BOG sets sights on 2nd phase of construction

With construction equipment still rumbling across many UNC-system campuses, the system's governing body already is looking past phase one of its ambitious building plan - and preparing to seek financing for phase two.

At its Friday meeting, the Board of Governors presented a preliminary budget estimate of $3.8 billion to $4 billion for the next six-year phase of the system's comprehensive construction and renovation plan.

That figure takes into account the projected capital needs of all 16 schools, though system officials still are awaiting final projections from several campuses.

Each school has been asked to present estimated costs for capital projects in the next six years, and the system's finance office expects to have all of those figures in hand by the end of the week.

A systemwide plan should be ready by November, when the board will meet to review the report and to prepare a budget request to submit to the legislature in January.

N.C. Sen. Vernon Malone, vice chairman of the Senate higher education appropriations committee, said a request of almost $4 billion likely would raise eyebrows.

"I think it'll get a good, hard look," he said. "I'd be more inclined to believe there will be many that will say the number is too high."

Malone, a Wake County Democrat, expressed concern about whether it would be wise to submit another bond referendum so soon after the $3.1 billion measure voters approved in 2000. He added that most legislators understand that the previous referendum did not cover all of the costs of the system's construction plan, which in 1999 were projected to be $6.9 billion.

"I don't suspect it's going to be turned away forthrightly without giving some very serious consideration," Malone said.

It is not yet certain how the BOG will ask the legislature to fund the additional construction.

"If you need a whole lot of money, a bond is usually the preferred method," said board member Cary Owen. "But there are all sorts of ways you can put it together."

Funding for facilities plans also can come from sources within the system itself, such as revenue from residence hall or athletic receipts. Those nongeneral funds typically make up only a fraction of the cost of large-scale construction projects.

BOG members say it will be a give-and-take negotiating process to determine how the legislature will choose to fund the system's eventual request.

"We're going to really have to do a lot of work to make sure that we present the best packet, both for the university as well as to make sure it's one that will get funded," said board member Gladys Robinson.

Legislators and BOG members alike said the attitude toward the next phase of funding will hinge in large measure on the state's economic outlook.

"There is a smorgasbord of considerations that will go into just how this whole thing will be addressed," Malone said. "I don't think there's any simple approach. It's going to be complicated."

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