THE SENATE

S.C.R. NO.

131

TWENTY-FIRST LEGISLATURE, 2002

S.D. 1

STATE OF HAWAII

Proposed

   


SENATE CONCURRENT

RESOLUTION

 

REQUESTING EXPEDITEd BUDGETING, FINANCING, AND CONSTRUCTION OF NEW SCHOOL FACILITIES.

 

WHEREAS, there has been a significant population growth and migration of school age children in various areas throughout the State which would require accelerated planning, design, and construction of school facilities; and

WHEREAS, compounding this situation is an ever increasing dilemma of over-aged, obsolete infrastructures, and inadequate resources in our school system; and

WHEREAS, Leeward Oahu is one of the fastest growing areas in the State, with many large residential projects being completed and young families with school-age children purchasing homes in the area; and

WHEREAS, the current elementary school facility in Village Park, which serves both Village Park and Royal Kunia, is already at capacity and inadequate to serve the existing student population, and the number of students in the area is increasing rapidly; and

WHEREAS, the increasing student population has created an urgent need to develop an easily accessible neighborhood school as quickly as possible; and

WHEREAS, the Department of Education (DOE) has identified the construction of Royal Kunia Elementary School as one of its top priorities and has identified a particular site for the school’s construction; and

WHEREAS, to address the community’s urgent need for the school, Royal Kunia School, LLC, a local developer, will work with the DOE and the State to obtain title to the site and remove the current encumbrances. In consideration for such assistance and to facilitate construction of the school, the DOE will grant a lease for the site to Royal Kunia School, LLC, and enter into a financing agreement under Chapter 37D, Hawaii Revised Statutes (HRS), for the design, development, and construction of the school on the site by Royal Kunia School, LLC, in accordance with DOE standards; and

WHEREAS, DOE intends to submit a request to the Department of Budget and Finance (B&F) pursuant to section 37D—2, HRS, to

enter into a financing agreement with Royal Kunia School, LLC, or its designee which includes:

(1) The issuance of tax-exempt certificates of participation to raise the funds for the acquisition and leasing of the site, design, development, construction, and financing of the school and for costs of issuance, reserves, and other financing costs;

(2) Estimated completion of design and construction of the school by Royal Kunia School, LLC, or its designee in accordance with DOE standards within one year and nine months from the date of funding;

(3) A twenty- to thirty-year lease for use of the school by the DOE, with rents sufficient to pay for the certificates of participation and other lease requirements;

(4) Deferral of all rents during construction and for a period of up to one year after completion;

(5) An option to purchase the school at the end of the lease term for one dollar or other nominal

consideration; and

(6) An option to buy out the lease prior to the expiration of the term upon such terms as may be negotiated in the certificate of participation; and

WHEREAS, financing the design, construction, and acquisition of the school through a financing agreement pursuant to Chapter 37D, HRS, will facilitate the construction of the school on an expedited basis and achieve cost savings and efficiency; and

WHEREAS, this type of financing agreement has been used successfully by the State for prior projects as an alternative mechanism through which much-needed public facilities may be acquired or constructed in a cost-effective and efficient manner; and

WHEREAS, during years when the State must exercise extreme economic prudence, such alternative financing should be encouraged, especially where those efforts will directly benefit education, provide an economic stimulus to the local economy, and enable expedited construction; and

BE IT RESOLVED by the Senate of the Twenty-First Legislature of the State of Hawaii, Regular Session of 2002, the House of Representatives concurring, that B&F is requested to enter into a financing agreement with Royal Kunia School, LLC, or its designee on behalf of the DOE for the design, construction, financing, lease, and land acquisition for Royal Kunia Elementary School, and issue tax-exempt certificates of participation to provide the necessary funds for the project; and

BE IT FURTHER RESOLVED that the Department of Land and Natural Resources (DLNR) is requested to grant a lease for the school site to Royal Kunia School, LLC, to facilitate the development of the school; and

BE IT FURTHER RESOLVED that B&F, DLNR, and DOE are requested to proceed in a joint effort with Royal Kunia School, LLC, or its designee to complete the acquisition of the site, granting of the lease, and design, development, and construction of the school as quickly as possible before 2004; and

BE IT FURTHER RESOLVED that the Legislature supports the community’s urgent need for a school in the Leeward area and the concept of the Royal Kunia School, LLC and to continue the development of innovative alternatives and partnerships to fast-track the planning, designing, and construction of urgently needed schools; and

BE IT FURTHER RESOLVED that the DOE in collaboration with Department of Accounting and General Services (DAGS) is requested to submit to the Legistature, no later than twenty days before the convening of the Regular Session of 2003, a five year plan of urgently needed new school construction and renovation projects by school educational districts and schools, including a report of potential and innovative alternatives for fast-tracking the completion of these projects; and

BE IT FURTHER RESOLVED that certified copies of this Concurrent Resolution be transmitted to the Comptroller, Director of Finance, Superintendent of Education, Chairperson of the Board of Education, and the Chairperson of the Department of Land and Natural Resources.

 

 

 

Report Title:

DOE; New Facility Budgeting, Financing, and Construction