Capital Budget Drivers
inflation, and other forces that cause increased demand for state
services and investments are called "budget drivers."
These forces are at work in both the operating and capital budgets.
Following is a discussion of the budget drivers for four major
capital budget programs.
K-12 School Construction Grants
The primary budget driver for public school (K-12) construction grants is enrollment growth. School enrollment is projected to increase at a rate of 2.0 percent in FY 1998 and 1.8 percent in FY 1999, adding approximately 35,000 new students to the K-12 system by the end of the biennium. Although overall growth rates in K-12 enrollment are beginning to slow down after a decade of steady increases, there is still mounting pressure at the higher grade levels that requires increasing investments in K-12 facilities.
These pressures are outpacing the availability of timber trust
revenues, which historically have been the main source of funding
for state support of local school construction. In recent years,
timber revenues have not kept pace with the demand for new school
A second capital budget driver in K-12 education is the need to
renovate, upgrade and replace aging facilities that require modernization.
About half of the existing square footage of school space is at
least 20 years old. These facilities require constant attention
to provide continuing service, protect the safety of students,
and allow for changes in technology. This objective is difficult
and costly to accomplish in older buildings. The increasing use
of computers is a prime example of how buildings require modernization
to provide students with the opportunities they deserve.
The state's increasing population, particularly in the 17-to-29
year old age group, is the primary budget driver for the higher
education capital budget in the next 10 to 15 years. The 1996
Master Plan for higher education, developed by the Washington
State Higher Education Coordinating Board and endorsed by the
1996 Legislature, calls for serving an additional 84,000 full
time students in post-secondary programs by the year 2010. This
enrollment boom is the result of a combination of the "baby-boom
echo," rapid growth in the number of individuals and families
moving to Washington State, and an increasing number of current
residents seeking workforce training.
Creating the capital facilities to provide for increased enrollments has been termed the "access" challenge, but institutions also face an additional challenge to ensure quality in the learning environment. The state must maintain its level of instructional quality during a time of growing competition from other states and new technological developments. Improved technology, with its attendant construction costs, is a major element in maintaining quality instruction in today's fast-changing world of education.
Since 1988, there has been a major effort to expand access to higher education by developing branch campuses throughout the state. New campuses are being designed, built, or expanded at Vancouver, Bothell, Tacoma, the Tri-Cities, and Spokane. These are major investments with multiple phases of construction. The state is committed to proceeding with these investments as rapidly as possible within the parameters of available funding. However, the cost of these facilities is also driving interest in defining and pursuing other non-traditional means of serving students - primarily through the use of technology and distance learning.
Included in the 1997 supplemental and 1997-99 capital budget are
projects that continue the commitment to expanding access through
branch campus construction, main campus development, and investments
in technology that support distance learning. Key projects specifically
designed to serve additional students include:
Department of Corrections
The state's prison population has doubled over the past eight years, increasing from 6,053 inmates in 1988 to the present population of 12,127. This number is expected to grow to 12,948 by the end of FY 1997, and to 13,943 by the end of FY 1999 - almost 15 percent from the current level. Current sentencing laws, population growth, and demographic changes combine to add approximately 500 inmates each year to the system. For the capital budget, this translates into the construction of a new 1,000-bed facility every biennium for the foreseeable future.
The average cost of a new adult male medium security prison bed at a new institution is approximately $100,000. This includes the cost of purchasing land; bringing in utilities and other infrastructure and support services; and building housing, dining, recreation, education, administration, support and industries space. Phasing the construction of a facility increases the average cost per bed, and increases the total cost of the completed institution. However, phasing over more than one biennium is often necessary to accommodate the large cost of these new institutions.
The first phase of a new facility is significantly more expensive than following phases. The land, site improvements and infrastructure generally must all be completed in the first phase. Buildings to house the core services (dining, education, administration) must all be completed to support the first component of housing. For this reason, the cost per bed of a phased facility is much higher in the first phase, and then lower in subsequent phases, requiring a longer-term view of each institutional investment. A value engineering analysis was conducted for the new institutions in the Governor's Ten-Year Plan so that the most efficient layout and level of security could be provided with the lowest possible operating cost.
The Governor's 1997-99 capital budget includes the following population-driven projects:
Juvenile Rehabilitation Administration
In early December of 1996, there were 1,369 youths in 13 state owned institutions and various community based facilities administered by the Juvenile Rehabilitation Administration (JRA) in DSHS. This number is expected to increase to 1,474 by the end of FY 1997, and to 1,518 by the end of FY 1999 - almost 11 percent from the current level. While the rate of juvenile violence declined in 1995, arrests and convictions continue to drive the demand for new beds. JRA is developing new medium- and maximum-security prototypical housing units that offer maximum program flexibility, and control staffing and other operating costs.
A second budget driver is the age and condition of JRA facilities. A recent study of all JRA facilities indicates approximately one-third of the facilities are in need of replacement or major renovation. This budget calls for replacing 64 outdated and inefficient beds at Maple Lane School.
The average cost of providing new JRA beds exceeds the cost of providing beds in adult correctional facilities. A JRA facility includes virtually all the elements of an adult correctional facility, plus an additional investment in education, program, and support space. The JRA system must deliver programs to a wide variety of age groups. In addition, the economies of scale possible in a large adult correctional center cannot be achieved since JRA institutions are smaller in size and the housing units have fewer beds in each building. The new 300-bed juvenile facility is estimated to cost approximately $185,000 per bed, as compared to $100,000 in an adult facility.
The 1997-99 Biennium capital budget includes the following projects
related to population and replacement needs.