During that Dec. 1 meeting of the General Assembly’s Commission on School Construction and Modernization, Del. Ronnie Campbell, R-Rockbridge, asked the million-dollar question — or at least, a question about how to distribute millions of desperately needed dollars.
“My thought with this committee was that we would look at school districts that could not afford construction,” Campbell said. “How can we get money to people like Lee County, that, when they go to the board of supervisors to request capital improvements, it gets shot down because they can’t afford it?”
The concern Campbell voiced applies to far more counties and cities and Virginia than just the community in the state’s westernmost corner. More than half of the state’s public school buildings are more than 50 years old, and replacing those buildings would cost $25 billion.
The state has a pool of money, the Literary Fund, that is supposedly dedicated to providing loans for school construction. Yet the fund’s problems are so profound and the rules that govern it so out of date that school systems are not using it.
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The maximum loan amount the fund allows is $7.5 million, an amount that covers only a fraction of the typical school construction project in 2021. State Superintendent of Public Instruction James Lane cites costs ranging from $22 million for an elementary school to $77 million for a high school.
The fact that the fund’s minimum size as specified by law is $80 million, barely enough to fund a single high school, cries out for revision to the law.
The Literary Fund loans also carry interest rates of 2% to 6%, which are too high for localities in financial distress to make use of, if they can afford to take on a loan at all.
Though the Literary Fund’s primary function is supposed to be aiding school construction, only $24 million has been spent toward that purpose in the past five years, while $790 has instead gone to the teacher retirement fund.
The state’s school facility crisis will only worsen if officials don’t come up with a better plan. The Commission on School Construction and Modernization made some excellent recommendations to the General Assembly that if implemented would at least take steps in the right direction.
The bipartisan commission was created in 2020 by a bill from Sen. Jennifer McClellan, D-Richmond, who is now the commission’s chair. Commission members representing our part of the state include Campbell, Bristol school superintendent Keith Perrigan, who serves president of the Coalition of Small and Rural Schools of Virginia, and Sen. Bill Stanley, R-Franklin County — who efforts earlier this year to offer solutions for this very issue passed the state Senate with a bipartisan vote but perished in the NoVa.-Democrat-controlled House Appropriations Committee.
Though the legislators on the commission might have wildly divergent views on other political matters, on Dec. 1 every recommendation but one passed by unanimous vote.
The contested recommendation, which still passed, but garnered some resistance, suggests that school boards automatically be allowed to keep unexpended funds at the end of a budget year, rather than returning the money to the locality that allotted it. Though some local governments already choose to do this, making it a mandate rather than a choice would definitely pick a fight — a representative from the Virginia Association of Counties essentially said as much.
Coming up with financial incentives to encourage the choice would be a spoonful of sugar for the medicine.
Now, here’s what everybody agreed on.
Fixing the Literary Fund, or at least making it useful again, by:
• Increasing the fund’s minimum size to $250 million;
• Raising the maximum loan size to $25 million;
• Reducing the interest rates by half, from 1% to %3;
• Clearing inactive projects from the fund’s waiting list;
• Increasing the amount available for a loan if it’s for school consolidation;
• Offering grants to assist localities with loan closing costs.
As Perrigan pointed out during the hearing, “You also have to provide grants and other incentives to the school divisions who can’t afford to take on those loans.”
Toward that end, the commission endorsed creating a separate fund that would assist with school construction and renovation that would offer grants that do not need to be paid back. Similar proposals have been floated in the past — and shot down.
“We’ve tried many different ways to do it,” Stanley said.
This version could potentially be filled by casino gaming proceeds. The 2020 bill that legalized and regulates casino gambling earmarked the money that would be raised for school construction but didn’t specify how that would be carried out.
In 2019, a law went into effect that allowed Halifax County — and only Halifax County — to impose a special sales tax of up to 1% specifically for funding school construction. The county then put the proposed tax on a referendum for residents to decide, and it passed with 70% of the vote. The tax was expected to bring it at least $3 million annually for school capital projects.
The commission wants all localities to have that same taxing power, subject to approval from their voters. “It allows all counties to engage in that by referendum rather than having to ask permission of the General Assembly,” Stanley said.
That’s a lot to work with, though in terms of making the state’s school facilities whole, it would amount to a venture up the foothills rather than a flag planted at the summit. The Department of Education found 322 projects that aren’t being funded, most of them in cash-strapped counties and cities, that would take $3.2 billion to fix.
But there must be a start. The state cannot shirk its duty to address this problem and provide the best possible education for every child regardless of where they live.
Virginia will begin 2022 with a Republican governor, a House of Delegates in Republican hands, barely, and a Senate still narrowly controlled by Democrats, not a promising recipe for decisive action. As there’s not a bad idea in this batch — and yes, we note the asterisk beside the expended school budget proposal, but even that would be better than nothing — we hope that the bipartisan spirit of this commission proves contagious.