2014 Session Wrap-Up: School Construction

This post summarizes the status of bills affecting K-12 school construction in the 2014 Legislative Session.

Creation of a State Debt – Qualified Zone Academy Bonds: HB 190/SB 218, provides $4,625,000 in grant funding to the Interagency Committee on School Construction and the Maryland State Department of Education for renovation, repair and capital improvement to schools under the qualified zone academy bond program.  MACo supported this legislation that provides funding for an important niche of projects that would not normally qualify as true capital projects eligible for general obligation bond (GO) funding. Status:  SB 218 was passed by the General Assembly and is awaiting the Governor’s signature.

Board of Public Works – Relocatable Classrooms – Indoor Air Quality Requirements HB 628/SB 238 clarifies that the State Department of Education’s indoor air-quality regulations apply only to relocatable classrooms purchased after July 1, 2014.  This clarification will allow regulations that have been on hold for several years to finally go into effect.  MACo supported the legislation which will protect the health and safety of our school children from harmful volatile organic compounds (VOCs). Status: HB 628/SB238 passed the General Assembly and is awaiting the Governor’s signature.

State Department of Education – Assessment Report for Broadband Capabilities in Public Schools HB 1388/SB988 requires the Maryland State Department of Education (MSDE) to report on existing broadband speeds and connections in all public schools in the State by December 1, 2014.  The request for additional information will help determine the preparedness of our schools to implement the PARCC assessments within the next couple of years.  MACo supported the legislation with an amendment asking that the report include recommendations of appropriate State and private resources to fund the required investment, which is estimated to cost up to $100 million. Status: HB 1388/SB988 passed the General Assembly, without amendments, and is awaiting the Governor’s signature.

Study of Alternative Financing Methods for the Purpose of School Construction (previously Maintenance of Effort – Lease Payment Exclusion): HB 349/SB 388 in its original form clarified that lease payments made by a local board of education to a private entity holding title to school property from the State’s public school are excluded from the maintenance of effort (MOE) requirement.  The bill was amended, however, to only require the Department of Legislative Services to examine the use by local school systems of lease payments or certain other alternative financing methods for school construction.  MACo supported the original legislation which would have made private investment into school construction more accessible in all counties by clarifying that lease payments on privately constructed schools may be excluded from maintenance of effort like other debt service payment. MACo also supported the amended bill. Status: HB 349, as amended, was passed the House but was not passed by the Senate so it did not proceed further. According to recent news coverage, however, a report on lease payment financing may be requested through an executive order from the Governor.

Public School Construction – Creative Financing Study HB1323/SB927 in its original form provided Baltimore, Prince George’s and Montgomery counties with up to $20.0 million each annually in addition to other public school construction funding.  The amended bill removes that language, and instead requests only a study of public school construction to include developing creative means, financing or otherwise, to increase funding for public school construction; creating more reliable revenue streams that could include leveraging funds by counties to meet public school construction needs; and examining the use of lease payments for other alternative financing methods, by local school systems for public school construction. Status: HB1323/SB927 was delayed on the final day of session and did not ultimately pass the Senate. However, according to recent news coverage, the study may be requested through an executive order from the Governor.

For more information on the bills in this article, contact Robin Clark or (410) 269-0043.