University's Capital Projects Approval Process

Overview

For capital projects with an estimated capital cost of $250,000 or more, the university’s approval process involves the following:

  • Needs Identification
  • Preliminary Planning
  • Project Scope and Funding Plan
  • Project Approval

Senior administrators (senior vice president or director of athletics) that are overseeing the planning process for capital projects may be asked to provide periodic updates to the president and the Capital Projects Advisory Committee on the progress of the project.


Needs Identification

To start the process, staff from the department or program, with support from staff from Facilities, Planning and Management (FP&M), work on defining the facility issues.  The outcomes of this are captured in a concept paper that includes:

  • a brief history that includes the nature of the facility issues in terms of programmatic needs and how the existing space does not meet current, and/or will not meet future, programmatic needs
  • a justification or need for the project including how the project was prioritized and/or aligns with a longer-term plans

The concept paper is submitted to the appropriate senior administrator.  The senior administrator has the authority to determine whether the needs justify proceeding with preliminary planning.


Preliminary Planning

Preliminary planning typically is led by staff from FP&M in close partnership with staff selected by the senior administrator.  For more complex, larger-scale projects, a formal planning committee may be assembled and an external consultant may be utilized.  The outcomes of the preliminary planning are captured in a project proposal that includes:

  • alternative options that were considered and a recommendation on which option best addresses the unit’s facility needs
  • a range in the anticipated capital costs and possible funding source(s)

The project proposal is submitted to the appropriate senior administrator.  The senior administrator has the authority to determine whether the proposal should proceed with further study unless the proposal meets any of the following criteria:

  • the project proposal is a major capital project[1]
  • the anticipated funding sources involve initiating fundraising activities and/or use of debt financing
  • there is likely to be legislative, community or other outside stakeholder interest in the project
  • major reallocation of space and/or the project impacts other units
  • change in land use or site implications

If the project proposal meets any of these criteria, the proposal must be submitted to the Office of the President to obtain the president’s approval to proceed with further planning. 


Project Scope and Funding Plan

Given the outcomes of the preliminary planning, an architectural study is conducted to establish a more defined project scope, in terms of size and cost. This phase of the process is led by staff from FP&M in close partnership with staff selected by the senior administrator.  External consultants or internal staff may conduct the architectural study, depending on the size and complexity of the project, and the time and availability of internal staff.

Concurrently with the architectural study, a funding feasibility study needs to be done to determine the probability for securing funding for the project and develop a funding plan. 

  • If state funding is part of the plan for financing the project, the project must go through the university’s annual process for requesting state appropriations and/or state bonding authority.
  • If donor gifts are part of the project funding plan, the ISU Foundation will conduct a fundraising feasibility study. 
  • If debt financing is part of the funding plan, staff from the Office of the Senior Vice President for Business and Finance and/or Treasurer’s Office will assist in the feasibility study.
  • If internal funds or other external funding (other than those listed above) are part of the funding plan, the department chair, dean, vice president, director, and/or senior administrator will need to determine the availability of those funds. 

The project scope and funding plan are captured in an updated project proposal which includes:

  • Project Description
    • brief history that includes the nature of the facility issues in terms of programmatic needs and how the existing space does not meet current, and/or will not meet future, programmatic needs
    • justification or need for the project including how the project was prioritized and/or aligns with a longer-term plan for the facility
    • alternative solutions that were considered to address the issue and rationale for selecting the proposed project
    • project scope including the approximate gross and net assignable square feet
    • proposed site selection, if applicable
    • general project schedule, if known
  • Project Budget (include lines for major expenditure items)
    • estimated capital costs and funding plan
    • estimated incremental increase in operating costs and anticipated funding sources

The updated project proposal is submitted to the appropriate senior administrator[2].  Once approved by the senior administrator, the proposal is submitted to the Office of the President to obtain the president’s final approval.  


Project Approval

All capital projects of $250,000 or more must be approved by the university’s president.  The president may decide to convene the Capital Projects Advisory Committee to gather input and provide advice on the project.  Once the president approves the project, the proposal is submitted to the Board Office for approval.  Capital projects with an estimated capital cost of $250,000 or more require approval by the Board Office or Board of Regents.


[1] A major capital project is defined as a new construction project with an estimated project budget of $1 million or more, or a renovation project with an estimated project budget of $2 million or more.
[2] Senior administrators have the authority to approve projects with estimated costs of less than $250,000.  The senior administrator’s approval constitutes approval to proceed with design and construction.