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9.02          Property    

A.          Duties and Responsibilities of the Board of Regents include:  

1.      Approval of the purchase and sale of property.  

2.      Approval of the disposal, transfer and sale of buildings.  

3.      Approval of leases and easements  

B.         Control, acquisition, and disposition.  The Board is responsible for management and control of real and personal property of the institutions under its control pursuant to Iowa Code §262.9[4].  

          All acts relating to the management, purchase, disposition, or use of lands and other property of the institutions are to be approved via roll call vote pursuant to Iowa Code §262.11   

C.      Purchases and Sales  

1.      The Board shall acquire real estate for the use of the Regent institutions, and dispose of real estate belonging to the institutions when not necessary for their purposes as delineated in Iowa Code §262.9[7] and Iowa Code §262.10  

a.          Acquisition includes the procurement of real property by gift, grant, purchase or any other method.

b.          Disposal includes the transfer of real property to another entity by gift, grant or sale or by any other method.  

2.         The Board’s policy is to convey real estate for monetary consideration based on appraisal; in all cases in which monetary consideration is waived by the Board, the alternative consideration shall be approved by the Board and detailed in Board minutes.    

3.         The Board policy is that property purchased shall be purchased at no more than the high appraisal or not more than 5 percent over the average of two appraisals, whichever is the lower figure.  This policy is not intended to limit negotiation for a price lower than the appraised value.     

4.          All requests for Board approval of the purchase or sale of property shall be accompanied by a map showing the location of the property to be purchased/sold.  

5.         It is the policy of the Board and the institutions to provide for the orderly use and development of land and related natural resources in Iowa for residential, commercial, industrial, and recreational purposes; to preserve private property rights, to protect natural and historic resources and fragile ecosystems of this state, including forests, wetlands, rivers, streams, lakes, and their shorelines, aquifers, prairies and recreational areas; promote the efficient use and conservation of energy resources, promote the creation and maintenance of wildlife habitat; to consider the protection of soil from wind and water erosion; and to preserve the availability and use of agricultural land for agricultural production.

When an institution, as part of actions undertaken under this section, determines that those actions are inconsistent with the land use policy outlined above, the institution shall notify the Board with an explanation of those adverse impacts and an explanation as to why alternatives without such adverse impacts are not feasible.   

      D.      Disposal, Transfer, and Sale of Buildings  

                1.     Disposal, transfer, or sale of buildings with an estimated fair market value of $10,000 or more will be placed on the agenda by the institution for Board action.

                2.     The chief business officer of each institution is authorized to dispose of
                        obsolete or worn out buildings with an estimated value of less than
                        $10,000, under the conditions established in this Policy Manual.

     E.        Leases 

1.          State law provides the Board with authority to lease properties and facilities, either as lessor or lessee, for the proper use and benefit of the institutions as detailed in Iowa Code §262.9[14].  The Board may, at its discretion, delegate authority to the universities to approve leases.  All leases requiring Board approval must be approved by roll call vote in accordance with Iowa Code §262.11.  

2.          Authority for approval of leases for the special schools is delegated to Iowa State University, following the parameters outlined below.  (Iowa State University is currently responsible for the overall administration of capital projects at the special schools – Regent Policy Manual §9.11.) 

3.          Approval of tenant property rental rates is delegated to the universities. 

4.          Lease approval delegations to the universities include: 

a.      Those with the Board as both lessee and lessor as further outlined in this section, including individual subleases within the SUI – Technology Innovation Center and ISU – Iowa State Innovation System, and farm leases; 

b.      Those for less than 10,000 gross square feet, and with less than $100,000 in annual rental costs, and for five years or less duration, including renewal periods within the lease.  (Leases for more than 10,000 gross square feet, or more than $100,000 in annual rental costs, or for greater than five years duration would require Board approval.  The Board Office may annually increase the $100,000 annual rental threshold by the Consumer Price Index – All Urban Consumers.); 

c.      Lease addenda increasing the amount of leased space, as long as the lease and addenda (in total) fall within the parameters of (b); 

d.      Lease addenda decreasing the amount of leased space; and 

e.      Lease renewals where there are no substantial changes in terms from the original lease or previous renewal, and the lease percentage rate increase (from the original lease or previous renewal) does not exceed the Consumer Price Index – All Urban Consumers. 

5.      Each university will report annually on the new leases and lease renewals into which it has entered during the last fiscal year (excluding renewal periods provided for in the original lease), as well as the approved tenant property rental rates.  The reporting format will be developed by the Board Office, in conjunction with the universities. 

6.      Universities will identify one institutional office with authority to approve leases and inform the university community and Board Office of that identification.

7.      Lease arrangements to be approved by the Board or the universities will use the standard Regent form developed by the Board Office unless exceptions are granted.  Deviations from this form for university approved leases will require the approval of the university’s general counsel office; exceptions for leases requiring Board approval will be made by the Board Office. 

8.      A university or special school may opt, at its discretion, to submit a request for approval of a specific lease to the Board even if it were to fall within the parameters of delegated leases. 

9.      All leases which include an option to purchase, a right of first refusal to purchase, or other right or option to purchase the improvements or the land on which the improvements are located, require Board approval. 

10.  Land leases, excluding farm leases which would be delegated as per 4a above, require Board approval. 

11.  For purposes of implementing Iowa Code §262.9[14], a lease is defined as the right to the sole use and occupation of property in exchange for consideration, usually rent. 

12.  The institution will prepare an exhibit for all lease agreements being presented for Board approval.  The exhibit will include the information requested by the Board Office. 

13.  The institutions will notify the Board Office when a lease agreement has been terminated prior to the end of the lease term, or when a lease agreement has expired (i.e., when either a renewal option or monthly extension is not exercised).   

14.  When the Board is the landlord in a farm lease, the lease shall terminate on March 1 of a calendar year.  Notification of termination shall be in accordance with Iowa Code §562.6 and §562.7. 

      F.       Easements 

1.      The Board is authorized to grant easements pursuant to Iowa Code §262.9[7]. 

2.   The institution will prepare an exhibit for all easements being presented for Board approval.  The exhibit will include the information requested by the Board Office.

      G.       Payments in Lieu of Taxes 

Payments in lieu of taxes (PILOTs) are defined as payments negotiated voluntarily by officials of a tax-exempt entity and officials of the community where it is located as a substitute for property taxes.  They do not include payments made under service agreements specifically provided by Iowa Code.

Prior to beginning any negotiations with a political subdivsion on a PILOT, the institution shall notify the Executive Director of its intent to negotiate such an agreement.

Agreements resulting in payments in lieu of taxes (PILOTs) between institutions under the control of the Board of Regents and a political subdivision shall be approved by the Board.  The request for approval shall include a detailed explanation of the need for the PILOT, the manner in which it was calculated, and concurrence from the applicable public entity assessor(s) as to the assessment calculation for establishing the amount of the PILOT.  The negotiated PILOT shall include a sunset / termination date and shall ensure, to the extent permitted by law, that the PILOT is dispersed to the applicable taxing entities (county, city, school district, etc.).