DRAFT ONLY - APPROVAL PENDING 

M I N U T E S

Select Committee on School Facilities

Room 150, U.W. Outreach Center                                                                           October 27, 2003

951 North Poplar                                                                                                      Casper, Wyoming

PRESENT:     Senator Irene Devin & Representative Mike Baker, Cochairmen;

Senators Jim Anderson, Rich Cathcart and Hank Coe;

Representatives Stan Cooper, Saundra Meyer, Ann Robinson and Jane Wostenberg.

School Facilities Commission:  Gregg Olson, Chairman.

Other Legislators In Attendance:  Senator John Schiffer.

                        Legislative Service Office: Mary Byrnes and Dave Nelson.

                        School Facilities Commission Staff:  Jim "Bubba" Shivler, David LaPlante, Brad Oberg, Ken Burnett, Teresa Kunkel and Mary Kay Hill.

Others In Attendance: See attached Appendix A.

ABSENT:       Senator Mike Massie.

AGENDA:      Please see attached Appendix B.

*  *  *  *  *

Representative Mike Baker, Select School Facilities Committee CoChair, convened the meeting at 8:35 a.m.

School Facility Design Guidelines and Adequacy Standards.

Jim "Bubba" Shivler and Brad Oberg, School Facility Commission staff, and Dodds Cromwell, MGT, addressed Select Committee members on the establishment of school facility adequacy standards and facility design guidelines.

Facility design guidelines originated from a steering committee assembled in 2002 and comprised of district representatives.  Based upon this effort, Commission staff and consultants developed facility prototypes to commence the establishment of state guidelines for use by the Commission in developing state building adequacy standards and scheduling statewide facility needs and remedies.  The Commission, based upon this initial work, adopted the assembled draft guidelines as part of Commission emergency rules and regulations.  Public hearings were conducted throughout the state on the proposed rules.  Permanent rules are scheduled to be adopted at the November 7 joint meeting of the Commission and the Select Committee, to take effect prior to expiration of emergency rules.

During development of facility guidelines, a Subcommittee comprised of Commissioners and Select Committee members was appointed to address issues surrounding athletic facilities and assembly space, including swimming pools, auditoriums and outdoor track facilities.  The Subcommittee presented proposed guidelines addressing these areas for consideration at a joint meeting of the Commission and Select Committee in June, and the Commission subsequently adopted the report at a July meeting.  The Subcommittee proposals were incorporated into Commission rules, a copy of which is attached at Appendix C.  CoChair Baker expressed concern that the proposed rules provide state funds for maintenance of existing pools but do not provide state funds for constructing new pools in future facility remediation.

Comparing Wyoming facility standards to national standards is problematic due to small school size in Wyoming.  Very few states have developed standards for small schools to the level of Wyoming.  When comparing Wyoming to those states that have developed small school standards, Wyoming appears to allow more generous gross square feet per student and to provide more consideration for vocational education and physical education programs.  Materials distributed on national comparisons are attached at Appendix D.

The Commission approaches facility remediation for excess capacity buildings on a case-by-case basis.  Prime consideration is given to the provision of the required educational program, and to the point at which it becomes educationally appropriate to combine school levels.  If remediation involves the disposal of excess capacity, the Commission encourages districts to explore continued building use prior to disposition of the building.  CoChair Baker urged the Commission to inform districts and residents that the responsibility for statewide building adequacy has been placed by the Court upon the state.  The state is addressing building adequacy according to the required statewide education program.  Senator Cathcart indicated the guidelines provide districts with the ability to provide programs based upon local district needs and to some extent, community desires.

District Facility Five Year Plan Review.

Under law, school districts are required to develop and submit to the Commission district facility plans addressing district wide building and facility needs over a five year period.  Beginning in 2002, Commission staff and consultants worked with school districts in developing and assembling master plan documentation and guidelines to assist in this effort.  The comprehensive planning effort will assist the Commission in scheduling statewide needs and developing a state plan for facility remediation.

Teresa Kunkel, School Facilities Commission staff, provided a summary of the district five-year plan review to date, together with subsequent budget implications.  The Commission has not yet adopted a budget for district construction, and the five-year review process is not final.   Twenty-five district plans have been approved by the Commission subject to plan modification.  The required thirty day district response time has not yet expired.  It is anticipated more clarity will be provided at the November 7 joint meeting.

The budget recommendation for minor capital construction projects addressing district facility inadequacies total $16.9 million over the next biennium, including 374 projects in twenty-six districts. Minor capital construction projects are those requiring a total expenditure of less than $200,000.  Over the same biennium, facility remediation for twenty-seven districts involves major capital construction projects.  Major capital construction projects include those projects requiring a total expenditure of $200,000 or more.  The Commission budget anticipates twenty elementary school projects, fifteen middle school projects and twenty high school projects, of which six, two and four, respectively, are new construction.  Attached Appendix E provides a complete summary.  As of October 22, the capital construction budget for the 05-06 biennium totaled $256 million.

CoChair Baker expressed concern that the distinction between major maintenance and minor capital outlay is not clear, even though major maintenance dollars cannot be expended for capital construction.  At minimum, CoChair Baker cautioned the Commission to be consistent in its application of both programs.  Commission Chairman Gregg Olson agreed additional clarification is required.

School Facility Commission Budgetary Recommendations.

Due to the dynamics inherent in the construction planning, design and building processes, Commission Director Shivler requested the Select Committee and the Legislature consider necessary flexibility in assembling the Commission capital construction budget.  The effective administration of capital construction projects may require shifting funds between projects as necessary to meet existing cash flow requirements and construction timelines.  Further and due to the modifications to process mechanisms under current law, the ability to determine precise project costs is not to the level of previous projects approved by the Legislature.  And finally, the Commission is concerned an amount reflected within the budget may be viewed as an entitlement.  The matter was exemplified through a proposal submitted by Laramie County School District #1 for Triumph High School, a copy of which is attached at Appendix F.

Senator Schiffer suggested the use of a reconciliation account within the capital construction budget which would provide the Commission with budget flexibility.  CoChair Devin suggested the Commission coordinate project contracts and project expenditures, and report the coordinated effort to the Select Committee and the Joint Appropriations Committee as it pertains to reconciliation account expenditures.  The Commission will address the matter in more detail at the November 7 joint meeting.

Major Maintenance.

Under current law, the Commission has little control over district major maintenance expenditures and the impact of expenditures upon district facility inadequacies.  Districts direct expenditures toward those buildings and facilities of their choice.  Through the five-year planning process however, the Commission does have some knowledge of the general direction of major maintenance expenditures.

Major maintenance payments and the routine maintenance adjustment to the cost-based school finance formula are both based upon statewide adequacy standards.  Under the proposed standards to be adopted by the Commission, gross square footage increases.  Current law also prescribes an acceptable range of excess square footage for district buildings and facilities, which was originally designed to provide a transition to districts to comply with adequacy standards.  Both gross square footage and excess capacity impact state maintenance funding.

Ken Burnett, School Facilities Commission staff, reviewed the existing statutory formula for computing district major maintenance payments and summarized proposed formula modifications.  A major modification involves the reduction of allowable excess capacity from 200% to 135% of state standards.  When combined with proposed adequacy standards, this modification results in maintaining the current statewide funding level for both the major maintenance and routine maintenance programs.  Additional proposed program modifications include:

·        Basing the replacement cost factor entirely on the R.S. Means value adjusted for Wyoming;

·        Phasing in major maintenance payments during the first seven years of a building's life;

·        Eliminating current provisions for closed buildings and providing a minimum funding level for closed buildings until reopened or determined surplus;

·        Increasing the funding percentage factor from two and one-quarter percent to two and one-half percent;

·        Requiring planning of major maintenance expenditures on a building-by-building basis within district five-year plans and conditioning expenditure upon prescription included and approved by the Commission within the five-year plan.

Materials on Commission proposals and proposed Commission major maintenance rules and regulations are attached at Appendix G.  Major maintenance rules and regulations will be considered by the Commission at the November 7 joint meeting.  Major maintenance expenditures and fund balances were discussed, together with estimate future expenditures.  Copies of accompanying materials are attached at Appendix H.  Pursuant to Select Committee request, Commission staff will provide comparative information on district optimal major maintenance expenditures compared to actual expenditures, broken down by educational and non-educational categories.

04LSO-0126.W3, "School buildings-major and routine maintenance."

Committee staff reviewed components of 04LSO-0126.W3, draft legislation implementing Commission proposals, a copy of which is attached at Appendix I.

After discussion and review, the following Select Committee modifications to the draft legislation were accepted:

·        Clarification of provisions appearing on Page 6-lines 4 through 11 to prevent payment of major maintenance for square footage leased by districts;

·        Page 6-line 16  Delete first "and"; delete "on and".

·        Page 6-line 17  Delete "July 1," insert "June 30,".

·        Page 6-line 19  Delete "such that by" insert "whereby at".

·        Modification of provisions appearing on page 7-lines 18 and 19 to phase down permissible excess square footage from 135% of state standards through SY2006, to 125% of state standards through SY 2009, and to 115% of state standards beginning SY 2010 and each school year thereafter;

·        Clarification of provisions appearing on Page 8-lines 6 through 24 and Page 9-lines 1 through 7 to prevent application of surplus provisions to those facilities designated for eventual replacement;

·        Modification of provisions appearing on Page 10-lines 10 through 24 and Page 11-lines 1 and 2 to maintain the major maintenance percentage factor at two percent for future years.

CoChair Devin directed staff to modify 04LSO-0126.W4 accordingly and moved the legislation forward for discussion at a future Select Committee meeting.

Local Enhancements.

In accordance with judicial determinations, local enhancements are available to districts for purposes of augmenting school buildings and facilities beyond state adequacy levels as defined by Commission rule and regulation.  Several issues surround local enhancements, including treatment of enhancements in computing major maintenance funding and the ability of districts to fund maintenance of enhancements independent of state sources.

Commission staff Ken Burnett presented several options for addressing major maintenance funding of local district enhancements, summarized in attached Appendix J.  Select Committee members expressed concern with any proposal providing for state maintenance of local enhancements.  Proposed major maintenance rules earlier discussed also address this matter, which will be discussed at the joint meeting scheduled for November 7.  In addition, the Commission will provide recommendations on enhancement maintenance at this meeting.

Mike O'Donnell and Donna Murray, Attorney General's Office, discussed legal parameters pertaining to local enhancements.  Following a review of language contained within Campbell I and Campbell III pertaining to local enhancements, discussion focused on options available to districts for funding maintenance of local enhancements and issues attached to each option.  Options discussed included district bonding, mill levies, special reserve funds and the capital facilities sales tax.  Attached at Appendix K is a copy of the power point presentation provided by Mr. O'Donnell.

Executive Session.

At 4:00 p.m., the Select Committee resolved itself into executive session to further discuss local enhancement issues with Mr. O'Donnell.  At 4:30 p.m., CoChair Devin reconvened the Select Committee in open session.

Several issues with respect to local enhancements emerged:

·        Maintenance of local enhancements and the ability to segregate enhancements in order to compute state major maintenance payments;

·        Revenues available to local districts for purposes of maintaining local enhancements;

·        A process at the state level to review local enhancements over time in determining at what point any enhancement is to become a state standard.

School Facilities Commission Chairman Gregg Olsen indicated the Commission would address these issues at the joint meeting scheduled for November 7, and develop recommendations for consideration by the Select Committee.

Future Select Committee Activity.

CoChair Devin advised Select Committee members of the upcoming joint meeting of the Commission and Select Committee scheduled for Friday, November 7 in Cheyenne.  More particulars will be forthcoming.  Beyond this meeting, at least one additional Select Committee meeting will be scheduled prior to the 2004 Budget Session, to be announced at a later date.

Adjournment.

CoChair Devin adjourned the Select Committee at 4:50 p.m.

Respectfully submitted,

____________________________                ______________________________

Senator Irene Devin,                                         Representative Mike Baker,

Select Committee CoChair                               Select Committee CoChair