BILL ANALYSIS �
Senate Appropriations Committee Fiscal Summary
Senator Kevin de Le�n, Chair
SB 1157 (Hancock) - School Facilities Funding
Amended: May 7, 2014 Policy Vote: Education 8-0
Urgency: No Mandate: No
Hearing Date: May 19, 2014 Consultant: Jacqueline
Wong-Hernandez
This bill meets the criteria for referral to the Suspense File.
Bill Summary: SB 1157 prohibits the transfer of funds from the
Seismic Mitigation Program for any other purpose, as specified,
and requires that any High Performance Schools (HPS) funds
transferred as the result of a Budget action in 2014 be used
only for projects that meet the original intent of the funds.
Fiscal Impact:
Cost pressure: This bill does not result in direct state
costs. By limiting the state's flexibility to use its
existing school facilities resources, however, it creates
cost pressure to provide more facilities funding. See staff
comments.
Background: Existing law establishes the School Facility Program
(SFP) under which the state provides general obligation bond
funding for various school construction projects. AB 127 (Nunez
and Perata), the Kindergarten-University Public Education
Facilities Bond Act of 2006, authorized Proposition 1D a
statewide general obligation bond proposal for $10.4 billion.
Proposition 1D, approved by the voters in November 2006,
provided $7.3 billion for K-12 education facilities and
allocated specified amounts from the sale of these bonds for
modernization, new construction, charter schools, Career
Technical Education Facilities, joint use projects, new
construction on severely overcrowded schoolsites, and high
performance incentive grants (HPIGs) to promote energy efficient
design and materials. In addition, portions of the amounts
allocated for new construction and modernization were authorized
for purposes of funding smaller learning communities and small
high schools and for seismic mitigation.
(Education Code � 17078.70-17078.72)
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Current law authorizes the Legislature to amend Proposition 1D
to adjust the amounts to be expended for each program within the
SFP, but prohibits the increase of decrease of the total amount
of funding to be expended under the Proposition. (EC �101012)
In 2002, Department of General Services (DGS) released the
report "Seismic Safety Inventory of California Schools." The
report identified 7,537 buildings that were of 12 construction
types, collectively known as Category 2 construction that would
not perform well in an earthquake. Proposition 1D, as part of
new construction funding, provided up to $199.5 million for
seismic mitigation of school facilities that are the most
vulnerable Category 2 buildings and that pose an "unacceptable
risk of injury" to students during a seismic event.
Proposition 1D also provided $100 million for HPIGs to promote
the use of designs and materials in school facility new
construction and modernization projects that include the
attributes of high performance schools, pursuant to regulations
adopted by the State Allocation Board. (EC �101012)
The Governor's 2014-15 Budget proposes the transfer of bond
authority from 4 specialized school facility programs to the new
construction and modernization programs. These include the
Overcrowding Relief Grant, Seismic Mitigation, Career Technical
Education, and HPIG programs. Under the proposal, half of any
remaining bond authority on June 30, 2014 would be equally
redirected to new construction and modernization. Any funds that
revert to these programs from rescinded projects or project
savings in the future would also be equally redirected.
Proposed Law: This bill prohibits the transfer of funds
identified for the repair or replacement of seismically
vulnerable school facilities for use for any other new
construction purpose.
This bill also provides, in the event of a Budget Act of 2014
action to transfer funds remaining in the HPIG fund for new
construction or modernization projects, that the funds be used
for projects that: a) promote the use of designs and materials
in these projects that include the attributes of
high-performance schools; and, b) include high performance
attributes that promote energy and water efficiency, maximize
the use of natural lighting, improve indoor air quality, utilize
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recycled materials and materials that emit a minimum of toxic
substances, and employ acoustics that are conducive to teaching
and learning.
Staff Comments: Currently, within the SFP, the New Construction
Fund and Modernization Fund are the most oversubscribed
accounts. There are more outstanding requests from local
educational agencies for new construction and modernization than
there are bond funds remaining. The Legislature has the
authority to move school bond funds among "programs" (accounts),
as long as they continue to be spent on the purpose for which
the bond was passed (school facilities). The Governor's Budget
proposes such a shift -- moving over $200 million from other
programs to new school construction and modernization projects.
This bill prohibits using school bond funds originally earmarked
for seismic work and high performance materials for any other
purpose, and requires that school facility bond funds originally
earmarked for charter schools, career technical education, and
overcrowded schoolsite relief be retained for their original
purpose until projects eligible for those funds have an
opportunity to apply for them. Preventing the shifting of
existing funds to new school construction and modernization
increases cost pressure for the state to provide additional
funds for those purposes, which would most likely be a new
school facilities bond.