Frankfort, Ky – Eleven major construction projects at six state universities, including dormitory renovations, new student centers, and athletic facility improvements will soon be underway as the result of the General Assembly’s quick passage of a bill that allows the schools to issue bonds for project financing at no cost to Kentucky taxpayers.
Governor Steve Beshear, joined by a bipartisan group of legislative leaders and state university presidents, signed House Bill 7 into law today. The law authorizes $363.3 million in agency bonds by Kentucky’s public universities for campus improvements supported by university revenues.
The bonds will have an estimated economic impact of nearly $623 million and will support 5,110 jobs. Each university will issue the bonds over the coming months.
“Because of our universities’ continued good stewardship during tough financial times, approving the use of agency bonds makes good sense for our schools and for our taxpayers,” said Gov. Beshear. “The 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. Our students need adequate classrooms, housing and facilities, and the issuance of these bonds will accelerate those projects.”
General Fund support for the universities has been cut 15 percent over the last three biennial budgets. Universities need the authority to utilize other revenues to maximize student opportunities, including needed facilities that may be built or improved without general fund revenues from the state. Many of projects were proposed in the last legislative session but were not authorized. No new fees are proposed to support the bonds for the projects.
“House Bill 7 is a wonderful example of how bipartisan governing should work. The bill is a result of consensus and will benefit both higher education and taxpayers,” said Senate President Robert Stivers.
“House Bill 7 shows what can happen when we all come together to move Kentucky forward,” said House Speaker Greg Stumbo. “These projects will go a long way to modernizing our public universities, and I want to thank Gov. Beshear and the college presidents for their work in helping to make this possible.”
“I was proud to sponsor House Bill 7 and work alongside Gov. Beshear, Kentucky’s college presidents, and my colleagues in the House and Senate to get this passed as quickly as we did,” said Rep. Rick Rand, of Bedford. “This will help our students, and provide some much needed job development and growth.”
Kentucky’s eight university presidents noted 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.
“We are enormously grateful to the Governor and the General Assembly for their bipartisan support for our campuses and their commitment to serve our students,” said Council on Postsecondary Education President Bob King. “These projects will create jobs across the Commonwealth, and produce the modern facilities we desperately need to provide our students the educational resources that will power their futures.”
Eleven construction projects at six institutions will be financed by agency bonds. Several projects will address outdated or inadequate student housing; others will improve existing classroom spaces. University presidents said these projects will provide a safer experience for students and faculty, improve campus quality of life, and avoid additional cost burdens for students.
The University of Kentucky plans to issue bonds for three separate projects, and will utilize athletic revenues to help pay for construction of an academic building, which is a first for a Kentucky university. Athletics will fund $65 million of a $100 million, 263,000-square-foot Academic Science Building, where Donovan Residence Hall currently sits. The current Chemistry-Physics Building is the second most used facility on campus, but is not equipped with modern or technology-rich classroom and laboratory space. Private fund-raising efforts also will be utilized.
Each of these projects is already in some form of planning by the universities, and some have initiated design work. Construction for most projects will begin this calendar year.
The projects to be supported by agency bonds include:
· Morehead State University
o Mignon Hall (residence hall) renovation, $9.2 million