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AN ACT

RELATING TO PUBLIC SCHOOLS; PROVIDING CRITERIA AND PROCEDURES

FOR FUNDING PUBLIC SCHOOL CAPITAL OUTLAY PROJECTS FOR PUBLIC

SCHOOL BUILDINGS, INCLUDING CAPITAL OUTLAY FOR KINDERGARTEN

CLASSROOMS; AUTHORIZING THE ISSUANCE OF SUPPLEMENTAL

SEVERANCE TAX BONDS; AUTHORIZING THE ISSUANCE OF SEVERANCE

TAX BONDS; CREATING A DEFICIENCIES CORRECTION UNIT AS PART OF

THE PUBLIC SCHOOL CAPITAL OUTLAY COUNCIL; CREATING THE PUBLIC

SCHOOL CAPITAL OUTLAY TASK FORCE; MAKING APPROPRIATIONS;

DECLARING AN EMERGENCY.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

Section 1. Section 7-27-12 NMSA 1978 (being Laws 1961,

Chapter 5, Section 10, as amended) is amended to read:

"7-27-12. WHEN SEVERANCE TAX BONDS TO BE ISSUED.--

A. The state board of finance shall issue and sell

all severance tax bonds when authorized to do so by any law

that sets out the amount of the issue and the recipient of

the money.

B. The state board of finance shall also issue and

sell severance tax bonds authorized by Sections 72-14-36

through 72-14-42 NMSA 1978, and such authority as has been

given to the interstate stream commission to issue and sell

such bonds is transferred to the state board of finance. The

state board of finance shall issue and sell all severance tax

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bonds only when so instructed by resolution of the governing

body or by written direction from an authorized officer of

the recipient of the bond money.

C. Except as provided in Subsection D of this

section, proceeds from supplemental severance tax bonds shall

be used only for public school capital outlay projects

pursuant to the Public School Capital Outlay Act or the

Public School Capital Improvements Act.

D. Proceeds from supplemental severance tax bonds

issued pursuant to Paragraph (2) of Subsection A of Section

19 of Chapter 6 of Laws 1999 (1st S.S.) shall be used for the

purposes specified in that paragraph.

E. Except as provided in Subsection F of this

section, the state board of finance shall issue and sell all

supplemental severance tax bonds when so instructed by

resolution of the public school capital outlay council

pursuant to Section 7-27-12.2 NMSA 1978.

F. The state board of finance shall issue and sell

supplemental severance tax bonds authorized by Paragraph (2)

of Subsection A of Section 19 of Chapter 6 of Laws 1999 (1st

S.S.) when so instructed by resolution of the commission on

higher education."

Section 2. A new section of the Severance Tax Bonding

Act, Section 7-27-12.2 NMSA 1978, is enacted to read:

"7-27-12.2. SUPPLEMENTAL SEVERANCE TAX BONDS--PUBLIC

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SCHOOL CAPITAL OUTLAY PROJECTS.--

A. The public school capital outlay council is

authorized to certify by resolution that proceeds of

supplemental severance tax bonds are needed for public school

capital outlay projects pursuant to Section 22-24-5 NMSA 1978

or for the state distribution for public school capital

improvements pursuant to the Public School Capital

Improvements Act. The resolution shall specify the total

amount needed.

B. The state board of finance may issue and sell

supplemental severance tax bonds in compliance with the

Severance Tax Bonding Act when the public school capital

outlay council certifies by resolution the need for the

issuance of the bonds. The amount of the bonds sold at each

sale shall not exceed the lesser of the amount certified by

the council or the amount that may be issued pursuant to the

restrictions of Section 7-27-14 NMSA 1978.

C. The state board of finance shall schedule the

issuance and sale of the bonds in the most expeditious and

economical manner possible.

D. The proceeds from the sale of the bonds are

appropriated as follows:

(1) the amount certified by the

superintendent of public instruction as necessary to make the

distribution pursuant to Section 22-25-9 NMSA 1978 is

appropriated to the public school capital improvements fund

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for the purpose of carrying out the provisions of the Public

School Capital Improvements Act; and

(2) the remainder of the proceeds is

appropriated to the public school capital outlay fund for the

purpose of making awards of grant assistance pursuant to

Section 22-24-5 NMSA 1978, except that, of the proceeds

received from the sale of the bonds in fiscal year 2001,

fifty million dollars ($50,000,000) shall be used for

projects to correct outstanding deficiencies pursuant to

Sections 22-24-4.1 and 22-24-4.2 NMSA 1978."

Section 3. Section 7-27-27 NMSA 1978 (being Laws 1961,

Chapter 5, Section 27, as amended) is amended to read:

"7-27-27. PURPOSE AND INTENT.--The purpose of the

Severance Tax Bonding Act is to establish the authority who

shall issue and sell all severance tax bonds for financing

specific projects authorized by the legislature

and all

supplemental severance tax bonds pursuant to Section

7-27-12.2 NMSA 1978

and to guarantee redemption of such bonds

by revenue derived from the receipts from taxes levied upon

natural resource products severed and saved from the soil and

such other money as the legislature may from time to time

determine. It is intended that projects to be financed from

the fund shall include the construction of public school

buildings, other buildings for state institutions and water

resource projects; and it is further intended that the income

from water resource projects in excess of the amount required

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for operation and maintenance of the project shall be used to

repay the severance tax bonding fund."

Section 4. A new Section 22-20-4 NMSA 1978 is enacted

to read:

"22-20-4. APPLICABILITY.--The provisions of Chapter 22,

Article 20 NMSA 1978 do not apply to public school capital

outlay projects subject to the oversight of the public school

capital outlay council pursuant to the Public School Capital

Outlay Act."

Section 5. Section 22-24-4 NMSA 1978 (being Laws 1975,

Chapter 235, Section 4, as amended) is amended to read:

"22-24-4. FUND CREATED--USE.--

A. There is created the "public school capital

outlay fund". Balances remaining in the fund at the end of

each fiscal year shall not revert.

B. Money in the fund may be used only for capital

expenditures deemed by the council necessary for an adequate

educational program.

C. The council may authorize the purchase by the

property control division of the general services department

of property to be loaned to school districts to meet a

temporary requirement. Payment for these purchases shall be

made from the fund. Title and custody to the property shall

rest in the property control division. The council shall

authorize the lending of the property to school districts

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upon request and upon finding that sufficient need exists.

Application for use or return of state-owned portable

classroom buildings shall be submitted by school districts to

the council. Expenses of maintenance of the property while

in the custody of the property control division shall be paid

from the fund; expenses of maintenance and insurance of the

property while in the custody of a school district shall be

the responsibility of the school district. The council may

authorize the permanent disposition of the property by the

property control division with prior approval of the state

board of finance.

D. Applications for assistance from the fund shall

be made by local school districts to the council in

accordance with requirements of the council.

E. The council shall review all requests for

assistance from the fund and shall allocate funds only for

those capital outlay projects that meet the criteria of the

Public School Capital Outlay Act.

F. Money in the fund shall be disbursed by warrant

of the department of finance and administration on vouchers

signed by the secretary of finance and administration

following certification by the council that an application

has been approved."

Section 6. A new section of the Public School Capital

Outlay Act, Section 22-24-4.1 NMSA 1978, is enacted to read:

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"22-24-4.1. OUTSTANDING DEFICIENCIES--ASSESSMENT--

CORRECTION.--

A. No later than September 1, 2001, the council

shall define and develop guidelines, consistent with the

codes adopted by the construction industries commission

pursuant to the Construction Industries Licensing Act, for

school districts to use to identify outstanding serious

deficiencies in public school buildings and grounds,

including buildings and grounds of charter schools, that may

adversely affect the health or safety of students and school

personnel.

B. A local school district shall use these

guidelines to complete a self-assessment of the outstanding

health or safety deficiencies within the district and provide

cost projections to correct the outstanding deficiencies.

C. The council shall develop a methodology for

prioritizing projects that will correct the deficiencies.

D. After a public hearing and to the extent that

money is available in the fund for such purposes, the council

shall approve allocations from the fund on the established

priority basis and, working with the school district and

pursuant to the Procurement Code, enter into construction

contracts with contractors to correct the deficiencies.

E. In entering into construction contracts to

correct deficiencies pursuant to this section, the council

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shall include such terms and conditions as necessary to

ensure that the state money is expended in the most prudent

manner possible and consistent with the original purpose.

F. Any deficiency that may adversely affect the

health or safety of students or school personnel may be

corrected pursuant to this section, regardless of the local

effort or percentage of indebtedness of the school district.

G. It is the intent of the legislature that all

outstanding deficiencies in public schools and grounds that

may adversely affect the health or safety of students and

school personnel be identified and funded pursuant to this

section no later than June 30, 2004."

Section 7. A new section of the Public School Capital

Outlay Act, Section 22-24-4.2 NMSA 1978, is enacted to read:

"22-24-4.2. DEFICIENCIES CORRECTION UNIT.--

A. A "deficiencies correction unit" is created as

part of the public school capital outlay council. The unit

shall be headed by a director, selected by the council, who

shall be versed in construction, architecture or project

management. Within budgetary constraints, the director shall

employ or contract with such technical and administrative

personnel as are necessary to carry out the provisions of

this section. The director shall be exempt from the

provisions of the Personnel Act.

B. The deficiencies correction unit shall:

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(1) work with the local school districts to

validate the assessment of the outstanding deficiencies and

the projected costs to correct the deficiencies;

(2) work with the school districts to

provide direct oversight of the management and construction

of the projects that will correct the outstanding

deficiencies;

(3) oversee all aspects of the contracts

entered into by the council to correct the outstanding

deficiencies;

(4) conduct on-site inspections while the

deficiencies correction work is being done to assure that the

construction specifications are being met and periodically

inspect all of the documents relating to the projects;

(5) require the use of standardized

construction documents as defined by the property control

division of the general services department and the use of a

standardized process for change orders; and

(6) have access to the premises of a project

and any documentation relating to the project."

Section 8. Section 22-24-5 NMSA 1978 (being Laws 1975,

Chapter 235, Section 5, as amended) is amended to read:

"22-24-5. PUBLIC SCHOOL CAPITAL OUTLAY PROJECTS--

APPLICATION--GRANT ASSISTANCE.--

A. For project allocation cycles occurring before

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September 1, 2003, the council shall approve an application

for grant assistance from the fund for a public school

capital outlay project not wholly funded pursuant to

Section 22-24-4.1 NMSA 1978, when the council determines

that:

(1) a need exists requiring action;

(2) the residents of the school district

have provided available resources to the school district to

meet its capital outlay requirements;

(3) the school district has used its capital

resources in a prudent manner;

(4) the school district has provided

insurance for buildings of the school district in accordance

with the provisions of Section 13-5-3 NMSA 1978;

(5) the school district:

(a) is indebted at not less than

sixty-five percent of the total general obligation debt

authorized by law; or

(b) within the last three years, was

indebted at the level required in Subparagraph (a) of this

paragraph and received a grant pursuant to this section for

the initial stages of a project and currently has a critical

need for an additional grant to complete the same project;

(6) the application includes:

(a) the capital needs of any charter

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schools located in the school district or the school district

has shown that the capital needs of the charter schools are

not as great as the capital needs requested in the

application; and

(b) the facilities needed in the school

district to implement a full-day kindergarten program or that

the school district has shown that the need for facilities to

implement the program is not as great as the capital needs

requested in the application; provided that the total amount

of assistance grants made in a fiscal year for the purpose of

implementing full-day kindergarten programs shall not exceed

five million dollars ($5,000,000); and

(7) the school district has submitted a

five-year facilities plan that includes:

(a) enrollment projections;

(b) a current preventive maintenance

plan to which the school adheres for each public school in

the district; and

(c) projections for the facilities

needed in order to maintain a full-day kindergarten program.

B. The council shall consider all applications for

assistance from the fund and, after a public hearing, shall

either approve or deny the application. Applications for

grant assistance shall only be accepted by the council after

a school district has complied with the provisions of this

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section. The council shall list all applications in order of

priority, and all allocations shall be made on a priority

basis, except:

(1) twenty million dollars ($20,000,000) of

the proceeds from supplemental severance tax bonds available

for the funding cycle in fiscal year 2001 and fifty million

dollars ($50,000,000) of the proceeds from supplemental

severance tax bonds available for the funding cycle in each

of fiscal years 2002 and 2003 shall be set aside for

allocation solely for projects in school districts that are

eligible for funding from the fund and that receive grants

from the federal government as assistance to areas affected

by federal activity authorized in accordance with Title 20 of

the United States Code, commonly known as "PL 874 funds" or

"impact aid"; and

(2) in the case of an emergency, the order

of priority shall first reflect those projects that have been

previously funded but are not as yet completed, excluding

expansion of those projects and contingent upon maintenance

of the required local support.

C. For allocation cycles beginning after

September 1, 2003, the following provisions apply:

(1) all school districts are eligible to

apply for funding from the fund, regardless of percentage of

indebtedness;

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(2) priorities for funding shall be

determined by using the statewide adequacy standards

developed pursuant to Subsection D of this section; provided

that the council shall apply the standards to charter schools

to the same extent that they are applied to other public

schools;

(3) after consulting with the staff

architect of the property control division of the general

services department, the council shall establish criteria to

be used in public school capital outlay projects that receive

grant assistance pursuant to the Public School Capital Outlay

Act. In establishing the criteria, the council shall

consider:

(a) the feasibility of using design,

build and finance arrangements for public school capital

outlay projects;

(b) the potential use of more durable

construction materials that may reduce long-term operating

costs; and

(c) any other financing or construction

concept that may maximize the dollar effect of the state

grant assistance;

(4) no more than ten percent of the combined

total of grants in a funding cycle shall be used for

retrofitting existing facilities for technology

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infrastructure;

(5) except as provided in Paragraph (6) of

this subsection, a project approved and ranked by the council

shall be funded within available resources in accordance with

the following formula:

(school district final prior year

assessed valuation per MEM ÷ the state

average final prior year assessed

valuation per MEM) x 0.5. The product

is subtracted from 1.0 and the

difference is then multiplied by

seventy-five percent. The product of

that calculation added to (the percent

of bonding capacity used x 0.25) equals

the percentage of the cost of the

approved project to be funded from the

fund. "MEM" means the total enrollment

of students attending public school in a

school district in the final funded

prior school year, with kindergarten

being counted as 0.5. In those

instances in which the formula provides

less than 0.1, 0.1 shall be used as the

state's share;

(6) in those instances in which a school

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district has used all of its local resources, the council may

fund the total amount of a project; and

(7) no application for grant assistance from

the fund shall be approved unless the council determines

that:

(a) the public school capital outlay

project is needed and included in the school district's five-

year facilities plan among its top priorities;

(b) the school district has used its

capital resources in a prudent manner;

(c) the school district has provided

insurance for buildings of the school district in accordance

with the provisions of Section 13-5-3 NMSA 1978;

(d) the school district has submitted a

five-year facilities plan that includes: 1) enrollment

projections; 2) a current preventive maintenance plan to

which the school adheres for each public school in the

district; and 3) projections for the facilities needed in

order to maintain a full-day kindergarten program;

(e) the school district is willing and

able to pay any portion of the total cost of the public

school capital outlay project that, according to Paragraph

(5) of this subsection established by law, is not funded with

grant assistance from the fund;

(f) the application includes the

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capital needs of any charter schools located in the school

district or the school district has shown that the facilities

of the charter schools in the district meet the statewide

adequacy standards; and

(g) the school district has agreed, in

writing, to comply with any reporting requirements or

conditions imposed by the council pursuant to Section

22-24-5.1 NMSA 1978.

D. After consulting with the public school capital

outlay task force and other experts, no later than September

1, 2002, the council shall develop statewide adequacy

standards applicable to all school districts. The standards

shall establish the minimum acceptable level for the physical

condition and capacity of buildings, the educational

suitability of facilities and the need for technological

infrastructure. The amount of outstanding deviation from the

standards shall be used by the council after September 1,

2003 in evaluating and prioritizing public school capital

outlay projects.

E. It is the intent of the legislature that grant

assistance made pursuant to this section allow every school

district to meet the standards developed pursuant to

Subsection D of this section; provided, however, that nothing

in the Public School Capital Outlay Act or the development of

standards pursuant to that act prohibits a school district

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from using local funds to exceed the statewide adequacy

standards.

F. Upon request, the council shall work with, and

provide assistance and information to, the public school

capital outlay task force.

G. The council may establish committees or task

forces, not necessarily consisting of council members, and

may use the committees or task forces, as well as existing

agencies or organizations, to conduct studies, conduct

surveys, submit recommendations or otherwise contribute

expertise from the public schools, programs, interest groups

and segments of society most concerned with a particular

aspect of the council's work.

H. The council shall promulgate such rules as are

necessary to carry out the provisions of the Public School

Capital Outlay Act.

I. No later than December 1 of each year, the

council shall prepare a report summarizing its activities

during the previous fiscal year. The report shall describe

in detail all projects funded, the progress of projects

previously funded but not completed, the criteria used to

prioritize and fund projects and all other council actions.

The report shall be submitted to the state board, the

governor, the legislative finance committee, the legislative

education study committee and each member of the

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legislature."

Section 9. A new section of the Public School Capital

Outlay Act, Section 22-24-5.1 NMSA 1978, is enacted to read:

"22-24-5.1. COUNCIL ASSISTANCE AND OVERSIGHT.--In

providing grant assistance pursuant to Section 22-24-5 NMSA

1978, the council shall:

A. assist school districts in identifying critical

capital outlay needs and in preparing grant applications;

B. take such actions as are necessary to assist

school districts in implementing the projects for which

grants are made, including assistance with the preparation of

requests for bids or proposals, contract negotiations and

contract implementation;

C. take such actions as are necessary to ensure

cost savings and efficiencies for those school districts that

are not large enough to maintain their own construction

management staff; and

D. include such reporting requirements and

conditions and take such actions as are necessary to ensure

that the grants are expended in the most prudent manner

possible and consistent with the original purpose for which

they were made. In order to ensure compliance with the

intent of this subsection, the council may:

(1) access the premises of a project and

review any documentation relating to a project;

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(2) withhold all or part of the amount of

grant assistance available for a project for grounds

established by rule of the council; and

(3) if it determines that a project is

repeatedly in substantial noncompliance with any reporting

requirement or condition, take over the direct administration

of the project until the project is completed."

Section 10. Section 22-25-9 NMSA 1978 (being Laws 1975

(S.S.), Chapter 5, Section 9, as amended by Laws 1988,

Chapter 64, Section 44 and also by Laws 1988, Chapter 66,

Section 2) is amended to read:

"22-25-9. STATE DISTRIBUTION TO SCHOOL DISTRICT

IMPOSING TAX UNDER CERTAIN CIRCUMSTANCES.--

A. Except as provided in Subsection C of this

section, the state superintendent shall distribute to any

school district that has imposed a tax under the Public

School Capital Improvements Act an amount from the public

school capital improvements fund that is equal to the amount

by which the revenue estimated to be received from the

imposed tax, at the rate certified by the department of

finance and administration in accordance with Section 22-25-7

NMSA 1978, assuming a one hundred percent collection rate, is

less than an amount calculated by multiplying the school

district's first forty-days' total program units by the

dollar amount specified in Subsection B of this section and

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further multiplying the product obtained by the tax rate

approved by the qualified electors in the most recent

election on the question of imposing a tax under the Public

School Capital Improvements Act. The distribution shall be

made each year that the tax is imposed in accordance with

Section 22-25-7 NMSA 1978; provided that no state

distribution from the public school capital improvements fund

may be used for capital improvements to any administration

building of a school district. In the event that sufficient

funds are not available in the public school capital

improvements fund to make the state distribution provided for

in this section, the dollar per program unit figure shall be

reduced as necessary.

B. In calculating the state distribution pursuant

to Subsection A of this section, the following amounts shall

be used:

(1) fifty dollars ($50.00) per program unit;

and

(2) for fiscal year 2005 and thereafter, an

additional amount certified to the state superintendent by

the public school capital outlay council. No later than

June 1, 2004 and each June 1 thereafter, the council shall

determine the amount needed in the next fiscal year for

public school capital outlay projects pursuant to the Public

School Capital Outlay Act and the amount of revenue, from all

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sources, available for the projects. If, in the sole

discretion of the council, the amount available exceeds the

amount needed, the council may certify an additional amount

pursuant to this paragraph; provided that the sum of the

amount calculated pursuant to this paragraph plus the amount

in Paragraph (1) of this subsection shall not result in a

total statewide distribution that, in the opinion of the

council, exceeds one-half of the total revenue estimated to

be received from taxes imposed pursuant to the Public School

Capital Improvements Act.

C. Notwithstanding the amount calculated to be

distributed pursuant to Subsections A and B of this section,

no school district, the voters of which have approved a tax

pursuant to Section 22-25-3 NMSA 1978, shall receive a

distribution less than an amount equal to five dollars

($5.00) multiplied by the school district's first forty days'

total program units and further multiplying the product

obtained by the approved tax rate.

D. In making distributions pursuant to this

section, the state superintendent shall include such

reporting requirements and conditions as are required by rule

of the public school capital outlay council. The council

shall adopt such requirements and conditions as are necessary

to ensure that the distributions are expended in the most

prudent manner possible and consistent with the original

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purpose as specified in the authorizing resolution. Copies

of reports or other information received by the state

superintendent in response to the requirements and conditions

shall be forwarded to the council."

Section 11. Laws 1999 (1st S.S.), Chapter 6, Section 19

is amended to read:

"Section 19. SUPPLEMENTAL SEVERANCE TAX BONDS--PURPOSE

FOR WHICH ISSUED--APPROPRIATION OF PROCEEDS.--

A. The state board of finance may issue and sell

supplemental severance tax bonds in compliance with the

Severance Tax Bonding Act in the following amounts for the

following purposes upon the following certification:

(1) an amount not exceeding one hundred

million dollars ($100,000,000) when the public school capital

outlay council certifies by resolution the need for the

issuance of the bonds for public school critical capital

outlay projects pursuant to the Public School Capital Outlay

Act; and

(2) an amount not exceeding twenty-five

million dollars ($25,000,000) when the commission on higher

education certifies by resolution the need for the issuance

of the bonds for infrastructure renovation and expansion at

the state's public post-secondary educational institutions or

other educational institutions confirmed in Article 12,

Section 11 of the constitution of New Mexico pursuant to a

plan developed and approved by the commission on higher

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education to fund the highest priority significant needs

identified by the commission.

B. The state board of finance shall schedule the

issuance and sale of the bonds in the most expeditious and

economical manner possible upon a finding by the board that

the projects have been developed sufficiently to justify the

issuance and that the projects can proceed to contract within

a reasonable time. The state board of finance shall further

take the appropriate steps necessary to comply with the

Internal Revenue Code of 1986, as amended.

C. The proceeds from the sale of the bonds

pursuant to Paragraph (1) of Subsection A of this section are

appropriated to the public school capital outlay fund to

carry out the provisions of the Public School Capital Outlay

Act. If the public school capital outlay council has not

certified the need for the issuance of the bonds by

January 31, 2001, authorization provided in this section

shall expire. Any unexpended or unencumbered balance

remaining from the proceeds of bonds issued pursuant to

Paragraph (1) of Subsection A of this section at the end of

fiscal year 2006 shall revert to the severance tax bonding

fund.

D. The proceeds from the sale of the bonds in

Paragraph (2) of Subsection A of this section are

appropriated to the commission on higher education for

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distribution to the governing bodies of the educational

institutions who have certified projects for funding with the

bond proceeds. If the commission on higher education has not

certified the need for the issuance of the bonds by the end

of fiscal year 2004, authorization provided in this section

shall expire. Any unexpended or unencumbered balance

remaining from the proceeds of bonds issued pursuant to

Paragraph (2) of Subsection A of this section at the end of

fiscal year 2006 shall revert to the severance tax bonding

fund."

Section 12. PUBLIC SCHOOL CAPITAL OUTLAY TASK FORCE--

CREATION--STAFF.--

A. The "public school capital outlay task force"

is created. The task force consists of twenty-one members as

follows:

(1) the dean of the university of New Mexico

school of law, or his designee;

(2) the dean of the New Mexico state

university college of engineering or his designee;

(3) the secretary of finance and

administration or his designee;

(4) the state investment officer or his

designee;

(5) the superintendent of public instruction

or his designee;

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(6) the chairmen of the house appropriations

and finance committee, the senate finance committee, the

senate education committee and the house education committee

or their designees;

(7) a minority party member of the house of

representatives, appointed by the New Mexico legislative

council;

(8) a minority party member of the senate,

appointed by the New Mexico legislative council;

(9) two public members who have expertise in

education and finance appointed by the speaker of the house

of representatives;

(10) two public members who have expertise

in education and finance appointed by the president pro

tempore of the senate;

(11) three public members who have expertise

in education and finance appointed by the governor; and

(12) three superintendents of school

districts or their designees that receive grants from the

federal government as assistance to areas affected by federal

activity authorized in accordance with Title 20 of the United

States Code, appointed by the New Mexico legislative council

in consultation with the governor.

B. The chair of the task force shall be elected by

the task force. The public school capital outlay task force

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shall meet at the call of the chair.

C. The public members of the public school capital

outlay task force shall receive per diem and mileage pursuant

to the Per Diem and Mileage Act.

D. The legislative council service, with

assistance from the department of finance and administration,

the investment office, the state department of public

education, the legislative education study committee and the

legislative finance committee, shall provide staff for the

public school capital outlay task force.

Section 13. PUBLIC SCHOOL CAPITAL OUTLAY TASK FORCE--

DUTIES.--The public school capital outlay task force shall:

A. study and evaluate the progress and

effectiveness of programs administered pursuant to the Public

School Capital Outlay Act and the Public School Capital

Improvements Act;

B. evaluate the existing permanent revenue streams

and other potential revenues as adequate long-term funding

sources for public school capital outlay projects and

recommend any changes that may be more cost-effective or

appropriate;

C.

evaluate the effectiveness and fairness of the

formula used in determining the amount of grant assistance

that an approved public school capital outlay project may

receive from the public school capital outlay fund and

recommended any proposed changes to the legislature;

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D. monitor and assist the public school capital

outlay council as it:

(1) defines outstanding public school

capital outlay deficiencies pursuant to Section 22-24-4.1

NMSA 1978;

(2) works with school districts in

conducting a self-assessment of the projects needed to

correct the outstanding deficiencies and establishes criteria

for addressing those needs;

(3) develops statewide adequacy standards

that establish the minimum acceptable level for the physical

condition and capacity of public school buildings, the

educational suitability of educational facilities and the

need for technological infrastructure; and

(4) develops guidelines and procedures for

reporting requirements and conditions to ensure that the

grants are expended in the most prudent manner possible and

consistent with the original purpose for which they were

made; and

E. no later than December 1 of each year, report

the results of its analyses and its findings and

recommendations to the governor and the legislature.

Section 14. SEVERANCE TAX BONDS--PURPOSE--APPROPRIATION

OF PROCEEDS.--The state board of finance may issue and sell

severance tax bonds in fiscal years 2002 and 2003 in

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compliance with the Severance Tax Bonding Act in an amount

not exceeding a total of one hundred million dollars

($100,000,000) when the public school capital outlay council

certifies the need for the issuance of the bonds. The state

board of finance shall schedule the issuance and sale of the

bonds in the most expeditious and economical manner possible.

The proceeds from the sale of the bonds are appropriated to

the public school capital outlay fund for the purpose of

providing grant assistance for public school capital outlay

projects that are needed to correct outstanding deficiencies

pursuant to Sections 22-24-4.1 and 22-24-4.2 NMSA 1978. Any

unexpended or unencumbered balance remaining at the end of

fiscal year 2006 shall revert to the severance tax bonding

fund. If the public school capital outlay council has not

certified the need for the issuance of the bonds by the end

of fiscal year 2003, the authorization provided in this

section shall expire.

Section 15. APPROPRIATIONS.--

A. Two million three hundred thousand dollars

($2,300,000) is appropriated from the general fund to the

state department of public education for expenditure in

fiscal years 2001 through 2003 for the purpose of completing

a statewide needs and cost assessment of all school districts

in order to identify all needed public school capital outlay

projects. Any unexpended or unencumbered balance remaining

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at the end of fiscal year 2003 shall revert to the general

fund.

B. Two hundred thousand dollars ($200,000) is

appropriated from the general fund to the state department of

public education for expenditure in fiscal year 2002 for the

purpose of assisting the public school capital outlay council

in performing those duties required of it pursuant to the

Public School Capital Outlay Act. The appropriation may be

expended by the department in the manner deemed by the

department and council to be the most expedient and cost

effective, including expenditures for employees and for

contractual services. Any unexpended or unencumbered balance

remaining at the end of fiscal year 2002 shall revert to the

general fund.

C. One million one hundred thousand dollars

($1,100,000) is appropriated from the general fund to the

deficiencies correction unit of the public school capital

outlay council for expenditure in fiscal years 2001 and 2002

for the purpose of carrying out its duties pursuant to the

Public School Capital Outlay Act. Any unexpended or

unencumbered balance remaining at the end of fiscal year 2002

shall revert to the general fund.

D. Fifty million dollars ($50,000,000) is

appropriated from the general fund to the public school

capital outlay fund for expenditure in fiscal years 2002

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through 2004 for the purpose of correcting outstanding

deficiencies pursuant to Sections 22-24-4.1 and 22-24-4.2

NMSA 1978. The appropriation is contingent upon the

secretary of general services and the secretary of finance

and administration certifying that the public school capital

outlay council has, by rule, adopted a project management

system to ensure that the projects will be constructed in the

most cost-effective and efficient manner. Any unexpended or

unencumbered balance remaining at the end of fiscal year 2004

shall not revert but shall be used for the purpose of

providing grant assistance pursuant to Section 22-24-5 NMSA

1978.

E. Twenty thousand dollars ($20,000) is

appropriated from the general fund to the legislative council

service for expenditure in fiscal years 2001 and 2002 for the

purpose of paying per diem and mileage for public members of

the public school capital outlay task force. Any unexpended

or unencumbered balance remaining at the end of fiscal year

2002 shall revert to the general fund.

Section 16. KINDERGARTEN CAPITAL FUNDING.--

A. Five million dollars ($5,000,000) is

appropriated from the general fund to the state department of

public education for expenditure in fiscal years 2001 through

2003 to purchase portable classrooms or to build classrooms

for full-day kindergarten throughout New Mexico. Any

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unexpended or unencumbered balance remaining at the end of

fiscal year 2003 shall revert to the general fund.

B. The state department of public education shall

adopt an application process for school districts that wish

to purchase portable classrooms or to build classrooms for

full-day kindergarten. The school districts shall submit

applications to the state department of public education by

July 1, 2001. School districts shall provide the following

information in the application to the state department of

public education:

(1) district enrollment by school in half-

day and full-day kindergarten for the 2000-2001 school year;

(2) the number of full-day kindergarten

classrooms to be constructed or purchased at each elementary

school in the district;

(3) whether the district is requesting brick

and mortar or portable full-day kindergarten classrooms;

(4) the signature of the district

superintendent approving the application; and

(5) verification from the superintendent of

public instruction that the need exists for portable

classrooms or built classrooms for full-day kindergarten.

C. When providing distributions to local school

districts pursuant to Subsections A and B of this section,

the state department of public education shall give priority

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to those school districts that serve children in schools with

the highest proportion of students most in need based upon

indicators in the at-risk factor and those that do not

qualify for funding under the Public School Capital Outlay

Act. The state department of public education shall also

consider the local resources available to build full-day

kindergarten classrooms and the possibility of converting

existing classrooms to full-day kindergarten classrooms.

Section 17. REPEAL.--Laws 2000, Chapter 95, Section 2

and Laws 2000 (2nd S.S.), Chapter 11, Section 3 are repealed.

Section 18. DELAYED REPEAL.--Sections 12 and 13 of this

act are repealed effective January 1, 2004.

Section 19. EMERGENCY.--It is necessary for the public

peace, health and safety that this act take effect

immediately.