University projects included in proposal

RALEIGH – Since the start of the 2004 short session, House and Senate leaders have debated a series of proposals that would increase the debt load for the state while funding several projects within the University of North Carolina system.

Most of the debate has centered on several projects that UNC Board of Governor members and several House and Senate leaders have attempted to get funded for the 2004-2005 budget. Discussion on the projects, which at one point included money for a motorsports test facility to be operated by UNC-Charlotte, has mostly been centered on funding options. That includes a balloon finance proposal that was touted by Democratic House Speaker Jim Black. The balloon financing plan, which would have required the state to make interest-only payments and pay the principal at the end of the loan term, was scrapped due to a lack of support in both the House and Senate.

This week, however, it appears that House and Senate leaders have reached a compromise that would bankroll pet projects for several state institutions by borrowing.

Several university projects are listed in a $463 million proposal that also includes funding for state parks and new juvenile detention centers. Lengthy discussions over those university projects contributed to the legislature’s delay in passing the adjustment to the budget for the 2005 fiscal year, which began July 1.

To pay for the entire package, the state would borrow $310 million during the current fiscal year and $153 million during the 2005-2006 fiscal year through bond sales.

“The bill allows us to fund the projects that are needed immediately, and also maximizes our ability to manage our debt in the future,” House leaders Black and Richard Morgan and Senate leader Marc Basnight said in a joint statement announcing the deal.

Among the university projects included in the bond proposal is a $60 million cardiovascular center at East Carolina and a long-sought, $180 million cancer center at UNC-Chapel Hill. To finance the UNC-CH cancer center, the state will borrow $110 million this fiscal year and $70 million the next.

“This will give us a world-class treatment facility that will make the world-class research faculty and facilities that we already have,” UNC-CH Chancellor James Moeser told The News and Observer.

The UNC-CH and East Carolina projects had been reviewed by the UNC Board of Governors and approved by board members. Other university projects included in the proposal, however, had not received reviews by the UNC board. Not reviewed were the $35 million health promotion center at UNC-Asheville, the $35 million genetics center at UNC-Charlotte, and the $28 million pharmacy school at Elizabeth City State.

The proposal also includes money for planning and designing of projects at Fayetteville State University, N.C. A&T University, UNC-Greensboro, UNC-Pembroke, Western Carolina University, and Winston-Salem State University. In all, $50 million will be made available in the current fiscal year for those design efforts.

The Board of Governors must still approve the projects before any money from the proposal is authorized to be spent. UNC Board Vice Chairman J. Craig Souza was nevertheless pleased with the package.

“Just because it’s not on our ‘A’ list doesn’t mean we don’t need the projects,” Souza told the N&O.