California colleges plow ahead with construction

California has slashed public university budgets, yet construction is booming at campuses statewide. The University of California system has $8.9 billion in building projects under way at its 10 campuses and five medical centers, including about $200 million at UC Merced.

With less money to operate the new buildings once they're finished, universities are straining maintenance and energy budgets. At least one new UC campus building is sitting empty because the university can't afford to run it.

University officials say all this construction was in the pipeline before the 2008 economic downturn squeezed state spending for higher education. Some is being paid for by part of a $10.4 billion bond voters approved in 2006, from which more than $3 billion went to public higher education.

Some is being underwritten by private donations, government research grants and student fees. About $1 billion came from bonds issued in 2009 under the federal stimulus program which the universities will have to repay and $325 million in bonds the UC system issued that year on its own.

More importantly, these officials say, the money for construction is kept in strictly separate capital, not operating, accounts. It can't be used for expenses such as salaries or enrollment.

Cost to taxpayers

David Kline, spokesman for the California Taxpayers Association, said that by insisting on continuing to build in spite of the financial downturn, the universities are missing the point.

The cost of construction is ultimately bankrolled by taxpayers, Kline said. That's because California's public universities and colleges are paying $1.1 billion a year in interest on those construction bonds, the legislative analyst's office reported in August.

"People discuss bond money as if it's free money that isn't coming out of the taxpayers' pockets, and that's exactly where it is coming from," Kline said.

The universities also have to clean, light, heat, cool and maintain these new buildings, the burden of which comes out of operating budgets that were cut by $1.4 billion this year, including $650 million at UC.

View post:
California colleges plow ahead with construction