STATE BUILDING AUTHORITY RESOLUTION H.C.R. 101: COMMITTEE SUMMARY
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House Concurrent Resolution 101 (as adopted by the House)
Sponsor: Representative Lee Gonzales
House Committee: Appropriations
Senate Committee: Appropriations


Date Completed: 11-13-08

CONTENT
House Concurrent Resolution 101 would approve the conveyance of property and approve a lease between the State, the State Building Authority (SBA), and the University of Michigan-Flint for a construction project that the Legislature has previously approved for planning and construction. Approval of the resolution would enable the SBA to issue bonds to finance the State's share of construction costs.


The project has met all of the planning approval requirements of the Joint Capitol Outlay Subcommittee and the Management and Budget Act. Approval of the resolution would create a contractual obligation between the State and the SBA, requiring the State to make annual rental payments to the SBA. The SBA uses the rental payments to pay off the bonds sold to finance construction. Once the debt obligations are satisfied, the SBA will transfer title back to the institution.

FISCAL IMPACT
The project represents new SBA bond debt obligations of $7.0 million. Annual rental payments to the SBA are estimated at $480,000 to $628,000 until the bonds are retired (approximately 15 to 17 years). Annual rental (debt service) payments to the SBA appropriated in the FY 2008-09 General Government appropriation bill total $231.8 million.



HCR		  
Project		  
Total Cost		 State
Share		 Institution Share Rental Range
101 University of Michigan-Flint, French Hall Renovations. The project includes renovation of 68,000 gross sq. ft. of classrooms, faculty offices, and support areas. $9,350,000 $7,000,000 $2,350,000 $480,000 to $628,000
Fiscal Analyst: Bill Bowerman

Analysis was prepared by nonpartisan Senate staff for use by the Senate in its deliberations and does not constitute an official statement of legislative intent. 101/0708