BILL NUMBER: AB 491 CHAPTERED BILL TEXT CHAPTER 710 FILED WITH SECRETARY OF STATE OCTOBER 7, 2005 APPROVED BY GOVERNOR OCTOBER 7, 2005 PASSED THE ASSEMBLY SEPTEMBER 8, 2005 PASSED THE SENATE SEPTEMBER 7, 2005 AMENDED IN SENATE SEPTEMBER 2, 2005 AMENDED IN SENATE AUGUST 31, 2005 AMENDED IN SENATE JULY 11, 2005 AMENDED IN SENATE JUNE 15, 2005 INTRODUCED BY Assembly Member Goldberg FEBRUARY 16, 2005 An act to amend Sections 17071.75, 17078.27, and 41329.55 of the Education Code, relating to school facilities, and making an appropriation therefor. LEGISLATIVE COUNSEL'S DIGEST AB 491, Goldberg Public schools. (1) Existing law, the Leroy F. Greene School Facilities Act of 1998, requires the State Allocation Board to allocate to applicant school districts, prescribed per-unhoused-pupil state funding for construction and modernization of school facilities, including hardship funding, and supplemental funding for site development and acquisition. Existing law provides that the ongoing eligibility of a school district for new construction funding is to be determined by making specified calculations, including a calculation using enrollment projections, as provided. This bill would, in addition, authorize additional eligibility for a school district that has 2 or more schoolsites with a pupil population density that is greater than 115 pupils per acre in kindergarten and grades 1 to 6, inclusive, or a schoolsite pupil population density greater than 90 pupils per acre in grades 7 to 12, inclusive, as determined by the Superintendent of Public Instruction using enrollment data from the California Basic Educational Data System for the 2004-05 school year, for funding for projects that will relieve overcrowded conditions, as specified. The existing act also establishes the Critically Overcrowded School Facilities Program to make apportionments to eligible applicants with critically overcrowded schools in advance of full compliance with all the application requirements otherwise required for apportionment. Existing law provides alternative methods for an applicant in the program to calculate enrollment for purposes of determining eligibility for a final apportionment for a project funded from the Kindergarten-University Public Education Facilities Bond Act of 2002. This bill would also provide alternative methods for an applicant in the program to calculate enrollment for purposes of determining eligibility for a final apportionment for a project funded from the Kindergarten-University Public Education Facilities Bond Act of 2004. (2) Existing law requires the California Infrastructure and Economic Development Bank to give notice to the Controller and a school district of certain lease financing provided to the school district from the proceeds of bonds, including a rent schedule, and requires the Controller to make apportionments to the bond trustee on the dates shown on the schedule. This bill would require the California Infrastructure and Economic Development Bank to amend or supplement that schedule in specified circumstances. (3) Existing law requires a county superintendent of schools to annually visit and examine each school in his or her county. Existing law specifies that the objective of these visits is to determine the status of certain circumstances, including, but not limited to, the condition of a school facility that poses an emergency or urgent threat to the health and safety of pupils or staff, and provides specified funds for this purpose. This bill would make an appropriation by reallocating savings realized from amounts appropriated for these visits, as specified, upon a determination by the State Department of Education, the Secretary for Education, and the Department of Finance that a county office of education has incurred extraordinary costs, with certain requirements. Appropriation: yes. THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS: SECTION 1. Section 17071.75 of the Education Code is amended to read: 17071.75. After a one-time initial report of existing school building capacity has been completed, the ongoing eligibility of a school district for new construction funding shall be determined by making all of the following calculations: (a) A school district that applies to receive funding for new construction shall use the following methods to determine projected enrollment: (1) A school district that has two or more schoolsites each with a pupil population density that is greater than 115 pupils per acre in kindergarten and grades 1 to 6, inclusive, or a schoolsite pupil population density that is greater than 90 pupils per acre in grades 7 to 12, inclusive, as determined by the Superintendent using enrollment data from the California Basic Educational Data System for the 2004-05 school year, may submit an application for funding for projects that will relieve overcrowded conditions. That school district may also submit an alternative enrollment projection for the fifth year beyond the fiscal year in which the application is made using a methodology other than the cohort survival method as defined by the board pursuant to paragraph (2), to be reviewed by the Demographic Research Unit of the Department of Finance, in consultation with the department and the Office of Public School Construction. If the Office of Public School Construction and the Demographic Research Unit of the Department of Finance jointly determine that the alternative enrollment projection provides a reasonable estimate of expected enrollment demand, a recommendation shall be forwarded to the board to approve or disapprove the application, in accordance with all of the following: (A) Total funding for new construction projects using this method shall be limited to five hundred million ($500,000,000), from the Kindergarten-University Public Education Facilities Bond Act of 2004. (B) The eligibility amount for proposed projects that relieve overcrowding is the difference between the alternative enrollment projection method for the year the application is submitted and the cohort survival method, as defined by paragraph (2), for the same year, adjusted by the existing pupil capacity in excess of the projected enrollment according to the cohort survival projection method. (C) The Office of Public School Construction shall determine whether each proposed project will relieve overcrowding, including, but not limited to, the elimination of the use of Concept 6 calendars, four track year-round calendars, or bussing in excess of 40 minutes, and recommend approval to the board. The number of unhoused pupil grants requested in the application for funding from the eligibility determined pursuant to this paragraph shall be limited to the number of seats necessary to relieve overcrowding, including, but not limited to, the elimination of the use of Concept 6 calendars, four track year-round calendars, or bussing in excess of 40 minutes, less the number of unhoused pupil grants attributed to that school as a source school in an approved application pursuant to Section 17078.24. (D) A school district shall use the same alternative enrollment projection methodology for all applications submitted pursuant to this paragraph and shall calculate those projections in accordance with the same district-wide or high school attendance area used for the enrollment projection made pursuant to paragraph (2). (2) A school district shall calculate enrollment projections for the fifth year beyond the fiscal year in which the application is made. Projected enrollment shall be determined by utilizing the cohort survival enrollment projection system, as defined and approved by the board. The board may supplement the cohort survival enrollment projection by the number of unhoused pupils that are anticipated as a result of dwelling units proposed pursuant to approved and valid tentative subdivision maps. (b) Add the number of pupils that may be adequately housed in the existing school building capacity of the applicant school district as determined pursuant to Article 2 (commencing with Section 17071.10) to the number of pupils for whom facilities were provided from any state or local funding source after the existing school building capacity was determined pursuant to Article 2 (commencing with Section 17071.10). For this purpose, the total number of pupils for whom facilities were provided shall be determined using the pupil loading formula set forth in Section 17071.25. (c) Subtract the number of pupils pursuant to subdivision (b) from the number of pupils determined pursuant to paragraph (2) of subdivision (a). (d) The calculations required to establish eligibility under this article shall result in a distinction between the number of existing unhoused pupils and the number of projected unhoused pupils. (e) Apply the increase or decrease resulting from the difference between the most recent report made pursuant to Section 42268, and the report used in determining the baseline capacity of the school district pursuant to subdivision (a) of Section 17071.25. (f) For a school district with an enrollment of 2,500, or less, an adjustment in enrollment projections shall not result in a loss of ongoing eligibility to that school district for a period of three years from the date of the approval of eligibility by the board. SEC. 2. Section 17078.27 of the Education Code is amended to read: 17078.27. (a) Upon completion of the preliminary process authorized pursuant to this article, and when a preliminary applicant has complied with the conditions set forth in this chapter for a final apportionment, including, but not limited to, Section 17070.50, the board shall adjust the preliminary apportionment as set forth in subdivision (b) and as necessary to reflect the current eligible grant amounts for final apportionments pursuant to this chapter consistent with regulations adopted pursuant to subdivision (c) of Section 17078.24. The board shall then convert the adjusted preliminary apportionment to a final apportionment and proceed to completion of the project in the same manner as for any project funded under provisions of this chapter other than this article. (b) The board may adjust for cost increases only if uncommitted funds reserved expressly for the purposes of this article remain available for those purposes. (c) For purposes of calculating enrollment to determine eligibility for a final apportionment for a project funded from the Kindergarten-University Public Education Facilities Bond Act of 2002, as set forth in Part 68.1 (commencing with Section 100600), and the Kindergarten-University Public Education Facilities Bond Act of 2004, as set forth in Part 68.2 (commencing with Section 100800), an applicant may use one of the following methods as an alternative to the method provided in subdivision (a) of Section 17071.75: (1) The current year enrollment as recorded on the cohort survival enrollment projection system described in subdivision (a) of Section 17071.75, for the year in which the application for the final apportionment is submitted. (2) (A) If eligibility for the preliminary apportionment was calculated pursuant to Section 17071.76, the current year or five-year projected enrollment as recorded on a cohort survival enrollment projection system, developed and approved by the board, that uses pupil residence in the high school attendance area, for the year in which the application for the final apportionment is submitted. (B) A school district that uses the method described in this paragraph to calculate enrollment shall also use this method to calculate enrollment for all applications it submits for final apportionments for projects for which preliminary apportionments were approved from the same bond authorization. SEC. 3. Section 41329.55 of the Education Code is amended to read: 41329.55. (a) Simultaneous with the execution of the lease financing authorized pursuant to Section 41329.52, the bank shall provide to the Controller and the school district a notification of its lease financing. The notice shall include a schedule of rent payments to become due to the bank from the school district and the name of the bond trustee. The Controller shall make the apportionment to the bond trustee of those amounts on the dates shown on the schedule. The bank may further authorize the apportionments to be used to pay or reimburse the provider of any credit enhancement of bonds and other ongoing or periodic ancillary costs of the bond financing issued by the bank in connection with this article. If the amount of rent payments vary from the schedule as a result of variable interest rates on the bonds, early redemptions, or changes in expenses, the bank shall amend or supplement the schedule accordingly. The Controller shall make the apportionment only from moneys in Section A of the State School Fund designated for apportionment to the district and any apportionment authorized pursuant to this subdivision shall constitute a lien senior to any other apportionment or payment of State School Fund moneys to or for that district not made pursuant to this subdivision. (b) The amount apportioned for a school district pursuant to this section is an allocation to the district for purposes of subdivision (b) of Section 8 of Article XVI of the California Constitution. For purposes of computing revenue limits pursuant to Section 42238 for any school district, the revenue limit for any fiscal year in which funds are apportioned for the district pursuant to this section shall include any amounts apportioned by the Controller pursuant to subdivision (a) as well as Section 41329.57. (c) No party, including the school district or any of its creditors, shall have any claim to the money apportioned or to be apportioned to the bond trustee by the Controller pursuant to this section. SEC. 4. (a) Notwithstanding any other law, the State Department of Education may allocate any savings available as of September 1, 2005, from the funds appropriated in paragraph (2) of subdivision (a) of Section 23 of Chapter 900 of the Statutes of 2004, to any county office of education for extraordinary costs related to the visits required in subparagraph (E) of paragraph (2) of subdivision (c) of Section 1240 of the Education Code. (b) The State Department of Education shall only allocate savings pursuant to subdivision (a) upon a determination by the State Department of Education, the Secretary for Education, and the Department of Finance that a county office of education has incurred extraordinary costs in accordance with subdivision (a) and of the amount of those costs incurred. (c) To the extent that the amount allocated pursuant to subdivision (a) is insufficient to cover those costs, these funds shall be prorated to county offices of education based upon the total costs agreed upon by the State Department of Education, the Secretary for Education, and the Department of Finance.