Fresno State expansion hits budget snag

SACRAMENTO -- An expansion at Fresno State faces a potential delay as state lawmakers remain reluctant to approve new bond borrowing with the state's budget in bad shape.

California State University, Fresno, is planning a $9.5 million building for faculty offices, lockers and labs to support its nursing, athletic and physical therapy programs. The 21,800-square-foot project would complement a $7.5 million aquatics center under construction near Cedar and Barstow avenues.

The building would provide more space for the kinesiology program, one of the most popular majors on campus, according to plans presented to a legislative budget committee that is considering the request. The plan also is to include locker rooms for water sports, women's volleyball and track and field -- which officials say are needed to comply with Title IX, a federal gender-equality law.

Fresno State is hoping to get $562,000 in bond money from the state in 2010-11 to pay for design work, with the rest of the funding coming from the state in subsequent years.

But the request has run into some resistance in the Capitol, where key lawmakers say the university's athletic budget -- not state money -- should pay for any portion of the building that's dedicated to sports.

At a hearing last week, a legislative committee reviewing 2010-11 budget requests could not reach consensus on the item and tabled it for further discussion.

Some lawmakers worried that if they approved the initial bond money now, the state might have to pay for the whole project.

"There should be a shared cost on this facility," said Sen. Denise Ducheny, D-San Diego, who leads the Assembly-Senate budget conference committee.

"We don't want to be on the hook for everything later if it's inappropriate."

Fresno State officials declined to comment on the possibility of tapping its athletic budget, which is suffering from stagnant revenues and stubbornly high expenses.

The Bulldog Foundation, the fundraising arm for athletics, also is stretched. "It's extremely difficult to raise money" in the down economy, said John Wallace, the foundation's chairman. But if asked to pitch in, "we'd try," he said.

In a separate vote, the state budget committee approved $81 million in bond funds for new construction at the University of California at Merced. The project would add a second building for the schools of natural sciences and engineering, giving the university more than 56,000 square feet of new space for offices and labs.

Gov. Arnold Schwarzenegger recommended funding the Fresno State and Merced projects, along with 10 other university construction projects across the state.

But the nonpartisan Legislative Analyst's Office said that as long the state faces budget deficits, the Legislature should approve only projects that "address life-safety issues or provide equipment necessary to complete previously funded projects."

The governor's proposal would in 2010-11 release $23 million in voter-approved bonds that are backed by the state's general fund, plus $419 million in new "lease-revenue bonds."

These bonds -- which don't require voter approval -- are secured by a lease on the new buildings and paid back with appropriations from the general fund, usually over 25 years. An additional $196 million in bond money would be needed as soon as 2011-12 to finish the projects, according to the Legislative Analyst's Office.

"This would increase the debt to the state, and at some point the state needs to prioritize its projects and only fund the most critical [ones] if it's going to get its spending back in line with revenue," said Mark Whitaker, an analyst with the LAO, which gives lawmakers budget advice.

Lawmakers must close a $19.1 billion budget gap for 2010-11, and future shortfalls are forecast.

Fresno State and Merced were not on the LAO's original list of six projects that should get money in 2010-11.

But to foster a compromise, the LAO added Merced, as well as $2.4 million to begin work on an expansion at CSU Channel Islands.

The LAO deemed those projects worthy because they are necessary for the "continued growth" of the two relatively new campuses.

The budget committee left the Fresno State project in limbo, but approved five University of California projects -- including one not on the LAO's list: $613,000 for design work for an expansion at UC San Diego's Scripps Institution of Oceanography.

All the projects still need approval by the full Legislature as part of 2010-11 budget legislation.