Act 104 of 1971, as amended, requires State agencies, departments or institutions to obtain legislative authorization prior to the construction and/or acquisition of any lands, building, structures, utility systems or similar facilities to be financed in part or wholly from State Treasury Funds, Federal Grants, Revenue Bonds or Revenue Notes provided by law, agency or institutional receipts, donated funds from private sources or a combination of the above sources.

In unusual circumstances between sessions of the General Assembly, a State agency, department or institution which needs to make a capital expenditure for construction and/or acquisition of any lands, buildings, structures, utility systems or similar facilities costing $50,000 or more in cash funds for which prior legislative authorization was not given must submit a request for such expenditure to the Chief Fiscal Officer of the State to include a Method of Finance (AFGM 043). The Method of Financing must include the source(s) of funding and estimate(s) of the cost of maintaining and operating such capital improvements in the event approval of such capital expenditures is to be granted. (NOTE: The source of bank funds must be specifically stated such as: tuition and fees, federal government, etc.) The Chief Fiscal Officer will submit his recommendation to the Legislative Council for review. If approved, the requesting agency, department or institution may proceed with the capital expenditure subject to the provisions of Act 876 of 1973, as amended and other legislation as applicable.

For those capital expenditure projects of less than $250,000 in cash funds for which prior legislative authorization was not given, the agency must submit a request for such expenditure to the Chief Fiscal Officer of the State, to include a Method of Financing. Upon his review and approval, the agency may proceed with the capital expenditure subject to the provisions of Act 876 of 1973, as amended and other legislation as applicable.

State agencies planning construction of buildings, major repairs, additions, or improvements to existing facilities are allowed to select their own architect and engineer subject to the review and approval of the Arkansas State Building Services. It is recommended that public notice of intent to select an architect or engineer be given prior to the selection. Notice must be given by means of an advertisement in a newspaper of extensive circulation in the area. All applicants should be given the opportunity to make an initial presentation limited to their background, prior experience, special expertise and any other area that will enable the agency to evaluate the capability and reliability of the person or firm applying. Applicants are not required to submit completed plans and specifications at the initial interview.

Prior to entering into any contract or making a commitment of any funds, the payment of which would be against a construction and permanent improvement appropriation, a Method of Finance (AFGM 043) must be submitted to the State Building Services Office of Construction, except that such provision shall not be applicable to The Game and Fish Commission, the Arkansas State Highway and Transportation Department, Public School Districts of the State of Arkansas, and office of elected officials. From the State Building Services Office of Construction, the Method of Financing goes to the Office of Accounting of the Department of Finance and Administration. Upon certification of the availability of appropriations and funds, the Department of Finance and Administration Office of Accounting approves the Method of Financing. It is then encumbered by the Fiscal Management Section of the Office of Accounting. The approved encumbered Method of Financing is copied and distributed by the Office of Accounting to State Building Services and the originating agency. The agency making the request is responsible for providing its contracting parties with a copy of the Method of Financing.

After the Method of Financing is approved an distributed, Professional Services contracts for architectural or engineering services, construction, repairs, alterations or improvements may be awarded. Refer to procedures by State Building Services for detailed instructions.

A revised Method of Financing must be submitted if:

1. Changes in items 1 through 5 (Attachment II – 8.1) cause a change in item

6 or,

2. Any change in funding sources (Attachment II – 8.1) items 7 through 9.

Modifications to approved Methods of Financing must be submitted on AFGH 043 to the Office of Construction, State Building Services. Subsequent distribution and/or processing will be accomplished according to that of the original Method of Financing.

If the estimated dates of commencement and/or completion as stated on the original Method of Financing change, a letter of revision must be submitted to the Office of Construction, State Building Services. This revised date will appear on the next revision to the Method of Financing.

Professional Services contracts relating to an approved Method of Financing must be on file in the Department of Finance and Administration Office of Accounting. All other contracts should be on file with the Office of Construction, State Building Services prior to payment being made against such contracts. If a change to the contracts changes items 1 though 6 of the Method of Financing a revised Method of Financing must be submitted. Refer to procedures issued by the Department of Finance and Administration Office of State Purchasing, and the Office of Construction, State Building Services regarding detailed instructions for the purchase of materials and/or services not included in the original contract(s).