II

107TH CONGRESS

1ST SESSION S. 119

To provide States with funds to support State, regional, and local school

construction.

IN THE SENATE OF THE UNITED STATES

JANUARY 22, 2001

Ms. SNOWE (for herself and Mr. CHAFEE) introduced the following bill; which

was read twice and referred to the Committee on Health, Education,

Labor, and Pensions

A BILL

To provide States with funds to support State, regional,

and local school construction.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘Building, Renovating,

5 Improving, and Constructing Kids’ Schools Act’’.

6 SEC. 2. FINDINGS.

7 Congress makes the following findings:

8 (1) According to a 1999 issue brief prepared by

9 the National Center for Education Statistics, the av10 erage public school in America is 42 years old, and
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1 school buildings begin rapid deterioration after 40

2 years. In addition, 29 percent of all public schools

3 are in the oldest condition, meaning that the schools

4 were built before 1970 and have either never been

5 renovated or were renovated prior to 1980.

6 (2) According to reports issued by the General

7 Accounting Office (GAO) in 1995 and 1996, it

8 would cost $112,000,000,000 to bring the Nation’s

9 schools into good overall condition, and one-third of

10 all public schools need extensive repair or replace11 ment.

12 (3) Many schools do not have the appropriate

13 infrastructure to support computers and other tech14 nologies that are necessary to prepare students for

15 the jobs of the 21st century.

16 (4) Without impeding on local control, the Fed17 eral Government appropriately can assist State, re18 gional, and local entities in addressing school con19 struction, renovation, and repair needs by providing

20 low-interest loans for purposes of paying interest on

21 related bonds and by supporting other State-admin22 istered school construction programs.

23 SEC. 3. DEFINITIONS.

24 In this Act:
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1 (1) BOND.—The term ‘‘bond’’ includes any ob2 ligation.

3 (2) GOVERNOR.—The term ‘‘Governor’’ in4 cludes the chief executive officer of a State.

5 (3) LOCAL EDUCATIONAL AGENCY.—The term

6 ‘‘local educational agency’’ has the meaning given to

7 such term by section 14101 of the Elementary and

8 Secondary Education Act of 1965 (20 U.S.C. 8801).

9 (4) PUBLIC SCHOOL FACILITY.—The term

10 ‘‘public school facility’’ shall not include—

11 (A) any stadium or other facility primarily

12 used for athletic contests or exhibitions, or

13 other events for which admission is charged to

14 the general public; or

15 (B) any facility that is not owned by a

16 State or local government or any agency or in17 strumentality of a State or local government.

18 (5) QUALIFIED SCHOOL CONSTRUCTION

19 BOND.—The term ‘‘qualified school construction

20 bond’’ means any bond (or portion of a bond) issued

21 as part of an issue if—

22 (A) 95 percent or more of the proceeds at23 tributable to such bond (or portion) are to be

24 used for the construction, rehabilitation, or re25 pair of a public school facility or for the acqui-
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1 sition of land on which such a facility is to be

2 constructed with part of the proceeds;

3 (B) the bond is issued by a State, regional,

4 or local entity, with bonding authority; and

5 (C) the issuer designates such bond (or

6 portion) for purposes of this section.

7 (6) STABILIZATION FUND.—The term ‘‘sta8 bilization fund’’ means the stabilization fund estab9 lished under section 5302 of title 31, United States

10 Code.

11 (7) STATE.—The term ‘‘State’’ means each of

12 the several States of the United States, the District

13 of Columbia, the Commonwealth of Puerto Rico, the

14 United States Virgin Islands, Guam, American

15 Samoa, the Commonwealth of the Northern Mariana

16 Islands, the Republic of the Marshall Islands, the

17 Federated States of Micronesia, and the Republic of

18 Palau.

19 SEC. 4. LOANS FOR SCHOOL CONSTRUCTION BOND INTER20 EST PAYMENTS AND OTHER SUPPORT.

21 (a) LOAN AUTHORITY AND OTHER SUPPORT.—

22 (1) LOANS AND STATE-ADMINISTERED PRO23 GRAMS.—

24 (A) IN GENERAL.—Except as provided in

25 subparagraph (B), from funds made available
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1 to a State under section 5(b) the State, in con2 sultation with the State educational agency—

3 (i) shall use not less than 50 percent

4 of the funds to make loans to State, re5 gional, or local entities within the State to

6 enable the entities to make annual interest

7 payments on qualified school construction

8 bonds that are issued by the entities not

9 later than December 31, 2004; and

10 (ii) may use not more than 50 percent

11 of the funds to support State revolving

12 fund programs or other State-administered

13 programs that assist State, regional, and

14 local entities within the State in paying for

15 the cost of construction, rehabilitation, re16 pair, or acquisition described in section

17 3(5)(A).

18 (B) STATES WITH RESTRICTIONS.—If, on

19 the date of enactment of this Act, a State has

20 in effect a law that prohibits the State from

21 making the loans described in subparagraph

22 (A)(i), the State, in consultation with the State

23 educational agency, may use the funds de24 scribed in subparagraph (A) to support the pro25 grams described in subparagraph (A)(ii).
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1 (2) REQUESTS.—The Governor of each State

2 desiring assistance under this Act shall submit a re3 quest to the Secretary of the Treasury at such time

4 and in such manner as the Secretary of the Treas5 ury may require.

6 (3) PRIORITY.—In selecting entities to receive

7 funds under paragraph (1) for projects involving

8 construction, rehabilitation, repair, or acquisition of

9 land for schools, the State shall give priority to enti10 ties with projects for schools with greatest need, as

11 determined by the State. In determining the schools

12 with greatest need, the State shall take into consid13 eration whether a school—

14 (A) is among the schools that have the

15 greatest numbers or percentages of children

16 whose education imposes a higher than average

17 cost per child, such as—

18 (i) children living in areas with high

19 concentrations of low-income families;

20 (ii) children from low-income families;

21 and

22 (iii) children living in sparsely popu23 lated areas;
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1 (B) has inadequate school facilities and a

2 low level of resources to meet the need for

3 school facilities; or

4 (C) meets such criteria as the State may

5 determine to be appropriate.

6 (b) REPAYMENT.—

7 (1) IN GENERAL.—Subject to paragraph (2), a

8 State that uses funds made available under section

9 5(b) to make a loan or support a State-administered

10 program under subsection (a)(1) shall repay to the

11 stabilization fund the amount of the loan or support,

12 plus interest, at an annual rate of 4.5 percent. A

13 State shall not be required to begin making such re14 payment until the year immediately following the

15 15th year for which the State is eligible to receive

16 annual distributions from the fund (which shall be

17 the final year for which the State shall be eligible for

18 such a distribution under this Act). The amount of

19 such loan or support shall be fully repaid during the

20 10-year period beginning on the expiration of the eli21 gibility of the State under this Act.

22 (2) EXCEPTIONS.—

23 (A) IN GENERAL.—The interest on the

24 amount made available to a State under section

25 5(b) shall not accrue, prior to January 1, 2007,
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1 unless the amount appropriated to carry out

2 part B of the Individuals with Disabilities Edu3 cation Act (20 U.S.C. 1411 et seq.) for any fis4 cal year prior to fiscal year 2007 is sufficient

5 to fully fund such part for the fiscal year at the

6 originally promised level, which promised level

7 would provide to each State 40 percent of the

8 average per-pupil expenditure for providing spe9 cial education and related services for each

10 child with a disability in the State.

11 (B) APPLICABLE INTEREST RATE.—Effec12 tive January 1, 2007, the applicable interest

13 rate that will apply to an amount made avail14 able to a State under section 5(b) shall be—

15 (i) 0 percent with respect to years in

16 which the amount appropriated to carry

17 out part B of the Individuals with Disabil18 ities Education Act (20 U.S.C. 1411 et

19 seq.) is not sufficient to provide to each

20 State at least 20 percent of the average

21 per-pupil expenditure for providing special

22 education and related services for each

23 child with a disability in the State;

24 (ii) 2.5 percent with respect to years

25 in which the amount described in clause (i)
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1 is not sufficient to provide to each State at

2 least 30 percent of such average per-pupil

3 expenditure;

4 (iii) 3.5 percent with respect to years

5 in which the amount described in clause (i)

6 is not sufficient to provide to each State at

7 least 40 percent of such average per-pupil

8 expenditure; and

9 (iv) 4.5 percent with respect to years

10 in which the amount described in clause (i)

11 is sufficient to provide to each State at

12 least 40 percent of such average per-pupil

13 expenditure.

14 (c) FEDERAL RESPONSIBILITIES.—The Secretary of

15 the Treasury and the Secretary of Education—

16 (1) jointly shall be responsible for ensuring that

17 funds provided under this Act are properly distrib18 uted;

19 (2) shall ensure that funds provided under this

20 Act are used only to pay for—

21 (A) the interest on qualified school con22 struction bonds; or

23 (B) a cost described in subsection

24 (a)(1)(A)(ii); and
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1 (3) shall not have authority to approve or dis2 approve school construction plans assisted pursuant

3 to this Act, except to ensure that funds made avail4 able under this Act are used only to supplement, and

5 not supplant, the amount of school construction, re6 habilitation, and repair, and acquisition of land for

7 school facilities, in the State that would have oc8 curred in the absence of such funds.

9 SEC. 5. AMOUNTS AVAILABLE TO EACH STATE.

10 (a) RESERVATION FOR INDIANS.—

11 (1) IN GENERAL.—From $20,000,000,000 of

12 the funds in the stabilization fund, the Secretary of

13 the Treasury shall make available $400,000,000 to

14 provide assistance to Indian tribes.

15 (2) USE OF FUNDS.—An Indian tribe that re16 ceives assistance under paragraph (1)—

17 (A) shall use not less than 50 percent of

18 the assistance for a loan to enable the Indian

19 tribe to make annual interest payments on

20 qualified school construction bonds, in accord21 ance with the requirements of this Act that the

22 Secretary of the Treasury determines to be ap23 propriate; and

24 (B) may use not more than 50 percent of

25 the assistance to support tribal revolving fund
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1 programs or other tribal-administered programs

2 that assist tribal governments in paying for the

3 cost of construction, rehabilitation, repair, or

4 acquisition described in section 3(5)(A), in ac5 cordance with the requirements of this Act that

6 the Secretary of the Treasury determines to be

7 appropriate.

8 (b) AMOUNTS AVAILABLE.—

9 (1) IN GENERAL.—Subject to paragraph (3)

10 and from $20,000,000,000 of the funds in the sta11 bilization fund that are not reserved under sub12 section (a), the Secretary of the Treasury shall make

13 available to each State submitting a request under

14 section 4(a)(2) an amount that bears the same rela15 tion to such remainder as the amount the State re16 ceived under part A of title I of the Elementary and

17 Secondary Education Act of 1965 (20 U.S.C. 6311

18 et seq.) for fiscal year 2001 bears to the amount re19 ceived by all States under such part for such year.

20 (2) DISBURSAL.—The Secretary of the Treas21 ury shall disburse the amount made available to a

22 State under paragraph (1) or (3), on an annual

23 basis, during the period beginning on October 1,

24 2001, and ending September 30, 2018.

25 (3) SMALL STATE MINIMUM.—
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1 (A) MINIMUM.—No State shall receive an

2 amount under paragraph (1) that is less than

3 $100,000,000.

4 (B) STATES.—In this paragraph, the term

5 ‘‘State’’ means each of the several States of the

6 United States, the District of Columbia, and

7 the Commonwealth of Puerto Rico.

8 (c) NOTIFICATION.—The Secretary of the Treasury

9 and the Secretary of Education jointly shall notify each

10 State of the amount of funds the State may receive for

11 loans and other support under this Act.

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