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How Your State Funds School Construction

July 24, 2014

image_13_schoolsIn every community across the U.S. is a school building. They’re used for learning, libraries, sports, and feeding kids, but they’re also used for community meetings, school programs, and in emergencies.  Each one of these schools is different, and so it’s probably not a surprise that they’re all funded differently.  The Pennsylvania Department of Education recently put together a summary of how all the states fund their capital planning projects like new buildings and modernizations in their Planning and Construction Workbook: A Report to the General Assembly.   Here is what they found:

Alabama: The Alabama Department of Education provides annual grants to school districts.
Alaska: The Alaska Department of Education and Early Development provides debt reimbursement and grant funding for individual projects.
Arizona: The Arizona School Facilities Board, through use of the Building Renewal Fund, provides project level grants on a competitive basis for capital improvements to existing facilities. The state also provides formula driven grants for new construction.
Arkansas: The Arkansas Division of Public School Academic Facilities and Transportation provides funds directly to local school districts for qualifying new construction, renovation, or alteration projects.
California: The state distributes facility funding directly to the local school districts through matching grants and reimbursements for individual projects. Generally, funds are distributed on a first come, first served basis, based on eligibility for funding, as determined by projected unhoused students for new construction and age of facilities for modernization.
Colorado: The Colorado Department of Education provides matching grants to local school districts on a competitive basis through the BEST program. The state’s minimum match is determined using several measures of school district wealth in comparison with statewide averages, as well as bond election effort and success over the past decade.
Connecticut: The Connecticut Department of Education provides matching grants to local school districts, with the state share (between 20 and 80 percent) determined by relative district wealth ranking.
Delaware: The Delaware Department of Education provides funding to local school districts for specific projects. The share of state support for public school facilities ranges from 60 to 80 percent and is determined by using an ability construction ratio that looks at the relative property wealth of a school district.
D.C.: The District of Columbia provides the Office of Public Educational Facility Modernization (OPEFM) capital funds for building improvements to the schools within the District of Columbia’s Public School system.
Florida: The Florida Department of Education provides monthly disbursements to local school districts based on available revenues, which are allocated by statutory formulas. (In January of 2012, Florida temporarily halted funding for all school construction projects due to lack of available resources. As a result of this decision, funding for projects was discontinued and schools and colleges were asked to return $250 million to the state until a solution could be identified and agreed upon.)
Georgia: The Georgia Department of Education provides reimbursements to school districts for approved facility projects, with the state facility funding level set by formula in state law.
Hawaii: The Hawaii Department of Education pays directly for local facility projects. Prioritization and state funding allocation is determined based on school building age and condition, as well as student demographics, building health and safety and maintenance needs.
Idaho: The Idaho Department of Education provides local school districts with facility assistance in the form of bond repayment subsidies, allocations for maintenance and emergency funds.
Illinois: The state provides grants to local schools districts for approved projects, with an automatic set‐aside of 20 percent of available state school construction funds allocated to Chicago Public Schools. The level of state funding depends upon district wealth and project type.
Indiana: Indiana provides no funds for school district capital outlay.
Iowa: The Iowa Department of Education provides grants to local school districts using a per pupil allocation formula. An equalization formula is used to distribute aid, with lower wealth school districts getting a higher share of state facility support.
Kansas: The Kansas Department of Education provides funding to local school districts for individual approved projects through three funding streams: bond and interest aid, capital outlay aid and new facilities weighting.
Kentucky: The Kentucky School Facilities Construction Commission provides annual appropriations to local school districts for facility funding through three primary funding sources.
Louisiana: Louisiana provides no funding for school capital outlay projects.
Maine: The Maine Department of Education provides reimbursements to local school districts for capital projects, with funding determinations made based on building condition.
Maryland: Maryland provides direct payments to vendors and reimbursements to local school districts.
Massachusetts: The Massachusetts School Building Authority provides matching reimbursement funds to cities, towns and regional school districts for individual projects. Project funding is determined based on building condition and overcrowding, with funds going to the neediest projects first. The state aid matching percentage varies depending on district wealth, with up to 80 percent of project costs covered for low‐wealth districts.
Michigan: Michigan provides school districts with loans (which must be repaid) to assist in making debt service payment on their qualified bonds.
Minnesota: The Minnesota Department of Education provides facility funding to local school districts through three primary mechanisms: Operating Capital Revenue as a component of the general education funding formula, Debt Service Equalization Aid and Maximum Effort School Aid loans.
Mississippi: The Mississippi Department of Education provides funds to local school districts for approved projects with the amount determined by project type and square footage.
Missouri: Missouri provides no funding to local school districts for capital projects.
Montana: The Montana Office of Public Instruction pays local school districts’ debt service, with state funding dependent on district wealth.
Nebraska: Nebraska provides no financial support to local school districts for capital outlay.
Nevada: Nevada provides no funding to school districts or public charter schools for capital outlay.
New Hampshire: New Hampshire provides reimbursements to school districts for approved capital projects. State funds are allocated based on community wealth equalization and the number of towns that utilize the school.
New Jersey: The New Jersey Department of Education provides project‐level funding to Regular Operating Districts, while Abbott districts are managed by the state with funds paid directly to contractors.
New Mexico: The New Mexico Public School Facilities Authority provides matching grants to local school districts for capital outlay as determined based on state‐established facility adequacy standards. The amount of the state match is based on district wealth.
New York: The New York Department of Education provides school districts with reimbursements for specific projects with state funds allocated based on district wealth and need.
North Carolina: The North Carolina Department of Public Infrastructure provides annual grants to school districts based on average daily membership and tax rate (higher tax rate qualifies for more state funds).
North Dakota: North Dakota provides no regular funding for capital outlay, although recently there have been one‐time appropriations of grant funds to local school districts for capital improvements.
Ohio: The Ohio School Facilities Commission provides matching grants to local school districts based on a legislative formula and rank of the district on the equity list.
Oklahoma: Oklahoma provides no funding to school districts for capital outlay.
Oregon: The Oregon Department of Education provides no funding to local school districts for capital outlay. However, the State Department of Energy has in the past provided $10 million annually for school energy conservation.
Pennsylvania: The Pennsylvania Department of Education provides reimbursements to local school districts for approved school construction projects.
Rhoda Island: The Rhode Island Department of Elementary and Secondary Education provide annual reimbursements to local school districts for approved capital projects. State facility funds are distributed first come, first served, based on need as determined by a community wealth index.
South Carolina: The South Carolina Department of Education provides reimbursements to school districts for approved capital projects, with funding levels determined by a formula that considers need and economy of the school district.
South Dakota: South Dakota provides no funding to local school districts for capital outlay.
Tennessee: Tennessee provides annual capital funds to local school districts through a formula as part of the Basic Education Program (BEP) funds.
Texas: The Texas Education Agency provides debt assistance to local school districts for capital projects through the Existing Debt Allotment (EDA) and Instructional Facilities Allotment (IFA) programs. State funds are allocated by statutory formula, with funding determinations made based on district wealth.
Utah: Utah provides annual non‐matching grants to local school districts based on formula.
Vermont: Vermont provides reimbursements to local school districts for approved projects. State reimbursement levels depend on project type.
Virginia: Virginia provides no grants to counties and cities for their public school capital projects. However, the state does permit the local municipalities to use the state’s credit rating and it provides some school construction funds at subsidized interest rates to school districts that meet program criteria.
Washington: Washington provides reimbursements to local school districts for approved projects. The level of state funding is determined by building condition and need for new space, with a funding formula based on maximum construction cost allocation.
West Virginia: The state provides reimbursements directly to individual approved capital projects. The School Building Authority evaluates projects for funding using established criteria that includes health and safety, reasonable travel time, regional planning, adequate space for projected enrollment, history of efforts to pass local bond issues, regularly scheduled preventative maintenance, and efficient use of funds.
Wisconsin: The state provides no facilities funding to local school districts.
Wyoming: The Wyoming School Facilities Commission (SFC) provides non‐matching grants to local school districts for approved capital projects. Project funding is determined by combining scores from a facility condition assessment, educational functionality, and capacity to create a prioritized needs index that identifies the most critical projects across the state. The SFC pays the full cost of all projects it funds – no local match is required.

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