June 28, 2017
On Wednesday, June 28, the State Allocation Board (SAB) met to hear issues related to actions taken at their meeting on June 5, 2017 (approval of “Option 1”). Specifically, under Action Items, the agenda included “Regulatory Amendments for Increased Program Accountability” and “Regulatory Amendments for the Financial Hardship Program.” Under Informational Items, the agenda included “School Facility Program Application Processing.” The following is a summary of each agenda item.
Regulatory Amendments for Increased Program Accountability
At its June 5th meeting, the SAB approved a grant agreement template and conforming regulatory amendments. Office of Public School Construction (OPSC) staff indicated that necessary changes would need to be presented to the SAB if the budget trailer bill was enacted (AB 99 was subsequently signed by the Governor). This item seeks SAB approval for the revised template grant agreement. The item was APPROVED with no discussion.
Regulatory Amendments for the Financial Hardship Program
These proposed regulatory amendments would allow districts seeking Financial Hardship assistance to submit a request for funding without a pre-approved Financial Hardship status. This would allow a Financial Hardship approval process by accepting the Form SAB 50-04 when districts are ready to submit, and conducting a Financial Hardship review at the time the application is processed, prior to placement on the Unfunded List. CASH has advocated for this improvement to the Financial Hardship Program for many years and fully supports this proposal. This item was APPROVED with no discussion.
School Facility Program Application Processing
At their June 5th meeting, the SAB directed OPSC staff to begin processing the Applications Received Beyond Bond Authority List, as well as newly submitted applications. In this item, OPSC staff presented information to the SAB on how they will process the projects previously on this list, as well as Approved Applications for new construction and modernization projects received on or after April 1, 2017, that are now on the OPSC workload list. Included in the approval of “Option 1” was the requirement that districts must recalculate their enrollment and SFP eligibility. CASH strongly objects to this action. CASH Vice Chair Julie Arthur (Palm Springs USD) testified that CASH believes that the provisions of “Option 1” are inconsistent with statute, and asked the SAB to revisit the issue. No request to revisit “Option 1” or action was taken on this item because it was not an Action item.
The next SAB meeting is scheduled for Wednesday, August 23, 2017.
~ CASH Staff
On Monday, June 5, 2017, the State Allocation Board (SAB) took action on two key policy issues that are critical to the implementation of Proposition 51: a) Regulatory Amendments for Increased Program Accountability (template for Upfront Grant Agreement); and, b) School Facility Program (SFP) Applications Received Beyond Bond Authority List (how to proceed with projects on the Acknowledged List). These proposals were originally scheduled to be adopted at the SAB meeting on April 24, 2017, but the action was deferred to a later date due to concerns with the draft prepared by the Office of Public School Construction (OPSC).
Fourteen CASH members testified during the hearing including Chair Don Ulrich (Clovis USD), Vice Chair Julie Arthur (Palm Springs USD), Immediate Past Chair Jenny Hannah (Kern HSD), and board members Rob Pierce (Elk Grove USD) and Alan Reising (Long Beach USD). The following is a summary of the actions that the SAB took on these agenda items:
Upfront Grant Agreement
The SAB voted to approve the Upfront Grant Agreement and conforming regulatory amendments, approved the projects on Attachment #5 for placement on the Unfunded List (Lack of AB 55 Loans), and exempted these projects from the Grant Agreement requirement. CASH and the education community had advocated for changes to the Grant Agreement, which were incorporated in this approval. These changes include:
- Changes to the eligible expenditures list to expand eligibility of freezers, refrigerators, and exercise equipment.
- The option of project-specific guidance letters incorporated by reference into the Grant Agreement – allows districts to achieve certainty on unusual project expenditures, ensuring auditors will allow.
- The Grant Agreement is required at fund release, not as a condition of apportionment.
- Projects on the True Unfunded List are exempt; the grant agreement still applies to all projects on the Acknowledged List.
The Grant Agreement as adopted includes a significant policy change by making educational technology, including computers and printers, an ineligible expenditure.
Beyond Bond Authority List
After extensive discussion and testimony from CASH board members and members of the education community, the SAB voted to approve “Option 1” which requires new construction projects on the Acknowledged List to re-justify their eligibility for the enrollment year in which the application was processed by OPSC, without losing their place in line. The biggest policy debate of the evening was whether schools should be required to update eligibility, or if projects would be processed with eligibility at the time of submittal. Projects that would no longer be eligible under updated eligibility have the right to submit an appeal to the SAB.
CASH would like to thank our members for their dedication and commitment to qualifying, approving, and now working to implement Proposition 51.
~ CASH Staff
May 24, 2017
Dear CASH School District Member:
We are writing to request your help in communicating with your representatives in the State Senate and the State Assembly to ask for their direct action to assist us in:
- Focusing legislative pressure on the Department of Finance (DOF) to increase school bond sales for matching funds through Proposition 51 in years 2018 and in 2019; and
- Communicating to the State Allocation Board (SAB) concerns as to how the Office of Public School Construction (OPSC) and DOF are proposing to treat districts projects negatively that are on the “Acknowledged List.”
Unfortunately, in the May Revision the DOF did not change the state’s plan to sell only $600 million in Proposition 51 bonds between now and June 30, 2018. That rate of bond sales will not even cover the new applications being filed, much less the current $2.4 billion waiting list.
In communicating with your legislative representatives we ask that you cite specific information about your District’s projects waiting for state bond funding, including estimated state bond funding amounts. We request that you speak to the need to increase state bond sale amounts for purposes of funding your projects and the $2.4 billion in the pipeline waiting for funding.
It is important to note here that it has been proposed by OPSC that the SAB consider sending projects on the “Acknowledged List” back to the applicant school districts, thus denying funding to those projects.
To date, there are $2 billion on the “Acknowledged List.” This is a combination of new construction and modernization projects. If your District has projects on the “Acknowledged List” we advise that you specifically identify those projects to your representative and detail the negative impact that the proposed action to deny funding to the “Acknowledged List” will have on your District.
We suggest also that you communicate your concern regarding the proposed OPSC/DOF “grant agreement” that is intended to be applied retroactively to all projects waiting for funding, notwithstanding the fact that contracts have been signed or that projects have been completed and occupied.
The Legislature needs to hear directly from you about the specific harm that the proposed OPSC and DOF actions will have on your district.
Again those proposed actions are:
- Limit bond sales;
- Reject projects waiting for funding on the “Acknowledged List;” and
- Require that a grant agreement is signed for each project retroactively.
Please review the draft letter that you may use to write your own request that the state sells more bonds faster.
Please send your letter to your State Assembly Member and State Senator.
Thank you in advance for your assistance on this matter of importance.
~ Tom Duffy
March 20, 2017
The Office of Public School Construction (OPSC) has scheduled a stakeholder meeting for Thursday, March 30, 2017, at the Department of General Services, Ziggurat building in West Sacramento. The meeting is scheduled for purposes of discussing and receiving feedback on the draft grant agreements for the School Facility Program. The notice has been posted to the OPSC website under Meeting Information and on the State Allocation Board webpage. This meeting will also be webcast.
~ CASH Staff