Gov. Steve Beshear announced a plan Thursday to approve the issuance of bonds by Kentucky’s public universities for campus improvements — including three major projects at Murray State University — supported by university revenues.
According to a press release from the Governor’s Office, these agency bonds will be issued by the individual universities over the coming months, and will allow the schools to fund critical renovation or construction projects at no cost to Kentucky taxpayers. The planned improvements at MSU will include $9.9 million in renovations to Hester College, $590,000 in upgrades to the sprinkler system at College Courts and $4.9 million in other assorted facility improvements.
Beshear and legislators plan to authorize $363.3 million in agency bonds, which would have an estimated economic impact of nearly $623 million and support 5,110 jobs. A bill will be filed soon to authorize the bonds, the release said.
“Agency bonds will meet the growing needs of our universities with no impact on the General Fund, as they will be paid for through existing revenue streams such as student fees and athletic revenues,” Beshear said. “I appreciate the universities’ continued good stewardship during these tough economic times. At a time when we are pushing our students to pursue higher education, it’s imperative that they have adequate classrooms, housing and facilities, and the issuance of these bonds will accelerate those projects to meet those needs quickly.”
General Fund support for the universities has been cut 15 percent over the last three biennial budgets. The bonds were proposed in the last legislative session but were not authorized, and no new fees are proposed to support the bonds.
“I appreciate the universities through donations and internal funds doing their part to develop better academic facilities, and especially applaud UK athletics for stepping up and funding the science center,” said Senate President Robert Stivers. “The concept has been well-received by the Senate Majority Caucus.”
“I’m in favor of using these agency bonds to do these projects, and I'm particularly impressed at the way UK President (Eli) Capilouto is using athletic revenues to help build an academic facility,” said House Speaker Greg Stumbo.
The Governor’s Office said Kentucky’s eight university presidents are united in support of the plan, noting that accelerating these long-delayed projects will save money in construction costs and avoid additional cost burdens for students. Each school enjoys strong bond ratings, and the schools will be able to guarantee the bonds through existing revenue streams at a reasonable cost.
According to an information packet sent to Beshear and the General Assembly by the presidents of Kentucky’s four-year, public universities, MSU’s planned renovations and upgrades will total $15.4 million and are estimated to affect 2,828 students, create 200 jobs and create a value of $25,516,382 for the state. Hester College is an eight-story residential hall that houses 318 students and has not had a major, extensive renovation since it opened in 1967. The packet said it needed the $9.9 million investment to replace all major existing electrical, HVAC and plumbing systems; ADA bathroom upgrades and flooring, ceiling and lighting improvements. The renovation could begin as early as July 1, 2013 and would take approximately 14 months.
College Courts consists of 12 two-story apartment-style residential units that opened between 1961 and 1966 and houses almost 200 upper-class and graduate students. While the facility is not required by the state fire code to have a fire suppression system, the university wants to install the system for added protection of students and property, the packet said. The $590,000 renovation could begin in July 2013 and would take approximately one year.
The assorted capital renewal projects are required repairs and renovations that would be scheduled to begin after July 1, 2013, and would be planned as necessary to accommodate housing needs and issues through June 30, 2014, the packet said. The planned projects include the following:
• $400,000 for roof replacement at Hart College
• $240,000 for roof replacement at College Courts
• $360,000 for a hot water heater replacement at College Courts
• $590,000 for exterior repairs and renovations to College Courts
• $2.95 million to replace fan coil heating/cooling units in five residential properties
• $400,000 for asbestos abatement in two residential properties
In an emailed statement, Dunn said, “I am tremendously grateful to Governor Beshear, President Stivers, and Speaker Stumbo for their leadership in advancing this opportunity that allows the state universities to invest in their collective future with these self-financed projects. It’s a great way to open this session and I hope it heralds a new spirit of cooperation in Frankfort. These projects are investments in not only our students obviously, but also the economy of the region given the number of jobs that will be created directly and indirectly from our MSU projects.”