projects in priority order, and
present funding recommendations for approval by the department.
[12/31/98; 5.3.9.6
NMAC - Rn & A, 5 NMAC 3.9.6, 07/31/05]
5.3.9.7 DEFINITIONS:
[RESERVED]
5.3.9.8 REVIEW
CRITERIA:
A. Reviewing and recommending: In reviewing and recommending
capital project requests, the higher education department will be guided by the
general criteria listed below. Specific determinants for evaluating the
projects may vary from year to year as the immediate capital needs of the
institutions evolve and as requirements for code compliance are revised. These
influences will be explained each year in the capital project recommendations
document prepared for the New Mexico legislature. In general, the higher
education department will give preference to the following types of projects:
(1) projects which are strongly related to
instructional programs and which support an institutions mission and particular
role;
(2) projects to provide high quality
educational settings which represent up-to-date technologies;
(3) projects which are necessary to
accommodate enrollment growth;
(4) projects to address major health and
safety problems and elimination of physical barriers to handicapped persons;
(5) projects resulting from unforeseen conditions
that if uncorrected would result in major property deterioration;
(6) projects to renovate facilities or to make
wise use of other existing resources whenever feasible and economical;
(7) projects to improve utilities systems or
building energy efficiency that will result in rapid capitalization of initial
costs and long-term reduction of energy costs;
(8) projects for which there is no other
available or more appropriate funding source, such as building renewal and
replacement funds, local bonds, revenue bonds, auxiliary revenues, or research
revenues.
B. Projects eligible for capital outlay recommendation:
Capital outlay projects which are primarily used to support the following activities
are eligible for consideration by the higher education department for state
funding:
(1) Instruction: Instructional space includes
classrooms, laboratories, other teaching facilities, and office space for
faculty deans, and instructional department heads and related clerical staff.
(2) Library: All activities necessary to
operate libraries are eligible.
(3) Administration services: All activities
related to student services or institutional administration are included in
this category (e.g., admissions, administrative vice presidents, comptroller,
computer center, dean of students, maintenance work shops, placement services,
university architect, vocational director).
(4) Research: Only four-year institutions may
submit requests for state funds for capital outlay projects to house research
activities which will enhance fulfillment of the institution's mission. All
sponsored research and organized research units, including administration and
management of research activities, may qualify for support.
(5) Public service: Institutions may submit
requests for state funds for capital outlay projects to house public service
activities. Eligibility under this category is limited to sponsored public
service activities and organized public service units, such as public
broadcasting services, small business development centers, and cooperative
extension services. See Subsection C of 5.3.9.8 NMAC below for activities not
eligible for state funding.
(6) Physical plant: Circulation and support
space, such as halls, restrooms, and mechanical equipment rooms, for buildings
housing eligible activities will be included in all capital outlay projects. In
addition, the following types of projects are eligible for consideration:
stand-alone utility structures such as heating and cooling plants, electric
substations, and utility tunnels; physical plant shops offices and storage areas;
and site improvements for infrastructure systems such as roads, parking lots,
drainage or storm sewers, water or wastewater, telecommunications cables, or
heating/cooling loops.
(7) Multi-use facilities: Capital projects
with buildings that house more than one activity, one or more of which are
eligible for state funding, may be submitted. However, only space devoted to
eligible activities may be considered for state funding. A plan for funding the
ineligible space from non-state sources must be included with the proposed
project. For individual projects with common space used for both eligible and
ineligible activities, state funding will be prorated based upon the percentage
of time and amount of space allocated to eligible activities; the balance must
be supported from other sources. (See the proration formula in Subsection D of
5.3.9.8 NMAC.)
(8) Land acquisitions: Land to be used for
eligible activities will be considered for state funding.
C. Projects ineligible for capital outlay recommendation:
Capital outlay projects which are primarily used for the following activities
are not eligible for higher education department recommendation:
(1) Non-instructional athletics, such as intercollegiate
sports. Examples of ineligible facilities are Pan American center at NMSU and
the UNM arena.
(2) Recreational or entertainment events, for
either students or the general public. Single purpose auditoriums such as Popejoy
hall at UNM are ineligible.
(3) All auxiliaries, such as bookstores, golf
courses, student unions, student housing, etc. These operations are not
eligible for state funding and are expected to be fully self-supporting and
self-liquidating from the revenues generated by their operations.
D. Proration of funding: When a multi-use building will be
used for both eligible and ineligible activities, the funding request must be
prorated between state and other sources according to the amount of time and
space devoted to eligible vs. ineligible activities. For example:
A new fine arts building is being proposed with a total of 70,000 gross
square feet (GSF) at a cost of $80/GSF, for a total of $5,600,000. Net
assignable square feet (NASF) within the building will be 56,000. Of this
amount, 35,000 NASF will be used by activities eligible for state funding;
15,000 NASF will be multi-use 60 percent of the time for eligible activities
(instruction) and 40 percent of the time for ineligible activities (community
concerts); and 6,000 NASF is ineligible. To determine the portion of the total
capital project that is eligible for consideration for state funding, the
following formula is used:
(1) (ES + (MU x EU)
NASF x GSF x cost per
GSF = State funding for eligible space
(2) (35,000 + (15,000 x .60)
45,000 x 70,000 x $80 =
$4,400,000
(3) ES = Eligible net assignable square feet
(4) MU = Multi-use net assignable square feet
(5) EU = Eligible use (percent of available
time used for eligible activities)
(6) NASF = Net assignable square feet
(7) GSF = Gross square feet
E. Exceptions for two-year colleges: Space for certain
functions that are ineligible for state funding at four-year institutions, such
as bookstore operations, food services, community services, and student social,
cultural, recreational activities, may be included as a portion of capital
projects submitted by two-year colleges. The rationale for this exception is
that two-year colleges usually do not have large-scale auxiliary enterprises which
can provide an adequate revenue stream for financing auxiliary facilities.
These exceptions apply only if a two-year college has provided the required
local match of 25 percent as described in the following Subsection F of 5.3.9.8
NMAC.
F. Required local match: For two-year institutions, the higher
education department requires local matching participation in the amount of 25
percent of the total cost for each project or group of projects. However, the higher
education department may waive or reduce the 25 percent matching requirement if
the institution is not authorized to issue local general obligation bonds, is
at maximum bonding capacity, or has already contributed from local sources at
least 25 percent of all construction costs, including the cost of the proposed
project.
[12/31/98; 5.3.9.8
NMAC - Rn & A, 5 NMAC 3.9.8, 07/31/05]
5.3.9.9 INSTITUTIONAL
FACILITY PLANNING: Each four-year university and two-year
college must have on file at the higher education department a current
five-year institutional plan containing the information on capital resources
which is required by the institutional planning guidelines. The required
information for branches of four-year institutions may be included in the main
campus institutional plan, but must be provided in full for each branch campus.
[12/31/98; 5.3.9.9
NMAC - Rn & A, 5 NMAC 3.9.9, 07/31/05]
History
OF 5.3.9 NMAC:
Pre-NMAC History: The material in this part was derived from
that previously filed with the State Records Center and Archives under:
BEF Rule 430,
Capital Budgets-Planning and Funding Recommendations, 2/27/85.
CHE Rule 430,
Capital Budgets-Planning and Funding Recommendations, 10/26/90.
History of
Repealed Material: [RESERVED]