October 29, 2013
October 24, 2013
Present: Assembly Member Joan Buchanan (Chair), Assembly Member Curt Hagman, Esteban Almanza (DGS), Cesar Diaz
Absent: Kathleen Moore (CDE)
The SAB Program Review Subcommittee met on October 24, 2013 to confirm its position on a number of previously-discussed items. They are now focused on honing their policy recommendations for a future program, in anticipation of presenting them to the full State Allocation Board in January.
At the October 24 meeting, the Subcommittee also revisited in-depth discussions regarding Financial Hardship and County Offices of Education (COEs).
Confirmation of Subcommittee Positions
In order to prepare recommendations for the full Board, OPSC staff sought confirmation on the Subcommittee’s position for a number of issues. Esteban Almanza (DGS) abstained from all policy recommendations because the Administration does not have an official position on a future bond.
The Subcommittee confirmed a YES vote on the following:
I. New Construction Eligibility:
- All school districts should be required to re-establish the new construction eligibility baseline in order to be eligible to receive funding under a new bond.
- The SFP Regulations should be aligned with California Code of Regulations, Title 5 for purposes of establishing a school district’s Gross Classroom Inventory (GCI) (defined term in SFP Regulations) if a new statewide school bond is passed in 2014. Definition of a classroom should be flexible and hold districts accountable for local decisions.
- When preparing the GCI, a school district should count portable classrooms (as defined in Education Code (EC) Section 17070.15(j)) as existing inventory. EC Section 17070.15(j) states, “Portable classroom” means a classroom building of one or more stories that is designed and constructed to be relocatable and transportable over public streets, and with respect to a single story portable classroom, is designed and constructed for relocation without the separation of the roof or floor from the building and when measured at the most exterior walls, has a floor area not in excess of 2,000 square feet.”
II. New Construction Funding:
- Supplemental grants for fire alarms and fire sprinklers should be combined with the new construction base grant.
III. Modernization Eligibility
- All school districts should be required to re-establish the modernization eligibility baseline at each site in order to be eligible to receive funding under a new bond.
- Modernization eligibility should continue with the current age-based model. [The Subcommittee acknowledged there may be some exceptions or some modifications to take other facility-specific information into account.]
- Supplemental grants for fire alarms should be combined with the modernization base grant.
IV. Modernization Funding
- Alternative: Use of modernization grants should be limited to incentivizing the replacement of existing portable classrooms with permanent construction.
V. CharterSchool Facilities Program
- The Charter School Facilities Program should continue to have a separate allocation of bond authority in a new bond.
VI. Statewide Facilities Inventory
- A statewide facilities inventory database for all K-12 public schools in California should be established.
The Subcommittee confirmed a NO vote on the following, related to funding for portable classrooms:
- New construction grants may continue to be used for the purpose of constructing portable classrooms (as defined above).
Because the Subcommittee approved the alternative identified above, they did not take action on the following:
- Modernization grants may continue to be used for the purpose of modernizing or replacing portable classrooms (as defined previously).
The Subcommittee was clear that their intention is to incentivize the replacement of portable classrooms with permanent facilities.
The conversation focused on possible modifications to the Financial Hardship qualifying criteria. OPSC staff reviewed qualifying criteria and data about participation in the Financial Hardship Program. Data presented in the item excluded information on COE participation. Since 2008, seventy-five percent of Financial Hardship approvals qualified under the “Total bonding capacity of less than $5 million” option. However, this category received the lowest amount of Financial Hardship apportionment funds, excluding the two projects qualifying under “Other evidence.”
In general, members of the Subcommittee were interested in exploring ways to tighten the rules and close any existing loopholes. Assembly Member Hagman expressed concern about inappropriate expenditure of funds, such as issuing debt for “extra” facilities in order to reach the bonding capacity threshold and qualify for Financial Hardship. He also expressed interest in capitalizing on assets like land for the purpose of local match. Assembly Member Buchanan acknowledged that the School Facility Program will always need a Financial Hardship program of some kind; districts with low bonding capacity can’t build or maintain appropriately, regardless of their level of effort. However, she indicated that local communities need to step up and provide their support for facilities.
The Subcommittee members were interested in increasing the threshold for bonded indebtedness of total bonding capacity, which is currently set at 60%. Esteban Almanza agreed that Financial Hardship should be reviewed but was not prepared to commit to details as the Administration does not have an official position on a future bond.
County Offices of Education
The Subcommittee revisited options and needs for COEs in the School Facility Program (SFP). OPSC provided data on COE participation in the SFP; COE projects have received $1 billion and account for approximately 3 percent of total SFP apportionments. OPSC identified that the following projects did not move forward to construction: $29.3 million in advanced grants for design (3% of total COE grants); $17.1 million in advanced grants for site (1.7% of total COE grants). Two-thirds of construction has been for community day and other K-12 students, and one-third has been for severe/non-severe Special Day Class (SDC).
In their capacity as county office representatives, C.A.S.H. Board members Jeff Becker (Fresno COE) and Jenny Hannah (Kern County Superintendent of Schools) addressed the Subcommittee. Jeff provided information on the role of COEs and the student populations they serve, and he identified a number of potential tweaks to the SFP, such as adjusting the alternative education loading standard and incentivizing the replacement of COE portables on district sites with permanent, integrated facilities. Jeff also urged for aligning the SFP, Title V, and Federal requirements for the purposes of serving special education students in their Least Restrictive Environment and creating integrated housing. Jenny elaborated on the challenges of special education siting, urging that all facilities should be adaptable to accommodate SDC students.
Assembly Member Buchanan acknowledged that COEs are in a unique situation because of their lack of access to revenue sources, such as GO bonds. She agreed that the Financial Hardship option will need to continue to exist for COEs, but she also argued that districts have the ultimate responsibility for educating students that are referred to COEs, and they should provide a share of facilities costs. Per Buchanan, districts in SELPAs, especially single-district SELPAs, should have to contribute a matching share, rather than the State providing full funding through Financial Hardship. Overall, the Subcommittee members were sensitive to special education siting issues and interested in exploring options to encourage integration. Assembly Member Hagman questioned why COEs are in the business of building facilities at all, asking if there is a way to use COE eligibility for district projects.
The Subcommittee was moving toward a framework for consensus on COE issues, built upon the foundation that COEs will continue to be funded through the SFP, with the option for Financial Hardship participation. Alternative education loading standards will be reviewed, and grant adequacy may also be discussed. To address special education siting issues, Buchanan suggested that districts should include SDC facilities in their master plans. She also stated that the developer fees needs analysis should include costs for SDC students. Buchanan agreed that the alternative education loading standard needs to be reviewed, and grant adequacy for SDC and community and community day schools should be discussed.
Items to Finalize/Continued Discussion
The Subcommittee briefly continued to discuss two open items:
– Consolidating special programs in order to streamline the SFP. Assembly Member Buchanan stated that Critically Overcrowded Schools (COS) and Overcrowded Relief Grant (ORG) do not need to be included in a future bond; ORG will be filled by a portable replacement option. Seismic Mitigation Program could become a qualifying category under New Construction or Modernization, rather than a separate pot of funds. Other programs would remain separate.
– Modernization. The Subcommittee continued to discuss whether or not modernization eligibility should be determined by capacity or enrollment at a site. They were interested in providing a mechanism to modernize a full site if most of it has eligibility.