The Minnesota State Colleges and Universities system is an Equal Opportunity employer and educator. Minnesota State Colleges and Universities FY Capital Budget Update Chief Finance and Facilities Officers Conference January 2009

Slide 2 Update Program and demand to date Suggested sizing target for 2010 Processing the project and priority list Next steps for 2010 What’s up for 2009?

Slide 3 Program update FY2008 results –Request$350 million –Authorized$281 –Vetoed$46.7 –Enacted$234 million Line item projects$179 million HEAPR*$ 55 million *Higher Education Asset Preservation and Replacement

Slide 4 Program update FY2010 “baseline” –Vetoed$ 55 million (w/ inflation) –Carry forward$192 –HEAPR$110 –Subtotal$357 million FY2010 new projects –24 proposals$ 59 million –Initiatives$ 19 Total $435 million

Slide 5 Budget sizing for 2010 Inflation since 2008 –$350 million (2008 request with inflation) is equivalent to $394 million (2010) Debt capacity at 3% of revenue –$385 million low end ($275 million projects and $110 million HEAPR) Debt capacity is a multi-year consideration –2010 commitments yield “tails” in 2012 –Board urges “caution” Recommended range: $380 - $410 million –Including $110 HEAPR

Slide 6 Process Last cycle: –All projects scored by evaluation teams –All projects presented at Board hearing This cycle: –New and modified projects to be scored –Currently 24 new projects Board OK’ed process change to this cycle: –After scoring: proposed project, priority list and six year capital plan presented to Leadership Council and Board for information –Proposed list is public in February vs. May

Slide 7 Process Board hearing to focus on projects where there are issues concerning: –Placement on proposed list –Cost –Scope –Phasing Anticipate 1 day of hearings February 25 Chancellor’s recommendation in May

Slide 8 Next steps Dec 08 – Final project submittals Jan 09 – Team reviews and scoring Feb 09 – Proposed project and priority list with six-year plan; Board hearing May 09 – Chancellor’s recommendation Jun 09 – Board final action; capital budget submitted to MMB and Governor July thru Dec 09 – Legislative bonding visits to campuses Feb 2010 – Legislative session begins; Governor’s bonding recommendations

Slide Capital Request Not the “traditional” bonding year No state process this year MnSCU responding to federal and state call for “stimulus” projects 5 capital projects vetoed in $40.3 million Asset preservation (HEAPR) - $50.0 million 4 projects partially funded in $26.8 million Total: $ million Bid the work 30 days to 8 months

Slide Capital Request Key is FAST execution Legislature wants to see contracts awarded within 30 to 90 days 2009 HEAPR may come with strings attached Federal requirements less clear although timely contracts will be required Federal strings too!

Slide 11 Capital Budget Update Questions?