Renovation Report: N.C. may consider bonds to shrink renovation funding gap

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It’s been almost a decade and a half since state agencies and community colleges got any bond money from the state to fund repairs and renovations to existing buildings.

In that time, those buildings have accumulated a multi-billion-dollar backlog in repair and renovation work. The state budgets money about every two years for work on existing state and university buildings, but it hasn’t given the 2- to 4-percent of replacement cost that’s recommended to maintain commercial buildings. Community colleges rely on county bonds for the majority of their capital projects, but receive state bond money as well.

Lt. Gov. Dan Forest last week said the state may consider a bond referendum to fix state buildings, which also would provide construction jobs and help give a jolt to the N.C. economy. Forest spoke at a joint meeting of American Institute of Architects’ N.C. chapter and the Carolinas chapter of the Associated General Contractors of America.

“A study is underway to look at all existing state facilities and their repair and renovation needs,” Forest said at the meeting. “We are looking at ways to drive efficiencies through facilities, but there are numerous updates needed. It will be difficult to fund all necessary repairs through savings in the short term, so a bond referendum may be needed if it can be done without raising taxes.”

History suggests that N.C. voters may be receptive to a bond referendum. Forest said a $3.1 billion referendum passed overwhelmingly in 2000. Of those bonds, $2.5 billion went toward construction needs of the 16 campuses of the University of North Carolina System, according to CAGC. The remaining $600 million went toward community colleges for their construction needs.

Kathy Drumm, executive vice president of Central Piedmont Community College, said that while CPCC enjoys solid support from Mecklenburg County bonds, many community colleges across the state don’t get the same level of support and are badly in need of state bond money.

“A lot of those colleges haven’t had any significant money since 2000,” Drumm said. “Given the growth that we’ve seen in community college enrollments in the past 14 years, our operating (costs) are climbing. This is an additional burden on the community colleges to keep our infrastructure in line with our growth.”

Dave Simpson, government relations and building director of the CAGC, said state buildings need $6 billion in repairs and renovations, $2.1 billion of which are on community college campuses.

“And we have the best community college system in the nation,” Forest said. “If we desire to stay in the lead, we will need to invest in our infrastructure. And that burden will not just fall on the state but our local communities as well.”

Forest told attendees at the joint meeting that he would support legislation in the upcoming short session of the N.C. General Assembly, which starts May 14, to do a study of repair and renovation needs to state buildings. If such a study were completed, it would make recommendations to the legislature on funding possibilities for repair and renovation projects. The General Assembly would then take into consideration those recommendations during 2015’s long session and determine how to proceed, be it a bond referendum or funding more of the projects itself.

“The study should be based on greatest needs and not just the wants and desires of interest groups,” Forest said. “We are still in the process of a long climb out of a deep recession and we must be the best stewards of the people’s money.”