Smart Schools Bond Act Update By: Stephanie M. Roebuck, Esq., & - PDF document

Smart Schools Bond Act Update By: Stephanie M. Roebuck, Esq., & Ralph C. DeMarco, Esq. March 8, 2015 On November 4, 2014, 62% of New York State voters voted in favor of the Smart Schools Bond Act of 2014, which authorized the creation of state debt and the sale of state bonds in the amount of up to two billion dollars ($2,000,000,000.00) to finance improved educational technology and infrastructure. This outline reflects the information available at this time. We are awaiting further guidance from the New York State Education Department, the New York State Division of Budget and the New York State Smart Schools Review Board. 1. New York Smart Schools Commission Report a. Early in 2014, Governor Cuomo appointed the New York State Smart Schools Commission (the “Commission”) to advise the state on how best to invest the proceeds of the proposed $2 billion Smart Schools Bond Act. b. In October 2014, the Commission filed a report (available online at www.smartschoolsny.com) which sets forth seven (7) keys to success for achieving a “smart school,” as follows: i. Embrace and expand online learning which will break down geographic barriers, provide access to the best sources of instruction in the world, and level the playing field for students in rural and smaller school districts; ii. Utilize transformative technologies, such as tablets, laptops, and interactive whiteboards to deliver differentiated instruction tailored to students’ specific abilities and needs that lets them learn and advance at their own pace; iii. Connect every school to high-speed broadband using technology that is capable of scaling up over time and deliver sufficient wireless capability to serve every student; iv. Extend connectivity beyond the four walls of the classroom so students from all backgrounds have equal access to the information superhighway;

v. Provide high-quality, continuous professional development to teachers, principals, and staff to ensure successful integration of technology into the teaching and learning experience; vi. Focus on in-demand Science, Technology, Engineering and Math (“STEM”) skills to ensure that students graduate with 21 st century skills; and vii. Plan, plan and plan again. c. The Commission’s report outlines recommendations to implement each key area, and provides anecdotal narratives from different New York State school districts and how each has successfully implemented new technology which has positively impacted student achievement. 2. Allowable Use of Bond Proceeds a. As authorized by the voters, there are four (4) broad permissible capital projects for which a school district’s bond allocation/proceeds may be used: i. The acquisition of learning technology equipment or facilities including, but not limited to, interactive whiteboards, computer servers, and desktop, laptop and tablet computers; ii. The installation of high-speed broadband or wireless internet connectivity for schools and communities; iii. The construction, enhancement, and modernization of educational facilities to accommodate pre-kindergarten programs and the provision of instructional space to replace transportable classroom units; and iv. The installation of high-tech security features in school buildings and on school campuses. b. The allocation may be used for the design, planning, site acquisition, demolition, construction, reconstruction, rehabilitation, or acquisition and/or installation of equipment related to the four (4) categories of capital projects listed above. c. According to information provided to the New York State Council of School Superintendents by the New York State Education Department, the allocation must be used for a bondable expense, but may not be used for purchases which have already received permanent financing. -2-

i. Furthermore, there may be an issue surrounding broadband Internet. Even though expanding broadband Internet clearly falls within the authorized uses for these bond proceeds, broadband Internet is typically leased, and leases are not bondable. d. The allocation will function as a reimbursement. i. As seen below, the statute specifies that allocated funds are to be “reimbursed” to school districts. e. There is no “on or after date” for use of the allocated funds. i. As seen below, any amount of a school district’s allocation which is not spent in a school year is carried over to the next succeeding school year. f. We anticipate that the forthcoming guidance from the Commissioner, the Division of Budget and/or the Smart Schools Review Board will address these issues in greater detail. 3. Allocation of Bond Proceeds a. School districts were allocated Smart Schools Bond Act funding in an amount proportionate to the district’s share of total formula based school aid in the 2013- 2014 school year, excluding Building Aid, Universal Prekindergarten Aid, and the Gap Elimination Adjustment. b. Each school district’s amount has already been calculated and is available online at http://www.governor.ny.gov/smart-schools-ny. 4. Pertinent Terms Defined by the Smart Schools Bond Act [N.Y. Educ. L. §3641(16)(a)] a. “Smart schools review board” shall mean a body comprised of the Chancellor of the State University of New York, the Director of the Budget, and the Commissioner of Education, or their respective designees. b. “Smart schools investment plan” shall mean a document prepared by a school district setting forth the “smart schools project or projects” to be undertaken with such district's smart schools allocation. c. “Smart schools project” shall mean one of the following capital projects: i. “Pre-kindergarten or transportable classroom unit (TCU) replacement project”—A capital project which, as a primary purpose, expands the availability of adequate and appropriate instructional space for pre- -3-

kindergarten or provides for the expansion or construction of adequate and appropriate instructional space to replace TCUs. ii. “Community connectivity project”—A capital project which, as a primary purpose, expands high-speed broadband or wireless internet connectivity in the local community, including school buildings and campuses, for enhanced educational opportunity in the state. iii. “Classroom technology project”—A capital project to expand high-speed broadband or wireless internet connectivity solely for school buildings and campuses, or to acquire learning technology hardware for schools, classrooms, and student use, including but not limited to whiteboards, computer servers, desktop computers, laptop computers, and tablet computers. iv. “School safety and security technology project”—A capital project to install high-tech security features in school buildings. 5. Implementation of the Smart Schools Bond Act a. Smart Schools Investment Plans [N.Y. Educ. L. §3641(16)(b)]: i. Under the statute, the Smart Schools Review Board must issue guidelines setting forth required components and eligibility criteria for smart schools investment plans to be submitted by school districts. 1. Such guidelines shall include but not be limited to: a. A timeline for school district submission of smart schools investment plans; b. Any requirements for the use of available state procurement options where applicable; c. Any limitations on the amount of a district's smart schools allocation that may be used for assets with a short probable life; and d. The loan of smart schools classroom technology. ii. No school district shall be entitled to a smart schools grant until the district submits a smart schools investment plan to the smart schools review board and receives the review board’s approval of the investment plan. -4-