Capital Budgeting
Scope
 Capital assets are real or personal property that have a value greater than or
equal to $5,000 and have an estimated life of greater than one year.
 This procedure applies to all construction, capital improvements, major
equipment purchases and other special projects requiring one or more
expenditures totaling $25,000 or more. This includes projects that are partially
or fully funded by outside funding sources (e.g. grants, gifts, etc.). Examples
include:
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New construction (new buildings or major additions)
Building repairs, renovations, demolition, or upgrades
Major maintenance (capital renewal and deferred maintenance)
Safety, ADA, or Legal Compliance construction projects
Energy conservation improvements
Grounds improvement
Real Estate Acquisition or Leasing
Vehicles
HVAC
Telecommunication and Information Technology systems (hardware and/or software)
New or replacement equipment or furniture
Requests under $25,000 should be included in departmental operating budgets.
Capital Process – to Request Funds
 Initial Development and Review of a Capital Proposal
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When an individual identifies a capital need that falls under the scope, he/she should
complete an Initial Capital Budget Request Form and submit it to his/her Provost or
Senior Vice President. The proposal should meet a specific objective such as an academic
or infrastructure requirement and be consistent with the university’s strategic plan and
campus master plan. The purpose of this form is to encourage the flow of ideas and allow
for advanced planning.
The Initial Capital Budget Request Form should include the following:
 desired project timing
 a brief description and justification of the project
 a rough estimate of the project cost, and identification of potential funding sources such as grants
or gifts.
 A very detailed analysis is not required at this point. This will be done after management’s initial
review in order to prevent unnecessary work if it is determined that the project is not feasible given
the university’s priorities and limited resources. Detailed instructions on how to prepare an Initial
Capital Budget Request Form are included on the finance website.
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An annual submission deadline will be set during the annual budgeting process each year
in order for the capital projects to be included in the following fiscal year capital budget. If
this date is missed, the forms may be submitted throughout the year for consideration in
subsequent years’ capital budgets and the 5-year Capital Plan.
 As discussed in the budgeting presentation – these requests will be reviewed
and priority will be determined by the BRT during the annual budgeting process
Other Forms
 Detailed Capital Budget Request: Every approved capital project/purchase is
required to have a completed and approved detailed capital budget request. This
is an item on the purchasing checklist. The form should include the following:
 Project details including name, estimated start and end date, estimated life of the new asset, project
administrator’s name, department, phone number, campus location
 Project description and justification
 Project cost
 Funding source(s)
 Annual operating cost impact (if any; ex: additional staffing)
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All projects must be reviewed by the SVP/Provost of the area under which the
project/purchase is submitted as well as the CFO. All facility projects should be reviewed
by the VP of facilities and any new system implementations or IT projects require the
approval of the CIO.
 Capital Budget Amendment: Form must be completed for any project that will
exceed its approved amount by 5% or $10,000. These amendments should be
filed as soon as the Project Administrator anticipates the overspend situation
 Include a reason for the overspend and cost details
 Funding for the overspend
 An amendment should also be filed if the timing of the project is going to change significantly and
cross several years
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Amendments require the same signature authority as the Detailed CBR form
Capital Budgeting
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Contact information:
Name
Title
Bryana Deak
Senior Financial Analyst
Phone
x5-7670
Capital expenditure policy, forms, and detailed instructions:
http://www.luc.edu/finance/capexppolicy.shtml
E-mail
btripp@luc.edu