Lawmakers this week gave final approval to a bill designed to give school districts around the state access to California’s $773 million qualified school construction bond allocation for 2009.
“This bill gets the money out on the street so that people can be put to work,” bill sponsor Sen. Loni Hancock, D-Berkeley, said in a statement. “I am so glad that we are able to help create new jobs.”
The QSCB program was created in the 2009 federal stimulus bill. It authorized $11 billion of the school bonds in each of 2009 and 2010, structured to provide a tax credit generous enough to make the program effectively interest-free for issuers.
Because the tax-credit market didn’t develop to a size commensurate with the program, Congress made changes in a bill signed last week by President Obama, to allow issuers to receive direct subsidies from the federal government instead.
The California Department of Education allocated $700 million of QSCB authority to school districts through a lottery last summer, with the remaining $73 million assigned to charter schools by the California School Finance Authority.
None of the 2009 state allocated QSCBs were issued after bond counsel refused to issue bond opinions because they were concerned the state allocation process lacked statutory authority as defined under federal law, according to legislative staff analyses of the bill. The bill was written to provide that authority.
The Senate approved the bill unanimously Monday; it has already cleared the Assembly.