Current through Register Vol. 35, No. 18, September 24, 2024
A.
Sufficient resources to evaluate and
implement project: a lease-purchase contract can be very complex and
involve multiple professional disciplines.
(1) The agency/department seeking to
implement a lease-purchase project shall collaborate with the property control
division in seeking sufficient resources and expertise to at the minimum
analyze, evaluate and negotiate the following to be consistent with the
guidance document approved by the CBPC:
(a)
baseline costs;
(b)
market/feasibility studies;
(c)
architectural and engineering specifications;
(d) construction/development
budgets;
(e) developer
qualifications;
(f) legal aspects
of developer agreements;
(g)
comprehensive financial modeling including alternative finance
scenarios.
(2) To the
extent these resources do not exist within the agency/department, the
agency/department in consultation with the property control division shall
engage those third party resources deemed necessary to implement said
transaction. The costs of these third party resources may be paid directly by
the agency/department or factored into and become a part of the total project
cost funded through the lease-purchase project.
B.
Develop baseline cost model:
the user agency/department in concert with PCD shall develop a baseline cost
model by which to compare the lease-purchase scenario. The baseline cost model
should be forecast for the anticipated useful life of the new facility. Costs
should include but not be limited to:
(1) all
third party leasing costs as escalated over the proposed term including
pass-through of operating expenses;
(2) debt service/capital costs for owned
facilities that are to be vacated or replaced;
(3) anticipated deferred maintenance expenses
for owned facilities; and
(4)
ancillary costs that will be eliminated by acquisition of new facility for
example, third party parking expenses, special meeting spaces, external storage
facilities, etc;
(5) for comparison
purposes, the total baseline cost as well as the cost of the lease-purchase
scenario shall be discounted to a net present value using the state's then
applicable cost of tax exempt borrowing.
C.
Comprehensive space needs
assessment: the agency/department shall have prepared and submitted to
the property control division for approval a comprehensive space needs
assessment. The space needs assessment will reflect the current space standards
for all state employees as well as take into consideration the special space
needs of the agency/department including but not limited to meeting rooms,
hearing rooms, storage and technology requirements.
