45th legislature - STATE OF NEW MEXICO - second session, 2002

RELATING TO PUBLIC SCHOOLS; AMENDING THE PUBLIC SCHOOL CAPITAL OUTLAY ACT TO REQUIRE THAT, IF ECONOMICALLY AND TECHNICALLY FEASIBLE, PROJECT COSTS INCLUDE THE CAPITAL COSTS OF GEOTHERMAL COOLING OR HEATING SYSTEMS.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

Section 1. Section 22-24-5 NMSA 1978 (being Laws 1975, Chapter 235, Section 5, as amended) is amended to read:

"22-24-5. PUBLIC SCHOOL CAPITAL OUTLAY PROJECTS--APPLICATION--GRANT ASSISTANCE.--

A. For project allocation cycles occurring before September 1, 2003, the council shall approve an application for grant assistance from the fund for a public school capital outlay project not wholly funded pursuant to Section 22-24-4.1 NMSA 1978, when the council determines that:

(1) a need exists requiring action;

(2) the residents of the school district have provided available resources to the school district to meet its capital outlay requirements;

(3) the school district has used its capital resources in a prudent manner;

(4) the school district has provided insurance for buildings of the school district in accordance with the provisions of Section 13-5-3 NMSA 1978;

(5) the school district:

(a) is indebted at not less than

sixty-five percent of the total general obligation debt authorized by law; or

(b) within the last three years, was indebted at the level required in Subparagraph (a) of this paragraph and received a grant pursuant to this section for the initial stages of a project and currently has a critical need for an additional grant to complete the same project;

(6) the application includes:

(a) the capital needs of any charter schools located in the school district or the school district has shown that the capital needs of the charter schools are not as great as the capital needs requested in the application; and

(b) the facilities needed in the school district to implement a full-day kindergarten program or that the school district has shown that the need for facilities to implement the program is not as great as the capital needs requested in the application; provided that the total amount of assistance grants made in a fiscal year for the purpose of implementing full-day kindergarten programs shall not exceed five million dollars ($5,000,000); and

(7) the school district has submitted a five-year facilities plan that includes:

(a) enrollment projections;

(b) a current preventive maintenance plan to which the school adheres for each public school in the district; and

(c) projections for the facilities needed in order to maintain a full-day kindergarten program.

B. The council shall consider all applications for assistance from the fund and, after a public hearing, shall either approve or deny the application. Applications for grant assistance shall only be accepted by the council after a school district has complied with the provisions of this section. The council shall list all applications in order of priority, and all allocations shall be made on a priority basis, except:

(1) twenty million dollars ($20,000,000) of the proceeds from supplemental severance tax bonds available for the funding cycle in each of fiscal years 2002 and 2003 shall be set aside for allocation solely for projects in school districts that are eligible for funding from the fund and that receive grants from the federal government as assistance to areas affected by federal activity authorized in accordance with Title 20 of the United States Code, commonly known as "PL 874 funds" or "impact aid"; and

(2) in the case of an emergency, the order of priority shall first reflect those projects that have been previously funded but are not as yet completed, excluding expansion of those projects and contingent upon maintenance of the required local support.

C. For allocation cycles beginning after

September 1, 2003, the following provisions apply:

(1) all school districts are eligible to apply for funding from the fund, regardless of percentage of indebtedness;

(2) priorities for funding shall be determined by using the statewide adequacy standards developed pursuant to Subsection D of this section; provided that the council shall apply the standards to charter schools to the same extent that they are applied to other public schools;

(3) after consulting with the staff architect of the property control division of the general services department, the council shall establish criteria to be used in public school capital outlay projects that receive grant assistance pursuant to the Public School Capital Outlay Act. In establishing the criteria, the council shall consider:

(a) the feasibility of using design, build and finance arrangements for public school capital outlay projects;

(b) the potential use of more durable construction materials that may reduce long-term operating costs; [and]

(c) for projects that include heating or cooling systems, the potential use of geothermal energy as the energy source for the systems; and

[(c)] (d) any other financing or construction concept that may maximize the dollar effect of the state grant assistance;

(4) no more than ten percent of the combined total of grants in a funding cycle shall be used for retrofitting existing facilities for technology infrastructure;

(5) except as provided in Paragraph (6) of this subsection, a project approved and ranked by the council shall be funded within available resources in accordance with the following formula:

(school district final prior year assessed valuation per MEM ÷ the state average final prior year assessed valuation per MEM) x 0.5. The product is subtracted from 1.0 and the difference is then multiplied by seventy-five percent. The product of that calculation added to (the percent of bonding capacity used x 0.25) equals the percentage of the cost of the approved project to be funded from the fund. "MEM" means the total enrollment of students attending public school in a school district in the final funded prior school year, with kindergarten being counted as 0.5. In those instances in which the formula provides less than 0.1, 0.1 shall be used as the state's share;

(6) in those instances in which a school district has used all of its local resources, the council may fund the total amount of a project; and

(7) no application for grant assistance from the fund shall be approved unless the council determines that:

(a) the public school capital outlay project is needed and included in the school district's five-year facilities plan among its top priorities;

(b) the school district has used its capital resources in a prudent manner;

(c) the school district has provided insurance for buildings of the school district in accordance with the provisions of Section 13-5-3 NMSA 1978;

(d) the school district has submitted a five-year facilities plan that includes: 1) enrollment projections; 2) a current preventive maintenance plan to which the school adheres for each public school in the district; and 3) projections for the facilities needed in order to maintain a full-day kindergarten program;

(e) the school district is willing and able to pay any portion of the total cost of the public school capital outlay project that, according to Paragraph (5) of this subsection established by law, is not funded with grant assistance from the fund;

(f) the application includes the capital needs of any charter schools located in the school district or the school district has shown that the facilities of the charter schools in the district meet the statewide adequacy standards; and

(g) the school district has agreed, in writing, to comply with any reporting requirements or conditions imposed by the council pursuant to Section 22-24-5.1 NMSA 1978.

D. After consulting with the public school capital outlay task force and other experts, no later than September 1, 2002, the council shall develop statewide adequacy standards applicable to all school districts. The standards shall establish the minimum acceptable level for the physical condition and capacity of buildings, the educational suitability of facilities and the need for technological infrastructure. The amount of outstanding deviation from the standards shall be used by the council after September 1, 2003 in evaluating and prioritizing public school capital outlay projects.

E. It is the intent of the legislature that grant assistance made pursuant to this section allow every school district to meet the standards developed pursuant to Subsection D of this section; provided, however, that nothing in the Public School Capital Outlay Act or the development of standards pursuant to that act prohibits a school district from using local funds to exceed the statewide adequacy standards.

F. Upon request, the council shall work with, and provide assistance and information to, the public school capital outlay task force.

G. The council may establish committees or task forces, not necessarily consisting of council members, and may use the committees or task forces, as well as existing agencies or organizations, to conduct studies, conduct surveys, submit recommendations or otherwise contribute expertise from the public schools, programs, interest groups and segments of society most concerned with a particular aspect of the council's work.

H. The council shall promulgate such rules as are necessary to carry out the provisions of the Public School Capital Outlay Act.

I. No later than December 1 of each year, the council shall prepare a report summarizing its activities during the previous fiscal year. The report shall describe in detail all projects funded, the progress of projects previously funded but not completed, the criteria used to prioritize and fund projects and all other council actions. The report shall be submitted to the state board, the governor, the legislative finance committee, the legislative education study committee and each member of the legislature."

Section 2. A new section of the Public School Capital Outlay Act is enacted to read:

"[NEW MATERIAL] GEOTHERMAL HEATING OR COOLING SYSTEMS.--In any public school capital outlay project, funded in whole or in part pursuant to the Public School Capital Outlay Act, that includes a heating or cooling system, if economically and technically feasible, the council may require that the heating or cooling system utilize geothermal energy. No proposed project shall be denied assistance or the scope of the assistance diminished because the project includes a geothermal heating or cooling system."