BILL REQ. #:  H-1494.1 

READ FIRST TIME 02/13/09.   

     AN ACT Relating to use of capital projects funds by school districts; amending RCW 84.52.053; reenacting and amending RCW 28A.320.330; creating a new section; and providing an expiration date.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION.  Sec. 1   The legislature finds that the quality of public school buildings is a vital element of providing a quality education, and that extending the useful life of such buildings through major equipment repair and major preventive maintenance is an essential element of a comprehensive program to provide quality public school buildings. Further, major equipment repair and major preventive maintenance which prolongs the useful life of school buildings will reduce other capital costs needed for school buildings. Accordingly, the legislature finds that renovation and replacement of major building facilities and systems that extends the useful life of these facilities and systems beyond their original planned life shall be considered construction, remodeling, or modernization of the affected facilities and systems, as such terms are used in RCW 84.52.053 and Article VII, section 2 of the state Constitution. It is the intent of the legislature that these expenditures be deemed for a major capital purpose and are also permitted uses of funds created by a district's two to six-year levies authorized by RCW 84.52.053.

Sec. 2   RCW 28A.320.330 and 2007 c 503 s 2 and 2007 c 129 s 2 are each reenacted and amended to read as follows:
     School districts shall establish the following funds in addition to those provided elsewhere by law:
     (1) A general fund for maintenance and operation of the school district to account for all financial operations of the school district except those required to be accounted for in another fund.
     (2) A capital projects fund shall be established for major capital purposes. All statutory references to a "building fund" shall mean the capital projects fund so established. Money to be deposited into the capital projects fund shall include, but not be limited to, bond proceeds, proceeds from excess levies authorized by RCW 84.52.053, state apportionment proceeds as authorized by RCW 28A.150.270, earnings from capital projects fund investments as authorized by RCW 28A.320.310 and 28A.320.320, and state forest revenues transferred pursuant to subsection (3) of this section.
     Money derived from the sale of bonds, including interest earnings thereof, may only be used for those purposes described in RCW 28A.530.010, except that accrued interest paid for bonds shall be deposited in the debt service fund.
     Money to be deposited into the capital projects fund shall include but not be limited to rental and lease proceeds as authorized by RCW 28A.335.060, and proceeds from the sale of real property as authorized by RCW 28A.335.130.
     Money legally deposited into the capital projects fund from other sources may be used for the purposes described in RCW 28A.530.010, and for the purposes of:
     (a) Major renovation, including (i) the replacement of facilities and systems where periodical repairs are no longer economical and (ii) renovation of facilities and systems that extends the useful life of the facility or system beyond its original planned useful life. Major renovation and replacement shall include, but shall not be limited to, major repairs, replacement, and refurbishment of roofing, exterior walls, windows, heating and ventilating systems, floor covering in classrooms and public or common areas, and electrical and plumbing systems.
     (b) Renovation and rehabilitation of playfields, athletic fields, and other district real property.
     (c) The conduct of preliminary energy audits and energy audits of school district buildings. For the purpose of this section:
     (i) "Preliminary energy audits" means a determination of the energy consumption characteristics of a building, including the size, type, rate of energy consumption, and major energy using systems of the building.
     (ii) "Energy audit" means a survey of a building or complex which identifies the type, size, energy use level, and major energy using systems; which determines appropriate energy conservation maintenance or operating procedures and assesses any need for the acquisition and installation of energy conservation measures, including solar energy and renewable resource measures.
     (iii) "Energy capital improvement" means the installation, or modification of the installation, of energy conservation measures in a building which measures are primarily intended to reduce energy consumption or allow the use of an alternative energy source.
     (d) Those energy capital improvements which are identified as being cost-effective in the audits authorized by this section.
     (e) Purchase or installation of additional major items of equipment and furniture: PROVIDED, That vehicles shall not be purchased with capital projects fund money.
     (f)(i) Costs associated with implementing technology systems, facilities, and projects, including acquiring hardware, licensing software, and online applications and training related to the installation of the foregoing. However, the software or applications must be an integral part of the district's technology systems, facilities, or projects.
     (ii) Costs associated with the application and modernization of technology systems for operations and instruction including, but not limited to, the ongoing fees for online applications, subscriptions, or software licenses, including upgrades and incidental services, and ongoing training related to the installation and integration of these products and services. However, to the extent the funds are used for the purpose under this subsection (2)(f)(ii), the school district shall transfer to the district's general fund the portion of the capital projects fund used for this purpose. The office of the superintendent of public instruction shall develop accounting guidelines for these transfers in accordance with internal revenue service regulations.
     (g) Major equipment repair, painting of facilities, and other major preventative maintenance purposes. However, to the extent the funds are used for the purpose under this subsection (2)(g), the school district shall transfer to the district's general fund the portion of the capital projects fund used for this purpose. The office of the superintendent of public instruction shall develop accounting guidelines for these transfers in accordance with internal revenue service regulations.
     (3) A debt service fund to provide for tax proceeds, other revenues, and disbursements as authorized in chapter 39.44 RCW. State forest land revenues that are deposited in a school district's debt service fund pursuant to RCW 79.64.110 and to the extent not necessary for payment of debt service on school district bonds may be transferred by the school district into the district's capital projects fund.
     (4) An associated student body fund as authorized by RCW 28A.325.030.
     (5) Advance refunding bond funds and refunded bond funds to provide for the proceeds and disbursements as authorized in chapter 39.53 RCW.

Sec. 3   RCW 84.52.053 and 2007 c 129 s 3 are each amended to read as follows:
     (1) The limitations imposed by RCW 84.52.050 through 84.52.056, and 84.52.043 shall not prevent the levy of taxes by school districts, when authorized so to do by the voters of such school district in the manner and for the purposes and number of years allowable under Article VII, section 2(a) of the Constitution of this state. Elections for such taxes shall be held in the year in which the levy is made or, in the case of propositions authorizing two-year through four-year levies for maintenance and operation support of a school district, authorizing two-year levies for transportation vehicle funds established in RCW 28A.160.130, or authorizing two-year through six-year levies to support the construction, modernization, or remodeling of school facilities, which includes the purposes of RCW 28A.320.330(2) (f) and (g), in the year in which the first annual levy is made.
     (2) Once additional tax levies have been authorized for maintenance and operation support of a school district for a two-year through four-year period as provided under subsection (1) of this section, no further additional tax levies for maintenance and operation support of the district for that period may be authorized. For the purpose of applying the limitation of this subsection, a two-year through six-year levy to support the construction, modernization, or remodeling of school facilities shall not be deemed to be a tax levy for maintenance and operation support of a school district.
     (3) A special election may be called and the time therefor fixed by the board of school directors, by giving notice thereof by publication in the manner provided by law for giving notices of general elections, at which special election the proposition authorizing such excess levy shall be submitted in such form as to enable the voters favoring the proposition to vote "yes" and those opposed thereto to vote "no".

NEW SECTION.  Sec. 4   This act expires July 1, 2013.