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Tight Florida budget strands university projects awaiting matching grants

TALLAHASSEE — University of South Florida's future polytechnic campus. University of Florida's graduate business studies building. Florida State University's Center for Asian Art.

These projects share one thing in common: They're on a waiting list for state money that was promised but not yet delivered.

Two state programs — one specific to facilities, and the other for major gifts — provide matching state dollars for private donations that pay for construction projects and for endowments supporting everything from scholarships to research programs. The facilities program matches donations dollar for dollar. The major gifts program matches up to 100 percent, depending on the size of the donation.

But the Legislature hasn't funded the programs since 2008, leaving universities waiting on a total of nearly $300 million in state matches. The state's colleges are waiting on another $220 million to be matched through similar programs.

Universities and the Board of Governors say restoring the funding to the programs is a legislative priority. They worry that continuing to leave them unfunded could have a chilling effect on private donations. In many cases, universities are fronting the money from the state with other funds.

"The donors are paying attention to it," said Mark Walsh, the University of South Florida's lobbyist.

But the chances don't look good: Draft spending plans in neither the House nor Senate contain the matching money.

A nearly $4 billion shortfall in the state's budget has the legislators who oversee higher education spending considering raising tuition and tightening eligibility for Bright Futures scholarships. They say the matching grants program falls to the bottom of their lists. Sen. Evelyn Lynn, R-Ormond Beach, has proposed temporarily closing the program to future projects.

"Perhaps we need to say, and be honest, that we're not going to be able to pay this for a while," Lynn said. "We owe that money. We don't want new people coming in and thinking they'll get it right away."

University system officials argue the timing to fund the programs couldn't be better: Paying the public match could get some of the construction projects and, thus, construction jobs off the ground.

"We try to find all ways to jump-start our economy. Here's an easy way," said Ava Parker, chairwoman of the Board of Governors. "We are one of the economic engines … and I think that engine is being slowed down because we're not investing the matching dollars."

Up until two years ago, universities and colleges could not borrow money to get a project started in anticipation of the matching funds coming in. The Legislature lifted that prohibition, and universities are now able to borrow internally or get a loan, thus banking on the state funds coming through.

The University of Florida is in line for $29 million for facilities and nearly $102 million for major gifts. In some cases, the university's foundation got a loan to cover the match, meaning it's now paying interest while waiting for the match to come in.

Leslie Bram, associate vice president of University of Florida Foundation, said certain projects, such as the $23 million William R. Hough Hall for graduate business studies, could not wait.

"We just had to get the shovel in the ground," she said.

But the lack of the match has the university considering scaling back some projects. A new facility for the chemical engineering department, currently in the design phase, is waiting on a $3.1 million state match. If that state money doesn't come in soon, the university may need to redesign the project to be much smaller, said spokesman Stephen Orlando.

The University of South Florida has requested matches of $42.3 million from both programs, about $22.6 million for facilities construction. Its list includes $10.6 million in a matching grant for the first phase of the university's proposed polytechnic campus in Lakeland plus $2.2 million for classroom renovations at the health school.

Joel Momberg, chief executive officer of the University of South Florida Foundation, acknowledged it's hard to say definitively whether the lack of funding for the program so far has hurt fundraising, which goes up and down with the economy.

Indeed, the USF foundation is on target to raise $70 million this year, back up to what it did about six years ago. Over the last two years, that number had dipped to $50 million.

"The good thing is that donors don't give because of the match," Momberg said. "The match is an incentive."

Still, he and others said, donors have given believing the state would match their money. The USF foundation has been fronting the state money for some projects, he said.

One idea under consideration by university officials is to get at least partial funding for some of the projects already in the queue.

The state's colleges also are hoping the funding eventually comes through, though Larry Bracken, who handles government relations for Pensacola State College, said he doubts it will happen anytime soon.

Now, when colleges woo donors, he said, officials must point out that the matching programs haven't been funded in several years.

"It used to be a good tool of leverage," he said. "Throw in the economy, the Legislature's problem and the fact this is in limbo — it's just made it very difficult."

Jodie Tillman can be reached at [email protected] or (850) 933-1321.

.Fast facts

No match in years

Two programs created by the state haven't received any money from lawmakers since 2007-08:

• The University Major Gifts program matches up to 100 percent of private donations for endowments. A minimum $100,000 private donation is required for the program to kick in. A $600,000 private donation would receive a 70 percent match; any grant more than $2 million gets a full match.

• The Alec P. Courtelis Facility Enhancement Challenge Grant program matches private donations for construction projects at 100 percent.

Tight Florida budget strands university projects awaiting matching grants 03/22/11 [Last modified: Tuesday, March 22, 2011 10:36pm]
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