The State of Washington owns the Metropolitan Tract, a parcel of office and hotel properties, occupying approximately 11 acres in downtown Seattle.  The University of Washington (UW) has developed and managed the Tract, which generates income for the University in excess of funds needed for operations and maintenance.  This income is appropriated by the Legislature for UW capital projects.  In recent years, the amount of income generated by the Tract for UW capital projects has amounted to $8 million per year.  RCW 28.B.20.362 required the UW to report to JLARC every two years on its management of the Tract.  Highlights of the UWs 2003 report include: (1) a decline in the value of the Tract, which reflects overall weakness in the Seattle commercial real estate market, and (2) financial projections that suggest the Tract may not continue to generate the same amount of income for UW capital projects in the next few years.