Inactive school districts face losing millions in state support for construction

Time is running short for a number of California school districts with approval to build or upgrade facilities but which have yet to claim the millions set aside for their projects under the state's school construction program.

Meanwhile, districts with facilities deemed unsafe in an earthquake are being urged to take advantage of recently expanded regulations under the School Facility Program to access special funds set aside by voters for seismic repair.

The State Allocation Board, which helps oversee public school construction, is scheduled to meet today to review the results of regulatory changes it made affecting its priority funding process. Some 22 districts in line to receive $241 million in matching state funds to build more than 100 projects are at risk of losing their award under new rules adopted earlier this spring.

Districts with approved projects as well as a monetary allocation that skip two consecutive priority funding rounds are expected to be removed from the funding list, allowing the allocation board to consider other districts with shovel-ready' projects awaiting matching funds.

Bond authority for school construction has all but been exhausted, and state and school officials have been lobbying the Legislature to place a new facilities measure on the 2014 ballot. A bill that would authorize such a measure has been introduced by Assemblywoman Joan Buchanan, a member of the SAB, but won't be taken up again until after the new year.

In the meantime, the SAB and OPSC staff - in an effort to get as many remaining dollars to schools ready to build - reworked their Priority Funding Process rules to state that the second time a district fails to take advantage of a filing period, the funding for the project will be rescinded and the district must reapply for a funding allocation.

According to OPSC executive director Lisa Silverman's report to the SAB, a total of 248 school projects reserving $755.4 million in School Facility Program bond authority were eligible to request a cash allocation in the department's last priority funding round, which ended June 6.

Twenty-two districts with 104 projects and approval for $241 million in state funds did not submit paperwork necessary to receive their money.

Under the new rules, districts are given two opportunities to participate in the priority funding process, meaning these districts must apply in the next funding round (in early 2014) or be removed from the list to make room for a project that is construction ready.

Considering it can take years for a project to reach the SAB's approved-but-not-yet-funded list, this could be a major setback. All districts on the OPSC's unfunded approval list' have received a monetary allocation for their projects that is reserved until the funds are actually requested. Many districts remain on the list and, for a variety of reasons, do not file the paperwork necessary to receive their grant, thus stalling other projects that could be funded and built.

Those projects are moving through the approval process and could come from a second list created to track applications that have come in since new construction and modernization bond authority has expired. As of Nov. 1, 2012, the applications received beyond bond authority list" has 15 districts with 21 new construction projects qualified for nearly $97 million in state funding. Modernization projects on the same list number 47 and qualify for just over $59 million in SFP money.

The allocation board will also receive an update on its seismic mitigation program, recently updated to allow for greater district participation.

The seismic mitigation program, established in 2006 with $199.5 million from Proposition 1D, provides grants to help districts rehabilitate or replace school facilities deemed to be most vulnerable during an earthquake. A school district is eligible for the funding to rehabilitate, replace or construct new classrooms and related facilities if it can demonstrate to the SAB that the health and safety of the pupils are at risk.

The first step toward qualifying for this funding is for a district to determine if a building meets the eligibility criteria established by the Division of State Architect. According to the staff report on this item, as of June 12, 210 buildings have been identified as eligible for the program.

Some 20 projects are at various stages in the program; once they are processed, $156 million in bond authority will remain.

In order to increase participation from districts in applying for seismic mitigation funding, SAB members directed staff to develop amendments to the regulations to broaden the eligibility criteria for the program. In 2011 the Board took action to adopt regulatory amendments to:

- Expand the list of eligible building types from eight to 14.

- Delete an eligibility criterion that required a "short period spectral acceleration" (ground shaking) of at least 1.68 based on 2003 U.S. Geological Survey National Seismic Hazard Maps.

- Specify that the DSA must review and approve structural engineer reports that conform to the DSA guidelines under the authority of Education Code Section 17310.

- Clarify that eligible structures must have "structural deficiencies that pose an unacceptable risk of injury to its occupants in a seismic event."

- Require that "unacceptable risk of injury" from faulting, liquefaction, or landslide must be documented by an engineering geologist's hazard report in accordance with the California Building Code and concurrence of the California Geological Survey.

To view the SAB agenda, visit http://www.dgs.ca.gov/opsc/Home.aspx and click on the blue Meeting Information' bar

To see the list of districts/projects who did not participate in the first of two available priority funding rounds, go to the same link above and click the blue Priority Funding Information' bar. Then look for the Non-Participation Occurrence List (as of June 7, 2013) link about half-way down the page.