January 27, 2010
SAB reduces facility grant, spares unfunded list
The State Allocation Board voted Wednesday to decrease funding for the School Facility Program grant by 6.74 percent for all construction projects approved in 2010. Exempted from that reduction, however, was roughly $2 billion worth of construction projects that received an approval from OPSC in 2009, but due to the states inability to sell bonds, are still waiting to be funded.Those projects on the unfunded list, about 400 total, will retain their 2009 grant amount. Assemblywoman Joan Buchanan, D-San Ramon, was by far the most outspoken board member in support of protecting those already in line.If a school district receives approval from the state, and receives x dollars for a project, and does all its planning based on those dollars, and then after the fact, because the statepursues less money it (reduces the apportionment). I think thats inherently unfair, she said. Not all members agreed with the motion. Cynthia Bryant, an aide to Gov. Arnold Schwarzenegger and incoming chair to the board, argued that the states accounting and tracking system would be strained to keep up with what will turn out to be two sets funding rates.I would argue that were just in a weird time and this list is what the list is. Its kind of a risk that people who got unfunded approvals have to take, and they should be cut, she said.Rob Cook, director of OPSC, noted that having two separate rates for project grant amounts would cause some significant administrative hurdles for his department. I dont know how we would execute this, he said. Cook added that in the past, unfunded projects have been reset to the current years cost index, but historically that has been a scaling up rather than a trimming down. The grant amount, based on an annual construction index known as the class B construction cost index, has increased funding every year since 1999. Cumulatively, the adjustment has risen 80 percent over the last decade for elementary and middle school grants, and 75 percent for high school grants. But a slump in the economy lowered the CCI for the cost index in 2010, thus lowering the amount of school construction funding. School construction projects are funded on a per-unhoused-pupil formula. The state pays 50 percent of the cost of new construction projects and 60 percent of modernization projects, although numerous district facility managers have argued for years that state support tends to come up short of the required amount.Districts submitting construction projects to OPSC in 2010 will be subject to the 6.74 percent grant decrease. The construction cost index adjustment was taken from data from eight California cities and submitted by Marshall and Swift, a company that evaluates construction costs for public and private entities.
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