BILL ANALYSIS                                                                                                                                                                                                    




                   Senate Appropriations Committee Fiscal Summary
                           Senator Christine Kehoe, Chair

                                           1380 (Hancock)
          
          Hearing Date:  05/17/2010           Amended: 04/28/2010
          Consultant:  Dan Troy           Policy Vote: ED 7-0
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          ____
          BILL SUMMARY:   SB 1380 would make the following changes to the  
          Career Technical Education Facilities Program (CTEFP):

                  Require school facilities constructed or modernized  
               with funds from the CTEFP to be used for career technical  
               education (CTE) purposes for a minimum of 25 years.  

                 Require CTE teachers and members of the local CTE  
               advisory committee to be included in the design and  
               planning process of a CTEFP grant application.
           
                 Require qualifying equipment purchased with CTEFP funds  
               to have a life expectancy of up to 10 years, except that up  
               to 10 percent of the funds could be used for items with a  
               life expectancy of 5 years.

                 Require the Department of Education to report on the  
               rate of project completion and to make recommendations to  
               facilitate the timely use of state bonds.
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          ____
                            Fiscal Impact (in thousands)

           Major Provisions         2010-11     2011-12       2012-13     Fund
                                                                  
          25-year minimum use      Reduction in bond pressure   Bond*

          Reporting                $50 to $75, one-time             Bond*

          *Proposition 1D 
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          ____

          STAFF COMMENTS: 
          
          In November of 2006, the voters approved Proposition 1D which  
          approved $10.4 billion in general obligation bonds for statewide  










          educational facilities, including both new construction and  
          modernization.  Of that amount, $500 million was dedicated  
          toward career technical education facilities and equipment  
          purchases.  Approximately $91 million of this amount is still  
          available.  The deadline for applications was March 31, 2010,  
          and the Office of Public School Instruction anticipates that all  
          of these funds will be exhausted in this funding cycle.  Grants  
          are capped at $3 million for new construction and $1.5 million  
          for modernization projects.  Under current law, equipment  
          purchases are limited to items with a 10-year lifespan.  The  
          primary intent of the bill is to ensure that facilities that  
          benefit from CTEFP funding are utilized for CTE purposes for an  
          extended period of time.
          Page 2
          SB 1380 (Hancock)

          The Department of Education estimates new workload costs of  
          between $50,000 and $75,000 to complete the required report.   
          These costs would be within the bond's 5 percent allowance for  
          state administration costs.  While the bill's provision to allow  
          the purchase of a limited amount of equipment with a life  
          expectancy of 5 years would increase the number of eligible  
          items (e.g., computer equipment), the bill's limitation on  
          district discretion for the use of facilities for a minimum of  
          25 years may serve to discourage district participation in the  
          program, and actually serve to reduce pressure on the bonds.