Subcommittee reviews school building budgets; LFA recommends $5.6 million cut to enrollment-growth program

The Public Education Appropriations Subcommittee reviewed the state's school building program and a related small-district capital projects fund on Jan. 30, 2025. Rochelle Gunderson, a financial analyst with the Legislative Fiscal Analyst's Office, walked the committee through COBie, the LFA's online budget tool, and the school building program's line items and funding sources. Gunderson highlighted that the school building agency receives $36,280,000 in total and that the agency's apparent fall in funding is largely the result of one-time allocations not repeated in the next fiscal year.

The LFA recommended an ongoing reduction of $5,600,000 to the capital outlay enrollment-growth program, saying the program's total statewide funding has not changed since 2016 while statewide enrollment has declined. "With total statewide enrollment decreasing, enrollment growth may be less of an issue than when the program was created," Gunderson said.

The recommendation drew committee questions about planning. Representative Thompson pressed for longer-term projections; Ben (identified in the record as an LFA analyst) said the office performs an annual enrollment projection and that the Gardner Policy Institute produces statewide school-age population projections that the LFA can use to produce multi-year enrollment projections for the committee. "I can get that for the committee," Ben said.

Separately, Sam Urie, finance director for the Utah State Board of Education, described the small-district capital projects fund created by HB 475 (2022 General Session). Urie said $50 million was appropriated in fiscal years 2023 and 2024 and fully distributed; fiscal 2025 received $30 million (a $15 million stabilization allocation and $15 million from the uniform school fund). He said the panel received more than $209 million in total project cost requests, with about $145 million of state matching requested, but only $30 million was available for distribution this year. Awardees in the current round included Carbon, Duchesne, Emery, South Sanpete, Tintic and Wayne school districts.

Urie described the independent panel that reviews applications: the State Board's superintendent and deputy superintendent, the USBE school construction specialist and two governor's appointees with construction experience. He said projects are evaluated under statutory priorities including life safety, efficiency of use, program growth and capacity, and that matches and local effort requirements are set by statute.

Committee members asked how districts handle cost escalation and matching. Urie and other presenters said districts sometimes must alter designs, seek loans from a separate school-district loan fund, or use local resources. Representative McPherson asked whether rural construction costs per square foot differ from urban areas; Urie replied that small districts tend to be cost-conscious but local decisions on extra amenities vary.

Why it matters: The LFA recommendation, if adopted, would reduce an ongoing state allocation aimed at districts with rapid enrollment growth. At the same time, rural districts seeking capital assistance say demand and project costs still outstrip available awards, creating pressure on the small-district fund.

Next steps: The LFA said it can provide multi-year enrollment projections using Gardner Institute data and internal economists. The committee did not record a formal vote on the LFA recommendation during this session.