Publications
Fall 2001 Newsletter
New Blueprint For School Facilities Finance Urged By State
Legislative Analyst's Office
School facilities throughout the state are crumbling and
we wonder why. Students are receiving sub-par educations and still
we ponder. What is the cause? Why is this happening? The Legislative
Analysts Office tried to remind Californians why in May with the
release of its report "A New Blueprint for California School
Facility Finance". However, whether because of the state's
energy crisis or merely a lack of legislative will those ideas
fell on deaf ears and have, as of yet, been all but ignored. NSBN
was pleased to talk with Marianne O'Malley, Principal Fiscal and
Policy Analyst for the State's LAO, who reminded us of the dysfunctional
nature of the current system, what it's doing to school facilities
throughout the state of California and fleshes out the long-term
and lasting effects it is having, not merely on the financial
front, but on the educational front as well.
The LAO released a report in May which outlined a new
blueprint for school facility finance in the state. Despite making
4 extremely practical recommendations, it was all but ignored
through much of the last Legislative session. Are you seeing any
ray of light that suggests it will be taken seriously in the near
future?
The blueprint is only a few months old. Major changes such as
the one we propose take a bit of time to take hold.
Our report is really asking both state and local governance structures
for a profound shift in accountability and responsibility. And
while no one predicted that a shift of this magnitude would happen
overnight, we're already beginning to see signs that people are
listening and interested in the concepts we detailed.
What motivated the Legislative Analysts Office to come
out with this set of recommendations?
The LAO has been analyzing state school facility bond measures
and the school facilities program for decades. Over time, we have
been struck by the tremendous obstacles school districts face
building and modernizing facilities. Under the existing system,
local school districts are never sure when state money will be
available, how much money will be available, or which school districts
will receive funding. Because of this, school districts face significant
difficulties implementing long-term capital outlay plans.
Your answer eludes to a key point, while local school
districts offer their own bond measures every 2-3 years, they
are never sure when state matching funds will be available. That
paradigm leads to poor planning re: construction and modernization
of school facilities. If the need for a correction is so apparent
and a new school bond is set to be voted on in the fall, why is
there so little reaction in the Capitol?
Before the Supreme Court's Serrano decisions and before Prop.
13, the state's role in K-12 finance, both on the operating and
the facilities side, was very different. In those days, the school
finance and governance systems were primarily local. Some 25 years
ago, however, we started to alter the finance and governance structures--and
we shifted considerable control over educational programs to the
state.
Particularly in recent years, the Legislature, school districts
and the LAO have begun to reevaluate the wisdom of such a shift.
And from our perspective, we see many advantages to the notion
of transferring greater control over school operations and facilities
back to school districts.
Let me ask you to comment on a quote from Asm. Frommer
in last month's TPR re: why the LAO report has failed to ring
any bells in the Capitol. He states, "It's a David versus
Goliath fight right now. You have a certain cadre of interest
groups in Sacramento who believe they know it all. They're not
interested in hearing criticism, new ideas or new philosophies.
And because of them, those of us advocating for reform are having
a difficult time being heard." Does he have it right? Are
the entrenched lobbyists and interest groups in Sacramento stopping
the school finance shift from happening?
A strong organizational effort aimed at promoting local control
over school facilities does not exist in Sacramento. If this is
a goal of local school districts, they may wish to dedicate more
attention, resources, and effort to elevate this debate. If school
districts want to see the notion of local control over school
facilities gain greater attention in the Capitol, school districts
will need to make that case more aggressively.
One would imagine that that coalition would include more
than merely school districts. Don't cities and counties have an
interest in whether this money is spent wisely? Have their voices
been added to this chorus in the Capitol?
Cities and counties have a very significant interest in having
school facilities meet the needs of their residents.
At present, it is very difficult for school districts to plan
a capital outlay program because, as we've mentioned, they never
know when funding will become available--or what terms will govern
the allocation of the funds. And these difficulties arise when
districts are trying to build "ordinary" schools.
Today, school advocates are talking about building smaller schools,
the reuse of strip malls, community centered schools, joint-use,
etc. These kinds of plans can take additional time and can require
coordination between local governments. In order to facilitate
these new and evolving ideas of school construction, school districts
really need to have a dedicated stream of revenue--and have greater
flexibility over the expenditure of these funds. This would facilitate
joint efforts between schools, cities, and counties because each
local government would know what long-term funds for school facilities
are available. Without these assurances, it is difficult to form
partnerships.
In the Sept. TPR, LAUSD's Facilities Chief, Capt. Jim
McConnell stated, "The way money is apportioned for deferred
maintenance needs to be re-examined. Facilities management and
construction isn't a high enough priority and I feel strapped
by state regulators and processes that, taken together, seem to
push against our success." Is this the kind of challenge
that your report is trying to address?
Our proposal is for the state and local communities to provide
school districts with a regular stream of revenues that school
districts can use for a broad range of facility needs. In some
parts of the state, districts may use these funds to rehabilitate
existing schools. In other areas, this funding may give districts
a newfound ability to plan and complete new construction projects.
Still other communities may use their funds to adaptively reuse
a facility.
The goal of our proposal is to give school districts the flexibility
to design capital outlay programs to meet the needs of their students,
teachers and communities.
There's a current conversation going on re: the next state
school bond. Is there anything that could be injected into the
language of that bond that would move us a half step toward the
goals and objectives you mention here and in the Legislative Analysts
Office's report?
We recommend that at least part of the next state bond be targeted
to districts that have the largest backlog of school facility
needs. In doing so, we would bring school districts' facility
conditions to more comparable "starting points."
Once that big backlog of school facility needs has been substantially
taken care of, we can replace the existing system of state support
through bond funds with an annual stream of state revenues.
And again, what's the cost of not reforming the state's
facilities funding process?
Speaking strictly in terms of financial costs, because of the
unpredictability of state facility funding, some school districts
with pressing facilities needs enter into financial arrangements,
such as COPS or leases, to fund their facility projects. School
districts enter into these arrangements under the hope that--at
some future point--they will receive state funds. All of these
financial arrangements, however, come at a financial cost: significant
interest payments on the borrowed money. These financing costs,
in turn, reduce the district's long-term ability to support their
capital outlay program.
More important than these financial costs, however, the current
school facility finance system hurts our children on the educational
front. Based on information provided by school districts throughout
the state, approximately one out of three school children attends
classes in overcrowded classrooms --or classrooms in need of modernization.
And while no one has been able to prove conclusively that there's
a correlation between the quality of school facilities and educational
outcomes, we all know intuitively that it is a more difficult
task to educate a kid in a severely overcrowded classroom--or
in a building lacking adequate laboratory facilities or functioning
bathrooms
|