Quantcast

North Bay Business Journal

Monday, October 14, 2013, 6:00 am

Proposition 39 could fund millions in energy projects at North Bay schools

‘It’s a big step we’ve been waiting on for a long time now’

By

Print Friendly Print Friendly    

Share this item

    NORTH BAY — More than half a billion dollars in anticipated annual funding will soon be available for energy efficiency upgrades at K-12 schools and junior colleges in California, potentially enhancing other efforts that are already under way to fund that work in the North Bay.

    Though the state continues to develop the specific guidelines for allocating new revenue from 2012′s Proposition 39, millions of dollars in new funding is likely to flow to school districts in the North Bay during its five-year funding window.

    Leaders in energy efficiency and facility management in the region are currently considering exactly what that funding will mean for North Bay schools, and whether a new financing program under development at the Sonoma County Water Agency might be able to further leverage those funds for a variety of energy efficiency improvements.

    “Right now, if you look at the way the state is funding education, we’ve been asked to cut back millions of dollars. Facilities are definitely a part of that,” said Jennifer Bruneman, director of facilities at Santa Rosa City Schools. “Our facilities are in need of repair.”

    The passage of Proposition 39 required multistate businesses to pay income taxes based on the proportion of their sales in California, closing what supporters said was an unfair tax advantage for companies based outside of the state.

    A portion of that revenue will flow to a newly created “Clean Energy Job Creation Fund” for five years, with an anticipated $2.5 billion made available primarily to K-12 schools and junior colleges.

    The California Energy Commission released draft guidelines for the program on Oct. 1, describing the manner by which funding would be allocated and the nature of eligible projects.

    Those projects span from relatively small-scale work like light fixture replacements and deferred maintenance to larger-scale efforts involving climate control and water management systems. Districts receiving more than $1 million in one year will be required to use half of that funding for larger projects costing at least $250,000.

    The commission is currently in the process of receiving public comment on the guidelines, with final guidelines expected by December.

    “It’s a big step we’ve been waiting on for a long time now,” said Aaron Jobson, principal at Quattrocchi Kwok Architects and a founding member of the Sacramento-based School Energy Coalition. “Every dollar they save on energy costs gets to go back to teachers, computers, and the schools.”

    With awards based on average daily attendance, Santa Rosa City Schools could stand to receive more than $800,000 annually and around $4 million in new funding over the next five years, Ms. Bruneman said. The funding would have what she called a “triple benefit” — increasing energy efficiency, lowering costs to service aging equipment and addressing a portfolio of deferred maintenance that has grown in the current budget environment.

    “It’s a proven thing that the learning environment has a big impact on both students and teachers,” she said.

    What remains to be seen is how those funds might impact previous efforts to develop a financing scheme for energy improvement projects at public facilities known as Sonoma County Efficiency Financing. The program, under development at the water agency, seeks to hold energy service companies financially accountable for expected energy savings in order to create a predictable stream of revenue to service a related bond.

    The relatively no-strings-attached nature of funding from Proposition 39 has caused some to hesitate in their participation in the SCEF program, as the associated bond service would appear as a debt on an organization’s balance sheets, said Dale Roberts, principal engineer of the water agency’s Energy Resources Group. The city of Cotati is so far the only entity that has officially joined the water agency in the program, accounting for a volume of work that is approximately half of the $20 million minimum that represents a certain critical mass for forming a public bond.

    Yet Mr. Roberts said that the new funding from Proposition 39 could potentially stand to enhance the SCEF program, allowing schools to bundle a large amount of work through the SCEF structure and realize greater benefit by using funds to reduce their bond obligation. Planners involved in the proposal are expected to decide if it will go forward by the end of this year, he said.

    “Interest rates went up a little bit, but we still feel that, where interest rates are now, it’s possible,” he said.

    “Those talks are underway,” said Ms. Bruneman. “It’s not that the district isn’t interested — we just have to look at the big picture.”

    Revenue set aside for schools from Prop. 39 will go to California’s general fund after five years, with some extension for projects that are still underway at the end of that period.

    “They want to use this as an example of why investing in schools is a good idea,” Mr. Jobson said.

     

    Copyright © 1988–2014 North Bay Business Journal
    View the policy for linking to website content.

    Print Friendly Print Friendly    

    Submit Your Comments

    Required

    Required, will not be published

    Comments are moderated and generally will be posted if they are on-topic and not abusive. For more information, please see our Comments and Letters Policy. To share this item by email or social media, use the links above.

    Do not use this form to contact people, companies or organizations mentioned in this story. Contact them directly. Private messages left here will be deleted.