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Allocations for projects made annually

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Tech clears confusion regarding plan funding
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With Louisiana Tech University facing additional budget cuts from the state, totalling an estimated $5 million, concerns regarding Tech’s Master Plan 2020 have been raised.

Dave Guerin, director of university communications, said money for projects such as Tech’s Master Plan 2020, which includes the demolition of Wyly Tower, are allocated through capital outlay funds — not general operating funds, which is where the $5 million cut would come from.

“The general ‘operating’ fund cannot be used for a project such as Wyly Tower, this project would fall under capital outlay,” he said. “Capital outlay funds are specifically for things such as new construction, renovations/repairs to existing facilities, expansion of existing facilities, land acquisition and site development/improvement. These are contained in House Bill 2, which is dedicated to construction-related projects. 

“General operating funds, which are contained in House Bill 1, are for operating expenses of state agencies which includes salaries and other current expenditures. 

“It is important to understand that capital outlay funds cannot be used for or transferred to operating accounts and vice versa.  Each are appropriated and allocated differently, and dedicated to specific costs.  You can think of it as two roads that parallel each other or move in the same direction, but never intersect.”

Guerin said concerned residents should understand that funding for capital outlay projects, such as the Master Plan and Wyly Tower, are multi-year endeavors and do not come at the expense of funding for salaries and current operations. 

“These are two separate funding mechanisms that are both important to the long-term success of the university, and every institution in the state is vying for these capital outlay funds to support needed projects on their campus,” he said.

“These long-term and multi-year projects are still very early in the planning and design phase, but are visions for the types of facilities and services that Louisiana Tech believes are essential for the continued growth and success of our students.”

Guerin added the university is sensitive to the current budget situation and how it impacts these projects.

“But we need to continue to prepare for the inevitable time at which Wyly Tower and other older facilities need to be replaced,” Guerin said. “Louisiana Tech is continually engaged in campus improvements and facility projects, some of which are more visible and high-profile than others. Each of these capital outlay projects are prioritized according to the needs of the campus to continue instruction, research and physical operations of the campus.”

He said the Master Plan is specifically built upon and parallels Tech’s strategic plan, TECH 2020, which can be viewed online at 2020.latech.edu.

“All the facility improvement and new construction projects are done with an emphasis on providing the best facilities and physical infrastructure possible to ensure we are able to teach and serve our students and faculty,” he said.

While there is a difference in the way general operating funds and capital outlay funds are appropriated and used, Guerin said both are vulnerable to cuts during a budget crisis.

“Both are important to the long-term growth and success of the institution,” he said.

Since funds for projects, such as the Master Plan 2020, are allocated over a number of years it is possible that funding may not be secured during the year in which the project was originally planned, Guerin said.

“Allocations are made annually for these projects so, yes, it is possible that a project may not be funded in the year that it is requested,” he said. “It would be delayed until the capital outlay funding request is approved and funds are allocated.”

But how much is Tech allocated in a given year for such improvement or renovation projects?

“It’s a somewhat complex process that varies from fiscal year to fiscal year, and is prioritized according to a number of different factors,” Guerin said. “Each year in August, we submit our capital outlay requests to the University of Louisiana Board of Supervisors who ranks our requests with those of our sister institutions. 

“These are the requests that the Legislature will review in the following spring as part of HB2. The capital outlay funding allocated by the legislature for a given project in each year’s HB2 is for work that will be done during that particular year.  Funding for long-term projects such as Wyly Tower replacement and the Master Plan is allocated over a number of years.”

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