To help ensure that the state’s approximately 10,500 schools have safe facilities in which to learn, California provides funding to school districts for facility construction, modernization and alteration through the School Facilities Program. The California State Auditor on Jan. 27 released an audit of the Office of Public School Construction’s (OPSC) administration of the School Facilities Program for modernization, finding that the program is in need of more funding as well as measures to improve the equitable distribution of money.
The audit determined that California will need $7.4 billion in state funding to meet existing and anticipated modernization funding requests over the next five years. Existing unfulfilled requests total $1.7 billion and the acting state auditor Michael Tilden estimates the additional $5.7 billion based on the increasing amount of modernization funds districts requested from 2013 through 2020, total number and size of school sites for which districts requested modernization funds, enrollment and other factors.
The auditor points out that critical data is missing — the state does not keep track of the age of school buildings. Additionally, the report states that the OPSC does not provide estimates of the need for modernization funding, which would be useful to the Legislature as it considers how much bond funding to put before voters. In place of an estimate by the OPSC, the auditor recommends that the Legislature seek voter approval for at least $7.4 billion in bond authority for modernization projects.
“To ensure the quality of estimates of future requests for modernization funding, the Legislature should require that the OPSC gather valid and reliable data about the age of all school facilities in California and that the Allocation Board’s estimates be based on this data,” the report stated.
The audit found that the current method of funding these projects through general obligation bonds is a “reasonable and common way to pay for infrastructure projects” and is the best option to fund these projects into the future.
Application and selection process needs reform
Modernization projects must meet certain criteria to qualify for the program, including being a permanent structure that is at least 25 years old or a portable classroom that is at least 20 years old that will enhance the structure’s ability to achieve educational purposes. A school district must also demonstrate it can contribute its share of the project costs to qualify for state funding. For modernization projects, school districts are responsible for providing at least 40 percent of the cost and the facilities program provides the remaining amount. In certain circumstances, school districts can qualify for additional state funding if they can demonstrate financial hardship.
With the exception of modernization projects that address an imminent threat to the health and safety of students, the Allocation Board, which approves funding for projects, does so on a first-come first-served basis. The board can only allocate as many funds as are available in the most recent voter-approved bond and develops a backlog of projects once that amount is hit. In the last few years, this has resulted in an average wait time of three years from application to funding approval.
This system disadvantages smaller and lower-wealth districts in a number of ways, from available staff to apply and monitor the project to a lack of funding to begin or complete a modernization project. The report references examples of wealthier districts that were able to fully complete a project using its own funds before it applies to the School Facilities Program. Uncertainty with voter approval of local bonds can also delay an application for a lower-wealth district.
The report recommends changes that could be made to make the program more equitable by prioritizing funding to projects that meet financial hardship criteria and districts in low-income areas in addition to those that address an imminent threat to the health and safety of students. It also suggests making a preliminary apportionment of funding available to all districts that meet the financial hardship criteria.
