2024 -- S 2168

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LC004251

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2024

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A N   A C T

RELATING TO EDUCATION -- SCHOOL FUNDS AND PROPERTY

     

     Introduced By: Senators Pearson, Gallo, Lawson, DiPalma, Euer, Cano, DiMario, and
Ruggerio

     Date Introduced: January 24, 2024

     Referred To: Senate Finance

     It is enacted by the General Assembly as follows:

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     SECTION 1. Chapter 16-9 of the General Laws entitled "School Funds and Property" is

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hereby amended by adding thereto the following section:

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     16-9-11. New school construction and renovations.

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     Not later than June 30, 2025, the department of education and the office of energy resources

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are hereby authorized and directed to develop and adopt regulations requiring all school buildings

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to meet the latest Northeast Collaborative for High Performance Schools (NE-CHPS) standard of

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zero energy capable, as defined in § 16-7-36, by December 31, 2036.

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     (1) The regulations shall allow flexibility to the furthest extent possible for local education

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agencies to pursue state and federal funding sources that assist in financing energy efficiency or

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renewable energy systems without any penalties or reduction in state housing aid provided by the

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department of education.

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     (2) Furthermore, for local education agencies that pursue federal funding for renewable

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energy systems, the department’s regulations shall direct and provide further guidance to local

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education agencies to build, own, and operate solar panels utilizing federal guidance established in

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I.R.C. § 6417.

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     SECTION 2. Sections 16-7-36, 16-7-39, 16-7-40 and 16-7-41.1 of the General Laws in

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Chapter 16-7 entitled "Foundation Level School Support [See Title 16 Chapter 97 — The Rhode

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Island Board of Education Act]" are hereby amended to read as follows:

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     16-7-36. Definitions.

 

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     The following words and phrases used in §§ 16-7-35 to 16-7-47 and in § 16-9-11 have the

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following meanings:

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     (1) “Adjusted equalized weighted assessed valuation” means the equalized weighted

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assessed valuation for a community as determined by the division of property valuation within the

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department of revenue in accordance with § 16-7-21; provided, however, that in the case of a

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regional school district the commissioner of elementary and secondary education shall apportion

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the adjusted equalized weighted assessed valuation of the member cities or towns among the

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regional school district and the member cities or towns according to the proportion that the number

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of pupils of the regional school district bears to the number of pupils of the member cities or towns.

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     (2) “Approved project” means a project which has complied with the administrative

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regulations governing §§ 16-7-35 through 16-7-47, and which has been authorized to receive state

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school housing reimbursement by the commissioner of elementary and secondary education.

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     (3) “Commissioning agent” means a person or entity who ensures that systems are

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designed, installed, functionally tested, and capable of being operated and maintained to perform

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in conformity with the design intent of a project.

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     (4) “Community” means any city, town, or regional school district established pursuant to

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law; provided, however, that the member towns of the Chariho regional high school district, created

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by P.L. 1958, ch. 55, as amended, shall constitute separate and individual communities for the

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purposes of distributing the foundation level school support for school housing for all grades

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financed in whole or in part by the towns irrespective of any regionalization.

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     (5) “Facilities condition index” means the cost to fully repair the building divided by the

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cost to replace the building as determined by the school building authority.

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     (6) “Functional utilization” means the ratio of the student population within a school

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facility to the capacity of the school facility to adequately serve students as defined by the school

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building authority.

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     (7) “Maintenance expenditures” means amounts spent for repairs or replacements for the

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purpose of keeping a school facility open and safe for use, including repairs, maintenance, and

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replacements to a school facility’s heating, lighting, ventilation, security, and other fixtures to keep

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the facility or fixtures in effective working condition. Maintenance shall not include contracted or

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direct custodial or janitorial services, expenditures for the cleaning of a school facility or its

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fixtures, the care and upkeep of grounds, recreational facilities, or parking lots, or the cleaning of

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or repairs and replacements to movable furnishings or equipment.

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     (8) “Owner’s program manager” means owner’s program manager as defined in § 37-2-7.

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     (9) “Prime contractor” means the construction contractor who is responsible for the

 

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completion of a project.

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     (10) “Reference year” means the year next prior to the school year immediately preceding

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that in which aid is to be paid.

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     (11) “Subject to inflation” means the base amount multiplied by the percentage of increase

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in the Producer Price Index (PPI) Data for Nonresidential Building Construction (NAICS 236222)

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as published by the United States Department of Labor, Bureau of Labor Statistics determined as

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of September 30 of the prior calendar year.

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     (12) "Zero energy capable" means the building:

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     (i) Meets the latest Northeast Collaborative for High Performance Schools (NE-CHPS)

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standard of a zero energy capable school building whereby the actual annual energy delivered other

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than as described in subsection (12)(ii) of this section, must be less than or equal to the renewable

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energy generated onsite; or

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     (ii) The actual annual energy delivered must be less than or equal to the sum of:

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     (A) The renewable energy generated onsite;

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     (B) The renewable energy generated offsite through a power purchase agreement; and

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     (C) The value of purchased NE-GIS certificates that meet the standard for a new renewable

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energy resources as defined in § 39-26-2.

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     16-7-39. Computation of school housing-aid ratio.

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     For each community, the percent of state aid for school housing costs shall be computed in

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the following manner:

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     (1) The adjusted equalized weighted assessed valuation for the district is divided by the

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resident average daily membership for the district (grades twelve (12) and below); (2) The adjusted

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equalized weighted assessed valuation for the state is divided by the resident average daily

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membership for the state (grades twelve (12) and below); (1) is then divided by (2) and the resultant

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ratio is multiplied by a factor currently set at sixty-two percent (62%) which represents the

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approximate average district share of school support; the resulting product is then subtracted from

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one hundred percent (100%) to yield the housing aid share ratio, provided that in no case shall the

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ratio be less than thirty percent (30%). Provided, that effective July 1, 2010, and annually at the

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start of each fiscal year thereafter, the thirty percent (30%) floor on said housing-aid share shall be

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increased by five percent (5%) increments each year until said floor on the housing-aid share ratio

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reaches a minimum of not less than forty percent (40%). This provision shall apply only to school

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housing projects completed after June 30, 2010, that received approval from the board of regents

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prior to June 30, 2012. Provided further, for the fiscal year beginning July 1, 2012, and for

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subsequent fiscal years, the minimum housing aid share shall be thirty-five percent (35%) for all

 

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projects receiving council on elementary and secondary education approval after June 30, 2012.

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The resident average daily membership shall be determined in accordance with § 16-7-22(1).

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     (2) No district shall receive a combined total of more than twenty (20) incentive percentage

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points for projects that commence construction by June 30, 2024, and five (5) incentive points for

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projects that commence construction thereafter; provided further, these caps shall be in addition to

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amounts received under §§ 16-7-40(a)(1) and, 16-7-40(a)(2), 16-7-40(j)(1) and 16-7-40(j)(2).

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Furthermore, a district’s share shall not be decreased by more than half of its regular share

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irrespective of the number of incentive points received nor shall a district’s state share increase by

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more than half of its regular share, including amounts received under §§ 16-7-40(a)(1) and 16-7-

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40(a)(2), irrespective of the number of incentive points received. Provided further that the

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aforementioned limit on the state share increasing by more than half of its regular share shall not

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apply to projects submitted for reimbursement after July 1, 2023.

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     16-7-40. Increased school housing ratio.

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     (a)(1) In the case of regional school districts, the school housing aid ratio shall be increased

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by two percent (2%) for each grade so consolidated.

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     (2) Regional school districts undertaking renovation project(s) shall receive an increased

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share ratio of four percent (4%) for those specific project(s) only, in addition to the combined share

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ratio calculated in § 16-7-39 and this subsection.

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     (b) In the case of projects undertaken by districts specifically for the purposes of school

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safety and security, the school housing aid share ratio shall be increased by five percent (5%) for

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these specific projects only, in the calculation of school housing aid. The increased share ratio shall

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continue to be applied for as long as the project(s) receives state housing aid. In order to qualify for

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the increased share ratio, seventy-five percent (75%) of the project costs must be specifically

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directed to school safety and security measures. The council on elementary and secondary

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education shall promulgate rules and regulations for the administration and operation of this

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section.

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     (c) For purposes of addressing health and safety deficiencies as defined by the school

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building authority, including the remediation of hazardous materials, the school housing aid ratio

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shall be increased by five percent (5%) so long as the construction of the project commences by

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June 30, 2024, is completed by June 30, 2029, and a two hundred fifty million dollar ($250,000,000)

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general obligation bond is approved on the November 2018 ballot. In order to qualify for the

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increased share ratio, twenty-five percent (25%) of the project costs or a minimum of five hundred

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thousand dollars ($500,000) must be specifically directed to this purpose.

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     (d) For purposes of educational enhancement, including projects devoted to the

 

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enhancement of early childhood education and career and technical education, the school housing

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aid ratio shall be increased by five percent (5%) so long as construction of the project commences

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by June 30, 2024, is completed by June 30, 2029, and a two hundred fifty million dollar

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($250,000,000) general obligation bond is approved on the November 2018 ballot. In order to

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qualify for the increased share ratio, twenty-five percent (25%) of the project costs or a minimum

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of five hundred thousand dollars ($500,000) must be specifically directed to these purposes.

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     (e) For replacement of a facility that has a facilities condition index of sixty-five percent

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(65%) or higher, the school housing ratio shall be increased by five percent (5%) so long as

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construction of the project commences by June 30, 2024, is completed by June 30, 2029, does not

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receive a bonus pursuant to subsection (f) or subsection (g), and a two hundred fifty million dollar

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($250,000,000) general obligation bond is approved on the November 2018 ballot. In order to

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qualify for the increased share ratio, twenty-five percent (25%) of the project costs or a minimum

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of five hundred thousand dollars ($500,000) must be specifically directed to this purpose.

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     (f) For any new construction or renovation that increases the functional utilization of any

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facility from less than sixty percent (60%) to more than eighty percent (80%), including the

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consolidation of school buildings within or across districts, the school housing aid ratio shall be

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increased by five percent (5%) so long as construction of the project commences by June 30, 2024,

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is completed by June 30, 2029, and a two hundred fifty million dollar ($250,000,000) general

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obligation bond is approved on the November 2018 ballot. In order to qualify for the increased

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share ratio, twenty-five percent (25%) of the project costs or a minimum of five hundred thousand

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dollars ($500,000) must be specifically directed to this purpose.

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     (g) For any new construction or renovation that decreases the functional utilization of any

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facility from more than one hundred twenty percent (120%) to between eighty-five percent (85%)

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to one hundred five percent (105%), the school housing ratio shall be increased by five percent

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(5%) so long as construction of the project commences by June 30, 2024, is completed by June 30,

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2029, and a two hundred fifty million dollar ($250,000,000) general obligation bond is approved

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on the November 2018 ballot. In order to qualify for the increased share ratio, twenty-five percent

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(25%) of the project costs or a minimum of five hundred thousand dollars ($500,000) must be

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specifically directed to this purpose.

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     (h) For consolidation of two (2) or more school buildings, within or across districts into

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one school building, the school housing aid ratio shall be increased by five percent (5%) so long as

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construction of the project commences by June 30, 2024, is completed by June 30, 2029, a two

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hundred fifty million dollar ($250,000,000) general obligation bond is approved on the November

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2018 ballot, and does not receive a bonus pursuant to subsection (f) or subsection (g). In order to

 

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qualify for the increased share ratio, twenty-five percent (25%) of the project costs or a minimum

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of five hundred thousand dollars ($500,000) must be specifically directed to this purpose.

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     (i) Any regionalized and/or non-regionalized school district receiving an increased share

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ratio for a project approved prior to July 1, 2018, shall continue to receive the increased share ratio

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for as long as the project receives state housing aid.

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     (j)(1) In the case of projects undertaken by districts specifically for the purposes of high-

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performance school design, the school housing aid share ratio shall be increased by five percent

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(5%) for these specific projects only, in the calculation of school housing aid. The increased share

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ratio shall continue to be applied for as long as the project(s) receives state housing aid. In order to

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qualify for the increased share ratio, seventy-five percent (75%) of the project costs must be

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specifically directed to this purpose. The council on elementary and secondary education shall

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promulgate rules and regulations for the administration and operation of this section.

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     (2) For any new construction or renovation that includes energy efficiency and renewable

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energy upgrades for the building to meet the standard of Zero Energy Capable school building

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pursuant to § 16-7-36(12), the school housing aid ratio shall be increased by ten percent (10%).

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     16-7-41.1. Eligibility for reimbursement.

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     (a) School districts, not municipalities, may apply for and obtain approval for a project

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under the necessity of school construction process set forth in the regulations of the council on

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elementary and secondary education, provided, however, in the case of a municipality that issues

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bonds through the Rhode Island health and educational building corporation to finance or refinance

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school facilities for a school district that is not part of the municipality, the municipality may apply

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for and obtain approval for a project. Such approval will remain valid until June 30 of the third

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fiscal year following the fiscal year in which the council on elementary and secondary education’s

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approval is granted. Only those projects undertaken at school facilities under the care and control

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of the school committee and located on school property may qualify for reimbursement under §§

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16-7-35 — 16-7-47. Facilities with combined school and municipal uses or facilities that are

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operated jointly with any other profit or nonprofit agency do not qualify for reimbursement under

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§§ 16-7-35 — 16-7-47. Projects completed by June 30 of a fiscal year are eligible for

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reimbursement in the following fiscal year. A project for new school housing or additional housing

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shall be deemed to be completed when the work has been officially accepted by the school

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committee or when the housing is occupied for its intended use by the school committee, whichever

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is earlier.

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     (b) Notwithstanding the provisions of this section, the board of regents shall not grant final

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approval for any project between June 30, 2011, and May 1, 2015, except for projects that are

 

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necessitated by immediate health and safety reasons. In the event that a project is requested during

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the moratorium because of immediate health and safety reasons, those proposals shall be reported

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to the chairs of the house and senate finance committees.

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     (c) Any project approval granted prior to the adoption of the school construction

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regulations in 2007, and which are currently inactive; and any project approval granted prior to the

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adoption of the school construction regulations in 2007 which did not receive voter approval or

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which has not been previously financed, are no longer eligible for reimbursement under this

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chapter. The department of elementary and secondary education shall develop recommendations

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for further cost containment strategies in the school housing aid program.

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     (d) Beginning July 1, 2015, the council on elementary and secondary education shall

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approve new necessity of school construction applications on an annual basis. The department of

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elementary and secondary education shall develop an annual application timeline for local

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education agencies seeking new necessity of school construction approvals.

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     (e) Beginning July 1, 2019, no state funding shall be provided for projects in excess of ten

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million dollars ($10,000,000) unless the prime contractor for the project has received

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prequalification from the school building authority.

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     (f) Beginning July 1, 2019, the necessity of school construction process set forth in the

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regulations of the council on elementary and secondary education shall include a single statewide

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process, developed with the consultation of the department of environmental management, that will

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ensure community involvement throughout the investigation and remediation of contaminated

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building sites for possible reuse as the location of a school. That process will fulfill all provisions

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of § 23-19.14-5 related to the investigation of reuse of such sites for schools.

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     (g) Beginning July 1, 2019, school housing projects exceeding one million five hundred

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thousand dollars ($1,500,000) subject to inflation shall include an owner’s program manager and a

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commissioning agent. The cost of the program manager and commissioning agent shall be

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considered a project cost eligible for aid pursuant to §§ 16-7-41 and 16-105-5.

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     (h) Temporary housing, or swing space, for students shall be a reimbursable expense so

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long as a district can demonstrate that no other viable option to temporarily house students exists

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and provided that use of the temporary space is time limited for a period not to exceed twenty-four

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(24) months and tied to a specific construction project.

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     (i) Environmental site remediation, as defined by the school building authority, shall be a

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reimbursable expense up to one million dollars ($1,000,000) per project.

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     (j) If, within thirty (30) years of construction, a newly constructed school is sold to a private

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entity, the state shall receive a portion of the sale proceeds equal to that project’s housing aid

 

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reimbursement rate at the time of project completion.

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     (k) All projects must comply with § 37-13-6, ensuring that prevailing wage laws are being

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followed, and § 37-14.1-6, ensuring that minority business enterprises reach the required minimum

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participation, and § 37-13-3.1, ensuring apprenticeship program utilization.

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     (l) Using reviewable criteria, all projects seeking school housing aid shall complete an

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independent, objective, reasoned study on all projects over ten million dollars ($10,000,000) to

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determine whether adoption of a project labor agreement on the proposed project or projects will

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help achieve the goals of the state purchases act.

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     SECTION 3. Section 16-105-3 of the General Laws in Chapter 16-105 entitled "School

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Building Authority" is hereby amended to read as follows:

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     16-105-3. Roles and responsibilities.

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     The school building authority roles and responsibilities shall include:

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     (1) Management of a system with the goal of ensuring equitable and adequate school

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housing for all public school children in the state;

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     (2) Prevention of the cost of school housing from interfering with the effective operation

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of the schools;

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     (3) Management of school housing aid in accordance with statute;

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     (4) Reviewing and making recommendations to the council on elementary and secondary

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education on necessity of school construction applications for state school housing aid and the

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school building authority capital fund, based on the recommendations of the school building

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authority advisory board;

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     (5) Promulgating, managing, and maintaining school construction regulations, standards,

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and guidelines applicable to the school housing program, based on the recommendations of the

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school building authority advisory board, created in § 16-105-8. Said regulations shall require

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conformance with the minority business enterprise requirements set forth in § 37-14.1-6 and with

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the latest Northeast Collaborative for High Performance Schools (NE-CHPS) standards or

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equivalent, contingent on approval from the council on elementary and secondary education;

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     (6) Developing a prequalification and review process for prime contractors, architects, and

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engineers seeking to bid on projects in excess of ten million dollars ($10,000,000) in total costs

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subject to inflation. Notwithstanding any general laws to the contrary, a prequalification shall be

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valid for a maximum of two (2) years from the date of issuance. Factors to be considered by the

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school building authority in granting a prequalification to prime contractors shall include, but not

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be limited to, the contractor’s history of completing complex projects on time and on budget, track

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record of compliance with applicable environmental and safety regulations, evidence that

 

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completed prior projects prioritized the facility’s future maintainability, and compliance with

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applicable requirements for the use of women and minority owned subcontractors;

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     (i) At least annually, a list of prequalified contractors, architects, and engineers shall be

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publicly posted with all other program information;

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     (7) Providing technical assistance and guidance to school districts on the necessity of

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school construction application process;

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     (8) Providing technical advice and assistance, training, and education to cities, towns,

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and/or local education agencies and to general contractors, subcontractors, construction or project

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managers, designers and others in planning, maintenance, and establishment of school facility

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space;

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     (9) Developing a project priority system, based on the recommendations of the school

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building authority advisory board, in accordance with school construction regulations for the school

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building authority capital fund, subject to review and, if necessary, to be revised on intervals not to

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exceed five (5) years. Project priorities shall include, but not be limited to, the following order of

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priorities:

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     (i) Projects to replace or renovate a building that is structurally unsound or otherwise in a

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condition seriously jeopardizing the health and safety of school children where no alternative exists;

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     (ii) Projects needed to prevent loss of accreditation;

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     (iii) Projects needed for the replacement, renovation, or modernization of the HVAC

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system in any schoolhouse to increase energy conservation and decrease energy-related costs in

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said schoolhouse;

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     (iv) Projects needed to replace or add to obsolete buildings in order to provide for a full

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range of programs consistent with state and approved local requirements; and

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     (v) Projects needed to comply with mandatory, instructional programs;

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     (10) Maintaining a current list of requested school projects and the priority given them;

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     (11) Collecting and maintaining readily available data on all the public school facilities in

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the state;

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     (12) Collecting, maintaining, and making publicly available quarterly progress reports of

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all ongoing school construction projects that shall include, at a minimum, the costs of the project

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and the time schedule of the project;

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     (13) Recommending policies and procedures designed to reduce borrowing for school

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construction programs at both state and local levels;

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     (14) At least every five (5) years, conducting a needs survey to ascertain the capital

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construction, reconstruction, maintenance, and other capital needs for schools in each district of the

 

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state, including public charter schools. Beginning in 2024, this needs survey shall include progress

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towards and recommendations for energy efficiency and renewable energy upgrades to bring all

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state school buildings to the definition of a zero energy capable school building pursuant to § 16-

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7-36;

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     (15) Developing a formal enrollment projection model or using projection models already

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available;

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     (16) Encouraging local education agencies to investigate opportunities for the maximum

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utilization of space in and around the district;

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     (17) Collecting and maintaining a clearinghouse of prototypical school plans that may be

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consulted by eligible applicants;

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     (18) Retaining the services of consultants, as necessary, to effectuate the roles and

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responsibilities listed within this section;

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     (19) Hiring an appropriate staff member who shall create and implement a plan to bring all

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Rhode Island school buildings in compliance with the standard of a zero energy capable school

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building pursuant to § 16-7-36 and who shall provide technical advice and assistance, training, and

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education to cities, towns, and/or local education agencies, and to general contractors,

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subcontractors, construction or project managers, designers and others on the latest NE-CHPS

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standards;

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     (19)(20) No district shall receive a combined total of more than twenty (20) incentive

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percentage points for projects that commence construction by December 30, 2023, and five (5)

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incentive points for projects that commence construction thereafter; provided further, these caps

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shall be in addition to amounts received under §§ 16-7-40(a)(1), and 16-7-40(a)(2), 16-7-40(j)(1),

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and 16-7-40(j)(2). Furthermore, a district’s share shall not be decreased by more than half of its

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regular share irrespective of the number of incentive points received, nor shall a district’s state

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share increase by more than half of its regular share, including amounts received under §§ 16-7-

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40(a)(1) and 16-7-40(a)(2), irrespective of the number of incentive points received.

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Notwithstanding any provision of the general laws to the contrary, the reimbursement or aid

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received under this chapter or chapter 38.2 of title 45 shall not exceed one hundred percent (100%)

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of the sum of the total project costs plus interest costs. If a two hundred and fifty million dollar

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($250,000,000) general obligation bond is approved on the November 2018 ballot, projects

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approved between May 1, 2015, and January 1, 2018, are eligible to receive incentive points (above

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and beyond what the project was awarded at the time of approval) pursuant to § 16-7-39 and § 16-

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7-40. Provided, however, any project approved during this time period with a project cost in excess

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of one million five hundred thousand dollars ($1,500,000), which does not include an owner’s

 

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program manager and a commissioning agent, shall only be eligible to receive five (5) incentive

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points. Incentive points awarded pursuant to the provisions of this subsection shall only be applied

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to reimbursements occurring on or after July 1, 2018. Any project approved between May 1, 2015,

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and January 1, 2018, that is withdrawn and/or resubmitted for approval shall not be eligible for any

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incentive points.

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     SECTION 4. This act shall take effect upon passage.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO EDUCATION -- SCHOOL FUNDS AND PROPERTY

***

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     This act would provide that not later than June 30, 2024, the department of education would

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develop and adopt, in consultation with the office of energy resources, regulations requiring all

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school buildings to meet the standard of zero energy capable, as defined in § 16-7-36, by December

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31, 2036.

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     This act would take effect upon passage.

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