Priority Issue: The Built to Learn Act & School Facilities Funding and Policy Highlights

 

The Built to Learn Act Becomes Law!

House Bill 1 – The Built to Learn Act

The Built to Learn Act, a landmark school construction funding and policy bill initially passed in 2020, finally became law in 2021 effective upon the passage of HB 1300, the Blueprint for Maryland's Future Act. The year delay was due to the Governor's veto of the Blueprint legislation in 2020. Because Built to Learn (HB 1) became law a year later than anticipated, the Built to Learn Act "Revisions" bill (SB 551) was passed to extend timelines and make several other substantive changes to the law.

Why MABE Strongly Supported the Built to Learn Act

Highlights

This bill authorizes the Maryland Stadium Authority (MSA) to issue up to $2.2 billion in revenue bonds, backed by annual payments from the Education Trust Fund (ETF) beginning in fiscal 2022 that phase up to $125 million annually by fiscal 2024, for public school construction projects in the State, including to support a possible public-private partnership (P3) agreement for Prince George’s County. It also increases or extends mandated State funding for supplemental public school construction programs and establishes a new special fund and mandate for the highest priority school facilities.

Sale of Revenue Bonds

The issuance of a bond under the bill is not directly, indirectly, or contingently a moral or other obligation of the State, MSA, or any other governmental unit to levy or pledge any tax or to make an appropriation to pay the bond. A bond issued by MSA to finance improvements, construction, or renovations to a public school facility.

Two Funds

Financing Fund - Monies in the financing fund are pledged to and used to pay (1) debt service on bonds issued by MSA; (2) debt service reserves under a trust agreement; (3) the annual payment to the Prince George’s County P3 fund; (4) all reasonable charges and expenses related to the issuance of bonds; and (5) all reasonable expenses related to MSA’s management of the fund and its project oversight responsibilities.

Facilities Fund - MSA may use the facilities fund as a revolving fund to pay (1) debt service on bonds; (2) design and construction costs relating to public school facilities; (3) to the extent authorized by federal law, any start-up costs, administration, overhead, and operations related to management of improvements to public school facilities; (4) all reasonable charges and expenses related to MSA’s oversight and project management responsibilities; and (5) all reasonable expenses related to its review of the Prince George’s County P3 agreement.

Project Management

In general, MSA is responsible for the construction and improvements to local school facilities financed with the proceeds from the revenue bonds. However, except for Baltimore City, MSA may authorize a local school board to contract for, manage, and oversee public school facility projects under its jurisdiction. Before authorizing a local school board to manage its projects, MSA must consider the board’s (1) track record of managing public school facility projects and (2) expertise and capacity to manage the proposed projects. Projects managed by MSA and local school systems are subject to the same requirements and procedures that govern the PSCP.

Other Key Bill Provisions and Amendments

MOUs with MSA, the IAC, and Local Governments

For any MSA funded school project, the MSA, county government, and county board of education must enter into a project memorandum of understanding for a public school facility that shall be subject to approval by the Interagency Commission on School Construction (IAC).

The project memorandum of understanding shall:

  • Be subject to the applicable terms and conditions set forth in the program memorandum of understanding under subsection (e)(2) of this section;
  • Identify specific parameters regarding the 5 roles and responsibilities of each party with respect to budget review and approval, procurement, design, schedule, construction administration, and contract compliance and reporting;
  • Reserve the right of the authority to assume a project under certain circumstances;
  • Include a provision that the state and local cost–share for the county established in regulations shall apply to a county public school facility approved for funding from the supplemental public school construction financing fund or the supplemental public school construction facilities fund; and
  • Require the county and county board of education to give priority in funding projects to schools:
    • that are the oldest buildings in the school system with significant facility deficiencies;
    • with high concentrations of students 20 eligible for free or reduced price meals;
    • with a high number of relocatable classrooms; or
    • with a high utilization based on the school’s state rated capacity;
    • with space needs for full–day prekindergarten or career and technical education programs; and
    • include a comprehensive plan for local hiring and a plan to maximize the utilization of state–certified locally based minority and women–owned businesses for projects approved for funding.

Eligible Costs and Local Cost-Share

The bill makes two adjustments to the calculation of school construction costs that are eligible for State reimbursement that apply only to projects funded from proceeds of the MSA bonds. Eligible costs for these projects include architectural, engineering, consulting, and other planning costs. Also, for a county that receives the minimum State share (50%) of eligible school construction costs and that has advanced construction funding for projects in PSCP, the State share of eligible costs for MSA bond proceeds must include 150% of the applicable gross area baseline per student for each project.

For projects funded by PSCP (but not from the proceeds of MSA bonds), IAC must adopt regulations that include architectural, engineering, consulting, and other planning costs as eligible costs for a project that (1) is located in a county that has fewer than 20,000 full-time equivalent students enrolled and (2) has received local planning approval from IAC.

Healthy School Facility Fund

Healthy School Facility Fund - The bill increases the mandated funding amount for the the Healthy School Facility Fund from $30 million to $40 million in FY 2023 and 2024.  Through FY 2024, 50% of these funds are to be awarded to school sin Baltimore City. It also specifies that funding priority must be given to resolve any severe issue that results in a school being closed, in addition to specified issues in current law. It also clarifies that plumbing-related projects may include  pipe insulation to reduce condensation in order to prevent mold, and adds roofs as eligible projects.

Note: The Capital Budget passed in 2021 provides the following:

  • $70 million for the Healthy School Facility Fund. The Governor’s budget did not provide funding for the program, as the funding mandate included in the Built to Learn Act did not apply at the time the budget was introduced. The General Assembly added $30 million of GO bond funds for the program, which was subsequently enhanced with $40 million of federal funds. (Source: 90-Day Report)

Public School Facilities Priority Fund 

The bill creates the Public School Facilities Priority Fund, effective July 1, 2022, to provide State funds to address the facility needs of the highest priority schools identified by the statewide facilities assessment completed by IAC under current law, with highest priority given to schools with a severe facility issue that required the school to be closed. The bill further specifies how the funds are to be used if the statewide facility assessment is not completed. IAC administers the fund.

In FY 2025 and 2026, the Governor must appropriate at least $40 million to the fund in either the annual State operating or capital budget bill. Beginning in fiscal 2027, the mandated annual appropriation increases to at least $80 million. Money expended from the fund is supplemental to and is not intended to take the place of funding that otherwise would be appropriated for public schools in the State.

Capital Grant Program for Local School Systems with Significant Enrollment Growth or Relocatable Classrooms

The bill makes several changes to the existing Capital Grant Program for Local School Systems with Significant Enrollment Growth or Relocatable Classrooms (EGRC). First, it raises the mandated annual funding level from $40 million to $80 million beginning in FY 2027. Second, it specifies that funding provided for EGRC above $40 million be allocated to eligible school systems based on their proportionate share of the percentage of
enrollment growth above the State average. Third, it changes the definition of “significant number of relocatable classrooms” to mean an average of more than 250 (instead of 300) relocatable classrooms over the past five years, beginning June 1, 2020. Finally, it requires the Governor to include funding for the program in either the operating budget or the capital improvement program of PSCP.

Note: The Capital Budget passed in 2021 provides the following:

  • $20 million more for the Supplemental Capital Grant Program, also known as the Enrollment Growth and Relocatable Classrooms Program, for a total allocation of $60 million. This includes $40.0 million allocated through the mandated statutory formula and $20.0 million to be allocated outside of the formula with specific allocations to jurisdictions as set forth in the capital budget bill.

Workgroup on the Assessment and Funding of School Facilities

The bill makes changes to the charge and timeline of the Workgroup first established by the 21st Century School Facilities Act of 2018 (referred to as Chapter 14).  The bill requires the President of the Senate and the Speaker of the House (instead of the State Superintendent of Schools) to jointly appoint the chair of the workgroup. The bill extended the deadline for the workgroup to report its findings and recommendations by two years; made changes to when IAC can begin using the results of a statewide facility assessment for school construction funding decisions; and extended the date when assessment data may be used for funding allocations by two years.

Note: SB 551, the Built to Learn Revisions bill, makes several other major changes to the Workgroup's charge and timeline.

In addition to the issues it must consider under Chapter 14 of 2018, the bill extends the Funding Workgroup’s deadline to December 31, 2021, and requires the Funding Workgroup to consider and make recommendations in the following areas:

  • Factors used to develop the State and local cost-share formula for school construction projects, including incorporating related changes to the formulas used to calculate State education aid under the Blueprint for Maryland’s Future;
  • Methods used to establish gross area baselines and the maximum State construction allocation for public school construction projects;
  • The purpose and implementation of the Local Share of School Construction Costs Revolving Loan Fund, which was established by Chapter 14 but never funded; and
  • The long-term effects of school construction decisions on the cost per student and total cost of ownership of public school facilities.

Local Capacity Studies

By July 1, 2022, each local school board must conduct a capacity study identifying the current capacity of each school and the demographics of students in the school compared to the overall student demographics for the school system. A capacity study completed within three years of the due date satisfies the requirement. The capacity study must be submitted to IAC and the General Assembly by December 1, 2022.


2021 Session Highlights

School Construction Funding Highlights
(HB 590 - Capital Budget Bill for FY 2022)

  • $285 million - Capital Improvement Program for approved local school construction and renovation projects.
  • $60 million - Supplemental Grant Program for school systems with more than 300 relocatable classrooms or high enrollment growth.
  • $70 million Health School Facility Grant Program for HVAC projects.
  • $10 million - Public School Safety Grant Program.
  • $6 million - Aging Schools Program.
  • $333 million - Built to Learn Act revenue bonds.

SB 551 - 21st Century School Facilities Act and Built to Learn Act - Revisions

  • Expands the charge of the School Facilities Assessment and Funding Workgroup to include recommendations to update the state-local cost share formula and reduce per pupil costs and total cost of ownership.
  • Sets FY 2022 as the floor for the State’s cost share until 2025. (Avoiding reductions for several systems.)
  • Expands Healthy Schools Program funding eligibility to include roofs and pipe insulation.
  • Updates the Prince George’s P3 program to reflect the new role of the Maryland Stadium Authority.
  • The bill’s Fiscal and Policy Note contains more detailed information.

SB 546/HB 636 - School Buildings - Drinking Water Outlets - Elevated Level of Lead (Safe School Drinking Water Act)

  • This bill (1) redefines “elevated level of lead” to mean a lead concentration in drinking water that exceeds 5 parts per billion (ppb) for the purposes of required lead water testing and remedial measures in public and nonpublic schools and (2) makes conforming changes to existing notice and remediation requirements.
  • If a water test sample for a drinking water outlet was analyzed on or before June 1, 2021, and the analysis indicated a concentration of lead that was more than 5 ppb but less than 20 ppb, a school must take appropriate remedial measures by Aug. 1, 2022.
  • The bill’s Fiscal and Policy Note contains more detailed information.

HB 630 - Primary and Secondary Education - School District Energy Use - Policy and Study

  • This bill requires each local school system to adopt or update a school district energy policy by July 1, 2022, including provisions on:
    • energy purchasing, conservation, and efficiency; and
    • monitoring and reporting of energy use by square foot and from renewable sources.
  • By Jan. 1, 2022, the Interagency Commission on School Construction (IAC) must coordinate with the Md. Energy Admin. (MEA) and the Md. Dept. of Environment (MDE) to develop a template policy.
  • The bill’s Fiscal and Policy Note contains more detailed information.

HB 37/SB 35 - Procurement - Prevailing Wage - Applicability

  • This bill expands the application of the prevailing wage law and rates to public work contracts of $250,000, including school construction projects. The previous threshold was $500,000.
  • The bill also applies the 25% state funding trigger for prevailing wage to all public work contracts. This change, lowering the threshold from 50% to 25%, was adopted specifically for school construction projects in 2014.

HB 83 - Public and Nonpublic Schools - Electric Retractable Room Partitions - Review and Report

  • This bill requires MSDE to conduct a thorough review and evaluation of electric retractable room partition equipment used in public and nonpublic schools in the State and of related practices and policies.
  • After completing its review and by Sept. 1, 2022, MSDE must adopt any regulations or guidelines needed to ensure safe operation.

SB 438/HB 401 - Public Schools - Pregnant and Parenting Students - Policies and Reports

  • This bill requires MSDE to develop a model policy, with specified elements, to support the educational and parenting goals and improve the educational outcomes of pregnant and parenting students.
  • Each local board must establish a local policy based on the model policy.
  • The bill requires each local board of education to excuse any parenting-related absence from a class due to the use of a lactation space to nurse or express breast milk.
  • Regarding school facilities, the bill requires each high school to designate a private lactation space in the school that meets specified requirements, including providing lactating students with access to a refrigerator located reasonably close to the private lactation space.
  • The bill’s Fiscal and Policy Note contains more detailed information.

SB 427/HB 205 - Public Schools - Provision of Menstrual Hygiene Products - Requirement

  • This bill requires each local board to provide menstrual hygiene products free-of-charge to students via dispensers installed in middle and high schools in at least 2 women’s restrooms by Oct. 1, 2022; and in all women’s restrooms by Aug. 1, 2025.
  • A public elementary school must install menstrual hygiene product dispensers in at least one restroom by Oct. 1, 2022.
  • School systems may be reimbursed by MSDE for costs and the Governor must include $500,000 for this purpose in the annual budget bill in FY 2023.
  • The bill’s Fiscal and Policy Note contains more detailed information.

 


Workgroup on the Assessment and Funding of School Facilities

The Workgroup reconvened on July 7, 2021 and received briefings on the current status of the statewide school facilities assessments and the launch of the Built to Learn Act.

MABE is pleased to announce that our representative on the Workgroup is Moalie Jose, a member of the Baltimore County Board of Education.

For more information, see links to the Workgroup’s webpage and meeting materials from the July 7th meeting.

 

 


For more information, contact John R. Woolums, Esq., MABE's Director of Governmental Relations, at jwoolums@mabe.org or 410-841-5414.

All Board Service Academies and committee meetings are virtual during this time.

If you have any questions, please email jbeltz@mabe.org.