CASH Alert: State Allocation Board (SAB) Update

Dear CASH Board of Directors,

Today, August 15, 2022, the State Allocation Board (SAB) held a meeting to conduct routine business. A proposed regulatory amendment pertaining to the allocation on monies appropriated from non-bond sources was removed from the agenda.

Executive Officer Statement

COVID-19 Extension Requests—

  1. Executive Order N-25-20, issued on March 4, 2020, proclaimed a State of Emergency exists in California due to the threat of COVID-19. As a result, the Executive Officer has authority during a proclaimed emergency by the Governor of the State of California, to grant program extensions and the Executive Officer must inform the State Allocation Board (SAB) of any action taken.
  2. Following Executive Order N-11-22, the majority of the provisions in Executive Orders following N-25-20 expired on or before June 30, 2022. Therefore, the Office of Public School Construction (OPSC) will no longer accept COVID-19 extension requests effective August 25, 2022.
  3. OPSC will continue to accept and review extension requests for any other ongoing states of emergency, such as wildfires, for school districts directly impacted. School districts that are requesting an extension request as a result of a state of emergency shall continue to submit the School District Extension Request Form.


Piggyback Contracts for Modular Facilities are Ineligible for State Funding from State allocation Board Administered Programs—

  1. At the June 22, 2022 SAB meeting, staff presented an item regarding piggyback contracts and Public Contract Code (PCC) compliance relative to modular school facilities. After staff’s presentation, discussion from the SAB members, and public comment, the SAB took the following action:
  2. Provide a grace period for SAB-administered programs for projects with construction contracts signed on or within sixty calendar days (through August 21, 2022) of this SAB action. Create a new process to begin after this grace period where staff evaluates the contracts during the time of application processing and prior to fund release to ensure no piggyback contracts have been used for modular facilities.
  3. Since this action:
  4. Staff will continue to process and present applications that signed piggyback contracts on or prior to August 21, 2022.
  5. OPSC has notified all District Superintendents and District Representatives on file with OPSC, as well as all stakeholders on OPSC’s master email subscription list, that are consistent with the PCC and the AG Opinion, modular school facilities must be competitively bid.
  6. OPSC has created a webpage to advise school districts of the PCC requirements and their applicability to state funding.
  7. OPSC has established a specific procedure during application processing, and/or in advance of fund release, for thoroughly reviewing contracts to ensure that funds are not released for projects that use piggyback contracts for modular school facilities. This process is outlined on the new webpage.
  8. For any contracts entered into after fund release (after OPSC’s review), staff will work with the State Controller’s Office to amend the K-12 Audit Guide for Appendices B and C, to ensure that as part of the project audit, and the K-12 local auditor would review the contracts for compliance.


2022-23 State Budget Updates—

  1. California Preschool, Transitional Kindergarten and Full-Day Kindergarten Facilities Grant Program. Assembly Bill (AB) 181 was signed by the Governor on June 30, 2022. This bill provided additional General Fund apportionments to the Program: $100 million for the 2022/2023 fiscal year and an additional $550 million for the 2023/2024 fiscal year. Additionally, this bill states that community college districts that operate a preschool program on behalf of, or in lieu of, a school district or county office of education may now also participate in the program by applying for preschool facilities grants.
  2. Funding Provided to Lynwood Unified School District for Lynwood High School Project. AB 181 appropriated $250 million to Lynwood Unified School District (District) from the General Fund for the 2022/2023 fiscal year to support the reconstruction and rehabilitation of Lynwood High School. This bill specifically states that the district shall submit a detailed construction cost estimate to OPSC for review and approval, as well as execute a grant agreement with OPSC. In general, the bill instructs OPSC to provide technical assistance to the district, as needed.
  3. Additional Funding for School Facility Program (SFP). AB 181 approved a total of $4.2 billion from the General Fund to the SAB to provide funding for SFP new construction and modernization projects. More specifically, this bill provided $1,300,000,000 for the 2022/2023 fiscal year, and declared intent to provide an additional $2,060,500,000 for the 2023/2024 fiscal year, and an additional $875,000,000 for the 2024/2025 fiscal year. The bill also stated that it is the intent of the Legislature that OPSC processes grant applications from apportionment by the SAB at its current processing capabilities. Staff held a stakeholder meeting on August 2, 2022 inviting members of the public to participate in the development of regulations for the efficient allocation of these General Fund moneys. 38 participants attended this meeting and provided invaluable feedback that was taken into consideration in drafting the proposed regulations in this Agenda.


Career Technical Education Facilities Program (CTEFP) Close of Funding Cycle Six—

  1. In September 2020, the Board approved 178 of 249 funding applications submitted for the CTEFP Cycle 6 for $287.8 million. While the program was oversubscribed, Staff anticipated that additional funds would likely return to the program through loan repayments and rescissions. Therefore, the Board directed Staff to hold the unprocessed applications until June 30, 2022 and process them following the funding matrix should funds become available. As funds returned, 10 additional applications were approved for placement on the Unfunded List (Lack of AB55 loans) between October 2020 and June 30, 2022.
  2. Now that the funding cycle is officially closed, all applications that were not funded by June 30, 2022 are being returned to the applicants.


22nd Priority Funding Round Closed—

  1. At the April meeting, the Board approved $652.6 million in Apportionments through the Priority Funding Process. As of July 29, 2022, OPSC received valid fund release authorizations for 193 unique projects totaling to $620.9 million in State funding.
  2. School districts that received a Priority Funding Apportionment were required to submit a valid Fund Release Authorization (Form SAB 50-05) by the end of Wednesday, July 27, 2022 to OPSC.


School Facility Program Approvals and Workload

The Unfunded Approval list dated August 15, 2022 contains projects worth $599,060,974.

Today’s agenda contains a list of Unfunded Approvals worth $169,770,419.

The Workload List dated July 31, 2022 contains projects worth the following:

New Construction & Charter          $152,888,700

Modernization                                   $358,767,382

Total                                                    $511,656,082

The Acknowledged List dated July 31, 2022 contains projects worth the following:

New Construction                             $1,685,770,798

Modernization                                   $2,258,769,764

Total                                                    $3,944,540,562

The next SAB meeting will take place on Wednesday, September 28, 2022 at 2:00 p.m. via Zoom and teleconference.

~ Nancy Chaires Espinoza, Legislative Advocate