I
106TH CONGRESS
1ST SESSION
H. R. 2469
To establish State revolving funds for school construction.
IN THE HOUSE OF REPRESENTATIVES
JULY 12, 1999
Mr. ANDREWS introduced the following bill; which was referred to the
Committee on Education and the Workforce
A BILL
To establish State revolving funds for school construction.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘State Revolving Funds
for Schools Act’’.
SEC. 2. STATE REVOLVING FUND PILOT PROGRAM.
(a) ESTABLISHMENT.—
(1) COOPERATIVE
AGREEMENTS.—Subject to
the provisions of this section, the Secretary of Edu-
cation may enter into cooperative agreements with
States for the establishment of State revolving funds
and multistate revolving funds for making loans to
local political subdivisions or local educational agen-
cies for building or repairing elementary or sec-
ondary schools which provide free public education.
(2) INTERSTATE COMPACTS.—2 or more States
may enter into a cooperative agreement under para-
graph (1) with the Secretary for the establishment
of a multistate revolving fund, to enter into an inter-
state compact establishing such fund in accordance
with this section.
(b) FUNDING.—The Secretary shall make grants to
State revolving funds and multistate revolving funds in a
State in a cooperative agreement under subsection (a)(1)
to provide initial capital for loans provided under this sec-
tion to local political subdivisions or local educational
agencies. Each fund shall apply repayments of principal
and interest on loans to the making of additional loans.
The Secretary shall take final action on an application for
a grant under this subsection within 90 days of the date
of the submittal of such application.
(c) REVOLVING FUND REQUIREMENTS.—In order to
establish a revolving fund under this section, each State
establishing the fund shall—
(1) meet the matching requirement described in
paragraph (d);
(2) identify an operating entity of the State as
recipient of the grant if the entity has the capacity
to manage loan funds;
(3) allow such funds to be used as reserve for
debt issued by the State so long as proceeds are de-
posited in the fund for loan purposes;
(4) ensure that investment income generated by
funds contributed to an account of the fund will
be—
(A) credited to the account;
(B) available for use in providing loans to
projects eligible for assistance from the account;
and
(C) invested in United States Treasury se-
curities, bank deposits, or such other financing
instruments as the Secretary may approve to
earn interest to enhance the leveraging of
projects assisted by the fund;
(5) ensure that any loan from the fund will
bear interest at or below the lowest interest rates
being offered for bonds the income from which is ex-
empt from Federal taxation, as determined by the
State;
(6) ensure that repayment of any loan from the
fund will commence not later than 1 year after the
project has been completed;
(7) ensure that the term for repaying any loan
will not exceed the projected useful life of the project
that is the subject of the loan; and
(8) require the fund to make an annual report
to the Secretary on its status and make such other
reports as the Secretary may require by guidelines.
(d) MATCHING REQUIREMENT.—In order to meet the
matching requirement, each State establishing a revolving
fund shall—
(1) contribute, at a minimum, in each account
of the fund from non-Federal sources an amount
equal to 25 percent of the amount of each capitaliza-
tion grant made to the State and contributed to the
fund under subsection (b); or
(2) require for any project financed from the
fund that the local political subdivision or edu-
cational agency contribute at least 20 percent of the
cost of such project from non-Federal sources.
(e) FORMS
OF
ASSISTANCE
FROM
REVOLVING
FUNDS.—
(1) IN GENERAL.—A revolving fund established
under this section may make loans to a local edu-
cational agency in an amount equal to all or part of
the cost of carrying out a project eligible for assist-
ance under this section. In the case of a project
which meets the requirement of subsection (d)(2), a
revolving fund established under this section may
make loans to a local educational agency in an
amount equal to up to 80 percent of the cost of car-
rying out a project eligible for assistance under this
section.
(2) APPLICATIONS FOR LOANS.—An application
to a revolving fund by a local educational agency for
a loan shall include—
(A) in the case of a renovation project, a
description of each architectural, civil, struc-
tural, mechanical, or electrical deficiency to be
corrected with funds under a loan and the pri-
orities to be applied;
(B) a description of the criteria used by
the applicant to determine the type of corrective
action necessary for the renovation of a facility;
(C) a description of improvements to be
made and a cost estimate for the improvements;
and
(D) such other information as the revolv-
ing fund may require.
A revolving fund shall take final action on a com-
pleted application submitted to it within 90 days
after the date of its submittal.
(3) CRITERIA FOR LOANS.—In considering ap-
plications for a loan, a revolving fund shall
consider—
(A) the extent to which the local edu-
cational agency involved lacks the fiscal capac-
ity, including the ability to raise funds through
the full use of such agency’s bonding capacity
and otherwise, to undertake the project for
which the loan would be used without the loan;
(B) the threat that the condition of the
physical plant in the project poses to the safety
and well-being of students;
(C) the demonstrated need for the con-
struction, reconstruction, or renovation based
on the condition of the facility in the project;
and
(D) the age of such facility.
(f) QUALIFYING PROJECTS.—A project is eligible for
a loan from a revolving fund if it is a project that consists
of—
(1) the construction of new elementary or sec-
ondary schools to meet the needs imposed by enroll-
ment growth;
(2) the repair or upgrading of classrooms or
structures related to academic learning, including
the repair of leaking roofs, crumbling walls, inad-
equate plumbing, poor ventilation equipment, and in-
adequate heating or light equipment;
(3) an activity to increase physical safety at the
educational facility involved;
(4) an activity to enhance the educational facil-
ity involved to provide access for students, teachers,
and other individuals with disabilities;
(5) an activity to address environmental haz-
ards at the educational facility involved, such as
poor ventilation, indoor air quality, or lighting;
(6) the provision of basic infrastructure that fa-
cilitates educational technology, such as communica-
tions outlets, electrical systems, power outlets, or a
communication closet;
(7) work that will bring an educational facility
into conformity with the requirements of—
(A) environmental protection or health and
safety programs mandated by Federal, State, or