University building repairs overdue.

Byline: Greg Bolt The Register-Guard

The Oregon University System is asking legislators and voters to buy into a plan that would float $500 million in state bonds to tackle a huge backlog of deferred maintenance on all seven public university campuses.

If approved, the bond sale would spark a massive renovation effort that would fix roofs, bring electrical and plumbing systems up to 21st century standards and add energy-saving environmental systems. Buildings also would be modernized so classrooms and labs would have up-to-date technology and equipment.

Grattan Kerans, OUS legislative director, said the investment is needed to keep buildings that are now 25 to 40 years old from falling further into disrepair.

More than half the square footage on university campuses was built between 1960 and 1975 to handle the coming baby boom generation, and without refurbishing many could prematurely reach the end of their useful lives, Kerans said.

Because of falling state support dating back to Measure 5 in 1990, universities have had to put off regular maintenance and building upgrades.

For at least the past two biennia, OUS had $40 million a year in deferred maintenance needs but a budget of only $12 million.

"It's pay me now or pay me later," Kerans said. "Well, today is later, tomorrow is much later and the day after is maybe too late."

University buildings account for half the building space owned by the state, and the 18 million square feet under university roofs has a combined market value of more than $3 billion.

But Kerans said circumstances have combined to put that investment in jeopardy.

"What we have here is almost a 'perfect storm' of declining state resources, a huge block of our previous capital investment aging its way into the deferred maintenance column and enormous enrollment growth," Kerans said. "Demand is going up at the same time our buildings are deteriorating around us."

The proposal requires an amendment to the state constitution, which currently has no provision for higher education bonds that are wholly repaid through state revenue.

Senate Joint Resolution 1 would refer a constitutional amendment to the voters in the May 2004 primary election. Companion legislation, Senate Bill 240, sets up the statutory authority allowing the higher education board to sell the bonds.

The board would decide the amount of bonds to be sold in a given year, which projects to tackle and the order they would be addressed.

The legislation bars bond funds from being used on new construction and limits projects to classroom, laboratory, library and administration projects; student housing, student unions and athletic facilities wouldn't qualify.

If SB 240 is approved, it would not take effect unless the constitutional amendment also passes. Both would expire after 10 years.

Oregon State University has the biggest backlog of deferred maintenance with $158 million in needs, according to a 2001 study. Portland State University is next with a $138 million backlog, and the University of Oregon is third with a $123 million list.

With the state still struggling with a down economy and shrinking tax revenue, questions about the timing of the measure are likely. But Kerans noted that no bond payments would be needed in the 2003-05 biennium, so the measure wouldn't have an impact until the 2005-07 budget year.

Also, Kerans said the bond projects would provide a much-needed economic boost for the state, generating family-wage jobs in communities across the state. Projects would probably begin in spring of 2005.

The size of the bond payments each biennium would depend on the amount of bonds sold. Kerans said now is a good time to take on the maintenance problem because interest rates are low and the state would get a good deal by selling bonds before rates start up.

Bob Simonton, director of capital construction and planning for OUS, said while campus maintenance crews have done a good job keeping the buildings looking nice, the beauty often is only skin deep. If underlying problems aren't addressed soon, more costly emergency repairs will be needed and some buildings might be closed until work can be done.

As an example, he said an October 2001 water leak at Portland State University shorted out an electrical panel and turned on a pump, flooding an adjoining building and damaging its boiler. Repairs cost $300,000.

"That's the worst way to make capital repairs, with an emergency," he said.

UNIVERSITY MAINTENANCE

According to a 2001 study, Oregon universities have $500 million in deferred maintenance needs, including $123 million at the UO. Some of the buildings with the greatest maintenance need and the cost are:

Knight Library: $12.2 million

Pacific Hall: $11.3 million

Lawrence Hall: $6.9 million

Klamath Hall: $6.3 million

Heustis Hall: $5 million

Prince Lucien Campbell Hall: $5.8 million