BILL ANALYSIS �
AB 2164
Page 1
Date of Hearing: April 18, 2012
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Felipe Fuentes, Chair
AB 2164 (Dickinson) - As Amended: March 29, 2012
Policy Committee: Higher
EducationVote:9-0
Urgency: No State Mandated Local Program:
No Reimbursable:
SUMMARY
This bill creates an additional exception to a provision
prohibiting funds appropriated for a California Community
College (CCC) capital outlay project from being expended until
the Department of Finance (DOF) and the State Public Works Board
(SPWB) have approved preliminary plans for that project.
Specifically, this bill allows a community college district to
be reimbursed, pursuant to an appropriation, for district funds
previously expended for preliminary plans, working drawings
and/or construction for a capital outlay project if the final
project proposal has been approved by the CCC Board of Governors
(BOG) and the project has been approved by the DOF and the SPWB.
FISCAL EFFECT
No direct fiscal impact. The bill could result in a reallocation
of state funding among CCC capital outlay projects, but
longstanding practice generally has been to consider and to
appropriate funds in the annual budget only for those CCC
projects previously approved by the BOG and proposed by the
governor.
COMMENTS
1)Purpose . The author notes that a statewide education bond has
not been authorized by the voters since 2006, and state bond
funds for CCC facilities have either been spent or are
otherwise committed to projects currently in process. Over 80
CCC projects have been approved by the BOG, but are on hold
pending a new state bond. Due to the statutory prohibition
AB 2164
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against projects started with local funds being reimbursed by
the state, a CCC district may be reluctant to start a project
even though it has the ability to do so. This bill authorizes
CCC districts to begin projects with local funds and still be
eligible for reimbursement, through an appropriation by the
Legislature of state funds, provided the project has been
approved by the BOG, DOF, and the SPWB.
In support, several CCC districts argue that this proposal
will enable them to fast-track projects critical to their
educational and job training mission, will help jump start
their local economies, and will save the state funds by
locking in construction contracts sooner amidst the current,
favorable bid climate.
2)Recommended Amendment . The exception provided in this bill
could put the Legislature on the back end of reviewing,
approving and appropriating funds for CCC capital outlay
projects in which districts seek state reimbursement. The
Legislature's assessment as to whether a project is even
meritorious of state funding and its scope and cost is
appropriate would come after a project's design, or even
construction, is already underway. (The Legislature could, of
course, deny all or part of a reimbursement request based on
its review.)
Given the uncertainty over future state bond funding, however,
and the current availability of locally-approved bonds in some
districts and the apparent benefits of getting projects
started earlier, it may be reasonable to provide the funding
exception propose in AB 2164, but for a limited time period
initially. Staff recommends recasting the exception as shown
below, which: (a) provides this new authority for five years,
until January 1, 2018; (b) ensures that reimbursement is
considered through the budget process, similar to all other
CCC capital outlay projects; (c) and seeks to clarify the
author's intent.
(D) (i) Amounts incurred by a community college district,
after the date of final project proposal approval by the
Board of Governors of the California Community Colleges.
Amounts incurred pursuant to this subparagraph may be
reimbursed pursuant to approval of preliminary plans by the
Department of Finance and the State Public Works Board and
an appropriation by the Legislature, in the annual budget
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bill or related legislation, of funds for one or more of
the following project phases: preliminary plans; working
drawings; construction; equipment. Any amounts to be
reimbursed shall be subject to the Legislature's
determination of the appropriate scope and cost of the
project.
(ii) This subparagraph shall be inoperative on January 1,
2018.
Analysis Prepared by : Chuck Nicol / APPR. / (916) 319-2081