On the first real day of the long session of the General Assembly, Senate Republicans presented a counter proposal to a school building bond bill proposed by House Speaker Tim Moore, R-Cleveland.
Senate Bill 5, Building North Carolina’s Future, would use money from the State Capital and Infrastructure Fund to raise more than $2 billion over nine years for K-12 school construction and maintenance.
“We are proposing this as an alternative to the school bond that has been proposed recently,” said Senate Majority Leader Harry Brown, R-Onslow, in a press conference today. “We just think that our plan is the right way to go because it dedicates more money faster and at less cost.”
Before the holidays, Moore filed a bond bill to go before voters that would include $1.9 billion for education construction needs. That would include $1.3 billion for K-12 capital construction and $300 million each for the UNC System and for North Carolina community colleges. During a stop on a statewide tour to discuss the bond this month, Moore changed the details of the bond slightly, saying that it would include about $1.5 billion for new K-12 schools and about $200 million each for the UNC System and Community College System.
A bond would necessitate the state taking on debt, and in the Senate counter proposal, the state would instead increase revenue to the State Capital and Infrastructure Fund (SCIF) to fund $2.03 billion each for the K-12 school system, higher education (community college and UNC systems), and state agencies for construction and maintenance over the next nine years.
The Senate bill proposes increasing the share of state revenue that goes to that fund to 4.5 percent, and then splitting the funds between the K-12 system, UNC, and Community College Systems, and state agencies. One-third will go to K-12, one-third to the higher education systems, and one third will go to state agencies, for a total of about $2 billion each. That bill has passed the full Senate.
The SCIF gets 4 percent of state revenue to take care of the state’s debt and for capital projects for state government and the UNC System. The Senate bill proposes increasing the share of state revenue that goes to that fund to 4.5 percent, and then splitting the funds evenly between the three education systems.
According to a press release from President Pro Tempore Phil Berger, R-Rockingham, the SCIF has about $237 million available this year but will grow as the state pays off its debts. By 2028, the fund should have about $1 billion available each year, according to the release. That’s before the changes made in this bill.
The Senate bill also proposes putting into statute a $100 million allocation to the Public School Capital Fund. This is something the legislature does anyway, but the proposal would write the funds into law.
The bill also touches on the K-3 class-size requirements instituted for the state’s public schools. In the legislation, districts that get these capital funds from the state must use them for capital projects that will help them comply with the class-size requirements if they aren’t already meeting them.
“We’ve heard multiple reasons why districts can’t comply with the requirements. One of them being additional space,” Brown said. “They will have the option to use this money to get there on the K-3 class size requirements.”
Brown said the Senate proposal is superior to the House bond plan for a number of reasons, including that it doesn’t require the state to pay off any debt. He said the House plan would cost a total of $3.1 billion, with $1.2 billion of that being interest that would have to be paid over 30 years.
“Our plan starts delivering funds in 2019, a full two years earlier than a bond. Counties can start addressing their school capital needs now rather than waiting,” he said.
State Superintendent Mark Johnson released a statement about school construction shortly after the press conference.
“I know the urgency and need for this state funding for school construction, especially for rural North Carolina, from my firsthand experience visiting our schools across the state,” he said. “I am pleased to see agreement in the legislature on this point, and I look forward to working with our partners in the General Assembly as we continue to discuss the details of that funding.”