Building funds at UNC are unstable

A bleak budget climate prevented the Democratic N.C. General Assembly from appropriating funds toward capital projects at UNC for the current fiscal year.

After a Nov. 2 election that handed the assembly to the Republicans for the first time since 1898, University officials fear that politics will become yet another obstacle in the quest for funding.

“We suspect that clearly they will (cut funding),” said Bruce Runberg, associate vice chancellor for planning and construction. “This coming session and budget year is going to be severe.”

Though some projects are at least partially funded by private funds, most are funded primarily — or entirely — through state dollars.

The Democratic state legislature declined to fund any projects at UNC for the current fiscal year, although it still approved five that had outside funding, such as renovations to the Student Union and Kenan Stadium.

Dwayne Pinkney, the associate provost for finance and academic planning who once served as the University’s state government liaison, said the new legislature will almost certainly cut capital funds because Republicans are traditionally averse to debt spending. Capital projects are, by nature, funded through such spending.

But he said his prediction goes beyond a politics-as-usual mentality.

“Last year we didn’t have any capital projects, either,” he said. “And that’s without a partisan stripe. Last year with Democrats it was the same way.”

But no matter the underlying reasons for the cuts, it is clear that some of the biggest and most important projects are those funded by the state.

In 2008, the School of Law was slated to move from its current, dilapidated building to a new one at Carolina North, and the Morehead Planetarium was supposed to receive millions of dollars in renovations.

But when the legislature began feeling the effects of the recession just months after the funds were approved, it decided not to send those funds after all, said Anna Wu, University architect and director of facilities planning.

“They have to continue to operate in buildings that are sub-optimal,” she said. “Generally that means they just won’t be as effective.”

But Pinkney, who has also had finance-based leadership roles in both the UNC system and the General Assembly, said a lack of funds wouldn’t affect the University’s academic quality.

“The University has been adapting to demands and constraints for a long time,” he said. “In the short run and foreseeable future, there will be no detrimental impact.”

However, the lack of funding does have the potential to negatively impact the surrounding community.
Wu said most capital projects are overseen by outside contractors, who generally hire from the area.
The $228 million mixed-use Bell Tower Development project has averaged 334 workers on site each work day since it began more than three years ago, reaching 1 million man hours earlier this month.

The contractor for that project has offices in Raleigh, so when the project ends in 2012, the area could face the loss of hundreds of jobs and millions of dollars from the market with no further projects being funded.
Karen Geer, director of facilities planning and construction, said the assembly took back more than $3 million in 2008 from the general repairs and renovations fund, as well as a combined $15.6 million from the Dental Sciences Building and the Bell Tower project.

The University currently has 20 capital projects underway, with more than $888 million in funding, including the $105 million Kenan Stadium expansion and the construction of a $243 million biomedical research imaging building.

All 20 projects are fully funded, but Runberg cautioned that their funding isn’t entirely safe, as the General Assembly can take funding back even after giving it out to a school.

“They have the authority to do that,” he said. “We don’t believe that they would, and we hope they don’t.”
Runberg said there is no way to look beyond this year, but that the prospects for now look bleak.

“Anyone, everyone, is likely to conclude that it is going to be a tough year for any type of project.”

Contact the University Editor at udesk@unc.edu.