SECTIONS 12000-12002

12000.  Whenever by any act of Congress funds are provided asfederal aid to education to the several states and the disposition ofthe funds is not otherwise provided for by or under the act ofCongress or by or under any law of this state, the apportionment anddistribution thereof to school districts shall, insofar as consistentwith the requirements prescribed by the federal law and implementingrules and regulations, be governed by the standards set forth inthis article. When any such federal law designates a state education agency orother agency or officer primarily responsible for state supervisionof public schools, such designation shall be deemed to refer to theState Board of Education. The State Board of Education shall maketimely application for any federal funds made available, and shall,pursuant to the federal law and the provisions of this article,direct the allocation and apportionment of the federal funds to localeducation agencies.12001.  The State Board of Education shall adopt rules andregulations for the allocation of federal funds to local schooldistricts and other agencies entitled to receive federal funds forthe support of schools. In determining the rules and regulations bywhich such allocations are to be made, the State Board of Educationshall consider all factors of local effort and all educationalprograms maintained by such agencies. Such rules and regulationsshall be based upon need and the agencies' abilities and effortsshall be carefully scrutinized.12001.5.  (a) The Legislature hereby finds and declares that thefederal tax credit bond volume cap for qualified school constructionbonds designated for the state by the federal American Recovery andReinvestment Act of 2009 (Public Law 111-5), together with InternalRevenue Service Notice 2009-35 issued pursuant thereto, does notconstitute federal moneys, federal funds, or funds of any kind forany purpose under this code. (b) There is hereby assigned to the State Department of Education,seven hundred million dollars ($700,000,000) of the state's 2009federal tax credit bond volume cap for qualified school constructionbonds, to be further assigned and distributed to or for the benefitof school districts and county offices of education in the state, asthe State Department of Education shall determine. (c) (1) There is hereby assigned to the California School FinanceAuthority, established pursuant to Section 17172, seventy-threemillion five hundred twenty-five thousand dollars ($73,525,000) ofthe state's 2009 federal tax credit bond volume cap for qualifiedschool construction bonds, to be issued for the benefit of charterschools, or to be further assigned and distributed to one or moreissuers in the state for the benefit of charter schools, as theauthority shall determine. (2) The parameters specified in "Borrowing Authority Parametersand Application," dated February 10, 2010, as developed by theCalifornia School Finance Authority and referenced in Resolution10-04 of the authority, shall apply to all applications submitted tothe California School Finance Authority for the state's 2009 federaltax credit bond volume cap for qualified school construction bonds.If an applicant uses any 2009 federal tax credit bond volume cap inconjunction with a bond that will serve as a local match for purposesof the Charter School Facilities Program established by Section17078.52, the applicant, in addition to the requirements of thissection, shall comply with all of the requirements of the CharterSchool Facilities Program. (d) (1) Any of the state's 2009 federal tax credit bond volume capfor qualified school construction bonds assigned to the StateDepartment of Education pursuant to subdivision (b) that has notresulted in the issuance of qualified school construction bonds byDecember 31, 2009, shall be added to the state's volume cap for 2010,in accordance with subsection (e) of Section 54F of the InternalRevenue Code, and assigned as set forth in this section. Thosedistricts and county offices of education that received an assignmentfrom the State Department of Education by December 31, 2009, andnotification from the State Department of Education that they weregranted an extension to issue bonds through March 31, 2010, shallhave an additional 120 days from the effective date of thislegislation to issue bonds. (2) Any of the state's 2009 federal tax credit bond volume cap forqualified school construction bonds originally assigned to the StateDepartment of Education in 2009 pursuant to subdivision (b) thatdoes not result in the issuance of qualified school constructionbonds within 120 days from the effective date of this legislationshall revert to the state, and shall be reallocated in accordancewith the process established pursuant to state law for allocating the2010 federal tax credit bond volume cap for qualified schoolconstruction bonds. (3) The department shall reassign to a school district any 2009federal tax credit bond volume cap for qualified school constructionbonds that was directly allocated to the district by the UnitedStates Internal Revenue Service pursuant to Internal Revenue ServiceNotice 2009-35, did not result in the issuance of qualified schoolconstruction bonds by December 31, 2009, and was reallocated by thedistrict to the state no later than 30 days after the effective dateof this section. The department shall grant the school district 120days from the effective date of this section to issue the qualifiedschool construction bonds. Any of the state's federal tax credit bondvolume cap for qualified school construction bonds assigned to aschool district described in this paragraph that does not result inthe issuance of qualified school construction bonds within 120 daysfrom the effective date of this section shall revert to the state andshall be reallocated by the department in accordance with theprocess established pursuant to state law for allocating the 2010federal tax credit bond volume cap for qualified school constructionbonds. (e) (1) Any of the state's 2009 federal tax credit bond volume capfor qualified school construction bonds assigned to the CaliforniaSchool Finance Authority pursuant to subdivision (c) that has notresulted in the issuance of qualified school construction bonds byDecember 31, 2009, shall be added to the state's volume cap for 2010,in accordance with subsection (e) of Section 54F of the InternalRevenue Code, and allocated as set forth in this section. Any charterschool that received an allocation from the California SchoolFinance Authority prior to December 31, 2009, shall retain itsallocation pursuant to the resolution of the California SchoolFinance Authority. (2) Any of the state's 2009 federal tax credit bond volume cap forqualified school construction bonds originally allocated to theCalifornia School Finance Authority in 2009 pursuant to subdivision(c) that does not result in the issuance of qualified schoolconstruction bonds by December 31, 2010, shall be retained by theCalifornia School Finance Authority, and reallocated in accordancewith the qualified school construction bond parameters established bythe California School Finance Authority. (f) Notwithstanding any other provision of law, in order tofurther the purposes of the federal American Recovery andReinvestment Act of 2009, and allow school districts to issue federaltax credit bonds as expeditiously as possible, the assignment anddistribution of the federal tax credit bond volume cap by the StateDepartment of Education and the California School Finance Authorityunder this section are exempt from the rulemaking provisions of theAdministrative Procedure Act (Chapter 3.5 (commencing with Section11340) of Part 1 of Division 3 of Title 2 of the Government Code). (g) It is the intent of the Legislature that the parameters andconditions adopted by the department and the California SchoolFinance Authority be comparable where practical and applicable inorder to ensure consistency and equity in the state level assignmentand distribution of the federal tax credit bond volume cap,including, but not limited to, maximum tax credit amounts per projector school district. (h) Notwithstanding any other provision of this section, issuerswithin the state may issue qualified school construction bonds in anymanner permitted by federal law, including, but not limited to, astax credit bonds or federal subsidy bonds.12001.6.  (a) The Legislature hereby finds and declares that thefederal tax credit bond volume cap for qualified school constructionbonds designated to California by the federal American Recovery andReinvestment Act of 2009 (Public Law 111-5), together with InternalRevenue Service Notice 2010-17 issued pursuant thereto, does notconstitute federal moneys, federal funds, or funds of any kind forany purpose under this code. (b) The department is authorized to assign and distribute thestate's 2010 federal tax credit bond volume cap for qualified schoolconstruction bonds to or for the benefit of school districts andcounty offices of education in the state. (c) There is hereby assigned to the department six hundredfifty-one million six hundred fifty-two thousand dollars($651,652,000) of the state's 2010 federal tax credit bond volume capfor qualified school construction bonds. (1) A school district or county office of education may apply forthe federal tax credit bond volume cap for qualified schoolconstruction bonds if the project is funded by local voter-approvedbonds issued by the school district or bond anticipation notes asauthorized by Section 15150. A county office of education and aschool district with an enrollment of 2,500 or less may use otherforms of financing with the submission of a resolution adopted by thecounty board of education or governing board of the school districtauthorizing the issuance of the financing. (2) A school district or county office of education that receiveda 2009 allocation but did not make any issuance may apply for 2010federal tax credit bond volume cap for qualified school constructionbonds nine months after the effective date of this section. (3) A school district or county office of education that receiveda 2009 or 2010 federal tax credit bond volume cap for qualifiedschool construction bond allocation from the United States Departmentof the Treasury is not eligible to apply. (4) Five business days after the enactment of this legislation,the department shall post the application form on its Internet Website. (A) An application must be submitted via certified mail. (B) An application shall not be postmarked until 30 business daysafter the enactment of this legislation. (C) An application shall include the total number of enrolledpupils who qualify for the federal free and reduced priced mealprogram and the total overall pupil enrollment for the 2008-09 schoolyear. (5) An application not meeting the conditions set forth inparagraphs (1) and (4) shall be returned to the applicant. (6) Applications meeting the conditions set forth in paragraphs(1) and (4) shall be accepted on a first-come-first-served basis bydate of postmark. If this program is oversubscribed, order ofallocation shall be established using the following criteria: (A) First, earliest date of postmark. (B) Second, the project for which the federal qualified schoolconstruction bond authorization will be applied received approvalfrom the Division of the State Architect before the application wassubmitted. (C) Third, the greater percentage of pupils who qualify for thefederal free and reduced priced meals program and are enrolled in theapplying school district or county office of education in the2008-09 school year. The department shall certify the number ofpupils who qualify and the overall enrollment and calculate thepercentage to the nearest one-hundredth of 1 percent. (7) The department shall authorize the 2010 federal tax creditbond volume cap for qualified school construction bonds no soonerthan December 1, 2010. (8) The department shall maintain a waiting list of eligibleschool districts and county offices of education that did not receivean allocation in the order established pursuant to paragraph (6). (9) An applicant may not apply for more than twenty-five milliondollars ($25,000,000) of 2010 federal tax credit bond volume cap forqualified school construction bonds. (10) A school district or county office of education applying for2010 federal tax credit bond volume cap for qualified schoolconstruction bonds authorization shall certify in its applicationthat it will fulfill all of the federal qualified school constructionbond program requirements, including both of the followingrequirements: (A) Within six months of the date of issuance, the school districtor county office of education shall enter into a contract orcontracts for use of an amount of bond proceeds equal to 10 percentof the authorization. (B) Within three years of the date of issuance, the schooldistrict or county office of education shall spend 100 percent of thebond proceeds for a qualified purpose. (11) Fifteen days after bond issuance, the school district orcounty office of education shall submit to the department a copy ofthe appropriate federal Internal Revenue Service Form, InformationReturn for Tax-Exempt Bonds, as confirmation of issuance. (12) Thirty days after the completion of the expenditure therecipient shall submit a completion report to the department. Thecompletion report must be certified by the bond counsel of the schooldistrict or county office of education. (13) If any or all of the federal qualified school constructionbond authorizations to a school district or county office ofeducation are not issued within six months from the date ofauthorization, any or all unused federal qualified schoolconstruction bond authorizations shall revert to the department. Noextensions shall be provided. (A) The department shall reallocate any remaining federalqualified school construction bond allocation to school districts orcounty offices of education that were eligible and applied for theauthorization but did not receive an allocation. (B) Reverted 2010 federal tax credit bond volume cap for qualifiedschool construction bonds shall be allocated to school districts orcounty offices of education pursuant to the order of priorityestablished by paragraph (6). (C) The department shall allocate reverted federal qualifiedschool construction bond authorizations as they are available anduntil all are issued. (d) The California School Finance Authority, established pursuantto Section 17172, is authorized to assign and distribute the state's2010 federal tax credit bond volume cap for qualified schoolconstruction bonds to or for the benefit of charter schools, or to befurther assigned and distributed to one or more issuers in the statefor the benefit of charter schools, as determined by the authority. (1) There is hereby assigned to the California School FinanceAuthority, established pursuant to Section 17172, sixty-eight millionfour hundred six thousand dollars ($68,406,000) of the state's 2010federal tax credit bond volume cap for qualified school constructionbonds, to be issued for the benefit of charter schools, or to befurther assigned and distributed to one or more issuers in the statefor the benefit of charter schools, as the authority shall determine. (2) A charter school may apply for the federal qualified schoolconstruction bond volume cap if it meets all of the followingcriteria: (A) The charter school is operated as, or is operated by, anonprofit entity. (B) The charter school has an approved charter in place that iscurrent at the time of application and continuously through the dateof bond issuance. (C) The chartering authority certifies that the charter school isin good standing and is in compliance with the terms of its charter. (D) The charter school provides the level of classroom-basedinstruction specified in paragraph (1) of subdivision (e) of Section47612.5. (E) The applicant has completed at least three full school yearsof instructional operation as a charter school as of the end of theprevious school year. (3) Five business days after the effective date of this section,the California School Finance Authority shall post the applicationform and fee schedule on its Internet Web site. (4) An application shall not be postmarked until 30 business daysafter the effective date of this section. (5) Following a review of all applications and a preliminary awardof borrowing authority, the California School Finance Authorityshall ask applicants to provide additional information as necessaryfor the issuance of the bonds. (6) Applications that meet the conditions set forth in paragraph(2) shall be considered by the California School Finance Authority ona first-come-first-served basis by date of postmark. If the programis oversubscribed, staff shall present a priority list to theauthority pursuant to paragraph (7). (7) In the event that the program is oversubscribed, priorityshall be assigned first to those charter schools that are best ableto demonstrate to the California School Finance Authority, in itssole discretion, that they will be capable of accessing the capitalmarkets or be privately placed with an investor. The order ofallocation shall be established using the following criteria: (A) Applicants who are able to obtain credit enhancement for aqualified school construction bond financing, including a bank letterof credit, who contribute substantial equity to a project, or whoare otherwise able to obtain investment-grade credit ratings shallreceive priority over other applicants. (B) In the event that multiple applicants satisfy the criteriadescribed in subparagraph (A), priority shall be assigned toapplications with the earliest postmark date. An application that ishand delivered and does not have a postmark date will be ranked basedon the time the application is received by the California SchoolFinance Authority. (8) Applicants shall not apply for more than twenty-five milliondollars ($25,000,000) of qualified school construction bondauthorization per project. (9) Subsequent application cycles may be considered if borrowingauthority for qualified school construction bonds remains availableafter the initial application period. (10) Subject to the sole discretion of the California SchoolFinance Authority, any authorization to borrow qualified schoolconstruction bond proceeds is contingent on the issuance of thequalified school construction bonds by December 31, 2011, after whichtime the authorization expires and the authority may allocate theauthorization to another qualified applicant. (11) The California School Finance Authority shall allocatereverted federal qualified school construction bond authorization asit becomes available and until all of the authorization is issued. (12) If an applicant uses any federal tax credit bond volume capin conjunction with a bond that will serve as a local match forpurposes of the Charter School Facilities Program established bySection 17078.52, the applicant, in addition to the requirements ofthis section, shall comply with all of the requirements of theCharter School Facilities Program.12002.  There is hereby created in the State Treasury the AuxiliaryState School Fund. Any funds received under act of Congress asfederal aid to education, and not required by such act or any law ofthis state to be otherwise deposited, may be deposited in theAuxiliary State School Fund.