Florida Board of Governors

03/08/2012

FACT SHEET & 2012 SESSION ACTION UPDATE: Capital Improvement Trust Fund (SB 1156 ADDED TO HIGHER ED CONFORMING BILL)

FOR IMMEDIATE RELEASE – March 8, 2012

BACKGROUND
There is no sufficient source of revenue for the maintenance and construction of “student life facilities,” such as student unions, cafeterias and recreational fields. By law, Public Education Capital Outlay (PECO) funds cannot be used to construct such student life facilities. Therefore, these facilities are funded from two student-paid fees deposited into the state’s Capital Improvement Trust Fund. However, the relatively small amount collected through the building fee and capital improvement fee have been inadequate to meet the System’s current student facilities needs – and students themselves (through the Florida Student Association) have approved and pursued the CITF bill as a way to address the quality of their student experience.

The Board of Governors supports this effort, and has in the past as well. The most promising action ever taken on this issue in the past decade occurred March 7, as detailed in the 2012 SESSION ACTION section below.

The Building Fee ($2.32 per student credit hour) and the Capital Improvement Fee ($2.44 per student credit hour) were established at their current levels in 1988 and have not changed, even though inflation and student enrollment have increased dramatically. In 1988 – 25 years ago – there were about 154,000 students System-wide, while that number has more than doubled, to more than 329,000 in 2011 (an increase of 175,000 total students). If the fees had increased only with the cost of inflation, the increase would have been about $8 in that time.

In order to quantify the need for student life facilities and after several years of attempting to work on the issue, the 2010 Legislature directed (in proviso within the 2010 General Appropriations Act*) that a survey be conducted to formally collect more details on the needs in the State University System. The survey conducted by the Board of Governors showed, at that time, total needs of more than $2 billion, and that the majority of the projects ($1.4 billion alone for financing of parking and housing) could funded from bonds that are paid for from student service fees – and would require no statutory or regulatory changes. The inventory and recommendations were coordinated with the close assistance of university vice presidents for student affairs, university facility planners, student government representatives and many others. The survey concluded that significant needs exist for new student life facilities, and the renovation or replacement of many existing facilities – parking and housing demands could be reasonably met by the existing financing framework and process if bonding processes continued. However, the demand for student facilities – such as student unions, recreational fields, wellness centers and cafeterias, all estimated at about $650 million at that time – never would be met within the existing financing framework and bonding availability.

Because of that fact, along with the demand for student life facilities by the students themselves, the Florida Student Association voted to ask the Legislature in the 2011 Session and the 2012 Session to allow the Board of Governors to approve requests for increases from university Boards of Trustees. The Board of Governors also included the issue in its legislative agendas for several years, including the 2012 Session.

For a full copy of the report, see: www.flbog.edu/pressroom/meeting_items.php?id=138&agenda=512.

(* - Proviso in the 2010 budget: “… the Board of Governors shall conduct a needs assessment survey of the State University System of student life facilities and develop recommendations to address unmet renovation or new facility needs identified by the survey. The recommendations shall specifically consider the impact of existing policies, statutory provisions, and regulations in meeting these needs and the unique challenges of smaller institutions or branch campuses.”)

2012 SESSION ACTION
Senate Bill 1156 was added to the Higher Education budget conforming bill on March 7. Provisions of the bill follow. In 2011, the Board of Governors voted to approve recommending to the 2012 Legislature that universities can pursue $1 voluntary, optional increase. Section 1009.24, F.S., would be amended to provide financing for student life facilities, primarily through bonding mechanisms. If passed by the Legislature and signed by the Governor, each university Board of Trustees would then, should they choose, voluntarily take up the matter for their respective universities and submit the traditional, comprehensive financing proposal package to the Board of Governors for any proposed bonded or building project. The language now in the 2012 Higher Ed conforming bill provides universities the flexibility to adopt increases to the CITF fee. Any increases are subject to the following:

•The fee increase must be recommended by a university committee, with half the members appointed by the student body president, half by the university president, and the committee chair jointly appointed.
• The building fee and university building fee – as explained earlier – are now merged into a single fee (the CITF fee).
• The fee can be increased by any amount no more than $2 per year, and must utilize the same university committee process as above to ensure an emphasis on extensive student participation.
• The fee can never exceed 10 percent of base tuition.