Public School Capital Construction Assistance Board Meeting Minutes Vision

Public School Capital Construction Assistance Board Meeting Minutes
Vision
All students in Colorado will become educated and productive citizens
capable of succeeding in a global society, in the workforce, and in life.
Goals
Every student, every step of the way
Read by
third grade
Start strong
Meet or
exceed standards
Date & Time:
Graduate
ready
Location:
201 E. Colfax Ave., Rm 101
Denver, CO 80203
th
January 28 , 2015
10:00 a.m.
Capital Construction Assistance Board Members
Lyndon Burnett – Chair
David Tadlock – Vice Chair
Cyndi Wright
Tim Reed
Denise Pearson
Ken Haptonstall
Matt Throop
Karl Berg
Kathy Gebhardt
I.
Call to Order – 10:01 a.m.
II.
Pledge of Allegiance
III.
Roll Call: Lyndon Burnett, David Tadlock, Karl Berg, Kathy Gebhardt, Ken Haptonstall, Denise Pearson,
Tim Reed, Matt Throop, Cyndi Wright. CDE Staff Attendees: Scott Newell, Dustin Guerin, Cheryl
Honigsberg, Jay Hoskinson, Kevin Huber, Paul Reynolds, Lola Underwood
IV.
Approve Agenda
•
V.
Approve Previous Minutes from October 22nd and December 5th, 2014 Meetings
•
VI.
The CCAB Chair called for a motion to approve the agenda
o So moved by David Tadlock
o Ken Haptonstall 2nd the motion
o Motion to approve the agenda carried unanimously.
The CCAB Chair called for a motion to approve the previous minutes from the October 22nd and
December 5th, 2014 meetings
o So moved by Tim Reed
o Cyndi Wright 2nd the motion
o Discussion: The CCAB Chair informed the board that some minor grammatical errors had been
fixed. Kathy Gebhardt asked that the October 22nd, 2014 minutes be tabled until the February
meeting to give the CCAB more time to review the document.
o Tim Reed made a motion to approve the December 5th, 2014 minutes
o Motion to approve the December 5th, 2014 minutes carried unanimously.
Board Report
Matt Throop informed the CCAB he had a “walk –through” of Ouray school district’s new building with
the district’s superintendent.
The CCAB Chair informed the board he had visited the Ft. Lupton ribbon cutting ceremony on December
8th, 2014, along with CDE staff member, Cheryl Honigsberg. The CCAB Chair expressed the community’s
excitement regarding the new school building addition and historic renovation.
The CCAB Chair informed the board that he had seen the Colorado Lottery video of the Rocky Mountain
Deaf School opening, featuring CCAB member Tim Reed, Executive Director of Facilities and Construction
for Jefferson County Public Schools. Lola Underwood informed the CCAB that the Lottery video is
available on the Division website homepage.
The CCAB chair told the CCAB he had presented Resolution 14-2, which addresses the one-time, tax-free
transfer language in marijuana excise tax statute, as a discussion item to the State Board of Education at
their January meeting. Mr. Burnett clarified the resolution would be presented as an action item at their
February meeting. Mr. Burnett explained one State Board member voiced he would not support the
resolution as he felt an insufficient amount of money had been lost due to the tax-free transfer language
to warrant pursuing a statutory change. Mr. Burnett informed the CCAB that Senator Steadman would
be running a bill on Monday, February 2nd to change the current language in statute regarding marijuana
excise tax and one-time, tax-free transfers from medicinal to recreational facilities. The CCAB chair
clarified that approximately $5 million of revenue had been lost due to the tax-free transfers. He
expressed that the resolution had the support of most of the State Board.
Tim Reed informed the CCAB he attended the Sheridan ES ribbon cutting ceremony on December 20th,
2014. Mr. Reed commended Cyndi Wright and Cheryl Honigsberg for doing a great job, noting that the
new building was an outstanding facility.
Kathy Gebhardt informed the CCAB she attended the Northern Superintendent’s meeting and spoke
about the BEST program and the CCAB’S legislative platform. Ms. Gebhardt told the board that she
encountered a lot of support for the platform, especially the board’s plans to raise the COP cap. The
CCAB Chair reiterated Ms. Gebhardt’s comments that there is a lot of support and discussion
surrounding ways to raise the COP cap, particularly methods that would allow for a self-sustaining fund.
The CCAB Chair voiced his concern that the additional money may end up funding public school finance
rather than being used for school capital construction. The CCAB chair told the board that he is
encouraged by the progress being made with the board’s legislative agenda. Kathy Gebhardt stressed
the importance of having the support of CASB, as the organization has a far-reaching influence
throughout the educational environment. The CCAB Chair acknowledged he has experienced a positive
response from all who have interacted with and been affected by the BEST program.
VII.
Director’s Report
Scott Newell informed the CCAB the BEST grant application opened on January 5th, 2015, and 26
applications are in the system as of January 28th, 2015, 10 of which are charter schools. Mr. Newell
outlined the grant application process, explaining that the grant application closes at the end of
February, at which point the application review process begins. Mr. Newell informed the board that he
expected the number of applications in the system to steadily increase within the coming weeks.
Scott Newell informed the CCAB the Division’s annual report is due to the House and Senate Education
and Finance committees on February 15th, 2015. Mr. Newell informed the CCAB that all previous reports
are available on the Division website. Mr. Newell clarified the report indicates how much the Division is
recommending the JBC appropriate for BEST grants this year. Mr. Newell clarified the amount is
approximately $50 million, based on five-year projections from the State Land Trust, Colorado Lottery,
and marijuana excise tax revenues. Mr. Newell explained the State Land Board had provided updated
figures indicating the program would receive approximately $89 million from the State Land Trust, an
amount significantly lower than the projected $120 million. Mr. Newell went on to explain that the
figures for next year are estimated at $72 million. Mr. Newell told the CCAB he had met with the
Colorado Lottery commissioners to talk about the BEST program. Mr. Newell explained the Lottery’s
revenues are down, meaning the program is forecast to receive approximately $700,000 from the
Colorado Lottery. Mr. Newell explained that marijuana excise tax revenue is trending up, resulting in
approximately $16.5 million dollars in funding for the BEST program.
Scott Newell informed the CCAB of Ft. Morgan’s expected closure on February 5th, 2015 due to the
anticipated blizzard which closed the bond markets early. Mr. Newell explained how the bond markets
closing early pushed Ft. Morgan’s closing back to February 12th, 2015. Mr. Newell clarified funds would
be available for Ft. Morgan after February 12th and that the district continues to make progress with
their project.
Scott Newell informed the CCAB that Deputy State Treasurer Brett Johnson left the State Treasurer’s
Office for a job at CDOT. Mr. Newell informed the board he had met with Mr. Johnson’s replacement,
Jonathan Forbes. Mr. Newell explained that Mr. Forbes is very focused on education and believes there
are ways to potentially allow the BEST program to finance more without raising the COP cap. Mr. Newell
informed the board that he and Mr. Forbes would continue to work together on that matter.
Scott Newell informed the CCAB he spoken with Jennifer Mello, Legislative Liaison for the Colorado
Department of Education, regarding the process for this legislative session. Mr. Newell informed the
board that Ms. Mello would come to the CCAB’s monthly meetings to provide a legislative update, as
well as track any bills that may directly affect BEST, such as the current Wind for Schools bill.
Scott Newell informed the CCAB he had spoken to Craig about the State Assessment, who had suggested
a line item in the School Finance bill that would allow BEST to updated the assessment and bring on 6
FTE to update the data. Mr. Newell explained that the proposal was moving along. Mr. Newell outlined
the main points of the proposed plan to update the assessment, including restructuring the Division’s
database with valuable data points that could be categorized and/or extracted from district’s systems
and databases, how to administer the assessment, and how to perform quality control on updates from
school districts, as well as the RFP process. Mr. Newell clarified that a subcommittee of experts would
probably be formed to devise and agree upon the final structure of the database. Mr. Newell further
clarified that due to the size of the assessment project, the Division would eventually go through the
involved process of state procurement.
Denise Pearson joined the meeting at 10:25 a.m.
Scott Newell provided the CCAB with an update regarding returning closed lease-purchase proceeds to
districts, explaining they were making sure all pieces of the process fit together adequately and feasibly.
Mr. Newell explained that he is hoping to have the process finalized within the coming weeks, at which
point the application process for remaining Lease-Purchase proceeds could begin.
Scott Newell clarified that the Wind for Schools bill - SB 15-063 aimed to modify and expand existing
statutory language in order to expand the Wind for Schools program. Mr. Newell said he would provide
the board with more information about the bill.
The CCAB chair noted the proposed changes to the assessment seem to be well received and that the
proposal is largely understood as a reasonable and financially feasible solution.
Denise Pearson informed the CCAB she had had dinner with some superintendents, the lobbyist for the
East Central BOCES, and Senators Hill, Merrifield, and Woods, to talk about the East Central BOCES
legislative agenda. Ms. Pearson explained Senator Hill spoke about using the $40 million in marijuana
excise tax revenues to boost general education funding since he knew of a $102 million school built
approximately 20 years ago that sat empty. Ms. Pearson told the CCAB she informed Senator Hill that
the BEST program was not involved with that school, and that she and Frank Reeves, superintendent of
Genoa-Hugo school district, explained to Senator Hill the necessity of the BEST program, especially for
small school districts. The CCAB chair noted he would try to make an appointment with Senator Hill to
try remedy any reservations Senator Hill may have about the BEST program.
Denise Pearson informed the CCAB she had talked to the East Central BOCES about one line in their
legislative platform that voices support for the BEST program. Ms. Pearson explained the East Central
BOCES are willing to expand their platform to include the first two or three items in the CCAB legislative
platform.
VIII.
Discussion Items
a) Review and discuss the Genoa-Hugo C113 school district grant reserve request – Scott Newell
reminded the CCAB of the details surrounding the Genoa-Hugo abatement issue presented to the
board at the December 2014 meeting. Mr. Newell informed the CCAB that he had spoken with
Ninyo and Moore per the board’s request. Mr. Newell clarified that there was a miscommunication
between the parties involved, and that the project’s owner’s representative had misstated facts.
Mr. Newell clarified that, initially, the grant reserve was not approved due to the Division’s
understanding that the issue could not be categorized as unknown and unforeseen. Contrary to the
Division’s initial understanding of the issue, Mr. Newell clarified Ninyo and Moore had performed
their job as expected and in compliance with regulations. He explained that Ninyo and Moore
found that abatement work did not need to be performed. He explained the Department of Health
had visited the building site and requested that the work be done regardless. He explained that in
this scenario, the issue does qualify as an unknown and unforeseen circumstance, thus allowing
Genoa-Hugo to access their grant reserve through the BEST program. Mr. Newell clarified GenoaHugo had spent approximately $5,000 on legal fees that would be covered with the grant reserve.
Mr. Newell clarified the district would be receiving funding from grant reserves to the amount of
$280,000, thus covering the entire cost of the issue, rather than the $107,000 the district had
initially requested.
b) Discuss the board’s legislative priorities – The CCAB Chair reiterated the board’s earlier discussion
regarding their legislative priorities for Denise Pearson, namely updates regarding the assessment
piece of the platform and the marijuana excise tax language changes.
Kathy Gebhardt requested that the legislative subcommittee meet to discuss gaining support for an
increase in the program’s COP cap, and that the issue be added to the February meeting agenda as
an action item. The CCAB Chair responded that he would prefer the assessment piece and School
Finance bill be approved before the board took robust action elsewhere. With regard to pursuing
an increase in the COP cap, the CCAB Chair stated his belief that having the assessment piece in
place would give the board a stronger leg to stand on. He clarified that he did not wish for the
board to wait too long before pursuing their objective to raise the COP cap. The CCAB Chair
clarified that the legislative subcommittee could still meet, but that it would be preferable to wait
to take action on another of the board’s legislative objectives. He clarified that the CCAB could
move forward with the assessment piece while still having a conversation about raising the COP
cap. Kathy Gebhardt encouraged the CCAB to pay attention to the Long bill and how that may
potentially affect the School Finance bill. The CCAB Chair clarified that the board would have a
better idea of the success of the assessment piece by approximately late April. Kathy Gebhardt
voiced her concerns about waiting to take action on raising the COP cap and stated the board
should adopt a specific position on the matter. Ms. Gebhardt also explained that the assessment
piece and raising the COP cap are legislative priorities reliant on two different revenue streams.
The board clarified that the assessment would use general fund dollars. Mr. Newell clarified that
the new Deputy State Treasurer Jonathan Forbes seemed in favor of the board’s suggestion to
support the assessment using a tiered approach utilizing marijuana dollars first, followed by State
Land Trust money, which would then be backed by the general fund.
Scott Newell suggested the CCAB invite Jonathan Forbes to the legislative subcommittee in
February and/or the February 25th CCAB meeting to discuss his thoughts on potential methods for
raising the COP cap.
c) Discuss the school district match percentage changes – Kathy Gebhardt informed the CCAB she had
attended the Northern Superintendents meeting where she was approached regarding increases in
some school district’s minimum match percentages. Scott Newell clarified that school districts were
informed of the amount of their match in early December as has been the case in previous years.
Mr. Newell explained the Division’s regional program managers explained to their districts that,
with the statutory changes involved in this year’s match calculations, they should anticipate a
potential increase or decrease in their minimum match percentage. Mr. Newell clarified that a
comparison of last year’s and this year’s matches illustrated more than half of the matches
decreased this year’s, while some increased substantially and others’ decreased substantially. Mr.
Newell clarified that school districts were aware of the potential changes to their minimum match
percentages well in advance of the final numbers being released. Mr. Newell clarified that the
median match is still around 50%. Mr. Newell clarified the new calculations were weighted for all
new applications, including those districts reapplying for a grant that was not awarded last year.
Mr. Newell clarified that of the factors included in the match calculations, those that are better
representations of a school district’s financial capacity were weighted more heavily than other
metrics, such as free and reduced lunch, PPAV, and median household income that don’t directly
relate to a school district’s ability to provide matching funds.
Scott Newell discussed revisions made to the waiver application, as well as to the instructions for
applicants pursuing a waiver, that would help facilitate the statutory changes. Mr. Newell
explained how the first three questions of the waiver application would allow the school district or
charter school to describing how providing the required match would be detrimental to the school,
or how receiving a waiver would relieve some of the school’s financial obligations. Mr. Newell
explained the application had been changed to encourage more thorough explanations of an
applicant’s reasons for not being able to meet their required match, as well as to give the applicant
an avenue through which to explain how the statutory changes to the match calculation do not
appropriately represent the school’s financial capacity.
Scott Newell clarified that the match subcommittee made the decision to weight the factors. Kathy
Gebhardt voiced her concerns regarding how well heavily weighting bond capacity works for cash
grants versus Lease Purchase grants. Scott Newell requested that any changes the CCAB wishes to
make to the match calculation be performed in the summer rather than mid-grant cycle. Mr.
Newell used Ken Haptonstall’s school district as an example for smaller districts being able to bond
for larger projects and use some of that money as part of a match for smaller BEST projects. Mr.
Newell explained that, in that example, Dr. Haptonstall’s district did have bonding capacity which
they were able to use, which demonstrates how a district’s bonding capacity should affect its
minimum match.
Tim Reed stated that the new minimum match percentages came out as intended, with most small
districts experiencing a reduction in the minimum match and most large districts experiencing an
increase.
Scott Newell clarified that a school district can explain their inability to bond using the waiver
process, and that the waiver application gives schools the opportunity to thoroughly explain the
reason(s) for their waiver request. Tim Reed stated the matching spreadsheet should look for the
most objective method while the waiver process allows for subjectivity.
The CCAB Chair explained the revisions to the waiver application specifically address the audit
comments.
Kathy Gebhardt stated her concern that potential changes in the match were not well-enough
communicated to school districts prior to the official minimum match percentages being released.
Scott Newell clarified that the board could add an action item to the February meeting to review
and approve revisions made to the waiver application, but that while the instructions for the
waiver process have changed, the content has not. Mr. Newell explained the waiver applications
and instructions for completing it are already posted on the Division website. Mr. Newell reassured
the CCAB that the Division continues to communicate often with school districts and charter
schools regarding all aspects of the grant application. The CCAB Chair requested that Scott Newell
provide an update regarding the waiver at the February meeting.
The CCAB Chair called for a short recess at 11:15 a.m. The meeting reconvened at 11:20 a.m.
d) Review and discuss proposed changes to the grant application evaluation tool – Scott Newell
explained to the CCAB changes had been made to the grant application evaluation tool based on
feedback from both the board and grant applicants. Mr. Newell explained he wanted to ensure the
changes to the evaluation tool were addressed early to ensure grant applicants could review the
tool as soon as possible. Mr. Newell explained an action item to approve the updated grant
application evaluation tool would be included on the February agenda. Mr. Newell clarified the
majority of revisions made to the evaluation tool were syntactical in order to elicit more thorough,
informative responses. Mr. Newell clarified some questions were deleted while new questions
were added. Mr. Newell clarified the evaluation tool included Division comments in lieu of a
supplemental book. Mr. Newell walked through the redline document of the revised evaluation
tool with the CCAB so they could see where the changes occurred. He explained the changes to the
tool allowed for more consistent prioritization of projects i.e. looking at the project’s scope rather
than it’s assumed worth. He explained that the FCI and CFI were combined into one question as
both factors dealt with the same evaluation, while a question regarding due diligence was added to
that section. Mr. Newell explained potential approaches to projects without assessments, clarifying
that some universal score needed to be agreed upon so as not to penalize those projects. Mr.
Newell clarified the Division had discussed potentially giving projects without assessments a score
equal to the average score for that question, or to give such projects a neutral score of five.
Scott Newell explained to the board that most changes had been made to the evaluation tool
section addressing financial capacity, and that it was, admittedly, a difficult section to evaluate,
especially when evaluated alongside a match calculation that presumably paints a clear picture of a
school district’s or charter school’s financial ability. Mr. Newell explained the questions addressing
financial capacity are intended to look at an applicant’s financial ability regarding their proposed
project through evaluating their financial resources rather than their calculated matching fund. Mr.
Newell asked the CCAB if they would be agreeable to changing the “matching fund” language in the
Financial Capacity section to “resources”. The CCAB agreed to a change in the language.
Regarding the question about an applicant’s contributions to a capital reserve type fund versus
their general fund expenditures, Scott Newell explained the possibility of the Division calculating a
range to determine what counts as a suitable contribution. Ken Haptonstall discussed school
auditors warning against keeping or contributing to a capital reserve fund due to statutory changes
against it. Scott Newell explained that schools who had a capital reserve type fund but who were
no longer contributing to said fund and had a remaining balance at the time statute changed would
still have their reserve balance taken into account. Mr. Newell explained the Division would be
discussing the matter with applicants prior to the grant evaluation meeting in order to create
constructive comments for the CCAB on the evaluation sheet, unless the board had other
recommendations of how to address that question. The CCAB Chair explained that capital reserve
funds were originally intended to prolong the life of a school building by addressing small problems
are they arose yet the recent economic environment has made it increasingly difficult to maintain
such a fund. The CCAB chair suggested leaving the question as it is currently stated and simply
remaining aware of the potential circumstances or issues regarding capital reserve type funds for
schools. Scott Newell suggested changing the question entirely to include language pertaining to
capital expenditures or capital expenditures planning. Denise Pearson suggested requesting
applicants explain how they maintain their buildings. Ms. Pearson also discussed whether fiscal
warnings were an appropriate measure for charters. Scott Newell explained there would still be an
evaluation of the financial structure for charter schools. Mr. Newell explained that evaluation of a
charter school’s financial structure was not presented in the evaluation criteria in the evaluation
tool as the evaluation tool must be uniform for every applicant. Mr. Newell explained the
information would be presented as a data point on the application instead. Mr. Newell explained
for charter schools, the Division collected additional data points including who owns the building
and criteria pertaining to the lease structure of a charter school building. Mr. Newell explained the
Division added an additional data point for charter schools this year regarding funding received by
charter schools from alternative sources. Tim Reed reiterated and supported Denise Pearson’s
suggestion that applicants be asked to explain what they are doing to take care of their buildings.
Scott Newell explained an applicant’s expenditures/expenditure planning needs to be an
evaluation criterion, and to facilitate Denise Pearson’s suggestion, the Division would compile a
range through which the CCAB could rank the pool of applicants and determine whether or not the
school was providing a suitable amount. Paul Reynolds clarified that the questions asked and the
information sought after through the Financial Capacity section of the evaluation tool could be
continually revisited and revised based on what was useful and was not. Matthew Throop
recommended rewording the question regarding an applicant’s contributions to a capital reserve
type fund to read “The applicant is contributing a suitable amount for capital needs”. The CCAB and
Scott Newell agreed the suggested language allowed for evaluation.
Scott Newell explained the section regarding whether or not a project was recommended had
changed and would require an explanation why a project had not been recommended.
Scott Newell explained it was difficult to determine what is considered the standard square footage
cost on a typical project as it varies from region to school type. Mr. Newell explained the Division
has the relevant data but is trying to avoid using that data as an evaluation point. Mr. Newell
clarified the Division staff will make notes regarding whether or not a project’s square footage cost
is appropriate. Mr. Newell clarified there are safeguards in place to ensure a fair application
process.
Scott Newell clarified that although school districts are not required to adhere to the construction
guidelines, statute dictates that compliance with the construction guidelines will be considered
when applying for a BEST grant. Mr. Newell clarified that a district does not have to adhere to the
construction guidelines in order to be considered for a BEST grant, but they must explain how they
comply with the construction guidelines or why they do not comply the constructions guidelines.
Mr. Newell explained to the CCAB that the League of Charter Schools is seeking to change language
in the statute regarding the construction guidelines they feel currently penalizes grant applicants
from charter schools. Mr. Newell informed the CCAB he thinks creating a separate competitive
grant solely for charter schools may be a better solution.
Scott Newell clarified that a project still needs a majority vote in order to be recommended to the
State Board of Education for award.
e) Discuss venues for the May 19-20 BEST Grant application evaluation meetings – Scott Newell asked
the CCAB if they would be happy to use the Adams 12 Conference Center again for the grant
evaluation meetings or if they would prefer an alternative venue. The CCAB Chair expressed his
satisfaction with the Adams 12 facility, explaining the facility works well for the grant meetings and
giving his support for using the venue again. Kathy Gebhardt agreed with the CCAB Chair’s
assessment of the Adams 12 facility.
Kathy Gebhardt left the meeting at 12:00 p.m.
IX.
Future Meetings
•
•
•
February 25, 2015 - 1:00 p.m. Location: 201 E. Colfax Avenue, Room 101, Denver, CO 80203
March 25, 2015 - 1:00 p.m. Location: 201 E. Colfax Avenue, Room 101, Denver, CO 80203
April 22, 2015 - 2:00 p.m. Location: 201 E Colfax Avenue, Room 101, Denver, CO 80203
Scott Newell informed the CCAB that scheduling conflict with the State Board of Education
necessitated that the February, March, and April CCAB meetings be held from 10:00 a.m. to 1:00 p.m.
in lieu of their usual running time of 1:00 p.m. to 3:30 p.m.
X.
Public Comment
There was no public comment.
XI.
Adjournment
• The CCAB Chair called for a motion to adjourn
o So moved by David Tadlock
o Ken Haptonstall 2nd the motion
o Motion to adjourn carried unanimously; Meeting adjourned 12:08 p.m.