 Welcome folks, this is Corrections and Institutions. We're doing our final markup of our capital budget today to put it in our final spreadsheet and also our final draft. And then we will plan on voting the committee bill out today. That's our plan. And but we have a few loose ends to tie up one being the Vermont State colleges in their request for transformation money for the capital budget for FY 22 and FY 23. For those dollars to be used towards either demolishing some of their buildings or maybe dealing with having to do a renovation in a building if they're gonna be leasing it just to give them some flexibility. So I'm not sure who is planning on speaking to this at all. I know Catherine and I were texting last night trying to figure out what was needed and what wasn't needed. So I'm not sure who would like to speak. Okay. I'll just start and just say, you know, thank you very much for inviting us in to provide you with a brief update on our capital request. And as you've noted, this is Sophie Zadatnyam, the Chancellor for the Vermont State College System. And with me I have Catherine Lovasa who's our Director of External Affairs and Government Relations. And then Sharon Scott who's our Chief Financial and Operating Officer. So since we last met with the committee at your recommendation, we have met twice with the State Treasurer's Office and spoken several times with the Municipal Bond Bank. And we are in the process of providing all the requested documents to both of those organizations. But I am gonna turn it over to Sharon Scott because she is our Chief Financial and Operating Officer and she is much more conversant in these topics than I am. Thank you. The conversations that we've had thus far have been extremely helpful and fruitful. So we really thank you for pointing us in their direction. For the State Treasurer, we've provided all of our capital funded projects since the 2010 capital bill. And through a review process, the Treasurer has determined that the Vermont State Colleges must follow 32 VSA 962. Should we choose to repurpose with another entity, sell or dispose of any assets that have received capital funding since the 2010 capital bill. This section of statute requires us to notify the Treasurer's Office at least 90 days in advance of any action we wish to take. And the Treasurer's Office will then complete a review and determine what, if any, remediation steps would be necessary to complete the requested action. The statute regarding the Vermont State Colleges does not currently point us to 32 VSA 962. Therefore, it's our understanding that appropriations will be adding language and session law this year that will make sure that it's crystal clear that the Vermont State Colleges must follow these steps moving forward. And that's especially important given transformation. We don't normally consider selling or disposing or repurposing of our assets. And it's important to put that in there as a reminder. For the Municipal Bond Bank, we've discussed the specific requirements that we need to take in order to maintain our agreements. And we're currently providing information to them regarding our sources and uses of all funds for projects that were funded by or refinanced through tax-exempt bonds with the Bond Bank. And much like the Treasurer's Office, there are going to be requirements that we need to follow in order to maintain the tax-exempt nature of these debt instruments. As you likely recall, the Vermont State Colleges have two primary proposals before you regarding capital needs. And we requested a capital appropriation in total of $10 million this biennium. Our top priority is construction, renovation and major maintenance in an amount of $4 million. And our second request was $6 million for facilities transformation related to our Vermont State Colleges transformation project. This request is quite different from the general fund transformation requests that we're making in a few key ways. First, the general fund transformation request includes a wide variety of efforts that don't qualify for capital funding. These efforts include project management, administrative and academic transformation, accreditation, marketing and branding, and most importantly, information technology expenditures, all of which that do not qualify for capital expenditures. Conversely, the capital request for transformation funding includes estimated transformation costs associated with building renovations, conversion, public-private partnerships, or possibly demolition. And we recognize that this committee is used to seeing a really clearly defined project list at the beginning of the biennium. And while we do have that list for our construction, renovation and major maintenance projects, our planning efforts for facilities transformation is really just beginning. Many of the decisions our transportation team will be making in the coming months will inform which projects and buildings will be part of our capital transformation. At this time, we anticipate that our plan will be complete by October of this year. We also know that the capital bill is a two-year bill and our transformation process is really not lining up with this bill. We therefore had put in this transformation request knowing it was vague, but also knowing that we'd need to discuss building transformation with you during this biennium. Given the information and where you are in your process and where we are in our timeline, we'd like to talk to you briefly today about shifting our request for $6 million for transformation to a conversation next year instead of discussing it right now. At that time, when we have our plan fully complete, we can bring a clearly defined capital transformation project list for your consideration. Our remaining needs for construction, renovation and major maintenance continue to be necessary to keep our buildings and facilities in reasonable repair. These projects, including such items as roof replacement and repairs, window replacements and stair reconstruction are all necessary to maintain Vermont State College buildings. So we wanna thank you for inviting us in today to talk about this issue and give you a brief update on our capital projects. And we look forward to answering any questions you may have. So we do a two-year budget. So what I'm just wanna be clear, you're gonna continue working on your transformation plan for the State College system in the buildings piece. You'll hope to have that done by October this year. So you're saying put off this conversation till next year, January next year, when we're dealing with the FY23 budget. So are you anticipating having money in that FY23 budget money? We would anticipate that we would. The problem that we have right now is that our planning is one year out of sync with the biennium. And so we'd like to be able to come back to you this fall or early next year and be able to give you a really clearly defined set of projects that would be able to be executed in FY23. So you would be comfortable with us putting no dollars for FY23 at this point. I don't wanna talk- In the transformation timeline? Yes. I'm wondering if we have maybe even 100,000 just to put money in there as a placeholder. You know what I'm talking about, Catherine? You've been through this awhile. Because we do a two-year budget, next year we come in in January, we have our two-year budget that we've already put in place. If there's no zero dollars, then it will have to be added in somewhere next year. If we put in maybe 100,000, it indicates we gotta look at this next year and there's 100,000 there. That's where I'm just trying to get at when I say a placeholder that we've provided this. Right, so we definitely know that we need transformation money. So whatever we can do to be able to make sure that it's a placeholder so that it's open for conversation would be really helpful. For us, the hard thing is that we don't know exactly what these projects are and we know it's difficult for you to make a decision on what you wish to fund if you don't know exactly what it is. And so if there's an opportunity for you to put a placeholder in so that we can be open for discussion next year, that would be excellent and really something that we could use. I'm just thinking of our process next year because we don't look, if there's no changes to anything, we don't look at those items that haven't been changed. We only look at those particular items that the governor has recommended tweaking or maybe any additions that's not already there. So that's why I don't want this to get lost for next year is what I'm thinking. Not that we're gonna have maybe three or six million next year, but at least it reminds us we need to have this conversation again. I think that makes perfect sense if that's possible. Okay. I think we can find maybe something somewhere, possibly. It, you know, 100,000 or less at least gives us a little indication that, hey, we gotta come back here with this line item. Just follow up on the proposed language that we've seen has a subsection C in that says prior to any funds being expended in this section, the corporation shall submit a transformation plan to institutions and education committees and notify the commissioner of finance and management. I just want to make clear if we go down this path that that language would not be in there because obviously if we're talking about major maintenance and renovations, you know, which would be the kind of things we normally do, we wouldn't need to come back to you or go to the commissioner to expend those monies that really that the intent of that of C, I'm assuming, was really to deal with this transformation piece and not how we normally spend capital funds. I would like to take a look at the language. I know we had it somewhere. Would you be able to email that to Phil Petty just so we can take a look at it? I know that we saw it briefly. We had a couple of members of our committee, Representative Dolan and Representative Campbell, I believe, working with Representative Fagan and Appropriations Committee. So before we take out our committee in that report back, I really want to look at the language. So the language makes perfect sense with regard to transformation dollars. I just wanted to make sure we didn't add some additional procedural barriers for spending the normal capital funds on major maintenance and repairing roofs and things like that. I don't think that was the intent. I just want to make sure. The intent, the intent is transformation piece. Karen, did you have your hand up? Yes, so thank you for this update. And I feel like there's some different conversations going on. So I'm going to try to bring it together with what I know of, I believe that there was a piece around the transformation of wanting to know what the plan was for the transformation. And I believe it was also Representative Morrissey. So I don't want to put her on the spot, but I think if I'm remembering this correct, there was a piece of wanting to know what the plan was for major maintenance and renovation so that we weren't funding major maintenance and something that then a year from now was going to be torn down or sold or repurposed. So they are together. So I don't know if we need a detailed plan, but like if we at least know like, these are the buildings that are not going to be sold. Like we're not doing major maintenance on those. I think that's where it was coming. So there were the two separate pieces of it. I think Sharon can probably talk to that. I do believe we have a detailed project, a detailed list of what the major maintenance projects are. And although we haven't worked out exactly which buildings might be impacted by transformation, that's a process we need to go through internally. I think we know for sure which buildings could potentially be on that list and which ones definitely won't be. But I'll let Sharon follow up on that. I don't think the two would overlap. I don't think we would be putting a lot of money into a building that we're anticipating may not be part of our portfolio moving forward. So on the surface, just to be clear, our preliminary look at facilities would likely be ones that are not included are covered by the capital bill or were not covered by the capital bill previously. It's only recently, for example, that residence halls and dining facilities could use capital facility money. And so those would actually be some of the first buildings that we would look at. When we propose our project list for capital funding every year, we provide a listing of all of the facilities that we anticipate that we would be likely to use capital funds on with specific major maintenance, major construction and renovation projects. However, there are other things that occur throughout the year and we do reserve a pot of money within our capital monies that we receive to handle things like when there's a major roof repair that needs to be done, we can't necessarily control which specific building may have to have those funds. Sometimes a roof fails and you can't do anything about it but we do try to plan ahead. And as we're looking ahead, it's one of the reasons why we are really developing a facilities plan that we anticipate will carry us through not just the five years of transformation but for the five years beyond to really look at facilities. And one of the criteria that we'll be looking at when we look at whether we're disposing of it, selling it, renovating it, we'll be looking at how much investment does it require to bring that up to speed. Because in some instances, we're going to want to choose buildings that we perhaps offload or dispose of that are ones that have the greatest carrying costs and might require the greatest amount of renovation. So we don't want to sink a lot of money like state capital money or institutional money into something that we would be likely to dispose of. It wouldn't make sense. And it's why we'll come forward with a transformation plan that will really clearly define what our plan looks like and then we will carve out in the future those projects that are related so that we're not intertwining those monies. The other thing is that the treasurer when we met with her office is very clear that the process for if we use state capital funds for something that we anticipate disposing of, leasing, selling or moving into a public private partnership, we'll really need to go through a mere mediation process. It's very difficult for them and difficult for us and we don't want to put either them or us through that process. So we're going to be really careful about making sure moving forward that we do not co-mingle those kinds of funds if we can make sure that happens at all possible. Can't help a major roof issue but we can be pretty careful in a lot of other ways. So I just want clarity on the language and what you mentioned, where it's being put in. I just want some clarity. We received in our email from Phil what was just sent to us from Catherine. That's language that was being proposed in our capital budget, Phil. So Chancellor, what you mentioned, was it the language that Catherine just sent that was proposed for our budget or were you referring to language that's going to be upstairs in the general fund big bill? No, this was language that was specific. As I understood it, this is language that was specific to the capital bill. And it talked about the amount of the sum being appropriated to the Vermont State Colleges and FY22 for construction renovation and major maintenance. And then it had another appropriation amount for FY23 but then it had this additional subsection C that just said prior to any funds being expended in this section, the corporation shall submit a transformation plan to institutions and education committees and notify the commissioner of finance and management. And obviously if we have a roof that starts leaking we don't want to have to come back. And particularly when you guys hopefully are all off having some quiet time and not in session. So I do understand the concern like if we're gonna use this money for transformation projects I totally get that that you want to see a plan before we do it. I just wanted to make sure there wasn't some unintended consequence from including language that was putting restrictions that weren't intended in the capital bill. I think we'll work with our staff to figure out how to clean up this language to make it clear that we don't want our major maintenance dollars and FY22 to be used towards buildings that you might unload. That's really the concern. Right. And that's a reasonable concern. And that, you know, if you have language that meets that goal that would be perfectly fine with us. So thank you very much. Just to really clarify this. Okay. Any other questions of the folks? I'm gonna get back to my participant list here. Sarah and then Marsha. Good morning. A quick question. I mean, historically, I think what we're struggling with is I think this committee wants to help the state colleges but one of the things that we did not get this year from you all that we usually do get is a priority project list which I believe I heard Sharon's referring to and that we understand how that works. It's a list and you can work but there's flexibility in that list. And I'm just wondering if that's something that you are working on or you can provide to the committee because I think that would, at least for me, you know, really ground the conversation because we're already appropriating funds for capital projects on the campuses. So is that something that you can send us? Absolutely. We can send it to you right after this meeting. Terrific. Thank you. So while we have, whoops, I'm sorry, Marsha, go ahead and then I'll shift gears a little bit. I was just going to ask you, so you don't turn your funds around dorm dollars to maintain dorms, obviously, right? Well, until recently, we couldn't use capital funds for any of our dorms. I know and that's why because dorms and cafeterias are your income, you have income from them. And that's why it was put in the capital bill. Correct. But you, but obviously you don't use that income to maintain because I know of colleges where kids have moved out in the state college system because of leaky dorm rooms. So each of our colleges puts aside $250,000 a year to maintain residence halls. And that's $250,000 for a Castleton, Vermont Tech and $500,000 for more than for my university because they have two separate campuses. So those funds are put aside that are used from institutional dollars, not capital dollars to maintain. Now that being said, $250,000 for a campus is really not enough in order to be able to maintain our residence halls in all cases to the standards they would like. In some cases, it's been able to maintain things to a pretty decent degree in others, it is not. So the experience that you may have heard is clearly the case. And I believe that's why this body helped make a change to allow the colleges to begin using some capital funding for that. That being said, we have not used capital funds yet for our residence halls because that language change was only last year and COVID got in the way. So. Well, I just happened to have family member at Johnson and I just had one at Lyndon, well, NVU, Lyndon that just went on to another college and I just heard from them and they were asking me about it. So that's where I got that input. It's definitely not enough money. And it's one of the reasons why we need to transform. Any other questions on this before I ask a different question I may put them on the spot. Okay, I'm going to shift gears a little bit. I know that the whole state college system is going through a transition transformation. You don't know what's going to look like. We are also looking at some of our current correctional facilities and the replacement of them. And we're just looking at all options that may be out there in terms of purchasing land. We're really looking more at the women's facility to get things started. We're looking at purchasing land. We're looking at currently state-owned lands. And when I say we're looking, we're just putting in language to have buildings and general services just explore all the options that may be out there in terms of where we could cite women's correctional facility and also re-entry facility for them as well or even for the males for that matter. Would there be, we're going to put in the BGS also looks to see if there's any opportunities with the Vermont State College System. For some of that from any of your campuses that might be a possibility that you might see or not. Is this an exploratory? It doesn't mean we're going to do it but just to look at all the options. Yeah, is that something that you're thinking about in terms of an entire campus or are you thinking about buildings on a campus? We're not sure yet. That's what we just want to have. We're putting in language enabling BGS buildings and general services to look at all the options that may be out there. And we know that the state college system is looking at options as well in terms of what to do with their campuses, what to do with their buildings. And there may be an opportunity there for some, some way or not, you know. For some design of a certain, you know, maybe some of the buildings or maybe the whole campus, we don't know. But we want to just put that out there to explore what are the possibilities. And then there'd be a report back to us in January. We'd certainly be happy to have those conversations. I mean, I have some familiarity with them on the federal prison side from previous work I've had not inmate, but visiting as part of being a federal law clerk and spending a fair amount of time in federal prisons in West Virginia. And I know there in the federal system, they have a lot of campus-based prisons, the low security prisons, and certainly, you know, I think there are probably certainly conversations we can have about what could work. So we would certainly be open to having those conversations. It's not locking anybody in. It's just a lot of options. I just didn't want to blindside you. Anything else before we shift gears here? So this has been very helpful. Thank you for coming back in, clarifying with us. And when we get back to our spreadsheet, which will be sometime this morning, we'll see where we are on our bottom line and see if we can, where we end up if we shift any dollars for the FY23 piece, okay? Thank you so much for your time. Thank you. Thank you.