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Senate Passes Bill Creating University Building Fund

New fund will improve space utilization while increasing operational efficiencies

JUNEAU-This week, the Alaska State Senate passed Senate Bill 74, creating the University Building Fund.  It is modeled after the Alaska Public Building fund which has been successfully operated by the state since 2000.

“Currently there is nearly 1 billion in maintenance backlog and though addressing deferred maintenance is a part of the strategy deployed in SB 74, its real thrust is space management,” said Senator Kelly.

As was the case before the Alaska Public Building Fund, state departments habitually had more space than they needed.  But what was found is that charging departments rent, as is done in a building fund mechanism, causes managers to become more efficient and prudent about the space they manage because they have to pay for it.

“Collecting rent from the departments is important feature of the fund because the University will encourage better use of space while making a cultural change from entitlement thinking to maximizing every square foot,” said Senator Kelly.  “Whenever you ask someone if they have enough space, they say ‘no’.  However, when you make them pay for that space, that opinion seems to change.”

Funding for the University Building Fund can come from several locations including appropriations from the Legislature, left over money from capital projects, donations to the University, and rent charges.  Money can only be put in and paid out of the fund with the Legislature’s approval.

Senate Bill 74 now goes to the House for further consideration.

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