Happy New Year! This is our first newsletter of 2022. SchoolWorks has been busy assisting over 60 of our clients with adjusting and developing trustee boundaries. With the delayed release of the 2020 Census data, there was a lot of work to do in a short amount of time. Thanks for your patience during this time period.

SchoolWorks is planning to attend the SSDA (Small School Districts Association) Annual Conference on March 6^th and 7^th. We look forward to seeing all of our clients that will be able to attend.

Much has been happening on the school facilities topic over the past few months. In this newsletter we will update you on developer fees, TK and K facility grants, the State School Building Program and the possibility of a State School Bond. 

Please contact us by e-mail, phone or use our online website tool to get the assistance you need or to get help with questions on any demographics or facility planning and funding issues.

The SAB meeting on January 26^th was much different than we had anticipated. This is normally the time of year that the SAB announces the inflation adjustment for the program grants and also the adjustment in the maximum Level 1 developer fee rate. However, OPSC stated they did not have the data in time to have this item on the agenda. It was delayed and will be approved at the February 23^rd meeting. 

There was funding allocated to just over $250 million in projects at this meeting. These were the funds provided to the program from the 2021/22 state budget.

The regulations were approved in January for the $490 million being allocated to the Full Day Kindergarten Program from the State General Fund that can now be used for K, TK and preschool classrooms. OPSC held a webinar on Feb 3^rd to review the program. See our notes below or our website for more information on this opportunity.

There were not any projects approved at this meeting as they were waiting for the inflation adjustment before adding more projects to the unfunded list.

The next SAB meeting is scheduled for February 23^rd.

The following chart illustrates the Prop 51 funds that were approved by the voters in 2016 (gold) and what portions have been distributed to schools (blue), are approved and about ready to be funded (gray) and those still waiting to be processed (green). We have added an orange color to the funds available to identify the contributions from the State General Fund.

The total backlog of projects is now at $4.399 billion which has slightly increased as no projects were approved this month. The applications submitted since the previous meeting totaled $213.06 million and represents two months of submittals.

The State School Bond Funding Program now has around $3.28 billion in applications that are still waiting for future funds. The State Budget Proposal includes an additional $2.3 billion to be added to the State School Bond Funding Program from the General Fund.

The maximum developer fee rates approved by the SAB in 2020 are $4.08 per square foot for residential and $0.66 per square foot for commercial/industrial projects.

Based on preliminary estimates we have seen, the new rates for 2022 will likely be around $4.78 for residential and $0.77 for commercial/industrial. If these calculations are correct, that would be an overall increase of 17.4%. 

With this major adjustment for inflation, it is our recommendation for all districts to consider updating their studies.

Thanks for all the interest in enrollment projections. We have been busy assisting many of our clients with understanding the enrollment trends and the impacts of the expanding eligibility for the TK grade.

The Demographic Studies we prepare for many of our clients is an analysis of the student populations within each school area. This data, along with birth data and new development data, is used to generate six-year enrollment projections for each school or program within the district. Our projections typically have an error rate of less than 1% and are useful for facility planning efforts, along with budgeting and staffing requirements. These studies are also an important part of your Facility Master Plan.

Please contact us if you need assistance or have any questions on these services.

There will be two application rounds for the additional funding allocated to this program. The first round will be April 2022 with $225 million available and the second round will be April 2023 with the remaining funds.

This program will fund either new classrooms or retrofit your existing building to create kindergarten classrooms. This program does require the district to operate full-day programs for the facilities funded by this grant. The funding for this program is mostly 75% state funded with a 25% local match. However, due to the increased facility costs and the limited amount of funds available and the significant demand anticipated most, if not all, projects that will be funded are likely to be financial hardship which results in 100% State funding for the project.

The basic eligibility determination looks at the current kindergarten enrollment, divided by 25, to calculate how many kindergarten rooms are needed. For TK and PS, the average of the enrollment in grades 1-3 is divided by 25. Once you know how many rooms are needed, you subtract how many kindergarten-style rooms you have, and then calculate how many you qualify for. No more than 4 TK and 4 PS classrooms will be funded for each project.

Since this program will continue to use the same priority point system, districts that qualify for financial hardship and those with a high percentage of students eligible for free/reduced lunch will be at the top of the list for approval.

A district cannot receive funding for a second project in one round unless every district that applied has been funded for a project. Therefore, we recommend only one application be considered for each district. We can help you determine which site has the best funding potential. 

With additional funds being proposed to be allocated to the School Facility Program, the passage of a State Bond could be delayed. If the $2.3 billion General Fund transfer (or more) remain in the final budget, then it is likely the Bond will be delayed until 2024. If the general funds get reduced or removed, then a State Bond will be needed. Discussions are still happening and we should know more in the next few months. 

Please reach out to us if you are interested in our services for the PS/TK/K Facility Grant or for a new Developer Fee Justification Study. These projects will be keeping us busy over the next few months. Thanks for considering SchooWorks to assist you with your facility planning efforts.

The California Department of Education (CDE) has recommended that districts update their facility master plans to account for the expansion of TK to a full grade. For more information on how we can assist you with updating your plan, please contact Brett Merrick, VP – Project Manager/Facilities Master Plan @ 916.300.0590. 

Ken Reynolds

President

SchoolWorks