755 KAR 1:080reg. Capital construction procedures

      Section 1. (1) The Board of Regents of Morehead State University shall elect to perform in accordance with KRS 164A.555 to 164A.630 regarding capital construction.

      (2) In accordance with the authority established in KRS 164A.560, the board shall delegate the responsibilities listed in subsection (1) of this section to the president of Morehead State University.

      (3) The president or a designee shall approve and execute all contracts relating to capital construction.

 

MR. PAUL GOODPASTER, Chair

MS. SHARON REYNOLDS, Secretary

      APPROVED BY AGENCY: June 10, 2016

      FILED WITH LRC: July 15, 2016 at 10 a.m.

      PUBLIC HEARING AND PUBLIC COMMENT PERIOD: A public hearing on this administrative regulation shall be held on August 23, 2016, at 6:00 p.m., at Morehead State University, Combs Building, Room 413. Individuals interested in being heard at this hearing shall notify this agency in writing five workdays prior to the hearing, of their intent to attend. If no notification of intent to attend the hearing was received by that date, the hearing may be cancelled. This hearing will not be made unless a written request for a transcript is made. If you do not wish to be heard at the public hearing, you may submit written comments on the proposed administrative regulation. Written comments shall be accepted until the end of the calendar day on August 31, 2016. Send written notification of intent to be heard at the public hearing or written comments on the proposed administrative regulation to the contact person:

      CONTACT PERSON: Mr. Richard T. Linio, Assistant Vice President, Office of Facilities Management, Morehead State University, 150 Martindale Drive, Morehead, Kentucky 40351, phone [phone], fax [phone], email [e-mail].

 

REGULATORY IMPACT ANALYSIS AND TIERING STATEMENT

 

Contact Person: Richard T. Linio

      (1) Provide a brief summary of:

      (a) What this administrative regulation does: This regulation allows Morehead State University under the provisions of KRS 164A.560, to manage and administer capital construction projects in accordance with KRS 164A.575, 164A.580, 164A.585, 164A.590, 164A.595 and 164A.600.

      (b) The necessity of this administrative regulation: This administrative regulation is necessary to allow Morehead State University to manage and administer capital construction projects at the agency level instead of continuing to rely on the Finance and Administration Cabinet for this service.

      (c) How this administrative regulation conforms to the content of the authorizing statutes: This administration regulation fully conforms to the requirement of KRS 164A.560 to allow the governing boards of the postsecondary educational institutions to manage and administer capital construction projects in accordance with KRS 164A.575, 164A.580, 164A.585, 164A.590, 164A.595 and 164A.600.

      (d) How this administrative regulation currently assists or will assist in the effective administration of the statutes: This administrative regulation will assist Morehead State University in effective administration of KRS 164A.575, 164A.580, 164A.585, 164A.590, 164A.595 and 164A.600 allowing management and administration of capital projects at the agency level instead of the state government level. This will result in more efficient operation and implementation of the University’s capital construction program. It will relieve the Finance and Administration Cabinet of management responsibilities which can be performed more

effectively by the University.

      (2) If this is an amendment to an existing administrative regulation, provide a brief summary of:

      (a) How the amendment will change this existing administrative regulation: This is a new administrative regulation

      (b) The necessity of the amendment to this administrative regulation: This is a new administrative regulation

      (c) How the amendment conforms to the content of the authorizing statutes: This is a new administrative regulation

      (d) How the amendment will assist in the effective administration of the statues: This is a new administrative regulation

      (3) List the type and number of individuals, businesses, organizations, or state and local governments affected by this administrative regulation: The entities affected by this administrative regulation are Morehead State University and the Finance and Administration Cabinet’s Department for Facilities and Support Services and its Division of Engineering and Contract Administration. This regulation will have no impact on any other business organization, or state and local government. Within Morehead State University, this regulation will affect the Assistant Vice President Office of Facilities Management, University Architect and Planning Department Staff, the Purchasing Department and the Accounting Department. Within the Department for Facilities and Support Services, its Division of Engineering and Contract Administration will be affected. Workload and project administration will be shifted from the Cabinet to the University. Cabinet staff who currently serve multiple agencies will be relieved of their responsibilities to service Morehead State University projects, allowing them more time to focus on other agencies projects. This staff includes project managers and other administrative staff who currently spend a portion of their time managing projects for the University.

      (4) Provide an analysis of how the entities identified in question (3) will be impacted by either the implementation of this administrative regulation, if new, or by the change, if it is an amendment, including: Morehead State University will assume management and oversight of its capital construction projects. The Department for Facilities and Support Services will assist with the transition of projects to the University and continue to manage projects that are too advanced to effectively transfer to the Universality for management. Once those projects are either transitioned or completed the Department will no longer be involved in the University’s construction program. In preparation for this, Morehead State University has adopted a Capital Construction Procedures Manual based on the procedures manual developed by the Finance Cabinet. Additionally processes will be put in place as needed to ensure that the requirements of KRS 164A and KRS 45A are complied with relating to capital construction project management. Morehead State University has project management staff in place and through some restructuring of current responsibilities minimal staff will be necessary. Additional salary costs for project administration will be less than $100,000 per year. Initial costs for software and equipment will be less than $15,000. The department for Facilities and Support Services may see a reduction in staff requirement as a result of this regulation. As a result of this regulation Morehead State University will be able to directly manage the schedule, budget, design and construction for its major facility projects. Since the oversight of these projects will be local,better overall control will be realized. The Department for Facilities and Support Services should also realize a positive impact from this regulation by the reallocation of staff time currently dedicated to serving the needs of Morehead State University.

      (5) Provide an estimate of how much it will cost to implement this administrative regulation:

      (a) Initially: The cost to implement the regulation will be minimal and will be limited to office equipment expense of less than $15,000.

      (b) On a continuing basis: The University already has project management staff in place and as we transition to managing all of our capital projects some additional staff will be needed. Cost associated with the additional staff primarily will include salaries, benefits and training. Since staff is already in place for project management the additional staffing needs should be minimal. Some current staff will be given additional responsibilities relating specifically to the management of our capital construction program. Some additional accounting staff and purchasing staff may be necessary. The total additional cost for staffing should be $100,00 or less per year.

      (6) What is the source of the funding to be used for the implementation and enforcement of this Administrative regulation: The funding for implementation and enforcement of this regulation will come from university funds.

      (7) Provide an assessment of whether an increase in fees or funding will be necessary to implement this Administrative regulation, if new, or by the change, if it is an amendment: No additional increase in fees or funding is anticipated based on the projected project load.

      (8) State whether or not this administrative regulation establishes any fees or directly or indirectly increases any fees: This regulation does not establish or directly or indirectly increase any fees.

      (9) TIERING: Is tiering applied? No, tiering is not applied. The regulation does not govern the activities of other entities and no entities will be disproportionately impacted by this regulation.

 

FISCAL NOTE ON STATE OR LOCAL GOVERNMENT

 

      1. What units, parts or divisions of state or local government (including cities, counties, fire departments, or school districts) will be impacted by this administrative regulation? Morehead State University’s Office of Procurement Services, Accounting & Fiscal Services divisions, and the Finance Cabinet’s Department for Facilities and Support Services.

      2. Identify each state or federal statute or federal regulation that requires or authorizes the action taken by the administrative regulation. KRS 154A.560

      3. Estimate the effect of this administrative regulation on the expenditures and revenues of a state or local government agency (including cities, counties, fire departments, or school districts) for the first full year the administrative regulation is to be in effect.

      (a) How much revenue will this administrative regulation generate for the state or local government (including cities, counties, fire departments, or school districts) for the first year? None

      (b) How much revenue will this administrative regulation generate for the state or local government (including cities, counties, fire departments, or school districts) for subsequent years? None

      (c) How much will it cost to administer this program for the first year should not exceed $100,000.00. These costs relate to administration of the program and additional personnel

      (d) How much will it cost to administer this program for subsequent years should not exceed $100,000.00. These costs relate to administration of the program and additional personnel.

      Note: If specific dollar estimates cannot be determined, provide a brief narrative to explain the fiscal impact of the administrative regulation.

      Revenues (+/-):

      Expenditures (+/-):

      Other Explanation:

Notation

      RELATES TO: KRS 164A.560, 164A.565, 164A.575, 164A.580, 164A.585, 164A.590, 164A.595, 164A.600

      STATUTORY AUTHORITY: KRS 164A.560

      NECESSITY, FUNCTION, AND CONFORMITY: KRS 164A.560 authorizes governing boards of each public institution of higher education to promulgate an administrative regulation to elect to perform financial management functions in accordance with KRS 164A.550 to 164A.630 and to delegate these functions to an official of the institution. This administrative regulation delegates the responsibilities of KRS 164A.575, 164A.580, 164A.585, 164A.590, 164A.595, and 164A.600 to the President of Morehead State University.