Stanford s Capital Budget and three-year Capital Plan are based on a projection of the major capital

Transcription

1 CHAPTER 4 CAPITAL BUDGET AND THREE-YEAR CAPITAL PLAN Staford s Capital Budget ad three-year Capital Pla are based o a projectio of the major capital projects that the uiversity will pursue i support of the academic missio. The Capital Budget represets the aticipated capital expeditures i the first year of the rollig three-year Capital Pla. The Capital Pla icludes projects that are i progress or are expected to commece durig that three-year period. Both the Capital Budget ad the Capital Pla are subject to chage based o fudig availability, budget affordability, ad uiversity priorities. At $2.5 billio, the Capital Pla reflects the sigificat ivestmet Staford cotiues to make i its facilities, drive by the academic priorities for teachig, research, ad related activities described i Chapter 2, ad the iitiatives of the admiistrative ad auxiliary uits that support the academic missio, described i Chapter 3. With the 2012/13 project completios, Staford will have ivested $4 billio i its facilities, ifrastructure ad commercial real estate sice The campus has bee trasformed with state-of-the-art facilities supportig sciece, egieerig, medicie, busiess, athletics, law ad the arts. Additioally, the Rosewood Sad Hill hotel ad office complex, ad other off-campus commercial developmet projects have provided additioal icome to the uiversity. I additio to the may projects curretly uder way ad previously forecasted, this year s pla icludes the followig ew projects: the Staford Istitute for Chemical Biology/ Neuroscieces buildig ($196.9 millio), Mayfield Califoria Aveue Faculty Staff Housig ($128 millio), a 1000-stall udergroud parkig structure at Roble field ($40.9 millio), 408 Paama Mall office buildig ($35.4 millio), 1651 Page Mill Road Teat Improvemets ($23.8 millio), reovatio of the Staford House i Oxford ($4 millio) ad a ew Dea s residece ad program space for the future Crother s College ($3 millio). Additioally, the followig projects have bee reactivated: Ecia Reovatio ($67.2 millio), Public Safety buildig ($17 millio), ad the fial phase of the Durad Buildig reovatio ($6.8 millio). The followig five sigificat projects comprise roughly half of Staford s Capital Pla: the Staford Eergy System Iovatios (SESI) project ($438 millio), Bio Medical Iovatio buildig 1 (BMI 1; formerly Foudatios i Medicie 1 (FIM 1)) ($266.4 millio), Bioegieerig/ Chemical Egieerig buildig (BioE/ChemE) ($215.5 millio), Chemical Biology/Neuroscieces buildig ($196.9 millio), ad the Biology Research ad Teachig project ($179.3 millio). The remaiig half of the pla icludes 30 additioal projects ad 8 ifrastructure programs. For a detailed listig of all Capital Pla projects ad programs, see the tables o pages This chapter will iclude a discussio of the 2013/14 Capital Budget, provide a overview of the capital plaig process, describe curret strategic iitiatives, ad preset the 2013/ /16 Capital Pla ad related costraits. THE CAPITAL BUDGET, 2013/14 The 2013/14 Capital Budget at $658.7 millio reflects the uiversity s sigificat capital projects icludig SESI, BioE/ChemE, Mayfield Califoria Aveue Faculty Staff Housig, Comstock Graduate Housig, McMurtry Buildig, Buildig Reovatio for SUL North, Aderso Collectio at Staford Uiversity, C.J. Huag Buildig, RAF 1 ad RAF 2 Rehabilitatio ad Retrofit, Crow Quadragle Reovatio, Northwest Data Ceter ad Commuicatios Hub (NDCCH), ad various ifrastructure projects ad programs. The projected 2013/14 expeditures reflect oly 65

2 66 MAJOR CAPITAL PROJECTS PERCENT OF COMPLETION 2013/14 1 Staford Eergy System Iovatios (SESI) ESTIMATED CAPITAL ESTIMATED PERCENT BUDGET PROJECT COMPLETE 2013/14 COST 2013/14 Replacemet Cetral Eergy Facility % Pipig, Buildig Coversios ad Process Steam Plat % New Electrical Substatio % Bioegieerig / Chemical Egieerig (Buildig ad Coective Elemets) % Mayfield Califoria Aveue Faculty Staff Housig (180 uits) % Comstock Graduate Housig (362 et ew beds) % McMurtry Buildig % Buildig Reovatio for SUL North % Aderso Collectio at Staford Uiversity % C.J. Huag Buildig % RAF 1 ad RAF 2 Rehabilitatio & Retrofit % Crow Quadragle Reovatio % Northwest Data Ceter ad Commuicatios Hub % , Icludes projects scheduled to be i costructio ad with forecasted expeditures greater tha $10 millio i 2013/14. a portio of the total costs of the capital projects, as most projects spa more tha oe year. The table highlights major capital projects with sigificat expeditures that will be icurred i the 2013/14 Capital Budget, as well as the percetage of each project expected to be complete by the ed of 2013/14. The size of the Capital Budget is based o the assumptio that fudig availability will alig with approved project schedules. Historically, the Capital Budget has bee substatially higher tha actual spedig due to project deferrals caused by fudig gaps. I fact, the last decade s actual expeditures were 70% of the total budgeted. Over the past five years, the percetage improved to 74% because the umber of projects i recet Capital Budgets that have all fudig idetified, staff assiged, ad Board of Trustees approval icreased. Sources ad Uses Sources of fuds for the Capital Budget will be a combiatio of curret fuds (which iclude the Capital Facilities Fud (CFF), fuds from uiversity ad school reserves, Geeral Use Permit (GUP) ad Staford Ifrastructure Program (SIP) fees), gifts, ad debt. The uiversity typically allocates CFF or debt fudig to projects i the absece Capital Budget Capital Expeditures CAPITAL BUDGET VS. EXPENDITURES 2002/03 to 2011/ % 41% 58% 69% 57% 72% 81% 70% 77% 68% 2002/ / / / / / / / / /12

3 THE CAPITAL BUDGET 2013/14 $658.7 MILLION Ifrastructure 51% Uses of Fuds by Project Type New Costructio 32% Reovatios 17% Uses of Fuds by Program Category Ifrastructure 51% Academic/Research 16% Capital Facilities Fud I Jue 2007, the Board of Trustees approved a icrease i the target edowmet payout rate from 5.0% to 5.5%. The additioal 0.5% payout releases urestricted fuds, which are held i the CFF to support major facilities projects. Aual trasfers to the CFF are projected to be $54.0 millio i 2012/13 ad $99.5 millio i 2013/14 with commitmets of $122.9 millio i 2012/13 ad $66.7 millio i 2013/14, as show i the table o the ext page, alog with a detailed listig of projects that have received or will receive these fuds. I geeral, o-formula CFF fuds are allocated to projects that are difficult to support through restricted sources, ad thus reduce the call for debt serviced by geeral fuds. The formula uits determie uses of their CFF fuds accordig to their highest priorities. of other available fudig. The mix of project fudig will be impacted by the timig of gift receipts, which may be bridge fiaced. The uses of fuds by project type ad program category for the $658.7 millio Capital Budget are show i the pie charts above. Ifrastructure ivestmet of $336 millio i 2013/14 (51%) icludes the SESI ad NDCCH projects, Ivestmet i Plat (Plaed Maiteace), ad Residetial & Diig Eterprises (R&DE) Capital Pla Projects (CPP; formerly R&DE s Capital Improvemet Program (CIP)). Academic support projects forecasted at $109.4 millio (17%) iclude Buildig Reovatio for SUL North, Aderso Collectio at Staford Uiversity, C.J. Huag Buildig, ad RAF 1 ad RAF 2 Rehabilitatio ad Retrofit. Academic/Research projects forecasted at $107 millio (16%) iclude BioE/ChemE, McMurtry Buildig, ad Crow Quadragle Reovatio. Ivestmet of $106.3 millio for housig projects (16%) is primarily for Mayfield Califoria Aveue Faculty Staff Housig ad Comstock Graduate Housig. Housig 16% Academic Support 17% Capital Budget Impact o 2013/14 Operatios The 2013/14 Cosolidated Budget for Operatios icludes icremetal debt service ad operatios ad maiteace (O&M) expeses for projects completig i 2013/14. Additioally, this budget icludes a icremetal icrease i iteral debt service ad O&M expeses for projects completig i 2012/13 that are operatioal for less tha 12 moths. Capital projects requirig debt are fuded from iteral loas that are amortized over the asset life i equal istallmets (pricipal ad iterest). The budgeted iterest rate (BIR) used to calculate the iteral debt service is a bleded rate of iterest expese o debt issued for capital projects, bod issuace ad admiistrative costs. The BIR for 2013/14 is 4.25%. The projected icremetal iteral debt service fuded by urestricted fuds, icludig formula uits, i 2013/14 is $6.7 millio. This amout icludes additioal debt service o BioE/ChemE, the Staford Research Computig Facility, the School of Medicie s (SoM) teat improvemets at Porter Drive locatios, ad other smaller capital projects ad programs. It is offset by decreases i bridge fiacig as scheduled paymets or gift pledges are made for several uiversity buildigs. This additioal debt service brigs the total aual iteral debt service i 2013/14 to $171.4 millio, $57.9 millio of which is bore by urestricted fuds. 67

4 68 CAPITAL FACILITIES FUND (CFF) Fudig Sources ad Committed Uses of Fudig 2012/ /14 Sources of Fudig Formula Uits School of Medicie Hoover Istitutio Presidet s Fuds No-Formula Total Fudig Committed Uses of Fudig Buildig Maiteace - School of Medicie RAF 1 ad RAF 2 Rehabilitatio ad Retrofit Stoe Complex Seismic Bracig Projects 1.3 C.J. Huag Buildig 0.8 Porter Drive Site Plaig - School of Medicie Various School of Medicie Projects Hoover Istitutio Projects Various Projects Fuded by Presidet s Fuds Buildig Reovatio for SUL North 48.5 Arrillaga Outdoor Educatio ad Recreatio Ceter 13.0 Crow Quadragle Reovatio 5.0 Istitute for Chemical-Biology (Fit-up for Professor Kholsa) 3.0 Searsville Alteratives Study 3.0 Aderso Collectio at Staford Uiversity 2.9 BioE/ChemE (bridge fiacig for gifts to be raised) 2.8 Emergecy Geerators ad Maagemet Programs Northwest Data Ceter ad Commuicatios Hub 2.5 McMurtry Buildig 2.0 Forsythe Data Ceter Phase 4 Power ad Coolig Upgrade 1.4 Biology Research Buildig Teachig Labs & Learig Ceter (Old Chem) Groud Source Heat Exchage Study Paama Mall Office Buildig Staford House i Oxford Registrar Classroom Reovatios 0.9 Roble Gym Reovatio Staford Naofabricatio Facility/CIS Kight ad Littlefield Repurposig 0.4 Meyer Library Demolitio 6.7 Campus Ceter Caopy 1.0 Other Projects Total Commitmets Net Aual Activity (68.9) 32.8 Balace at Begiig of Year Ucommitted Balace Cosolidated iteral debt service, icludig that bore by formula uits, auxiliaries, service ceters, Faculty Staff Housig, ad real estate ivestmet is projected to icrease from $164.7 millio to $171.4 millio. I additio, aual lease paymets for retal properties, largely occupied by the SoM, are projected to be $26.8 millio i 2013/14. The uiversity will icur icremetal O&M costs i 2013/14 of $5.4 millio, which icludes $3.2 millio for the BioE/ ChemE Buildig, $1.3 millio for 3160 Porter Drive, ad $935,000 for the Staford Research Computig Facility. CAPITAL PLANNING OVERVIEW Capital Plaig at Staford Staford s Capital Pla is a three-year rollig pla with budget commitmets made for the first year ad oly for projects with fully idetified ad approved fudig. Cash flow expediture forecasts for these projects exted beyod the three-year period, ad budget impacts for operatios, maiteace, ad debt service commece at costructio completio. The pla icludes forecasts of both cash flow ad budget impacts by year ad demostrates the impact of projects beyod the three-year pla (see table o page 76). The Capital Pla is set i the cotext of a loger-term capital forecast for the uiversity. The details of this loger-term forecast, particularly fudig sources ad schedules, are less clear tha those of the three-year pla, as the eeds ad fudig sources that may emerge over the log-term horizo are difficult to aticipate. Over the loger-term forecast, plas ted to evolve as various projects prove more feasible tha others based upo shiftig fudig realities ad academic priorities. Strategic Iitiatives The followig uiversity strategic iitiatives, detailed below, are itegral to this year s Capital Pla: Staford Eergy System Iovatios (SESI) Sciece, Egieerig, ad Medical Campus (SEMC) Arts Iitiative New Housig Off-Site School ad Admiistrative Facilities

5 Staford Eergy System Iovatios Icluded i the Capital Pla is the SESI project, which at $438 millio represets 17% of the pla. SESI will replace the existig cetral eergy plat ad related ifrastructure. Staford curretly receives most of its thermal (heatig ad coolig) ad electrical eergy from the Cardial Cogeeratio plat (Coge). Coge operatios are based o a operatio ad maiteace agreemet with Geeral Electric that expires i April At that time, the plat will be 28 years old ad at the ed of its useful life. Other cetral eergy plat equipmet is or will be at or ear the ed of its useful life. Sice 2007, early $130 millio of maiteace ad system upgrade projects have bee deferred pedig cosideratio ad selectio of a Coge replacemet. Campus growth projectios ad the expasio of the Staford Hospital ad Cliics ad Lucile Packard Childre s Hospital will require a 20% icrease i both thermal ad electrical eergy capacity by Approximately half of this icreased demad i thermal eergy is due to campus developmet ad half is attributed to the hospitals growth, while all of the electrical growth is due to the campus sice the hospitals are o the City of Palo Alto electrical grid. After a rigorous review of may optios by exteral egieerig firms, fiacial cosultats, faculty, seior uiversity maagemet, ad the Board of Trustees, SESI was approved i December 2011 ad is scheduled to be complete by April SESI icludes the followig compoets: Procuremet of electricity through Direct Access (effective March 2011); Replacemet of Cetral Eergy Facility (RCEF) ad campus electrical substatio o the west side of campus. The RCEF recovers waste heat from the campus chilled water system (which is curretly discharged out of coolig towers) to meet the bulk of campus heatig eeds; Coversio of the existig cetral steam system to a more efficiet hot water system; ad Decommissioig ad demolitio of the existig plat ad electrical substatio. SESI is oe of the most efficiet ad iovative cetral district thermal eergy system desigs i the world ad will further advace Staford s leadership i egieerig ad evirometal excellece while also greeig the bottom lie i the truest sese. Oce SESI is complete, the campus will utilize 70% of the waste heat curretly expelled from coolig towers to meet 80% of campus heat demads; reduce campus water cosumptio by more tha 18%; ad reduce greehouse gas emissios to less tha half of curret levels ad well below 1990 levels. Sciece, Egieerig, ad Medical Campus Over the course of the SEMC iitiative, the uiversity has ivested i the replacemet of agig facilities for the sciece, egieerig, ad medical programs with the costructio of the followig projects: Active Bioegieerig/Chemical Egieerig Buildig (to be completed i 2014) Biology Research ad Teachig Project (both buildigs to be completed i 2016) Completed Astrophysics Buildig (2006) Jerry Yag ad Akiko Yamazaki Eviromet ad Eergy Buildig (2007) Lorry I. Lokey Stem Cell Research Buildig (2010) Je-Hsu Huag Egieerig Ceter (2010) James ad Aa Marie Spilker Egieerig ad Applied Scieces Buildig (formerly Nao) (2010) Li Ka Shig Ceter for Learig ad Kowledge (2010) This year s Capital Pla icludes both the BioE/ChemE buildig ad the Biology Research ad Teachig project, the remaiig SEMC projects. Bioegieerig/Chemical Egieerig Buildig At $215.5 millio, the BioE/ChemE project is the fial compoet of the Sciece ad Egieerig Quad 2 (SEQ 2). This buildig ad its associated coective elemets ad fit-ups will facilitate iterdiscipliary study through the placemet of two related programs Bioegieerig ad Chemical Egieerig i oe locatio. The buildig will iclude wet laboratories ad associated support spaces desiged for teachig ad itesive research i each of the departmets. Icluded also i the buildig scope are classrooms, faculty offices, ad coferece spaces. The 227,000 gross square feet (gsf) BioE/ChemE buildig will be cosistet with the architectural character of the SEQ 2 Quad. Costructio is i progress. 69

6 70 Biology Research ad Teachig Project The Biology Research ad Teachig project cosists of two separate facilities that represet the eighth ad last compoet of the SEMC. These facilities iclude the followig: Biology Research Buildig The Biology Research buildig is iteded to replace the existig Herri Hall ad Herri Laboratory buildigs, which will ultimately be removed. The proposed $96.1 millio buildig will provide laboratory space for approximately half of the departmet s faculty, plus the correspodig research staff of graduate studets, post-docs, ad techicias. The 108,500 gsf buildig will be located orth of the Gates Computer Sciece buildig ad frot oto Campus Drive; four stories above grade ad oe below are plaed. Icluded i the buildig scope are laboratory support spaces, faculty offices, ad coferece areas. The ew buildig will ecourage collaboratio ad iterdiscipliary work, allowig faculty with research i molecular biology, cell biology, eurobiology, biophysics, ad molecular evolutio to coduct their research across departmetal ad school boudaries. Costructio is aticipated to begi i Teachig Labs & Learig Ceter I cojuctio with the Biology Research Buildig, the Capital Pla icludes the reovatio of the Old Chemistry (Old Chem) buildig ito a udergraduate studet learig ceter. The $66.7 millio reovated facility will house Biology ad Chemistry teachig laboratories, a combied scieces library for Biology, Chemistry, ad Math, as well as classrooms, auditoria, ad studet collaboratio areas. Architectural programmig has begu ad desig work is aticipated to begi later this year. Due to the historic status of Old Chem, the reovatio will fully retai the buildig s exterior character ad select iterior features. Costructio is aticipated to begi i Arts Iitiative The Arts Iitiative, a key compoet of the Staford Challege, established a uiversity commitmet to the followig: Egage the arts ad creativity; Improve arts i udergraduate life; Stregthe the academic programs i the arts; ad Develop world class facilities to support the arts. The developmet of a log rage visio to create a Arts District established a physical pla to support this iitiative. This district, which flaks Palm Drive ad the Oval at the mai etrace ito campus, leverages the followig Staford veues the Cator Arts Ceter, Frost Amphitheater, Memorial Auditorium, the Art Gallery ad the recetly completed Big Cocert Hall. The Big Cocert Hall is a 844-seat acoustically exceptioal vieyard-style hall that held its first performace i Jauary Two additioal key buildig compoets of the Arts District Aderso Collectio at Staford Uiversity ad McMurtry Buildig are uder costructio ad whe complete, will provide additioal exhibit ad academic space. Aderso Collectio at Staford Uiversity This $36 millio, 33,000 gsf buildig will house the Aderso Collectio at Staford 121 works by 86 artists that iclude some of the foremost examples of post-world War II America art. The collectio marks a major milestoe i the Staford Arts Iitiative, a uiversity-wide campaig to itegrate the arts fully ito the life of the Staford campus. The site is located orth of the Cator Arts Ceter o the corer of Lomita ad Campus Drive. Costructio has commeced ad is scheduled to complete i McMurtry Buildig The $87 millio McMurtry Buildig will serve as a iterdiscipliary hub for the arts at Staford. The 100,000 gsf buildig will be the future home of the Art ad Art History Departmet s programs i Art Practice, Art History, Film ad Media Studies, ad Documetary Film. The buildig is located o Roth Way betwee the Cator Arts Ceter ad Parkig Structure 1 o the site of the ow demolished Old Aatomy buildig. Costructio has commeced ad is scheduled to complete i Coectios i the ladscape betwee the Big Cocert Hall, the Aderso Collectio at Staford Uiversity, the McMurtry Buildig, ad the Cator Arts Ceter are plaed to highlight Staford s existig collectio of outdoor art, as well as to provide future opportuities for ewly commissioed art. New Housig Staford Uiversity prides itself i havig a housig program that provides a wide rage of choices for its studets, faculty, ad staff. The visio for academic housig builds upo this program by providig the physical framework that offers a variety of livig optios.

7 Costructio of the Comstock Graduate Housig project ($110 millio) has recetly commeced ad will iclude the demolitio of ie existig low-rise resideces. Oce complete, 362 et ew graduate beds will be added to the housig ivetory. Additioally, two udergraduate housig projects are plaed at Laguita ($35 millio) ad Mazaita ($20 millio) for a additioal 328 ew beds. The Graduate School of Busiess (GSB) also plas to expad their curret housig stock by buildig 150 ew graduate beds ($66.7 millio), with costructio commecig i I additio to studet housig, the uiversity plas to build 180 residetial uits for faculty ad staff o Califoria Aveue i Palo Alto ($128 millio). Alog with providig much eeded housig, this project will also meet compliace requiremets uder the Mayfield Developmet Agreemet. Off-Site School ad Admiistrative Facilities Several departmets withi Staford s School of Medicie alog with various uiversity admiistrative uits have moved or will move to the Porter Drive area of the Staford Research Park. Oce all the teat improvemets are complete, these Staford etities will partially or fully occupy seve buildigs with a populatio of approximately 2,000 faculty ad staff. The moves are the result of academic space eeds that curretly caot be accommodated o campus ad the strategic iitiative that allows core campus lads to be used for the highest academic priorities by locatig admiistrative fuctios to earby locatios. Curretly this locatio is the Staford Research Park. I 2005 ad 2008, Staford purchased a total of 35 acres i Redwood City to develop a admiistrative uiversity campus. Staford is curretly workig with Redwood City to draft a detailed 30-year developmet agreemet, to which sigificat poits have bee agreed. Redwood City s approval to allow for 1.5 millio square feet of ew developmet for admiistrative office space is expected to be received i THE CAPITAL PLAN, 2013/ /16 Staford s academic campus, icludig the School of Medicie but excludig the hospitals, has approximately 700 facilities providig over 16 millio square feet of physical space. The physical plat has a historical cost of $6.9 billio ad a estimated replacemet cost i excess of $10 billio. The Capital Pla icludes a forecast of Staford s aual programs desiged to restore, maitai, ad improve campus facilities for teachig, research, housig, ad related activities ad outlies Staford s eeds for ew facilities. The Capital Pla is compiled, reviewed, ad approved i a coordiated maer across the uiversity. The pla carefully balaces istitutioal eeds for ew ad reovated facilities with the challegig costraits of limited developmet etitlemets, available fudig, ad budget affordability. Projects listed i the Capital Pla are those approved by the provost. May of the projects are uder the purview of the Board of Trustees. Board-level approvals are required for ay of the followig: Total project cost of $10 millio ad above New buildig costructio Projects that use 5,000 or more ew square feet withi the Academic Growth Boudary Chages i lad use Projects with major exterior desig chages Expeditures i the 2013/ /16 Capital Pla, which iclude major costructio projects i various stages of developmet ad umerous ifrastructure projects ad programs, total $2.5 billio. The table below provides a compariso of the last three Capital Plas. COMPARATIVE CAPITAL PLANS 2011/ / /14 Desig/Costructio , ,200.9 Forecasted 1, ,096.4 Ifrastructure Total 1, , , Projects i Desig ad Costructio Projects i Desig ad Costructio total $1.2 billio (47% of the pla). Costructio of these projects is cotiget upo fudraisig of $101.1 millio (8%). Sixtee projects are listed i this category, as show i the related table o page 79.

8 72 The cost of projects i Desig ad Costructio icreased by $170.3 millio from 2012/13 as a result of projects movig from the Forecasted category ad the additio of ew projects, partially offset by the completio of certai projects. Projects movig from Forecasted to Desig ad Costructio iclude Comstock Graduate Housig ($110 millio), C.J. Huag Buildig ($23.2 millio), RAF 1 ad RAF 2 Rehabilitatio ad Retrofit ($20.6 millio), Buildigs ad Reovatio ($20.5 millio), Crow Quadragle Reovatio ($15 millio), ad Northwest Data Ceter ad Commuicatios Hub ($14.9 millio). The Mayfield Califoria Aveue Faculty Staff Housig project ($128 millio) ad Crothers Hall/Crothers College Dea s Residece ($3 millio) are two ew projects to the Capital Pla. Projects scheduled to be completed i 2012/13 iclude the 3155 ad 3165 Porter Drive Lab Reovatios ($42.4 millio), Staford Research Computig Facility ($41.2 millio), Arrillaga Outdoor Educatio ad Recreatio Ceter ($35.5 millio), Comparative Medicie Pavilio (formerly Satellite RAF) ($26.5 millio), Arrillaga Family Sports Ceter Additio ($17 millio), ad Staford Auxiliary Library III Phase 2 ($14.8 millio). The Durad Reovatio - Phase 4 ($6.8 millio) project has bee reactivated ad is icluded i this Capital Pla. Forecasted Projects Forecasted Projects are those aticipated to receive Board of Trustees approval over the ext three years. These projects total $1.1 billio (43% of the pla) ad are listed o page 80. As with the projects i Desig ad Costructio described above, these projects are cotiget upo fudig. For this group of projects, a total of $308.5 millio (28%) remais to be fudraised ad $246.6 millio (22%) i fuds have yet to be idetified. Project costs withi this category have icreased by $256.1 millio from 2012/13, as a umber of ew ad reactivated projects have bee added to the Capital Pla. The ew ad reactivated projects iclude the Staford Istitute for Chemical Biology/Neuroscieces buildig ($196.9 millio), Ecia Reovatio ($67.2 millio), Roble Field Parkig Structure ($40.9 millio), 408 Paama Mall office buildig ($35.4 millio), 1651 Page Mill Road Teat Improvemets ($23.8 millio), Public Safety buildig ($17 millio), Meyer Library Demolitio ($6.7 millio), ad Staford House i Oxford ($4 millio). Ifrastructure Staford s ogoig efforts to reew its ifrastructure are reflected i a budget of $249.4 millio (10% of the pla) ad are listed o page 81. Ifrastructure costs have decreased from last year s Capital Pla by $12.9 millio. Ifrastructure programs iclude the Ivestmet i Plat Program (Plaed Maiteace), R&DE s Capital Pla Projects (formerly CIP Program), Capital Utilities Program (CUP), Staford Ifrastructure Program (SIP), Iformatio Techology & Commuicatios Systems, Whole Buildig Eergy Retrofit Program Group 2, Geeral Use Permit (GUP) Mitigatio Program, ad Storm Drai projects. GUP mitigatio ad SIP projects are fuded through costructio project surcharges. The other categories of projects are fuded by cetral fuds or debt. Ivestmet i Plat Plaed Maiteace Program Aual Ivestmet i Plat assets represets the maiteace fuds plaed to be ivested to preserve ad optimize Staford s existig facilities ad ifrastructure (e.g., pathways, outdoor structures, ad grouds). These projectios are based o the life cycle plaig methodology, the key cocept beig that life expectacies of facility subsystems are kow ad, as a result, maiteace schedules ca be predicted. The three-year estimated program cost is $149.5 millio. R&DE Capital Pla Projects R&DE s CPP iitiative is iteded to address health ad safety issues, seismic upgrades, code compliace, eergy coservatio ad sustaiability measures, ad major programmatic improvemets i the studet housig ad diig physical plat. CPP projects aticipated over the ext three years total $41.9 millio. CPP icludes cotiuatio of the code compliace upgrades of various Row Houses, repairs to the Escodido Village slab heatig system ad ifrastructure, as well as bathroom ad kitche reovatios ad the remaiig projects of the Deferred Maiteace Backlog Reductio (Phase 1 ad 2) program. Completed CPP projects will be maitaied through the Staford Housig Asset Reewal Program (SHARP), the Diig Asset Reewal Program (DARP), ad Hospitality Asset Reewal Program (HARP). Capital Utilities Program The $24.4 millio three-year pla improves electrical, steam, water, chilled water, ad wastewater utility

9 systems. The aual CUP program covers the areas of system expasio ($15.2 millio) ad system replacemet, ($9.2 millio), expadig systems as required by campus growth ad replacig systems that are ear the ed of their useful life. Staford Ifrastructure Program SIP cosists of campus ad trasportatio projects ad programs for the improvemet ad geeral support of the uiversity s academic commuity, hospitals, ad physical plat. SIP expeditures are expected to total $13.3 millio over the ext three years (excludig SIP fudig for replacemet parkig spaces). SIP projects iclude campus trasit improvemets, parkig lot ifrastructure improvemets, site improvemets, ladscape desig ad ehacemets, bicycle, cart ad pedestria paths costructio, ad various lightig, sigage, ad outdoor art istallatio. Iformatio Techology ad Commuicatios Systems The uiversity s computig ad commuicatios systems provide comprehesive data, voice, ad video services to the campus commuity. Over time, these systems must be improved ad/or replaced so that a cosistetly high level of service ca be maitaied. Additioally, ew techologies are implemeted that provide more efficiet, faster, ad/ or more cost-effective solutios. This program totals $11.5 millio for upgrades to these critical uiversity systems, ad icludes $2.8 millio for a etwork backboe refresh that is required every five years ad $850,000 for ehaced IT etwork coectios from campus to uiversity buildigs at Porter Drive. Whole Buildig Eergy Retrofit Program Group 2 This retrofit program seeks to reduce eergy cosumptio i Staford s largest eergy-itesive buildigs. The program bega i 2003/04 with studies of the top 12 eergycosumig buildigs, represetig $15.9 millio of eergy expeses per year, or early 36% of the total campus eergy expese. It has sice bee expaded to offer costeffective, capital-itesive eergy retrofit opportuities to additioal large eergy-cosumig buildigs. The retrofits completed thus far have delivered aual eergy cost savigs of $3.3 millio, a discouted payback of about 4 years, ad Pacific Gas ad Electric rebates of $2 millio. WHOLE BUILDING ENERGY RETROFIT PROGRAM ESTIMATED ANNUAL PROJECT RETROFIT STATUS CONSUMPTION SAVINGS EARLY RESULTS Stauffer I - Chemistry Complete 38% 46% Gordo & Betty Moore Materials Research 1 Complete 32% 10% Paul Alle Ceter for Itegrated Systems (CIS) Complete 15% 14% Forsythe (George) Hall Complete 8% 8% Stauffer II - Physical Chemistry Complete 38% 43% Gates Computer Sciece Complete 29% 27% Beckma Ceter for Molecular ad Geetic Medicie Complete 46% 32% Gilbert Biological Scieces Complete 35% 32% Cator Ceter for Visual Arts Complete 13% 14% Big Wig (Gree Library West) Complete 16% 50% Packard Electrical Egieerig Complete 26% Mitchell Earth Scieces Desig 50% Gree Earth Scieces Desig 15% Clark Ceter Desig 26% Arrillaga Alumi Ceter Desig 27% Varia Physics Laboratory Mechaical Egieerig Laboratory Study Study Lucas Ceter Delayed to 2014/15 Ceter for Cliical Scieces Research (CCSR) Delayed to 2016/17 Herri Hall - Biology 2 Cacelled 73 1 Costructio scope reduced from origial survey. 2 Plaed for demolitio.

10 74 The table o the previous page summarizes the status of these projects, expected aual savigs, ad actual savigs achieved. Each project goes through a oe-year tuig ad moitorig period followig completio of costructio to esure the buildig is performig to desig expectatios, followed by ogoig moitorig. As such, early results may ot be idicative of expected log-term improvemets due to the time eeded for the chages to take full effect. Geeral Use Permit Mitigatio Fudig for GUP mitigatios is geerated by a iteral fee levied o capital projects that icrease school/departmet campus space allocatios. The fee provides fudig ecessary for implemetatio of Sata Clara Couty GUP requiremets ad recommedatios icludig trails, storm water maagemet, trasportatio demad maagemet, protectio of biological resources, ad other programs. Also icluded are projects related to water coservatio, water allocatio (i.e., alterative supplies), ad wastewater collectio expasio, whose three-year estimated cost is $1.7 millio. Additioally, GUP fees fud ew parkig spaces. Storm Drais The ogoig storm draiage program icludes projects for improvig ad expadig the capacity of the campus storm draiage system, replacig deteriorated pipes, ad improvig draiage aroud buildigs. I additio, striget storm water quality regulatios are ecessitatig ew storm water treatmet approaches such as bioswales, bioretetio, ad storm water capture to miimize cotamiatio coveyed to atural water bodies from commo storms. These treatmet approaches will be icorporated o ew buildig sites, where feasible. This program covers campus-wide storm water treatmet facilities that meet these requiremets beyod those met by ew buildig projects. The three-year estimated program cost is $1.5 millio. Other Staford Etities I a effort to preset a comprehesive view of uiversity plaed costructio, the capital plaig process has icluded real estate ivestmets, Staford Hospital ad Cliics (SHC), Lucile Packard Childre s Hospital (LPCH), ad SLAC Natioal Accelerator Laboratory. Although the Capital Pla tables at the ed of this chapter do ot iclude these etities, brief descriptios of their capital programs follow. The SLAC capital programs are addressed i Chapter 2, page 50. Real Estate Ivestmets Real Estate is maagig three major ivestmet projects totalig $186 millio i various stages of developmet o Staford lads. Two ew commercial offices of 194,000 square feet will be developed i the Research Park at a cost of $110.9 millio, replacig 135,000 square feet of fuctioally obsolete buildigs. I additio to the 180 uits faculty staff housig i the Capital Pla, 220 ew housig uits will be built, 70 of which will be below market-rate uits developed i Palo Alto as part of the Mayfield Developmet Agreemet, with the remaiig 150 uits plaed to be developed as a multifamily apartmet project i Melo Park ad reted to the ope market. The 142,000 square foot market-rate apartmet project is budgeted at $75 millio. Oce rets from all projects are stabilized, $16 millio of additioal aual gross reveue is expected to be geerated. Staford Hospital ad Cliics ad Lucile Packard Childre s Hospital Sice receivig developmet etitlemets for the Staford Uiversity Medical Ceter (SUMC) Reewal Project i July 2011, costructio activity has begu o the SUMC sites, ad sigificat project milestoes have bee reached. The reovatio of the historic Hoover Pavilio was completed i December 2012, housig a umber of patiet services as well as the practices of several commuity physicias. O the mai SUMC campus, site clearig activity to make way for the New Staford Hospital is i progress, ad mass excavatio is uder way for the Lucile Packard Childre s Hospital Expasio. Utility upgrades to serve the ew medical facilities are curretly i progress alog Welch ad Quarry Roads, ad are expected to complete i fall The estimated project costs of SHC ad LPCH are $2 billio ad $1.1 billio, respectively. Overall Summary A summary table of the 2013/ /16 three-year Capital Pla appears o page 76. Icluded are projects ad programs i Desig ad Costructio, Forecasted, ad Ifrastructure categories that are curretly active or are aticipated to commece i the ext three years. To differetiate betwee the estimated costs of the threeyear Capital Pla ad the forecasted spedig to complete its projects ad programs, a additioal table (Capital Pla Cash Flows) is icluded alog with the Capital Pla Summary. This table forecasts the expediture outflow of

11 the Capital Pla based o project ad program schedules. These cash expeditures are aticipated to be spet over a period extedig beyod 2015/16. Operatig (icludig utilities), maiteace, ad debt service costs will impact the uiversity s operatig budget oce the costructio is substatially complete. Although the Capital Pla Summary shows the full budget impact of all completed projects, it is importat to ote that this impact aligs with the project completio schedule ad will be absorbed by the uiversity budget over a period beyod the three-year pla based o actual project completio dates. A table etitled Capital Pla Impact o Budget is icluded with the Capital Pla Summary ad Capital Pla Cash Flows table to forecast the budget impact by area of resposibility (e.g., geeral fuds, formula schools, etc.). chart breaks out the same activity ito project types New Costructio, Ifrastructure, ad Reovatios with them comprisig 54%, 30%, ad 16% of the pla, respectively. THE CAPITAL PLAN 2013/ /16: $2.5 BILLION Sources of Fuds Resources to be Idetified 10% Academic Debt 6% Curret Fuds 24% The tables at the ed of this chapter provide a detailed list of the projects icluded i the Capital Pla. The accompayig text summarizes these projects i order to preset a comprehesive view of all major plaed costructio o Staford lads. Service Ceter/ Auxiliary Debt 32% Gifts to be Raised 16% Gifts i Had or Pledged 12% The followig sectios address the Capital Pla fudig sources ad uses, alog with resource costraits. Capital Pla Fudig Sources As the chart shows, Staford s Capital Pla relies o several fudig sources icludig Curret Fuds, Gifts, ad Debt. Depedig upo fudraisig realities ad time frames, some projects will prove more difficult tha others to udertake. As a result, it is possible that projects i the Capital Pla will have to be cacelled, delayed, or scaled back i scope. For ay projects relyig o Gifts to be Raised, the Office of Developmet has determied that fudraisig plas are feasible, although the time frames for the receipt of gifts are subject to chage. Resources to be idetified icludes fuds yet to be fully idetified, with the expectatio that fuds will come from a combiatio of school, departmet, ad uiversity reserves, ad other sources. Uses of Fuds by Program Category ad Project Type The middle chart divides the Capital Pla activity ito program categories Academic/Research, Ifrastructure, Housig, ad Academic Support with the largest categories beig Academic/Research ad Ifrastructure at 46% ad 30% of the Capital Pla, respectively. The last Uses of Fuds by Program Category Ifrastructure 30% Academic Support 8% Ifrastructure 30% Reovatios 16% Housig 16% Academic/Research 46% Uses of Fuds by Project Type New Costructio 54% 75

12 SUMMARY OF THREE-YEAR CAPITAL PLAN 2013/ /16 PROJECT FUNDING SOURCE GIFTS UNIVERSITY DEBT ANNUAL CONTINUING COSTS SERVICE ESTIMATED CAPITAL CENTER/ RESOURCES PROJECT BUDGET CURRENT IN HAND OR TO BE AUXILIARY ACADEMIC TO BE DEBT OPERATIONS & COST 2013/14 FUNDS 1 PLEDGED RAISED DEBT DEBT IDENTIFIED 2 SERVICE MAINTENANCE 3 Projects i Desig & Costructio 1, Forecasted Projects 1, Total Costructio Pla 2, Ifrastructure Programs Total Three-Year Capital Pla 2013/ /16 2, Icludes fuds from uiversity ad school reserves ad the GUP ad SIP programs. Also icludes the $20 millio Hoover subvetio for the McMurtry Buildig. 2 Aticipated fudig for this category is through a combiatio of school, departmet, uiversity reserves, ad other sources. 3 Operatios & Maiteace icludes plaed ad reactive/prevetative maiteace, zoe maagemet, utilities, cotracts, grouds, ad outdoor lightig. CAPITAL PLAN CASH FLOWS 2016/17 & 2012/13 & PRIOR 2013/ / /16 THEREAFTER TOTAL Projects i Desig & Costructio ,200.9 Forecasted Projects ,096.4 Total Costructio Pla ,297.3 Ifrastructure Programs Total Three-Year Capital Pla 2013/ / , CAPITAL PLAN IMPACT ON BUDGET Debt Service 2016/17 & 2014/ /16 THEREAFTER TOTAL Geeral Fuds Formula ad Other Schools Auxiliary Other Icremetal Iteral Debt Service Operatios ad Maiteace Geeral Fuds Formula ad Other Schools Auxiliary Other Icremetal Operatios ad Maiteace Primarily the hospitals alog with Forsythe facility, Faculty Staff Housig, ad outside etities.

13 Capital Pla Costraits Affordability The icremetal iteral debt service expected at the completio of all projects commecig i the three-year pla period (completio dates rage from 2013/14 to 2017/18) totals $54.9 millio aually (excludig debt service for bridge fiacig the receipt of gifts ad operatig lease paymets). Of this amout, $17.2 millio will be serviced by geeral fuds, $12.6 millio directly by formula schools (the GSB ad SoM), ad $25.1 millio by auxiliary ad other operatios. Service ceter debt is fuded through rates paid by customers ad has bee allocated ad icluded i the totals for geeral fuds, formula schools, auxiliary, ad other operatios. The additioal O&M costs expected at the completio of all projects commecig i the three-year period total $29.1 millio per year. Of this amout, $14.3 millio will be serviced by geeral fuds, $7.7 millio by the formula schools, ad $7.1 millio by auxiliary ad other operatios. O&M ad debt service o capital projects compete directly with other academic program iitiatives. Debt Capacity As of May 15, 2013, debt available to fiace capital projects ad faculty mortgages is estimated at $953 millio, icludig $351 millio of taxable commercial paper, $207 millio of tax-exempt commercial paper, $341 millio of uexpeded tax-exempt bod proceeds, ad $54 millio of uexpeded taxable bod proceeds. By the ed of Jue 2013, $99 millio of the uexpeded tax-exempt bod proceeds will be used to fiace projects o taxable commercial paper. I additio, through year-ed 2012/13 ad 2013/14, $122 millio iteral amortizatio proceeds o debt-fuded projects will become available to led to projects, ad $116 millio i forecasted pledge paymets will retire debt issued to bridge fiace the receipt of gifts. The Capital Pla will require a total of $1,098 millio of debt: $688 millio to complete projects already approved or uder costructio; $260 millio for projects forecast to be approved i 2013/14; ad $151 millio to bridge fiace the receipt of gift pledges for projects uder costructio. Additioal debt may be required to fiace the Faculty Staff Housig program. As of May 1, 2013, the portfolio of debt-subsidized mortgages had decreased by $17.1 millio to $372 millio. Projects idetified i the three-year Capital Pla commecig after 2014/15 will require a additioal $172 millio i debt. Debt for these projects has ot bee committed ad allocatios will be evaluated i the cotext of debt capacity, affordability, viability of the fudig pla, ad GUP limitatios. Etitlemets The Staford campus ecompasses 8,180 acres, which fall withi six jurisdictios. Of this total, 4,017 acres, icludig most of the cetral campus, are withi uicorporated Sata Clara Couty. I December 2000, Sata Clara Couty approved a Geeral Use Permit (GUP) that allows Staford to costruct up to 2,035,000 additioal gross square feet of academic-related buildigs o the core campus. The GUP also allows the costructio of up to 2,000 ew studet housig uits ad over 1,000 uits of housig for postdoctoral fellows, medical residets, faculty, ad staff, though Staford is curretly workig with Sata Clara Couty to amed the GUP housig provisios to allow more studet uits. Coditios of approval icluded the followig: Creatio of a academic growth boudary to limit the buildable area to the core campus for a miimum of 25 years; Approval of a sustaiable developmet study (SDS) before ew costructio is developed beyod oe millio gross square feet. (The SDS was approved by Sata Clara Couty i April 2009.); ad Costructio of 605 uits of housig for each 500,000 gross square feet of ew academic buildig. Give the striget requiremets imposed by the GUP ad the icreasigly difficult etitlemet eviromet, Staford carefully maages the allocatio of ew growth. The total GUP square footage allocatio was origially projected to be expeded over 15 years at a average rate of approximately 135,000 gsf per year. Subsequet experiece has legtheed this projectio. This year s Capital Pla utilizes et 312,486 of GUP square feet, after demolitios. This square 77

14 footage, alog with gross square feet previously allocated, brigs the total GUP 2000 gsf expeded or plaed to over oe millio. With the ameded GUP housig provisios ad the completio of plaed housig projects, icludig Comstock Graduate Housig, GSB Housig Expasio, ad Laguita ad Mazaita Udergraduate Housig, Staford will have added 2,361 et ew housig likage uits sice approval of the GUP. The completio of these uits will eable the uiversity to costruct early 2 millio gsf of ew academic ad academic support space uder the GUP. CAPITAL PLAN PROJECT DETAIL The tables o the followig three pages show projects grouped withi three categories: Projects i Desig ad Costructio, Forecasted Costructio Projects, ad Ifrastructure Projects ad Programs. 78

15 2013/ /16 CAPITAL PLAN PROJECTS IN DESIGN & CONSTRUCTION PROJECT FUNDING SOURCE GIFTS UNIVERSITY DEBT ANNUAL CONTINUING COSTS FISCAL YEAR ESTIMATED CAPITAL IN HAND SERVICE CENTER/ RESOURCES SCHOOL/ PROJECT PROJECT BUDGET CURRENT OR TO BE AUXILIARY ACADEMIC TO BE DEBT OPERATIONS & DEPARTMENT SCHEDULE COST 2013/14 FUNDS 1 PLEDGED RAISED DEBT DEBT IDENTIFIED 2 SERVICE MAINTENANCE 3 Staford Eergy System Iovatios (SESI) Replacemet Cetral Eergy Facility LBRE Pipig, Buildig Coversios, ad Process Steam Plat 4 LBRE New Electrical Substatio LBRE Bioegieerig/Chemical Egieerig Base Buildig SOE/SOM Coective Elemets SOE/SOM Future Fit-up SOE/SOM Mayfield Califoria Aveue Faculty Staff Housig (180 uits) LBRE Comstock Graduate Housig (362 et ew beds) R&DE McMurtry Buildig H&S Buildig Reovatio for SUL North SUL Aderso Collectio at Staford Uiversity PRES/PROV C.J. Huag Buildig SOM RAF 1 ad RAF 2 Rehabilitatio ad Retrofit SOM Buildigs ad Reovatio SOE Mazaita Udergraduate Housig (128 ew beds) R&DE Crow Quadragle Reovatio SLS Northwest Data Ceter ad Commuicatios Hub ITS/AS Durad Reovatio - Phase 4 SOE Widhover Cotemplative Ceter VPSA Crothers Hall/Crothers College Dea s Residece R&DE Subtotal Projects i Desig & Costructio 1, Icludes fuds from uiversity ad school reserves ad the GUP ad SIP programs. Also icludes the $20 millio Hoover subvetio for the McMurtry Buildig. 2 Aticipated fudig for this category is through a combiatio of school, departmet, uiversity reserves, ad other sources. 3 Operatios & Maiteace icludes plaed ad reactive/prevetive maiteace, zoe maagemet, utilities, cotracts, grouds, ad outdoor lightig. 4 Curret status of Pipig, Buildig Coversios, ad Process Steam Plat budget is $40 millio more tha the $165.7 millio. Revised budget will be completed i fall 2013 after additioal egieerig ad cotract egotiatios are fialized. 79

16 / /16 CAPITAL PLAN FORECASTED CONSTRUCTION PROJECTS PROJECT FUNDING SOURCE GIFTS UNIVERSITY DEBT ANNUAL CONTINUING COSTS FISCAL YEAR ESTIMATED CAPITAL IN HAND SERVICE CENTER/ RESOURCES SCHOOL/ PROJECT PROJECT BUDGET CURRENT OR TO BE AUXILIARY ACADEMIC TO BE DEBT OPERATIONS & DEPARTMENT SCHEDULE COST 2013/14 FUNDS 1 PLEDGED RAISED DEBT DEBT IDENTIFIED 2 SERVICE MAINTENANCE 3 Bio Medical Iovatio Buildig 1 (BMI 1) (formerly FIM 1) Buildig SOM Tuel Ifrastructure SOM Staford Istitute for Chemical Biology/Neuroscieces Buildig DOR Biology Research ad Teachig Biology Research Buildig H&S Teachig Labs & Learig Ceter (Old Chem) H&S Coective Elemets H&S Demolitios (Herri Lab/Herri Hall/Mudd/Org Chem) H&S (6.1) Ecia Reovatio (Iteratioal Iitiative) DOR GSB Housig Expasio (150 ew beds) GSB Hoover Office Buildig New Buildig HOOVER Demolitio of Cummigs Art HOOVER (1.0) Roble Field Parkig Structure (1000 spaces) LBRE Goveror s Corer Reovatio - Phases 1-4 R&DE Paama Mall Office Buildig PRES/PROV Laguita Udergraduate Housig (200 ew beds) R&DE Roble Gym Reovatio H&S Page Mill Road Teat Improvemets SOM Stoe Complex Seismic Bracig Projects 4 SOM Public Safety Buildig PRES/PROV School of Educatio Buildig Seismic Reovatio Phase 2 GSE Meyer Library Demolitio PRES/PROV (2.6) Forsythe Data Ceter Phase 4 Power ad Coolig Upgrade ITS/AS High Voltage Itertie LBRE Staford House i Oxford VPUE Subtotal Forecasted Projects 1, SUBTOTAL CONSTRUCTION PLAN 2, Icludes fuds from uiversity ad school reserves ad the GUP ad SIP programs. 2 Aticipated fudig for this category is through a combiatio of school, departmet, uiversity reserves, ad other sources. 3 Operatios & Maiteace icludes plaed ad reactive/prevetative maiteace, zoe maagemet, utilities, cotracts, grouds, ad outdoor lightig. 4 Excludes the Boswell portio of the project which will be fuded by SHC.