The state school construction board has recommended projects totaling $67.9 million for 2014-15, a significantly lower total than those approved in prior years.
A year ago, the board approved about $105 million in projects for 2013-14. And two years ago, $273 million in projects was recommended for the 2012-13 cycle.
The reason for the decline is simple. The 2008 law that created the Building Excellent Schools Today program limits BEST’s debt repayments to $40 million a year.
Larger BEST projects such as new schools usually have been funded through lease-purchase arrangements under which investors buy financial instruments called certificates of participation (COPs). Districts use those investment revenues to build their projects, and the state pays off the investors over multiple years. So the state is still paying off COPs for projects approved in prior years and is just about at the $40 million limit.
The only large COP project recommended by the Capital Construction Assistance Board at a meeting this week was $36 million to build a new middle school in Fort Morgan. The district earned a spot on the BEST backup list last year but didn’t win a grant because none of the 2013 finalists dropped off. (BEST projects are funded by a combination of state grants and local matches. In past years some finalists have been dropped because voters defeated bond issues needed to raise local matching funds.) Even though Fort Morgan was only on the backup list last year, district voters did approve a bond issue for its match.
Scott Newell, executive director of the Division of Public School Capital Construction Assistance, said the state treasurer has determined there is sufficient funding to cover the Fort Morgan project. In the very unlikely event that falls through, the board selected an $11.8 million junior/senior high school addition in the Edison district as a backup.
Given the size of the Fort Morgan recommendation, the rest of the 2014-15 project list totals only $31.8 million, a combination of $16.4 million in cash grants from the state and $15.4 million in local matches.
Only five of the 25 cash-funded projects total more than $1 million each, including a $3.2 million roof replacement in Alamosa, $1.2 million of water line work in Sheridan, $2.2 million of miscellaneous repairs at Dartmouth Elementary School in Aurora and $14.1 million in fire protection and safety upgrades at Pueblo County High School. That project includes $10.8 million in local funds. (Get links to the full list of recommended projects and all 2014-15 applicants here.)
The full list of recommended projects will be considered and voted on by the State Board of Education at its June meeting. The Fort Morgan project also has to be ratified by the Capital Development Committee, a joint House-Senate panel.
The BEST program is open to all schools and prioritizes projects related to building safety and health. But a main goal has paying for new schools in small districts that don’t have sufficient property values to fund building projects. There will be few if any such projects in the immediate future, given that BEST has reached its $40 million repayment limit. That concerns program advocates, and there was talk during the 2014 session about finding additional revenues and raising the cap. But nothing jelled on that issue. BEST receives most of its funding from a share of the revenues earned on state lands.
Happy ending nears in one BEST story
The Aspen Community School, a charter in the rural Woody Creek area, is holding a groundbreaking ceremony June 3 for a project that will replace its 42-year-old log building.
The school fought for years to get a BEST grant, but the effort was stymied by high matching requirements. A compromise reached two years ago (see story) finally made a grant possible, and the school has reached about 70 percent of its overall fundraising goal, according to a recent news release.