December 28, 1999
ITEM 105-2000-C1299 Modification of authority to build and authorization for an Intercap Loan to conduct bridge financing for the construction project collectively known as the Epicenter Pilot Project.
Resolved: That the Montana Board of Regents modifies its authority established in BoR Item #93-2001-R1196 to include; new construction south of the existing Gaines Hall, renovation of Gaines, Lewis and Leon Johnson Halls, and establishment of an Operations and Maintenance Endowment. Collectively, this project will be known as the Epicenter Pilot Project. The Montana Board of Regents authorizes Montana State University Bozeman to secure Intercap financing up to one million dollars to act as a bridge loan for said project.
Background: In accordance with Montana Board of Regents Item #93-2001-R1196 and House Bill 005 of the 1997 Montana Legislature, Montana State University Bozeman, in conjunction with the Architect & Engineering Division, has conducted planning and design of a classroom and laboratory building. Representation on the planning and design group includes students, faculty, research and administrative constituents of the campus community. Discussions involving the original authorization emphasized the need for new space overall for the University with intent focusing on such. During planning, it became apparent that funding was insufficient to provide entirely newly constructed space that met the goals of those involved in the process of laboratory, student study, research, and related faculty office spaces. In order to maintain said goals within identified revenue sources, viable options for renovation were developed. The Presidents Executive Council has requested that the planning group proceed with design of a project in the magnitude of $13.6M.
Components of the project consist of the following; new construction south of the
existing Gaines Hall ($10.6M), renovation of four undergraduate chemistry laboratories in
the existing Gaines Hall ($750K), renovation to the basement of Lewis Hall ($1.5M),
relocation and renovation of the Cadaver Laboratory from the basement of Lewis Hall to
Leon Johnson Hall ($150K), and an Operations and Maintenance Endowment ($612K). The
endowment is designed to fund the portion of Operations & Maintenance for the new
construction component south of existing Gaines Hall not funded by the State as defined
during the 1999 Legislature.
Funding Sources for the project consist of the following; proceeds from the 1996-D series bonds, proceeds cumulated from collection of the student fees designated for this project, revenue bonds proceeds pledging student fees designated for this project, Indirect Cost Recovery funds, revenue bond proceeds pledging an annual commitment of Indirect Cost Recovery (IDC) funds, Industry Partnerships, and major maintenance funds of the University.
Demolition for the Lewis component will occur during Christmas Break (beginning January 3, 2000) to minimize disruption to classroom activity. The Johnson component construction will be conducted early in 2000. Renovation of the existing Gaines Labs will be conducted during the summer so as not to displace student offerings. Design for the remainder of the project is underway and will continue until the University goes to market with bonded financing package Spring 2000. Existing funds on hand will be insufficient to meet construction and planning needs until that time. A temporary bridge financing arrangement is needed and answered with an Intercap loan. Regental authority is required for Intercap loans in excess of $500K. Authority for one million-dollar Intercap loan is requested. Upon receipt of the bond proceeds in the spring, the balance owing for the interim financing will be paid.