Public School Facilities Authority seeks operating increase; lawmakers raise concerns about aging schools, local match and construction costs

The committee reviewed the Public School Facilities Authority's operating budget request and adopted the LFC recommendation after a motion by Vice Chair Dixon and a second by Representative Hernandez; no opposition was recorded on the motion.

PSFA staff told the committee the agency requested $7,894,228 for its operating budget, a $483,000 increase largely driven by personal services. Executive Director Iris Romero and PSFA staff said the package includes a 3% performance‑based compensation strategy, two additional FTE (a regional project manager and an energy manager) and $25,000 to start contracting for an evaluation of the state/local match funding formula. Romero said the energy manager role would support district energy‑efficiency initiatives and a maintenance verification program intended to help districts realize utility savings.

Kelly Carswell, the LFC analyst for PSFA, reminded the committee that PSFA does not receive general fund operating support; its operating authority comes from the Public School Capital Outlay Fund and must stay within statutory administrative limits tied to the fund's five‑year average. Carswell said the LFC and executive recommendations were substantially the same and that analysts had reached consensus on performance measures.

Lawmakers raised concerns about the condition of older schools and how capital and maintenance funding is prioritized. Representative Sanchez asked whether PSFA oversees upgrades and construction; staff confirmed PSFA grants capital construction and maintenance assistance under statutory programs and noted the capital outlay fund has an absolute balance referenced during the meeting of about $1.6 billion (staff cautioned portions of that balance are already committed to projects).

Members pressed PSFA staff on waiver criteria for districts that cannot meet local match requirements. Programs manager Elise Ramos explained statutory waiver criteria: for districts with more than 800 students, a mill levy reaching at least 10 and demonstrable good‑faith efforts are required; smaller districts have different thresholds (for example, a 7 mill levy and other criteria). Committee members noted a pending bill (SB 82) that would change some waiver criteria and ease access for smaller, low‑capacity districts.

Several representatives described acute local needs: sewer odor, failing roofs and a lack of adequate local bonding capacity were raised as examples of why some schools need prioritized attention. Representative Baca and others also described how material and labor cost escalation—and contractor selection—are creating challenges for many projects, particularly in rural and remote areas.

PSFA staff said they would continue work with districts to prioritize projects and to begin the requested analysis of the state/local match formula.

Ending: The committee adopted the LFC recommendation for PSFA's operating budget; members asked PSFA to provide additional detail on capital commitments, the status of outstanding awards, and the planned scope for the state/local match analysis.