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SAB's Implementation Committee Discusses Delayed Funds for Approved School Projects The State Allocation Board’s Implementation Committee met on March 12 in Sacramento. The primary issue discussed was the development of recommendations to the SAB for establishing a priority system for fund releases when bond funds become available. On December 17, 2008, the Pooled Money Investment Board (PMIB) ceased the sale of bonds and the disbursement of money from authorized State bonds. At that time 849 projects had been approved for apportionment in the School Facilities Program (SFP). A number of districts had moved ahead with projects under the assumption that the State money would be released as soon as they submitted their SAB 50-04 Fund Release. Yet no funds are anticipated to be released. Rumors abound as to the timing of the sale of bonds and the fund releases. Two weeks ago, OPSC staff indicated that it may be as long as a year before any funds would be available. But on March 12, a legislative staff member indicated that the PMIB will authorize the sale of $3 billion in bonds in early April. When funding becomes available, it is unlikely that all the bonds will be sold at the same time. The SAB therefore asked for some guidelines on which projects should be funded first. It should be noted that all the projects related to this discussion have been apportioned by the SAB, and are within the funding limits of the available bond capacity. These projects will eventually be funded. The discussion concerns the timing of that funding. Regardless of the timing, there are districts that have committed funds in good faith for projects under the assumption that the funds would be released when they were needed. Those districts now find themselves in the position of having contractual commitments without state funding to back those commitments. The focus of the discussion centered on those districts at greatest risk. Projects that had apportionments and had started construction prior to the December 17, 2008 announcement were determined to have the highest priority. Districts at risk of work stoppage on a construction project were also considered to be high priority. Finally, districts at risk of becoming insolvent were considered a priority. Above all, the Committee wanted the date order system to remain in place. If districts were at risk in one of the categories they may be funded ahead of other projects with less risk. There was an extended discussion on the specific criteria to be used for each of the priorities. These issues will be presented to the SAB at the March 25 meeting for discussion. The Committee also reviewed minor proposed changes to the Multitrack Year Round Education (MTYRE) grant program. These changes only affect five districts in the state that have continued to receive MTYRE operational grant money in exchange for reduced eligibility. Those changes will be taken to the March 25 SAB for approval. Editor's Note: Dennis L. Dunston is the Director of District Support Services with the educational consulting firm Total School Solutions. |
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