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Subject:   Qualified School Construction Bonds

 
Under ARRA, the federal Treasury has issued state 2009 allocations for a new kind of tax credit bond: the Qualified School Construction Bond (QSCB). QSCBs are a zero-interest financing mechanism supported through federal tax credits to the bond purchaser. Vermont’s authorization for 2009 is $24,845,000. We are likely to see a similar authorization for 2010, to be determined by formula, by the Treasury, near year-end.
The minimum allocation amount per district will be $500,000 and the maximum will be $3,000,000. QSCB allocations are not grants; they are simply an authorization to seek out and utilize an interest-free bond from an entity desiring a tax credit in lieu of your interest. 
 
Vermont Eligibility Criteria and Allocation Parameters
Unlike Qualified Zone Academy Bonds (see QZAB notes below), QSCB eligibility involves no poverty tests or demographic stipulations. All school districts with voter-approved school renovation, repair, or modernization projects may apply for a bond allocation. Consistent with the spirit of ARRA, allocations for QSCB financing will not be approved for refinancing other borrowing or for projects already completed or under construction. Bonding for the eligible project must be voter-approved before an application is submitted.
New construction and space additions, as well as any projects eligible for state school construction aid and/or receiving a QZAB allocation, will only be considered for QSCB allocations after all other qualified requests received by November 13, 2009 have been filled. The first round of allocations will be awarded based upon complete and qualifying applications received by July 15, 2009. A second round of allocations will be awarded based upon complete and qualifying applications received by November 13, 2009. Amounts remaining after November 20, 2009 may be used to increase the maximum allocations per district. If qualifying applications exceed available allocations, awards will be made based upon date of vote.
 
Process
The school district submits an application package to my office. I determine that the application meets the federal and state criteria and notify the district of the amount of Vermont’s federal QSCB allocation that has been assigned to them. That basically ends the department’s role. 
 

Districts set up the financing independently, typically with a commercial bank. The terms of the QSCB (length of amortization and amount of tax credit) are set by the Treasury at date of issuance. Education Department has been working with Vermont banks to establish a market and prepare referrals for you. In my opinion, there is no need to hire an outside consultant to market your bond. Cathy Hilgendorf  is available to banks and the district for technical assistance.

 
Reminders
The issuance of bonds (any type of bonds) by school districts is subject to provisions of Vermont law. The district may wish to utilize bond counsel for QSCBs just as they might any other type of bonding.
Title 24 V.S.A. §1786a should be reviewed. Improvements financed for more than five years must be voter approved by Australian ballot.
 
 
QZAB notes
Qualified Zone Academy Bonds, which have been around for eight or nine years, are a different kind of tax credit bond. Currently, there is $2,747,000 available. Two basic qualification criteria, which apply to QZABs and not to QSCBs, are (1) at least 35% of students served by the project are eligible for free or reduced-price lunch, and (2) a partnership with one or more businesses or private entities who pledge a contribution to the school worth at least ten percent of the amount of the bond. 
        
        
 
Application for Qualified School Construction Bond (QSCB) allocation is attached.
Questions should be directed to
Cathy Hilgendorf
(802) 828-5402
 

(This information is intended to provide the public with basic information of potential federal assistance and funding opportunities. Those interested in these or similar programs should contact the appropriate federal and state agencies for detailed information. Please note: Not all applicable programs are included below; the following information is subject to change; and additional requirements, restrictions and guidance may apply.)

State Fiscal Stabilization Fund

The State Fiscal Stabilization Fund provides $53.6 billion to provide fiscal relief to states

Vermont will receive $96.1 million in stabilization funds

Administrator: Office of the Governor - The Governor must submit applications to the U.S. Department of Education describing how Vermont will use its allocations.
Purpose: To provide fiscal relief to the States to prevent tax increases and cutbacks in critical education and other services. To provide funding for elementary, secondary, and higher education, and for public safety and other government services, including higher education modernization.
Description: The Governor may use 81.8 percent (81.8%) of the stabilization funds ($78,609,800) to support elementary, secondary, and postsecondary education and some school construction and 18.2 percent (18.2%) of the stabilization funds ($17,490,200) for public safety or other government services, which can include education and higher education modernization, renovation, and repair.
Website: http://governor.vermont.gov/
Phone: (802) 828-3333 (Office of the Governor)
(800) 649-6825

 

 

 


Special Education

$12.2 billion was included for the Individuals with Disabilities Education Act (IDEA)

Vermont will receive $25.6 million in formula funding

Administrator: Vermont Department of Education
Purpose: To assist states and school districts with paying for the rising cost of special education for students with disabilities.
Description The IDEA Part B, Grants to States Program provides formula grants to assist the states in meeting the excess costs of providing special education and related services to children with disabilities.
Website: http://education.vermont.gov/new/html/dept/recovery_act.html
Phone: (802) 828-3135 (Vermont Department of Education)

Education for the Disadvantaged

$13 billion was included for Title I of the Elementary and Secondary Education Act

Vermont will receive $33.5 million in formula funding

Administrator: Vermont Department of Education
Purpose: Provides funding for programs that provide extra academic support to help raise the achievement of students at risk of educational failure or to help all students in high-poverty schools meet challenging state academic standards.
Description: Provides local educational agencies (LEAs) with supplemental education funding, especially in high-poverty areas.
Website: http://education.vermont.gov/new/html/dept/recovery_act.html
Phone: (802) 828-3135 (Vermont Department of Education)

Education Technology

$650 million was included for the Enhancing Education through Technology Program

Vermont will receive $3.1 million in formula funding

Administrator: Vermont Department of Education
Purpose: These funds should be used to improve student academic achievement and ensure that students are college and workforce ready by making certain that every student has 21st century skills and is technology literate. In addition, the funds should be used to increase ongoing and meaningful professional development around technology that leads to changes in teaching and curriculum and improves student achievement.
Description: The Enhancing Education through Technology Program supports State, district, and school efforts to integrate technology into curricula in order to improve teaching and learning. Funding shall be used for technology hardware, software applications, professional development and related instructional technology staff and services.
Contact: Vermont Department of Education
Website: http://education.vermont.gov/new/html/dept/recovery_act.html
Phone: (802) 828-3135 (Vermont Department of Education)

Vocational Rehabilitation

$540 million was included for Vocational Rehabilitation State Grants

Vermont will receive $1.6 million in funding

Administrator: Agency of Health and Human Services, Department of Disabilities, Aging and Independent Living, VocRehab Vermont
Purpose: To help individuals with disabilities prepare for and engage in gainful employment.
Description: This program provides grants to states to support a wide range of services. Eligible individuals are those who have a physical or mental impairment that results in a substantial impediment to employment, who can benefit from vocational rehabilitation (VR) services for employment, and who require VR services. Priority must be given to serving individuals with the most significant disabilities if a state is unable to serve all eligible individuals.
Website: http://www.vocrehab.vermont.gov
Phone: 1-866=879-6757 (VocRehab, toll-free)
(802) 241-2186 (VocRehab)

Teacher Quality Enhancement Competitive State Grants

$100 million was included for the Teacher Quality State Grants Program

Office: Office of Postsecondary Education
Agency: U.S. Department of Education
Purpose: To provide grants to states to improve the quality of the teaching workforce.
Description: States may use grant funds to reform teacher licensing and certification requirements; provide alternative methods of teacher preparation; and provide alternative routes to state certification. The funds provided in the economic recovery bill will assist states in modernizing the teaching workforce, addressing teacher shortages, and providing new routes to teaching for jobless individuals seeking to enter the teaching field.
Website: http://www.ed.gov/programs/heatqp/eligibility.html
Phone: (202) 502-7676 (Teacher Quality Enhancement Grants Program)

Statewide Longitudinal Data Systems Grant Program

$250 million was included in competitive grants was provided for the Statewide Longitudinal Data Systems Program

Office: Institute of Education Sciences
Agency: Department of Education
Purpose: To make competitive grants to states to enable them to design and develop statewide longitudinal data systems that use individual student data for reporting and improving student achievement, and to facilitate research to improve student achievement and close achievement gaps.
Description: With these grants, states could increase the capacity of their data systems, provide teachers the information they need to tailor instruction to help each student improve, and give administrators the resources and information to effectively and efficiently manage their data systems.
Website: http://nces.ed.gov/programs/slds/
Phone: (202) 502-7300 (National Center for Education Statistics)

Student Financial Assistance

$15.64 billion was included for the Pell Grant Program. $200 million was included for work-study programs

Office: Office of Federal Student Aid
Agency: Department of Education
Purpose: To provide need-based scholarships for undergraduate students. These additional funds will provide immediate financial relief to an additional 800,000 students and their families who are struggling to pay for the cost of a higher education during the economic downturn.
Description: Students may fill out the Free Application for Federal Student Aid (FAFSA) to determine if they are eligible to receive a Federal Pell Grant or Work-Study funds.
Website: http://www.ed.gov/programs/fpg/index.html
Phone: 1-800-433-3243 or 1-800-4FED-AID

Rural Community Facilities

$130 million was included for the Rural Community Facilities program

Agency: U.S. Department of Agriculture - State Rural Development Office
Type: Competitive Grants
Description: Funds to support grants and loans to rural areas for critical community facilities, such as for healthcare, education, fire and rescue, day care, community centers, and libraries.
Website: http://www.rurdev.usda.gov/rhs/cf/cp.htm (National)
http://www.rurdev.usda.gov/VT/ (Vermont)
Phone: (802) 828-6011 (USDA- Rural Development, Montpelier Office)
 

NEW GRANTS ********* Posted June 10

84.327 Technology and Media Services for Individuals with Disabilities-National Center on Accessible Instructional Materials
Due date 7/6/09
Eligibility Institutions of Higher Education (IHEs)

 

84.184 Grants for Coalitions To Prevent and Reduce Alcohol Abuse at Institutions of Higher Education
Due date 7/6/09
Eligibility: State governments, Institutions of Higher Education (IHEs)

 

84.116 Special Focus Competition: Innovative Strategies in Community Colleges for Working Adults and Displaced Workers
Due date 8/4/09
Eligibility: Institutions of Higher Education (IHEs)