Senate Bill No. 360
(By Senators Jackson, Bailey, Ball, Boley, Dugan,
Fanning, Hunter, McKenzie, Minear, Oliverio, Plymale,
Schoonover and White)
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[Originating in the Committee on Education;
reported January 30, 1998.]
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A BILL to amend and reenact section fifteen, article nine-d,
chapter eighteen of the code of West Virginia, one thousand
nine hundred thirty-one, as amended, relating to the school
building authority generally.
Be it enacted by the Legislature of West Virginia:
That section fifteen, article nine-d, chapter eighteen of
the code of West Virginia, one thousand nine hundred thirty-one,
as amended, be amended and reenacted to read as follows:
ARTICLE 9D. SCHOOL BUILDING AUTHORITY.
§18-9D-15. Legislative intent; distribution of money.
(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 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 section
moneys for school major improvement projects 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:
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 school major improvement plan, to be updated annually,
pursuant to section sixteen of this article:
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) 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, the basis to be determined
by the authority in accordance with the provisions of section
sixteen of this article.
(e) If a county board of education proposes to finance a
project that is approved pursuant to 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 such terms and
conditions as 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.
(f) 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 subsection, any county board failing to expend money within three
years of the allocation to the county board shall forfeit the
allocation and thereafter is ineligible for further allocations
pursuant to this subsection until the county board 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.
(g) 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,
the basis to be determined by the authority in accordance with
the provisions of section sixteen of this article:
Provided,
That the moneys may not be distributed to any county board that
does not have an approved school major improvement plan or to any
county board that is not prepared to commence expenditures of the
funds during the fiscal year in which the moneys are distributed:
Provided, however, That any moneys allocated to a county board
and not distributed to that county board shall be deposited in an
account to the credit of that county board, the principal amount
to remain to the credit of and available to the county board 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.
(h) 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 of
education shall promulgate rules relating to county boards'
maintenance budgets, including items which shall be included in
the budgets.
(i) 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.
(j) 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 in accordance
with the provisions 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.
(k) 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 multi- county arrangements as the authority shall determine reasonable
and proper.