Tag Archives: Coalition for Adequate School Housing

CASH Legislative Update

July 13, 2017

Friday, July 15 is the last day for policy committees to hear and refer bills to fiscal committees. This is a key deadline because bills that are held in policy committees are effectively dead for this year, and bills that are approved and move onto the fiscal committees can continue to move through the legislative process. Below are status updates on bills of concern to the organization that CASH advocates have been actively engaged on. Thematically, these bills reflect two issue areas that have dominated school facility legislation this year – local bond accountability and transparency, and the lead content of water in schools. CASH is pleased to have helped improve some bills and helped block others that could not be improved. The Legislature convenes summer recess on Friday, July 21 and returns on Monday, August 21  to finish its business for 2017.

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State Allocation Board Update

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. Continue reading

Governor Signs Budget

June 27, 2017

Today the Governor Signed AB 97, the budget bill for FY 2017-18, as well as the related trailer bills to enact policy changes in the budget. Below is an update on a number of key school facility policy issues that are addressed in budget trailer bills.

SB 96: Department of Industrial Relations

Makes changes to the Department of Industrial Relations (DIR) prevailing wage monitoring program, including:

  • Raises the threshold for the program’s applicability from $1,000 to $25,000 for construction projects and $15,000 for maintenance projects.
  • Increases penalties for contractors and subcontractors who fail to register correctly.
  • Creates new penalties for awarding bodies, including school districts, who would be subject to a fine of $100 per day, up to $10,000.
  • An awarding body determined to be a “willful violator” with two program violations within 12 months could lose state facility funding for one year.
  • Increases the annual contractor registration fee from $300 to $400 and permits a contractor to register for multiple years at a time.

The budget also includes $805,000 in 2017-18 and $759,000 in 2018-19 for positions to educate awarding bodies about their requirements under the law.

AB 111: DSA Filing Fee

Increases Division of the State Architect (DSA) project filing fees for construction or alteration of school buildings. The fee will increase from 0.7% to 1.25% for the first $1 million in construction costs, and from 0.6% to 1.0% for costs in excess of $1 million. If the balance in the Public School Planning, Design, and Construction Review Revolving Fund exceeds six months of expenditures, the fee will automatically decrease.

AB 99: School Facility Program Audits

Includes the School Facility Program (SFP) audit changes, adding state-funded school facility project scope to the local annual K-12 audit. CASH successfully lobbied for amendments to the bill to provide school districts with the flexibility to use capital funds or operational dollars to repay any expenditures deemed ineligible. The original proposal from the Administration would have required automatic payback of audit exceptions using a withholding from the next Proposition 98 apportionment. The new audit provisions apply to SFP projects funded on and after April 1, 2017.

AB 99 & AB 125: Proposition 39 – Encumbrance Date and Program Extension

Includes provisions related to the Proposition 39 energy efficiency program. The bill extends the encumbrance date for projects by 12 months to June 30, 2019. The Legislature is now considering an additional trailer bill that includes the provisions of SB 518 (De Leon) to extend the Proposition 39 program indefinitely. Identical language is reflected in both AB 125 and SB 110, and either bill could move forward. These bills extend the sunset on the Proposition 39 program indefinitely, though future funding is subject to an appropriation in the annual budget process. The bills would establish a new competitive grant framework for allocation of the dollars. The bills would also sweep remaining unallocated funds from the first five years of the program for projects that have not submitted an Energy Expenditure Plan (EEP) by March 1, 2018. These funds would be dispersed as follows:

  • $75 million for a school bus retrofit and replacement program to be administered by the California Energy Commission.
  • $100 million for low- and no-interest Energy Conservation Assistance Act (ECAA) loans.
  • The remainder would be used for competitive grants for K-12 schools in designated tiers.

Passage of AB 125 or SB 110 would make SB 518 obsolete. Budget trailer bills are urgency statutes that are effective immediately upon signature and require only a majority vote to pass, in contrast to a typical urgency bill, which requires a two-thirds vote. Trailer bills are not subject to the June 15 budget bill deadline. Senate President Pro Tem Kevin De Leon, the author of SB 518, appears very interested in moving this issue through the legislative process via trailer bill.

~ CASH Staff

CASH Budget Update: Legislature Approves State Budget & Trailer Bills

June 15, 2017

Today, the Legislature passed AB 97, the budget bill for FY 2017-18, meeting the constitutional deadline to pass an on-time budget by June 15, 2017. The Legislature also passed a number of accompanying trailer bills to implement policy changes in the budget. The budget includes $125.1 billion in General Fund spending, including $9.9 billion in total reserves. This is the largest budget reserve in California’s history and is consistent with the Governor’s priority of preparing for the next economic downturn. The budget will now go to the Governor for his signature, or line item veto, if any.

School Finance Budget Trailer Bill – AB 99

School Facility Audit Language – This bill includes new school facility audit language (commencing with changes to Education Code Section 41024) that requires local auditors to include state funded facility projects in the annual school district audit. The audit language includes references to the new fund release grant agreement adopted at the June 5, 2017 State Allocation Board (SAB) meeting. The audit language also includes language on the use of project savings and the process for repaying state funds audit exceptions.

One-Time Discretionary Funding – This bill includes $876.6 million (one-time Proposition 98) for any purpose, including deferred maintenance and capital outlay. This is approximately $145 per average daily attendance.

Emergency Repair Program – This bill includes language that any unencumbered funds in the School Facilities Emergency Repair Account revert to the Proposition 98 Reversion Account. AB 99 extends this encumbrance.

Budget Trailer Bills AB 111 and SB 96 (Anticipate Approval at the Time of Posting)

Proposition 39 – The date for local encumbrance of these funds increases from June 30, 2018 to June 30, 2019.

DSA Filing Fee – The Legislature passed budget trailer bill AB 111, which increases Division of the State Architect (DSA) project filing fees for construction or alteration of school buildings. The fee will increase from 0.7% to 1.25% for the first $1 million in construction costs, and from 0.6% to 1.0% for costs in excess of $1 million. If the balance in the Public School Planning, Design, and Construction Review Revolving Fund exceeds six months of expenditures, the fee will automatically decrease.

Department of Industrial Relations – The Legislature passed budget trailer bill SB 96, which makes changes to the Department of Industrial Relations (DIR) prevailing wage monitoring program, including:

Raises the threshold for the program’s applicability from $1,000 to $25,000 for construction projects and $15,000 for maintenance projects.

  • Increases penalties for contractors and subcontractors who fail to register correctly.
  • Creates new penalties for awarding bodies, including school districts, which would be subject to a fine of up to $100 per day, up to $10,000.
  • An awarding body determined to be a “willful violator” with two program violations within 12 months could lose state facility funding for one year.
  • Increases the annual contractor registration fee from $300 to $400 and permits a contractor to register for multiple years at a time.

The budget also includes $805,000 in 2017-18 and $759,000 in 2018-19 for positions to educate awarding bodies about their requirements under the law.

Additional OPSC Staffing and Bond Sales – We thank Senator Bates for her comments on lack of Proposition 51 progress; however, the budget agreement does not include any additional staff for the Office of Public School Construction (OPSC) nor any proposed increase in the January budget proposal for Proposition 51 state school bond sales.

~ CASH Staff

Proposition 39 Update

June 9, 2017

I am pleased to provide this update to CASH members on state legislative actions with regard to the Proposition 39 program.  We are active on two pathways – legislative and through the budget process – for an extension of the program’s encumbrance deadline date so that local education agencies (LEAs) may fully use their allocations knowing what the fifth year of allocation will be. There is also state action on a program extension beyond the five years that California’s voters approved in November 2012.

Legislation – SB 518 (de Leon)

The Leader of the Senate, President Pro Tem Kevin De Leon is the author of legislation to extend the Proposition 39 program and directs any funding remaining in the fund by a date certain to be used for clean energy buses in needy communities with bad air quality as determined by the Air Resources Board.

After the bus allocation of $75 million, another $100 million is to be added for low and no-interest loans to schools under the Energy Conservation and Assistance Act (ECAA).  Funds remaining after the two uses above will be available to K-12 school districts, charters, county offices of education and charter schools by application within four tier levels based on average daily attendance (ADA) data.

The bill also:

  • Sets encumbrance date for the Proposition 39 Program’s five years of funding at 3/31/19 and sweeps unused funding on 3/1/18 for the purposes outlined above.
  • Removes the Proposition 39 Program’s sunset going forward – to be allocated in the annual budget process.

We have held productive conversations about the timelines in SB 518, as we have concerns that the “sweeping” date would leave schools with no additional time beyond the current August 1, 2017 CEC deadline for submission of final energy expenditure plans (EEP).

If they are planning to use their fifth-year allocations, LEAs should be moving forward to submit plans to the CEC by that date (see more info on the EEP deadline below). 

Senate Pro Tem de Leon’s Proposition 39 legislation is progressing and has moved off Suspense and was approved on the floor of the Senate.  SB 518 is now moving to Assembly for assignment to a policy committee.

State Budget and Proposition 39 Program

We testified at and communicated with State Budget Subcommittee hearings in both the Assembly and the Senate on Proposition 39 and both Houses have included a Prop 39 extension in their Budget proposals that are now being discussed in Budget Conference Committee.

The Assembly has recommended an extension to June 30, 2019 – a full year extension – if this were to occur, we believe that the CEC will set their EEP final deadline date more in line with what LEAs originally anticipated for the full years – at or around June 30, 2018.

The Senate’s budget proposal aligns with the SB 518, the Senate Pro Tem’s legislation, and includes the March 1, 2018 sweeping date for use by K-12 schools, clean buses, loans and the extension of the program indefinitely – and the March 31, 2019 encumbrance date.

A CASH letter has been sent to the members of the Legislative Budget Conference Committee asking for the Assembly deadline date and the extension of the program as proposed in Senate.  Stay Tuned.

CEC Advice for Schools

At School Energy Coalition (SEC) Forums held last month, the CEC shared some advice with us about those final EEPs – LEAs should include all school sites that may be potentially considered for projects in your plan – even if you are unsure of the funding that may be available – because the system the agency uses won’t allow amendments to add sites later.

They also shared that there are about one million dollars remaining in CEC’s Bright Schools and technical assistance; low and no-interest loans for energy efficiency projects funded under the ECAA.

CASH/SEC Zero-Net Energy Workshop: June 27 and 29

SEC is pleased to be co-sponsoring the June Workshop with CASH on moving schools to zero-net energy.  The Workshops will be held on June 27th in Sacramento and June 29th in Ontario.  Click here to register online.

We will be sharing information on how to get to ZNE on a school site or district – from the planning and decision-making process, ZNE and CHPS, financing and case studies from schools that are making the move now to generate savings and provide healthy classrooms for teachers and students that improve academic performance, teacher retention along with utility bill savings.

Please contact me with comments or questions on energy, water, or Prop 39!  aferrera@m-w-h.com

~ Anna Ferrera

SAB Takes Action on Upfront Agreement & Beyond Bond Authority Project List

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

CASH Alert: Encouragement to Attend the June 5, 2017 SAB Meeting

May 26, 2017

On Monday, June 5, 2017, the State Allocation Board (SAB) will meet at 4:00 pm in Room 437 of the State Capitol to consider recommendations on the proposed Grant Agreement, True Unfunded List, and Acknowledged List. Click here to see the CASH letter addressing these proposals.

We encourage you to attend the SAB meeting and speak to your specific concerns about the proposals and how they will affect your school district or client district.

More information will be provided during the CASH Monthly Update Meeting also scheduled for Monday, June 5, 2017, at 11:00 am in the Lower Level Conference Room A at 1130 K Street, Sacramento, CA 95814.

We additionally would like to further encourage you to communicate your concerns directly to your State Senators and Assembly Members. The district draft letter found here, may be a resource in doing so.

~ Tom Duffy

CASH Urgent Action Alert: Letters Needed from School District Members

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:

  1. 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
  2. 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:

  1. Limit bond sales;
  2. Reject projects waiting for funding on the “Acknowledged List;” and
  3. 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

May CASH Day & SAB Meeting Rescheduled to June 5

May 15, 2017

The May 24 State Allocation Board meeting has been canceled. The next State Allocation Board meeting is scheduled for Monday, June 5 at 4:00 pm at the State Capitol, Room 437.

The CASH Monthly Update and Annual Conference Planning Committee meetings will also be rescheduled for Monday, June 5.

~ CASH Staff

OPSC Holds Second Stakeholder Meeting on the Front-End Grant Agreement

May 8, 2017

Today, the Office of Public School Construction (OPSC) hosted a stakeholder input session to receive additional feedback on the proposed front-end grant agreement for School Facility Program projects. The grant agreement was initially presented to the State Allocation Board (SAB) for discussion on April 24, 2017. At that time, the SAB did not have enough votes to pass the grant agreement as drafted, and they deferred action until the May SAB meeting.

OPSC staff began today’s stakeholder meeting by stating that concerns related to the audit trailer bill language should be brought to Department of Finance. OPSC staff then outlined items that they have identified for possible amendment prior to the next SAB meeting. Topics included, but were not limited to:

  • Which documents applicants are required to attach
  • Inclusion of a “site description”
  • Whether the definitions section should be limited to items that are unique to the grant agreement
  • Timing of when grant agreements should be executed
  • Laws and regulations with which applicants must comply
  • Impacts to the Priority Funding process
  • Expenditure report due dates and substantial progress
  • Hold harmless/indemnity provision
  • Eligible and ineligible expenditures

The issue of outlining a list of eligible and ineligible expenditures generated the most stakeholder feedback and discussion. Numerous stakeholders were concerned that expenditures on items not explicitly listed on the eligible expenditures list would not be accepted by local auditors. There were concerns that the proposed agreement would reduce the flexibility that districts have under the current grant program structure. There were also concerns voiced on behalf of Financial Hardship districts and county offices of education, which would have difficulty identifying local dollars to fund “ineligible” items such as computers.

OPSC’s goal is to bring an amended agreement to the next SAB meeting on May 24, 2017. They anticipate that the updated draft grant agreement will be available approximately one week prior to the hearing date and that the SAB agenda item will identify stakeholder feedback similar to the April agenda. OPSC anticipates that a larger regulations package will need to be brought to the SAB after the Legislature approves, and the Governor signs, the audit trailer bill language.

If you have feedback that you would like to provide, OPSC is still accepting comments on the grant agreement and requested that comments be submitted within the next few days. The current version of the grant agreement under discussion may be found here.

~ Rebekah Cearley