School Construction Joint Hearing - Feb 1, 2024

In 2021, Vermont initiated a comprehensive inventory and assessment of all public school buildings through Act 72, aiming to address long-standing issues stemming from the suspension of a school construction aid program in 2008. The subsequent creation of the School Construction Aid Taskforce in 2023, mandated by Act 78, aimed to analyze the assessment results and formulate recommendations for a new statewide aid program.

Stakeholders on Taskforce conducted eight meetings, including onsite visits and expert presentations. The findings underscored urgent needs, with an estimated annual spending requirement of $300M over 20 years to address facility deficiencies and create 21st-century learning environments. The Taskforce emphasized the critical role of school facilities in educational outcomes, citing a significant backlog of projects and deteriorating conditions affecting safety and equity. Drawing on insights from a range of experts and examining funding models from other states, the Taskforce was able to lay out a few proposals. Key recommendations include a centralized school construction aid program, projects that are prioritized by state educational goals, efficient fund utilization, and continuity of financial and technical resources. Acknowledging the inability for a state-funded solution alone, the Taskforce urged a multifaceted approach, emphasizing financial innovation, collaboration with career technical education centers, and a robust planning process. The report concludes that in the absence of a comprehensive state aid program, districts face inequities, urging legislative and administrative action to bridge the funding gap and uphold Vermont's commitment to quality.

The Task Force was supposed to start its work by July 15, 2023. However, due to the unprecedented flooding event in Vermont beginning July 10, the Task Force was not able to convene until August 28, 2023. They met eight times, including one onsite meeting at the Milton Elementary and Middle School. Over the course of its work, the Task Force authored a charter document outlining its goals and practices and heard from several presenters including:

  • The Agency of Education regarding the School Facilities Assessment.
  • The Vermont Bond Bank, the State Treasurer’s Office, and the Joint Fiscal Office on the state of Vermont education funding and municipal bonding.
  • The Agency of Education on school construction programs in other states.,
  • USDA Rural Development on a Winooski project and opportunities for other school districts.
  • Public Resources Advisory Group (State’s financial advisor) on financing scenario modeling.
  • Milton School officials on the status of their school building (including a physical tour).
  • The Department of Environmental Conservation and the Department of Health on Vermont’s School PCB testing program.
  • A panel of superintendents on the challenges districts face navigating the State’s PCB Testing program.

Informed by these presentations and the individual expertise of Task Force members themselves, the remaining portion of the Task Force’s time was spent discussing the group’s responses to its legislative charge. Additionally, a small working group was formed late in the fall as an effort to collaboratively draft the sections of this report for the full Task Force’s consideration. Their full meeting record can be found on the Agency of Education website and includes links to the aforementioned presentation materials and resources.

Two examples were provided about how deal with school construction projects. The Massachusetts example, a quasi-independent governmental body has taken on all of the functions of school construction aid, including the awarding of funds through grants (generated through tax revenue, as opposed to bonding) in addition to programmatic management of a school facilities program. The Rhode Island example mirrors the previous Vermont school construction aid program, but is more robust and expansive in its reach. It also relegates the authority for the awarding of state funds (bonds, for the most part) to a separate entity. The tasks of the Rhode Island School Building Authority includes everything but the final decisions about funding.

The taskforce recommends that the Legislature study these, and other state models and that they align their governance approach with the funding/financing and programmatic strategies that they develop. The Legislature might also benefit from testimony from districts from Rhode Island, Massachusetts or other states to gain an understanding of the benefits and limits of each approach. Finally, the taskforce urges any governance structure to be appropriately staffed and funded through a stable appropriation.

In addition to the specific recommendations made in the sections mandated in Act 72, the taskforce also acknowledged that there is a significant amount of groundwork that can and should be undertaken prior to the reestablishment of a school construction aid program. This work will ensure that state funding is directed towards projects that demonstrate significant planning and engagement with the local community to ensure the passage of necessary bonds and that the discussion of possible revenue and/or financing options are comprehensive and will address all aspects and requisite supports for a robust program. The taskforce recommends that these activities be supported in the 2023-2024 Legislative session as necessary prerequisites for any subsequent decision-making.

  1. They recommend that funds be appropriated for the Joint Fiscal Office (JFO) to model sources of funding, in addition to bonding, to support a school construction aid program. The JFO should include in its analysis the identification of a separate source of funding to support full-time staff to manage a construction aid program.
    1. The modeling should also consider how the state or school districts could maximize their state and local funds by leveraging federal funding programs including the Inflation Reduction Act Tax Credit program for schools to reduce energy costs, or the USDA Rural Community Development programs.
    2. The modeling should consider whether and/or how other state or federal programs or funding sources could be integrated or coordinated with a school construction aid program to encourage and even incentivize the repurposing of schools as social infrastructure, including housing.
  2. The taskforce recognizes that many districts do not have the resources (technical or financial) to engage in high-level master planning activities that include community stakeholders. Because it is the recommendation of the taskforce that districts only be eligible for funding if they have completed a district-wide master planning exercise, it is our recommendation that the Legislature create a planning grant program, to last five years, so that districts can complete a master planning process and become eligible for future funding.
    1. In order to encourage the passage of local bonds to fund school construction projects, these master planning grants should include as an eligible cost, the consideration of the adaptive reuse of school buildings for housing or other social infrastructure.
  3. There is a significant amount of planning and research needed in the areas of governance, funding, priorities and programmatic mechanics. The taskforce recommends that the Legislature establish a working group to build out a plan for a report to be delivered to the Legislature in January 2025. The working group should:
    1. Build from the recommendations made in this report and any additional priorities identified by the Legislature.
    2. Review and make recommendations on existing statute and regulation that might be impacted by or better aligned to a future school construction aid program.
    3. Identify areas where economizations or efficiencies might be gained (e.g. prequalifying consultants with experience in the planning, renovation and construction of schools or consideration of cost containment strategies like the use of building plan templates for new construction).
    4. Align with and result from the fiscal modeling produced by the Joint Fiscal Office.

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