BILL ANALYSIS
------------------------------------------------------------
|SENATE RULES COMMITTEE | AB 264|
|Office of Senate Floor Analyses | |
|1020 N Street, Suite 524 | |
|(916) 445-6614 Fax: (916) | |
|327-4478 | |
------------------------------------------------------------
THIRD READING
Bill No: AB 264
Author: Mullin (D)
Amended: 9/8/03 in Senate
Vote: 21
SENATE EDUCATION COMMITTEE : 9-0, 7/10/03
AYES: Vasconcellos, McPherson, Alarcon, Denham, Karnette,
Knight, Scott, Sher, Vincent
NO VOTE RECORDED: Alpert, Chesbro, Romero, Speier
SENATE APPROPRIATIONS COMMITTEE : 11-1, 8/29/03
AYES: Alpert, Battin, Aanestad, Ashburn, Bowen, Burton,
Escutia, Johnson, Karnette, Machado, Murray
NOES: Poochigian
NO VOTE RECORDED: Speier
ASSEMBLY FLOOR : 77-0, 6/4/03 - See last page for vote
SUBJECT : Surplus school property: use of proceeds
SOURCE : Author
DIGEST : This bill allows a school district that meets
specified criteria to use 25 percent of the proceeds from
the sale of surplus school property for one-time
expenditures without losing eligibility for state
facilities funding.
ANALYSIS : Current law requires that school districts
that receive state funding for construction and
modernization of school facilities establish a restricted
CONTINUED
AB 264
Page
2
account within the school district's general fund and to
deposit an amount equal to three percent of the school
district's general fund into the fund for maintenance of
school facilities.
Current law also requires school districts to use the funds
derived from the sale of surplus property for capital
outlay or maintenance of school district property, and
requires school districts to match state funding for
deferred maintenance by setting aside one local dollar for
every state dollar allocated to the district for deferred
maintenance.
This bill:
1. Authorizes a school district that meets the below
criteria to deposit up to 25 percent of proceeds from
the sale of surplus school property, as defined, to the
district's general fund and use those funds for any
one-time expenditure, except for salaries and benefits.
To be eligible, a district must:
A. Have enrollment of fewer than 11,000 pupils.
B. Have experienced declining enrollment for each
school year from 1999-2000 to 2002-03.
C. Use proceeds from the sale of property that
occurred between July 1, 1997, and June 30, 2000.
1. Provides that use of sale proceeds as described above
does not disqualify a school district from participating
in the state school building program that distributes
state bond funding.
2. Defines "sale" to include lease of surplus property with
an option to purchase.
3. Provides that the State Allocation Board shall review,
and may disapprove, the determination that property is
surplus property if any of the proceeds from the sale
are used for purposes other than capital outlay or
maintenance costs.
AB 264
Page
3
4. Provides that the bill self-repeals on January 1, 2005.
5. Requires the State Allocation Board to reduce
apportionments for hardship assistance for five years
and by an amount equal to the proceeds from the sale of
surplus property used for the one-time expenditures of
school districts.
Related legislation
SB 588 (Johnson) would allow a school district to deposit
the funds derived from the sale of surplus property in the
general fund of the district for any general fund purpose.
SB 39 (Perata) allows the Oakland Unified School District,
for a limited time to use the proceeds of sale of property
owned by the district to reduce or retire the emergency
loan that was also provided in that bill. SB 39 has been
signed.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
To the extent that a school district meets the specified
criteria and can still maintain eligibility for new
construction and modernization funding, the bill could
result in unknown, potentially multi-million dollar cost
pressure on school facilities bonds since current law
generally requires surplus property proceeds to be used for
school capital outlay.
SUPPORT : (Verified 9/8/03)
California Teachers Association
South San Francisco Unified School District
Numerous individual letters
ASSEMBLY FLOOR :
AYES: Aghazarian, Bates, Benoit, Berg, Bermudez, Bogh,
Calderon, Campbell, Canciamilla, Chan, Chavez, Chu, Cohn,
Corbett, Correa, Cox, Diaz, Dutra, Dutton, Dymally,
Firebaugh, Frommer, Garcia, Goldberg, Hancock, Harman,
Haynes, Jerome Horton, Shirley Horton, Houston, Jackson,
AB 264
Page
4
Keene, Kehoe, Koretz, La Malfa, La Suer, Laird, Leno,
Leslie, Levine, Lieber, Liu, Longville, Lowenthal,
Maddox, Maldonado, Matthews, Maze, McCarthy, Montanez,
Mountjoy, Mullin, Nakanishi, Nakano, Nation, Negrete
McLeod, Nunez, Oropeza, Pacheco, Parra, Pavley, Plescia,
Reyes, Richman, Ridley-Thomas, Runner, Salinas,
Samuelian, Simitian, Steinberg, Strickland, Vargas,
Wiggins, Wolk, Wyland, Yee, Wesson
NC:sl 9/8/03 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
**** END ****