"NEW SECTION. Sec. 1. The legislature finds that school districts may have school facilities with significant building systems deficiencies that are not adequately served by a large construction project program like the school construction assistance program or a small construction project program like the small school district and state-tribal education compact school modernization program. Therefore, the legislature finds it would be beneficial to local tax payers to establish a low interest loan program that would allow school districts to fund midsize projects through existing resources rather than paying all project costs upfront.

NEW SECTION. Sec. 2. A new section is added to chapter 28A.525 RCW to read as follows:

(1) Subject to the availability of amounts appropriated for this specific purpose, the office of the superintendent of public instruction, in coordination with the office of the state treasurer, must administer a modernization loan program for school districts and state-tribal education compact schools with significant building system deficiencies. The office of the superintendent of public instruction and the office of the state treasurer may adopt rules to implement this section.

(2) The office of the superintendent of public instruction must assist school districts and state-tribal education compact schools interested in seeking modernization loans by providing technical assistance and planning grants. The superintendent of public instruction may prioritize planning grants for school districts and state-tribal education compact schools with the most serious building deficiencies and the most limited financial capacity. Planning grants may not exceed $75,000 per applicant.

(3)(a) An advisory committee with the following membership must assist the office of the superintendent of public instruction in designing the loan application process, developing the prioritization criteria, and evaluating the grant applications:

(i) Four members of the legislature of the state of Washington, one of whom is appointed by the chairperson of each of the two largest political caucuses in the senate and house of representatives; and

(ii) Three members who have experience in financing and managing school facilities, as appointed by the superintendent of public instruction.

(b) Advisory committee members may not be involved in developing projects or applying for loans funded under this section.

(c) The office of the superintendent of public instruction must provide administrative and staff support to the advisory committee.

(4) The superintendent of public instruction must submit a list of modernization projects, as prioritized by the advisory committee, to the governor and legislature by January 8, 2025, and every November 1st thereafter. The list must include: (a) A description of the project; (b) the proposed state funding level, not to exceed $6,000,000 or 10 percent of the amount appropriated for this purpose, whichever is greater; (c) estimated total project costs; and (d) local funding resources used as repayment. Loan funds may be awarded only after the legislature approves the list of projects.

(5) The office of the state treasurer must administer the loans approved by the legislature under subsection (4) of this section.

(a) Modernization loans provided pursuant to this section may not exceed a one percent interest rate or a period of 20 years.

(b) Funds collected as repayment of loans issued under this section must be deposited in the common school construction fund.

(6) For projects in this section that are also eligible for funding through the school construction assistance program, the office of the superintendent of public instruction must expedite and streamline the administrative requirements, timelines, and matching requirements for the funds provided under this section to be used promptly. Funds provided under this section plus state funds provided in the school construction assistance program grant must not exceed total project costs minus available local resources."