ENROLLED
H. B. 4601
(By Delegates Mezzatesta, Williams, Tabb, Renner,
Swartzmiller, Kuhn and HartmanSPONSOR)
[Passed March 13, 2004; in effect from passage.]
AN ACT to amend and reenact §18-9A-7 of the code of West Virginia,
1931, as amended; and to amend and reenact §18-9D-2, §18-9D-6,
§18-9D-8, §18-9D-15 and §18-9D-16 of said code, all relating
to public education; suspending basic foundation allocation
for bus replacement and providing allocation for academic
trips for one school year; school building authority;
redefining certain terms; correcting references; allowing
expenditure of certain moneys for vocational programs at
comprehensive high schools and vocational schools cooperating
with community and technical college programs; encouraging
cooperation relating to vocational technical facilities;
authorizing appropriation of up to certain amount of school
construction funds for budget purposes for next school year
only; providing that excess lottery revenues not be
transferred to school construction fund for the next school
year only, with funds made available for legislative
appropriation
; project submission and evaluation; requiring facilities plan as condition of receiving funds; providing
for certain guidelines and procedures by authority for plans,
plan modifications and evaluating projects; clarifying that
certain revenues can only be expended on projects authorized
in accordance with the guidelines and procedures section; and
providing for certified list of projects to joint committee
.
Be it enacted by the Legislature of West Virginia:
That §18-9A-7 of the code of West Virginia, 1931, as amended,
be amended and reenacted; and that §18-9D-2, §18-9D-6, §18-9D-8,
§18-9D-15 and §18-9D-16 of said code be amended and reenacted, all
to read as follows:
ARTICLE 9A. PUBLIC SCHOOL SUPPORT.
§18-9A-7. Foundation allowance for transportation cost.
The allowance in the foundation school program for each county
for transportation shall be the sum of the following computations:
(1) Eighty-five percent of the transportation cost within each
high-density county and ninety percent of the transportation cost
within each low-density county for maintenance, operation and
related costs, exclusive of all salaries: Provided, That for any
county that uses an alternative fuel such as compressed natural gas
or other acceptable alternative fuel for the operation of all or
any portion of its school bus system, the allowance in the
foundation school program for the county for that portion of its
school bus system shall be ninety-five percent of the
transportation cost for maintenance, operation and related costs,
exclusive of all salaries, incurred by the use of the alternatively fueled school buses: Provided, however, That any county using an
alternative fuel and qualifying for the additional allowance shall
submit a plan regarding the intended future use of alternatively
fueled school buses;
(2) The total cost, within each county, of insurance premiums
on buses, buildings and equipment used in transportation:
Provided, That the premiums were procured through competitive
bidding;
(3) An amount equal to eight and one-third percent of the
current replacement value of the bus fleet within each county as
determined by the state board. The amount shall only be used for
the replacement of buses. Buses purchased after the first day of
July, one thousand nine hundred ninety-nine, that are driven one
hundred eighty thousand miles, regardless of year model, will be
subject to the replacement value of eight and one-third percent as
determined by the state board: Provided, That for the school year
beginning on the first day of July, two thousand four, only, the
allowance in the foundation school program for each county for
transportation shall not include an amount for the replacement of
buses. In addition, in any school year in which its net enrollment
increases when compared to the net enrollment the year immediately
preceding, a school district may apply to the state superintendent
for funding for an additional bus. The state superintendent shall
make a decision regarding each application based upon an analysis
of the individual school district's net enrollment history and
transportation needs: Provided, however, That the superintendent shall not consider any application which fails to document that the
county has applied for federal funding for additional buses. If
the state superintendent finds that a need exists, a request for
funding shall be included in the budget request submitted by the
state board for the upcoming fiscal year;
(4) Eighty-five percent of the cost of contracted
transportation services and public utility transportation within
each high-density county and ninety percent of the cost of
contracted transportation services and public utility
transportation within each low-density county;
(5) Aid in lieu of transportation equal to the state average
amount per pupil for each pupil receiving the aid within each
county; and
(6) Ninety-five percent of the transportation cost for
maintenance, operation and related costs, exclusive of all
salaries, for transporting students to and from classes at a
multicounty vocational center.
The total state share for this purpose shall be the sum of the
county shares: Provided, That no county shall receive an allowance
which is greater than one-third above the computed state average
allowance per transportation mile multiplied by the total
transportation mileage in the county: Provided, however, That one
half of one percent of the transportation allowance distributed to
each county shall be for the purpose of trips related to academic
classroom curriculum and not related to any extracurricular
activity: Provided further, That for the school year beginning on the first day of July, two thousand four, only the transportation
allowance of each county shall include an allocation for the
purpose of trips related to academic classroom curriculum and not
related to any extracurricular activity. The allocation shall
equal the amount distributed to the county for this purpose in the
school year beginning on the first day of July, two thousand three:
And provided further, That any remaining funds credited to a county
for the purpose of trips related to academic classroom curriculum
during the fiscal year shall be carried over for use in the same
manner the next fiscal year and shall be separate and apart from,
and in addition to, the appropriation for the next fiscal year:
And provided further, That the state board may request a county to
document the use of funds for trips related to academic classroom
curriculum if the board determines that it is necessary.
ARTICLE 9D. SCHOOL BUILDING AUTHORITY.
§18-9D-2. Definitions.
The following terms, wherever used or referred to in this
article, have the following meanings unless a different meaning
clearly appears from the context:
(1) "Authority" means the school building authority of West
Virginia or, if the authority is abolished, any board or officer
succeeding to the principal functions of the school building
authority or to whom the powers given to the authority are given by
law;
(2) "Bonds" means bonds issued by the authority pursuant to
this article;
(3) "Construction project" means a project in the furtherance
of a facilities plan with a cost of the project greater than five
hundred thousand dollars for the new construction, expansion or
major renovation of facilities, buildings and structures for school
purposes, including the acquisition of land for current or future
use in connection with the construction project, as well as new or
substantial upgrading of existing equipment, machinery,
furnishings, installation of utilities and other similar items
convenient in connection with placing the construction project into
operation: Provided, That a construction project may not include
such items as books, computers or equipment used for instructional
purposes, fuel, supplies, routine utility services fees, routine
maintenance costs, ordinary course of business improvements and
other items which are customarily considered to result in a current
or ordinary course of business operating charge: Provided,
however, That a construction project may not include a major
improvement project;
(4) "Cost of project" means the cost of construction,
expansion, renovation, repair and safety upgrading of facilities,
buildings and structures for school purposes; the cost of land,
equipment, machinery, furnishings, installation of utilities and
other similar items convenient in connection with placing the
project into operation; and the cost of financing, interest during
construction, professional service fees and all other charges or
expenses necessary, appurtenant or incidental to the foregoing,
including the cost of administration of this article;
(5) "Facilities plan" means a ten-year countywide
comprehensive educational facilities plan established by the county
board in accordance with guidelines adopted by the authority to
meet the goals and objectives of this article that: (i) Addresses
the existing school facilities and facility needs of the county to
provide a thorough and efficient education in accordance with the
provisions of this code and policies of the state board; (ii) best
serves the needs of the individual student, the general school
population and the communities served by the facilities; (iii)
includes a school major improvement plan as defined in this
section; (iv) is updated annually to reflect projects completed,
current enrollment projections and new or continuing needs; and (v)
is approved by the state board and the authority prior to the
distribution of state funds pursuant to this article to any county
board or other entity applying for funds;
(6) "Project" means a construction project or a major
improvement project;
(7) "Region" means the area encompassed within and serviced by
a regional educational service agency established pursuant to
section twenty-six, article two of this chapter;
(8) "Revenue" or "revenues" means moneys deposited in the
school building capital improvements fund pursuant to the operation
of section ten, article nine-a of this chapter; moneys deposited in
the school construction fund pursuant to the operation of section
thirty, article fifteen, chapter eleven of this code and pursuant
to the operation of section eighteen, article twenty-two, chapter twenty-nine of this code; moneys deposited in the school building
debt service fund pursuant to section eighteen, article twenty-two,
chapter twenty-nine of this code; moneys deposited in the school
major improvement fund pursuant to the operation of section thirty,
article fifteen, chapter eleven of this code; any moneys received,
directly or indirectly, from any source for use in any project
completed pursuant to this article; and any other moneys received
by the authority for the purposes of this article;
(9) "School major improvement plan" means a ten-year school
maintenance plan that: (i) Is prepared by a county board of
education in accordance with the guidelines established by the
authority and incorporated in its countywide comprehensive
educational facilities plan or is prepared by the state board of
education or the administrative council of an area vocational
educational center in accordance with the guidelines if the
entities seek funding from the authority for a major improvement
project; (ii) addresses the regularly scheduled maintenance for all
school facilities of the county or under the jurisdiction of the
entity seeking funding; (iii) includes a projected repair and
replacement schedule for all school facilities of the county or of
entity seeking funding; (iv) addresses the major improvement needs
of each school within the county or under the jurisdiction of the
entity seeking funding; and (v) is required prior to the
distribution of state funds for a major improvement project
pursuant to this article to the county board, state board or
administrative council; and
(10) "School major improvement project" means a project with
a cost greater than fifty thousand dollars and less than five
hundred thousand dollars for the renovation, expansion, repair and
safety upgrading of existing school facilities, buildings and
structures, including the substantial repair or upgrading of
equipment, machinery, building systems, utilities and other similar
items convenient in connection with such renovation, repair or
upgrading in the furtherance of a school major improvement plan:
Provided, That a major improvement project may not include such
items as books, computers or equipment used for instructional
purposes, fuel, supplies, routine utility services fees, routine
maintenance costs, ordinary course of business improvements and
other items which are customarily considered to result in a current
or ordinary course of business operating charge.
§18-9D-6. School building capital improvements fund in state
treasury; school construction fund in state treasury;
school building debt service fund in state treasury;
school improvement fund in state treasury;
collections to be paid into special funds; authority
to pledge the collections as security for refunding
revenue bonds; authority to finance projects on a
cash basis.
(a) There is continued in the state treasury a school building
capital improvements fund to be expended by the authority as
provided in this article. The school building capital improvements
fund shall be an interest-bearing account with interest credited to and deposited in the school building capital improvements fund and
expended in accordance with the provisions of this article.
The school building authority may pledge all or any part of
the revenues paid into the school building capital improvements
fund that are needed to meet the requirements of any revenue bond
issue or issues authorized by this article prior to the twentieth
day of July, one thousand nine hundred ninety-three, or revenue
bonds issued to refund revenue bonds issued prior to that date,
including the payment of principal of, interest and redemption
premium, if any, on the revenue bonds and the establishing and
maintaining of a reserve fund or funds for the payment of the
principal of, interest and redemption premium, if any, on the
revenue bond issue or issues when other moneys pledged may be
insufficient for the payment of the principal, interest and
redemption premium, including any additional protective pledge of
revenues that the authority in its discretion has provided by
resolution authorizing the issuance of the bonds or in any trust
agreement made in connection with the bond issue. Additionally,
the authority may provide in the resolution and in the trust
agreement for priorities on the revenues paid into the school
building capital improvements fund that are necessary for the
protection of the prior rights of the holders of bonds issued at
different times under the provisions of this article.
Any balance remaining in the school building capital
improvements fund after the authority has issued bonds authorized
by this article and after the requirements of all funds, including reserve funds established in connection with the bonds issued prior
to the twentieth day of July, one thousand nine hundred
ninety-three, pursuant to this article have been satisfied may be
used for the redemption of any of the outstanding bonds issued
under this article which by their terms are then redeemable, or for
the purchase of the bonds at the market price, but not exceeding
the price, if any, at which the bonds are in the same year
redeemable and all bonds redeemed or purchased shall immediately be
canceled and shall not again be issued.
The school building authority, in its discretion, may use the
moneys in the school building capital improvements fund to finance
the cost of projects authorized in accordance with the provisions
of section sixteen of this article on a cash basis. Any pledge of
moneys in the fund for revenue bonds issued prior to the twentieth
day of July, one thousand nine hundred ninety-three, is a prior and
superior charge on the fund over the use of any of the moneys in
the fund to pay for the cost of any project on a cash basis:
Provided, That any expenditures from the fund, other than for the
retirement of revenue bonds, may only be made by the authority in
accordance with the provisions of this article.
(b) There is continued in the state treasury a special revenue
fund named the school building debt service fund into which shall
be deposited the amounts specified in section eighteen, article
twenty-two, chapter twenty-nine of this code. All amounts
deposited in the fund shall be pledged to the repayment of the
principal, interest and redemption premium, if any, on any revenue bonds or refunding revenue bonds authorized by this article:
Provided, That deposited moneys may not be pledged to the repayment
of any revenue bonds issued prior to the first day of January, one
thousand nine hundred ninety-four, or with respect to revenue bonds
issued for the purpose of refunding revenue bonds issued prior to
the first day of January, one thousand nine hundred ninety-four.
Additionally, the authority may provide in the resolution and in
the trust agreement for priorities on the revenues paid into the
school building debt service fund that are necessary for the
protection of the prior rights of the holders of bonds issued at
different times under the provisions of this article. On or prior
to the first day of May of each year, the authority shall certify
to the state lottery director the principal and interest and
coverage ratio requirements for the following fiscal year on any
revenue bonds issued on or after the first day of January, one
thousand nine hundred ninety-four, and for which moneys deposited
in the school building debt service fund have been pledged, or will
be pledged, for repayment pursuant to this section.
After the authority has issued bonds authorized by this
article and after the requirements of all funds have been
satisfied, including coverage and reserve funds established in
connection with the bonds issued pursuant to this article, any
balance remaining in the school building debt service fund may be
used for the redemption of any of the outstanding bonds issued
under this article which, by their terms, are then redeemable or
for the purchase of the outstanding bonds at the market price, but not to exceed the price, if any, at which the bonds are redeemable
and all bonds redeemed or purchased shall be immediately canceled
and shall not again be issued: Provided, That after the authority
has issued bonds authorized by this article and after the
requirements of debt service and all associated funds have been
satisfied for the fiscal year, including coverage and reserve funds
established in connection with the bonds issued pursuant to this
article, any remaining balance in the school building debt service
fund may be transferred to the school construction fund created in
subsection (c) of this section and used by the school building
authority in its discretion to finance the cost of school
construction or improvement projects authorized in accordance with
the provisions of section sixteen of this article on a cash basis.
(c) There is continued in the state treasury a special revenue
fund named the school construction fund into which shall be
deposited the amounts specified in section thirty, article fifteen,
chapter eleven of this code and section eighteen-a, article twenty-
two, chapter twenty-nine of this code, together with any moneys
appropriated to the fund by the Legislature: Provided, That for the
school year beginning the first day of July, two thousand four,
only, funds from the excess lottery allocated in section eighteen-
a, article twenty-two, chapter twenty-nine of this code shall not
be transferred to the school construction fund and, in lieu
thereof, made available for legislative appropriation: Provided,
however, That for the school year beginning the first day of July,
two thousand four, only, up to five million dollars of the amounts in the fund may be appropriated by the Legislature for budget
shortfalls. Expenditures from the school construction fund shall
be for the purposes set forth in this article, including
lease-purchase payments under agreements made pursuant to
subsection (e), section fifteen of this article and section nine,
article five of this chapter and are authorized from collections in
accordance with the provisions of article three, chapter twelve of
this code and from other revenues annually appropriated by the
Legislature from lottery revenues as authorized by section
eighteen, article twenty-two, chapter twenty-nine of this code
pursuant to the provisions set forth in article two, chapter five-a
of this code. Amounts collected which are found, from time to
time, to exceed the funds needed for purposes set forth in this
article may be transferred to other accounts or funds and
redesignated for other purposes by appropriation of the
Legislature. The school construction fund shall be an
interest-bearing account, with the interest credited to and
deposited in the school construction fund and expended in
accordance with the provisions of this article. Deposits to and
expenditures from the school construction fund are subject to the
provisions of subsection (k), section fifteen of this article.
(d) There is continued in the state treasury a special revenue
fund named the school major improvement fund into which shall be
deposited the amounts specified in section thirty, article fifteen,
chapter eleven of this code, together with any moneys appropriated
to the fund by the Legislature. Expenditures from the school major improvement fund shall be for the purposes set forth in this
article and are authorized from collections in accordance with the
provisions of article three, chapter twelve of this code and from
other revenues annually appropriated by the Legislature from
lottery revenues as authorized by section eighteen, article
twenty-two, chapter twenty-nine of this code pursuant to the
provisions set forth in article two, chapter five-a of this code.
Amounts collected which are found, from time to time, to exceed the
funds needed for purposes set forth in this article may be
transferred to other accounts or funds and redesignated for other
purposes by appropriation of the Legislature. The school major
improvement fund shall be an interest-bearing account, with
interest being credited to and deposited in the school major
improvement fund and expended in accordance with the provisions of
this article.
(e) The Legislature finds and declares that the Supreme Court
of Appeals of West Virginia has held that the issuance of
additional revenue bonds authorized under the school building
authority act, as enacted in this article prior to the twentieth
day of July, one thousand nine hundred ninety-three, constituted an
indebtedness of the state in violation of section four, article X
of the Constitution of West Virginia, but that revenue bonds issued
under this article prior to the twentieth day of July, one thousand
nine hundred ninety-three, are not invalid. The Legislature
further finds and declares that the financial capacity of a county
to construct, lease and improve school facilities depends upon the county's bonding capacity (local property wealth), voter
willingness to pass bond issues and the county's ability to
reallocate other available county funds instead of criteria related
to educational needs or upon the ability of the school building
authority created in this article to issue bonds that comply with
the holding of the West Virginia Supreme Court of Appeals or
otherwise assist counties with the financing of facilities
construction and improvement. The Legislature further finds and
declares that this section, as well as section eighteen, article
twenty-two, chapter twenty-nine of this code, have been reenacted
during the first extraordinary session of the West Virginia
Legislature in the year one thousand nine hundred ninety-four in an
attempt to comply with the holding of the Supreme Court of Appeals
of West Virginia.
The Legislature further finds and declares that it intends,
through the reenactment of this section and section eighteen,
article twenty-two, chapter twenty-nine of this code, to dedicate
a source of state revenues to special revenue funds for the
purposes of paying the debt service on bonds and refunding bonds
issued subsequent to the first day of January, one thousand nine
hundred ninety-four, the proceeds of which will be used for the
construction and improvement of school building facilities. The
Legislature further finds and declares that it intends, through the
reenactment of this section and section thirty, article fifteen,
chapter eleven of this code and section eighteen, article
twenty-two, chapter twenty-nine of this code, to appropriate revenues to two special revenue funds for the purposes of
construction and improvement of school building facilities.
Furthermore, the Legislature intends to encourage county boards to
maintain existing levels of county funding for construction,
improvement and maintenance of school building facilities and to
generate additional county funds for those purposes through bonds
and special levies whenever possible. The Legislature further
encourages the school building authority, the state board and
county boards of education to propose uniform project
specifications for comparable projects whenever possible to meet
county needs at the lowest possible cost.
The Legislature further finds and declares that it intends,
through the reenactment of this section and section eighteen,
article twenty-two, chapter twenty-nine of this code, to comply
with the provisions of sections four and six, article X of the
Constitution of West Virginia; and section one, article XII of said
Constitution.
§18-9D-8. Use of proceeds of bonds; bonds exempt from taxation.
(a) The maximum aggregate face value of bonds that may be
issued by the authority, for which the moneys in the school
building debt service fund are to be pledged, is four hundred
million dollars. The issuance of revenue bonds under the
provisions of this article shall be authorized, from time to time,
by resolution or resolutions of the school building authority which
shall set forth the proposed projects authorized in accordance with
the provisions of section sixteen of this article and provide for the issuance of bonds in amounts sufficient, when sold as provided
in this section, to provide moneys considered sufficient by the
authority to pay the costs, less the amounts of any other funds
available for the costs or from any appropriation, grant or gift
for the costs: Provided, That bond issues from which bond revenues
are to be distributed in accordance with section fifteen of this
article for projects authorized pursuant to the provisions of
section sixteen of this article are not required to set forth the
proposed projects in the resolution. The resolution shall
prescribe the rights and duties of the bondholders and the school
building authority and, for that purpose, may prescribe the form of
the trust agreement referred to in this section. The bonds may be
issued, from time to time, in such amounts; shall be of such
series; bear such date or dates; mature at such time or times not
exceeding forty years from their respective dates; bear interest at
such rate or rates; be in such denominations; be in such form,
either coupon or registered, carrying such registration,
exchangeability and interchangeability privileges; be payable in
such medium of payment and at such place or places within or
without the state; be subject to such terms of redemption at such
prices not exceeding one hundred five percent of the principal
amount of the bonds; and be entitled to such priorities on the
revenues paid into the fund pledged for repayment of the bonds as
may be provided in the resolution authorizing the issuance of the
bonds or in any trust agreement made in connection with the bonds:
Provided, however, That revenue bonds issued on or after the first day of January, one thousand nine hundred ninety-four, which are
secured by lottery proceeds shall mature at such time or times not
exceeding ten years from their respective dates.
(b) The bonds shall be signed by the governor, and by the
president or vice president of the authority, under the great seal
of the state, attested by the secretary of state, and the coupons
attached to the bonds shall bear the facsimile signature of the
president or vice president of the authority. In case any of the
officers whose signatures appear on the bonds or coupons cease to
be officers before the delivery of the bonds, the signatures shall
nevertheless be valid and sufficient for all purposes the same as
if the officers had remained in office until the delivery. The
revenue bonds shall be sold in the manner determined by the
authority to be for the best interests of the state.
(c) Any pledge of revenues made by the school building
authority for revenue bonds issued prior to the twentieth day of
July, one thousand nine hundred ninety-three, pursuant to this
article is valid and binding between the parties from the time the
pledge is made; and the revenues pledged shall immediately be
subject to the lien of the pledge without any further physical
delivery of the revenues pledged or further act. The lien of the
pledge is valid and binding against all parties having claims of
any kind in tort, contract or otherwise, irrespective of whether
the parties have notice of the lien of the pledge, and the pledge
shall be a prior and superior charge over any other use of the
revenues pledged.
(d) The proceeds of any bonds shall be used solely for the
purpose or purposes as may be generally or specifically set forth
in the resolution authorizing those bonds and shall be disbursed in
the manner and with the restrictions, if any, that the authority
provides in the resolution authorizing the issuance of the bonds or
in the trust agreement referred to in this section securing the
bonds. If the proceeds of the bonds, by error in calculations or
otherwise, are less than the cost of any projects specifically set
forth in the resolution, additional bonds may in like manner be
issued to provide the amount of the deficiency; and unless
otherwise provided for in the resolution or trust agreement
hereinafter mentioned, the additional bonds shall be considered to
be of the same issue and are entitled to payment from the same
fund, without preference or priority, as the bonds before issued
for the projects. If the proceeds of bonds issued for the projects
specifically set forth in the resolution authorizing the bonds
issued by the authority exceed the cost of the bonds, the surplus
may be used for any other projects authorized in accordance with
the provisions of section sixteen of this article or in any other
manner that the resolution authorizing the bonds provides. Prior
to the preparation of definitive bonds, the authority may, under
like restrictions, issue temporary bonds with or without coupons,
exchangeable for definitive bonds upon the issuance of the
definitive bonds.
(e) After the issuance of any of revenue bonds, the revenues
pledged for the revenue bonds shall not be reduced as long as any of the revenue bonds are outstanding and unpaid except under the
terms, provisions and conditions that are contained in the
resolution, trust agreement or other proceedings under which the
revenue bonds were issued.
(f) The revenue bonds and the revenue refunding bonds and
bonds issued for combined purposes, together with the interest on
the bonds, are exempt from all taxation by the state of West
Virginia, or by any county, school district, municipality or
political subdivision thereof.
(g) To meet the operational costs of the school building
authority, the school building authority may transfer to a special
revenue account in the state treasury interest on any debt service
reserve funds created within any resolution authorizing the issue
of bonds or any trust agreement made in connection with the bonds
for expenditure in accordance with legislative appropriation or
allocation of appropriation.
(h) Any school construction bonds issued under this section
shall be issued on parity with any existing school building
authority bonds previously issued under this article.
§18-9D-15. Legislative intent; allocation of money among
categories of projects; lease purchase options;
limitation on time period for expenditure of project
allocation; county maintenance budget requirements;
project disbursements over period of years;
preference for multicounty arrangements; submission
of project designs; set-aside to encourage local participation; etc.
(a) It is the intent of the Legislature to empower the school
building authority to facilitate and provide state funds and to
administer all federal funds provided for the construction and
major improvement of school facilities so as to meet the
educational needs of the people of this state in an efficient and
economical manner. The authority shall make funding determinations
in accordance with the provisions of this article and shall assess
existing school facilities and each facility's school major
improvement plan in relation to the needs of the individual
student, the general school population, the communities served by
the facilities and facility needs statewide.
(b) An amount that is no more than three percent of the sum of
moneys that are determined by the authority to be available for
distribution during the then current fiscal year from: (1) Moneys
paid into the school building capital improvements fund pursuant to
section ten, article nine-a of this chapter; (2) the issuance of
revenue bonds for which moneys in the school building debt service
fund are pledged as security; (3) moneys paid into the school
construction fund pursuant to section six of this article; and (4)
any other moneys received by the authority, except moneys paid into
the school major improvement fund pursuant to section six of this
article, may be allocated and may be expended by the authority for
projects authorized in accordance with the provisions of section
sixteen of this article that service the educational community
statewide or, upon application by the state board, for educational programs that are under the jurisdiction of the state board. In
addition, upon application by the state board or the administrative
council of an area vocational educational center established
pursuant to article two-b of this chapter, the authority may
allocate and expend under this subsection moneys for school major
improvement projects authorized in accordance with the provisions
of section sixteen of this article proposed by the state board or
an administrative council for school facilities under the direct
supervision of the state board or an administrative council,
respectively. Furthermore, upon application by a county board, the
authority may allocate and expend under this subsection moneys for
school major improvement projects for vocational programs at
comprehensive high schools, vocational schools cooperating with
community and technical college programs, or both. Each county
board is encouraged to cooperate with community and technical
colleges in the use of existing or development of new vocational
technical facilities. All projects eligible for funds from this
subsection shall be submitted directly to the authority which shall
be solely responsible for the project's evaluation: Provided, That
the authority may not expend any moneys for a school major
improvement project proposed by the state board or the
administrative council of an area vocational educational center
unless the state board or an administrative council has submitted
a ten-year facilities plan: Provided, however, That the authority
shall, before allocating any moneys to the state board or the
administrative council of an area vocational educational center for a school improvement project, consider all other funding sources
available for the project.
(c) An amount that is no more than two percent of the moneys
that are determined by the authority to be available for
distribution during the current fiscal year from: (1) Moneys paid
into the school building capital improvements fund pursuant to
section ten, article nine-a of this chapter; (2) the issuance of
revenue bonds for which moneys in the school building debt service
fund are pledged as security; (3) moneys paid into the school
construction fund pursuant to section six of this article; and (4)
any other moneys received by the authority, except moneys deposited
into the school major improvement fund, shall be set aside by the
authority as an emergency fund to be distributed in accordance with
the guidelines adopted by the authority.
(d) An amount that is no more than five percent of the moneys
that are determined by the authority to be available for
distribution during the current fiscal year from: (1) Moneys paid
into the school building capital improvements fund pursuant to
section ten, article nine-a of this chapter; (2) the issuance of
revenue bonds for which moneys in the school building debt service
fund are pledged as security; (3) moneys paid into the school
construction fund pursuant to section six of this article; and (4)
any other moneys received by the authority, except moneys deposited
into the school major improvement fund, may be reserved by the
authority for multiuse vocational-technical education facilities
projects that may include post-secondary programs as a first priority use. The authority may allocate and expend under this
subsection moneys for any purposes authorized in this article on
multiuse vocational-technical education facilities projects,
including equipment and equipment updates at the facilities,
authorized in accordance with the provisions of section sixteen of
this article. If the projects approved under this subsection do
not require the full amount of moneys reserved, moneys above the
amount required may be allocated and expended in accordance with
other provisions of this article. A county board, the state board,
an administrative council or the joint administrative board of a
vocational-technical education facility which includes post-
secondary programs may propose projects for facilities or
equipment, or both, which are under the direct supervision of the
respective body: Provided, That the authority shall, before
allocating any moneys for a project under this subsection, consider
all other funding sources available for the project.
(e) The remaining moneys determined by the authority to be
available for distribution during the then current fiscal year
from: (1) Moneys paid into the school building capital
improvements fund pursuant to section ten, article nine-a of this
chapter; (2) the issuance of revenue bonds for which moneys in the
school building debt service fund are pledged as security; (3)
moneys paid into the school construction fund pursuant to section
six of this article; and (4) any other moneys received by the
authority, except moneys deposited into the school major
improvement fund, shall be allocated and expended on the basis of need and efficient use of resources for projects funded in
accordance with the provisions of section sixteen of this article.
(f) If a county board of education proposes to finance a
project that is authorized in accordance with section sixteen of
this article through a lease with an option to purchase leased
premises upon the expiration of the total lease period pursuant to
an investment contract, the authority may allocate no moneys to the
county board in connection with the project: Provided, That the
authority may transfer moneys to the state board of education
which, with the authority, shall lend the amount transferred to the
county board to be used only for a one-time payment due at the
beginning of the lease term, made for the purpose of reducing
annual lease payments under the investment contract, subject to the
following conditions:
(1) The loan shall be secured in the manner required by the
authority, in consultation with the state board, and shall be
repaid in a period and bear interest at a rate as determined by the
state board and the authority and shall have any terms and
conditions that are required by the authority, all of which shall
be set forth in a loan agreement among the authority, the state
board and the county board;
(2) The loan agreement shall provide for the state board and
the authority to defer the payment of principal and interest upon
any loan made to the county board during the term of the investment
contract, and annual renewals of the investment contract, among the
state board, the authority, the county board and a lessor: Provided, That in the event a county board which has received a
loan from the authority for a one-time payment at the beginning of
the lease term does not renew the subject lease annually until
performance of the investment contract in its entirety is
completed, the county board is in default and the principal of the
loan, together with all unpaid interest accrued to the date of the
default, shall, at the option of the authority, in consultation
with the state board, become due and payable immediately or subject
to renegotiation among the state board, the authority and the
county board: Provided, however, That if a county board renews the
lease annually through the performance of the investment contract
in its entirety, the county board shall exercise its option to
purchase the leased premises: Provided further, That the failure
of the county board to make a scheduled payment pursuant to the
investment contract constitutes an event of default under the loan
agreement: And provided further, That upon a default by a county
board, the principal of the loan, together with all unpaid interest
accrued to the date of the default, shall, at the option of the
authority, in consultation with the state board, become due and
payable immediately or subject to renegotiation among the state
board, the authority and the county board: And provided further,
That if the loan becomes due and payable immediately, the
authority, in consultation with the state board, shall use all
means available under the loan agreement and law to collect the
outstanding principal balance of the loan, together with all unpaid
interest accrued to the date of payment of the outstanding principal balance; and
(3) The loan agreement shall provide for the state board and
the authority to forgive all principal and interest of the loan
upon the county board purchasing the leased premises pursuant to
the investment contract and performance of the investment contract
in its entirety.
(g) To encourage county boards to proceed promptly with
facilities planning and to prepare for the expenditure of any state
moneys derived from the sources described in this section, any
county board or other entity to whom moneys are allocated by the
authority that fails to expend the money within three years of the
allocation shall forfeit the allocation and thereafter is
ineligible for further allocations pursuant to this section until
it is ready to expend funds in accordance with an approved
facilities plan: Provided, That the authority may authorize an
extension beyond the three-year forfeiture period not to exceed an
additional two years. Any amount forfeited shall be added to the
total funds available in the school construction fund of the
authority for future allocation and distribution. Funds may not be
distributed for any project under this article unless the
responsible entity has a facilities plan approved by the state
board and the school building authority and is prepared to commence
expenditure of the funds during the fiscal year in which the moneys
are distributed.
(h) The remaining moneys that are determined by the authority
to be available for distribution during the then current fiscal year from moneys paid into the school major improvement fund
pursuant to section six of this article shall be allocated and
distributed on the basis of need and efficient use of resources for
projects authorized in accordance with the provisions of section
sixteen of this article: Provided, That the moneys may not be
distributed for any project under this section unless the
responsible entity has a facilities plan approved by the state
board and the authority and is to commence expenditures of the
funds during the fiscal year in which the moneys are distributed:
Provided, however, That any moneys allocated to a project and not
distributed for that project shall be deposited in an account to
the credit of the project, the principal amount to remain to the
credit of and available to the project for a period of two years.
Any moneys which are unexpended after a two-year period shall be
redistributed on the basis of need from the school major
improvement fund in that fiscal year.
(i) No local matching funds may be required under the
provisions of this section. However, the responsibilities of the
county boards of education to maintain school facilities are not
negated by the provisions of this article. To be eligible to
receive an allocation of school major improvement funds from the
authority, a county board must have expended in the previous fiscal
year an amount of county moneys equal to or exceeding the lowest
average amount of money included in the county board's maintenance
budget over any three of the previous five years and must have
budgeted an amount equal to or greater than the average in the current fiscal year: Provided, That the state board shall
promulgate rules relating to county boards' maintenance budgets,
including items which shall be included in the budgets.
(j) Any county board may use moneys provided by the authority
under this article in conjunction with local funds derived from
bonding, special levy or other sources. Distribution to a county
board, or to the state board or the administrative council of an
area vocational educational center pursuant to subsection (b) of
this section, may be in a lump sum or in accordance with a schedule
of payments adopted by the authority pursuant to guidelines adopted
by the authority.
(k) Funds in the school construction fund shall first be
transferred and expended as follows:
Any funds deposited in the school construction fund shall be
expended first in accordance with an appropriation by the
Legislature. To the extent that funds are available in the school
construction fund in excess of that amount appropriated in any
fiscal year, the excess funds may be expended for projects
authorized in accordance with the provisions of section sixteen of
this article. Any projects which the authority identified and
announced for funding on or before the first day of August, one
thousand nine hundred ninety-five, or identified and announced for
funding on or before the thirty-first day of December, one thousand
nine hundred ninety-five, shall be funded by the authority in an
amount which is not less than the amount specified when the project
was identified and announced.
(l) It is the intent of the Legislature to encourage county
boards to explore and consider arrangements with other counties
that may facilitate the highest and best use of all available
funds, which may result in improved transportation arrangements for
students or which otherwise may create efficiencies for county
boards and the students. In order to address the intent of the
Legislature contained in this subsection, the authority shall grant
preference to those projects which involve multicounty arrangements
as the authority shall determine reasonable and proper.
(m) County boards shall submit all designs for construction of
new school buildings to the school building authority for review
and approval prior to preparation of final bid documents:
Provided, That a vendor who has been debarred pursuant to the
provisions of sections thirty-three-a through thirty-three-f,
inclusive, article three, chapter five-a of this code, may not bid
on or be awarded a contract under this section.
(n) The authority may elect to disburse funds for approved
construction projects over a period of more than one year subject
to the following:
(1) The authority may not approve the funding of a school
construction project over a period of more than three years;
(2) The authority may not approve the use of more than fifty
percent of the revenue available for distribution in any given
fiscal year for projects that are to be funded over a period of
more than one year; and
(3) In order to encourage local participation in funding school construction projects, the authority may set aside limited
funding, not to exceed five hundred thousand dollars, in reserve
for one additional year to provide a county the opportunity to
complete financial planning for a project prior to the allocation
of construction funds. Any funding shall be on a reserve basis and
converted to a part of the construction grant only after all
project budget funds have been secured and all county commitments
have been fulfilled. Failure of the county to solidify the project
budget and meet its obligations to the state within eighteen months
of the date the funding is set aside by the authority will result
in expiration of the reserve and the funds shall be reallocated by
the authority in the succeeding funding cycle.
§18-9D-16. Authority to establish guidelines and procedures for
facilities and major improvement plans; guidelines
for modifications and updates, etc.; guidelines for
project evaluation; submission of certified list of
projects to be funded; department on-site inspection
of facilities; enforcement of required changes or
additions to project plans.
(a) The authority shall establish guidelines and procedures to
promote the intent and purposes of this article and assure the
prudent and resourceful expenditure of state funds for projects
under this article including, but not limited to, the following:
(1) Guidelines and procedures for the facilities plans, school
major improvement plans and projects submitted in the furtherance
of the plans that address, but are not limited to, the following:
(A) All of the elements of the respective plans as defined in
section two of this article;
(B) The procedures for a county to submit a preliminary plan,
a plan outline or a proposal for a plan to the authority prior to
the submission of the facilities plan. The preliminary plan, plan
outline or proposal for a plan shall be the basis for a
consultation meeting between representatives of the county and
members of the authority, including at least one citizen member,
which shall be held promptly following submission of the
preliminary plan, plan outline or proposal for a plan to assure
understanding of the general goals of this article and the
objective criteria by which projects will be evaluated, to discuss
ways the plan may be structured to meet those goals, and to assure
efficiency and productivity in the project approval process;
(C) The manner, time line and process for the submission of
each plan and annual plan updates to the authority;
(D) The requirements for public hearings, comments or other
means of providing broad-based input on plans and projects under
this article within a reasonable time period as the authority may
consider appropriate. The submission of each plan must be
accompanied by a synopsis of all comments received and a formal
comment by the county board, the state board or the administrative
council of an area vocational educational center submitting the
plan;
(E) Any project specifications and maintenance specifications
considered appropriate by the authority including, but not limited to, such matters as energy efficiency, preferred siting,
construction materials, maintenance plan and any other matter
related to how the project is to proceed;
(F) A prioritization by the county board, the state board or
the administrative council submitting the plan of each project
contained in the plan. In prioritizing the projects, the county
board, the state board or the administrative council submitting the
plan shall make determinations in accordance with the objective
criteria formulated by the school building authority in accordance
with this section. The priority list is one of the criteria that
shall be considered by the authority deciding how the available
funds should be expended;
(G) The objective means to be set forth in the plan and used
in evaluating implementation of the overall plan and each project
included in the plan. The evaluation must measure how the plan
addresses the goals of this article and any guidelines adopted
under this article, and how each project is in furtherance of the
facilities plan and school major improvement plan, as applicable,
as well as the importance of the project to the overall success of
the facilities plan or school major improvement plan and the
overall goals of the authority; and
(H) Any other matters considered by the authority to be
important reflections of how a construction project or a major
improvement project or projects will further the overall goals of
this article.
(2) Guidelines and procedures which may be adopted by the authority for requiring that a county board modify, update,
supplement or otherwise submit changes or additions to an approved
facilities plan or for requiring that a county board, the state
board or the administrative council of an area vocational
educational center modify, update, supplement or otherwise submit
changes or additions to an approved school major improvement plan.
The authority shall provide reasonable notification and sufficient
time for the change or addition as delineated in guidelines
developed by the authority.
(3) Guidelines and procedures for evaluating project proposals
that are submitted to the authority that address, but are not
limited to, the following:
(A) Any project funded by the authority must be in furtherance
of the facilities plan or school major improvement plan and in
compliance with the guidelines established by the authority;
(B) If a project is to benefit more than one county in the
region, the facilities plan must state the manner in which the cost
and funding of the project will be apportioned among the counties;
(C) If a county board proposes to finance a construction
project through a lease with an option to purchase pursuant to an
investment contract as described in subsection (f), section fifteen
of this article, the specifications for the project must include
the term of the lease, the amount of each lease payment, including
the payment due upon exercise of the option to purchase, and the
terms and conditions of the proposed investment contract; and
(D) The objective criteria for the evaluation of projects which shall include, but are not limited to, the following:
(i) How the current facilities do not meet and how the plan
and any project under the plan meets the following:
(I) Student health and safety including, but not limited to,
critical health and safety needs;
(II) Economies of scale, including compatibility with similar
schools that have achieved the most economical organization,
facility use and pupil-teacher ratios;
(III) Reasonable travel time and practical means of addressing
other demographic considerations;
(IV) Multicounty and regional planning to achieve the most
effective and efficient instructional delivery system;
(V) Curriculum improvement and diversification, including the
use of instructional technology, distance learning and access to
advanced courses in science, mathematics, language arts and social
studies;
(VI) Innovations in education;
(VII) Adequate space for projected student enrollments;
(VIII) The history of efforts taken by the county board to
propose or adopt local school bond issues or special levies to the
extent constitutionally permissible; and
(IX) Regularly scheduled preventive maintenance; and
(ii) How the project will assure the prudent and resourceful
expenditure of state funds and achieve the purposes of this article
for constructing, expanding, renovating or otherwise improving and
maintaining school facilities for a thorough and efficient education.
(4) Guidelines and procedures for evaluating projects for
funding that address, but are not limited to, the following:
(A) Requiring each county board's facilities plan and school
major improvement plan to prioritize all the construction projects
or major improvement projects, respectively, within the county. A
school major improvement plan submitted by the state board or the
administrative council of an area vocational educational center
shall prioritize all the school improvement projects contained in
the plan. The priority list shall be one of the criteria to be
considered by the authority in determining how available funds
shall be expended. In prioritizing the projects, the county board,
the state board or the administrative council submitting a plan
shall make determinations in accordance with the objective criteria
formulated by the school building authority;
(B) The return to each county submitting a project proposal an
explanation of the evaluative factors underlying the decision of
the authority to fund or not to fund the project; and
(C) The allocation and expenditure of funds in accordance with
this article, subject to the availability of funds.
(b) Prior to final action on approving projects for funding
under this article, the authority shall submit a certified list of
the projects to the joint committee on government and finance.
(c) The state department of education shall conduct on-site
inspections, at least annually, of all facilities which have been
funded wholly or in part by moneys from the authority or state board to ensure compliance with the county board's facilities plan
and school major improvement plan as related to the facilities; to
preserve the physical integrity of the facilities to the extent
possible; and to otherwise extend the useful life of the
facilities: Provided, That the state board shall submit reports
regarding its on-site inspections of facilities to the authority
within thirty days of completion of the on-site inspections:
Provided, however, That the state board shall promulgate rules
regarding the on-site inspections and matters relating thereto, in
consultation with the authority, as soon as practical and shall
submit proposed rules for legislative review no later than the
first day of December, one thousand nine hundred ninety-four.
(d) Based on its on-site inspection or notification by the
authority to the state board that the changes or additions to a
county's board facilities plan or school major improvement plan
required by the authority have not been implemented within the time
period prescribed by the authority, the state board shall restrict
the use of the necessary funds or otherwise allocate funds from
moneys appropriated by the Legislature for those purposes set forth
in section nine, article nine-a of this chapter.