The Vermont Statutes Online

Title 16 : Education

Chapter 123 : State Aid for Capital Construction Costs

• § 3445. Approval and funding of school construction projects

  (a) Construction aid.

  (1) Preliminary application for construction aid. A school district eligible for assistance under section 3447 of this title that intends to construct or purchase a new school, or make extensive additions or alterations to its existing school, and desires to avail itself of State school construction aid shall submit a written preliminary application to the Secretary. A preliminary application shall include information required by the Agency by rule and shall specify the need for and purpose of the project.

  (2) Approval of preliminary application.

  (A) When reviewing a preliminary application for approval, the Secretary shall consider:

  (i) regional educational opportunities and needs, including school building capacities across school district boundaries, and available infrastructure in neighboring communities;

  (ii) economic efficiencies;

  (iii) the suitability of an existing school building to continue to meet educational needs; and

  (iv) statewide educational initiatives.

  (B) The Secretary may approve a preliminary application if:

  (i)(I) the project or part of the project fulfills a need occasioned by:

  (aa) conditions that threaten the health or safety of students or employees;

  (bb) facilities that are inadequate to provide programs required by State or federal law or regulation;

  (cc) excessive energy use resulting from the design of a building or reliance on fossil fuels or electric space heat; or

  (dd) deterioration of an existing building; or

  (II) the project results in consolidation of two or more school buildings and will serve the educational needs of students in a more cost-effective and educationally appropriate manner as compared to individual projects constructed separately;

  (ii) the need addressed by the project cannot reasonably be met by another means;

  (iii) the proposed type, kind, quality, size, and estimated cost of the project are suitable for the proposed curriculum and meet all legal standards;

  (iv) the applicant demonstrates proficiency in the school district quality standards regarding facilities management adopted by rule by the Agency;

  (v) the applicant has completed a facilities master planning process that:

  (I) engages robust community involvement;

  (II) considers regional solutions;

  (III) evaluates environmental contaminants; and

  (IV) produces a facilities master plan that unites the applicant’s vision statement, educational needs, enrollment projections, renovation needs, and construction projects; and

  (vi) if the applicant school district is applying for construction aid for a school building that was constructed or renovated before 1980, the applicant has completed indoor air quality testing for polychlorinated biphenyls that was conducted according to the Department of Environmental Conservation’s standards for testing.

  (3) Priorities. Following approval of a preliminary application and provided that the district has voted funds or authorized a bond for the total estimated cost of a project, the Agency, with the advice of the State Aid for School Construction Advisory Board, shall assign points to the project as prescribed by rule of the Agency so that the project can be placed on a priority list based on the number of points received.

  (4) Request for legislative appropriation. The Agency shall submit its annual school construction funding request to the Governor as part of its budget pursuant to subdivision 212(21) of this title and shall clearly identify those projects contemplated under subsection 3440(b) of this chapter for funding through State bonding. Following submission of the Governor’s recommended budget to the General Assembly pursuant to 32 V.S.A. § 306 and submission of the Governor’s recommended capital budget to the General Assembly pursuant to 32 V.S.A. § 309, the House Committees on Education and on Ways and Means and the Senate Committees on Education and on Finance shall recommend a total school construction appropriation for the next fiscal year to the General Assembly for inclusion in the education payment under subsection 4011(a) of this title.

  (5) Final approval for construction aid.

  (A) Unless approved by the Secretary for good cause in advance of commencement of construction, a school district shall not begin construction before the Secretary approves a final application. A school district may submit a written final application to the Secretary at any time following approval of a preliminary application.

  (B) The Secretary may approve a final application for a project provided that:

  (i) the project has received preliminary approval;

  (ii) the district has voted funds or authorized a bond for the total estimated cost of the project, provided that the district shall not issue the bond until the Secretary notifies the district of its State bonding support;

  (iii) the district has made arrangements for project construction supervision by persons competent in the building trades;

  (iv) the district has provided for construction financing of the project during a period prescribed by the Agency;

  (v) the project has otherwise met the requirements of this chapter;

  (vi) if the proposed project includes a playground, the project includes a requirement that the design and construction of playground equipment follow the guidelines set forth in the U.S. Consumer Product Safety Commission Handbook for Public Playground Safety; and

  (vii) if the total estimated cost of the proposed project is less than $50,000.00, no performance bond or irrevocable letter of credit shall be required.

  (C) The Secretary may provide that a grant for a high school project is conditioned upon the agreement of the recipient to provide high school instruction for any high school pupil living in an area prescribed by the Agency who may elect to attend the school.

  (D) A district may begin construction upon receipt of final approval. However, a district shall not be reimbursed for debt incurred due to borrowing of funds in anticipation of aid under this section.

  (6) Award of construction aid.

  (A) The base amount of an award shall fund 30 percent of the total approved cost of a project. Projects for which the applicant is a consolidated school district are eligible for additional bonus incentives as specified in rule to fund up to an additional 45 percent of the total approved cost.

  (B) Construction aid shall be awarded as a debt service subsidy, as support through State bonding, or as a combination of both. Amounts shall be awarded annually and are subject to an annual appropriation for the purposes of the program.

  (C) Annually, the Capital Debt Affordability Advisory Committee (CDAAC) shall recommend to the House Committees on Education, on Ways and Means, and on Corrections and Institutions and the Senate Committees on Education, on Finance, and on Institutions the annual total State bonding support available for the capital budget and this program and the annual debt service subsidies to be awarded under this chapter. The recommendation shall include an analysis of how the use of State bonding support for school construction under this program affects overall capital budget capacity.

  (D) As used in subdivision (A) of this subdivision (a)(6), “consolidated school district” means either of the following:

  (i) a school district that results from a merger identified as advisable in a merger committee’s final recommendations offered pursuant to Sec. 13(b) of legislation enacted by the General Assembly in 2026 that requires each school board to participate on a merger committee to study the advisability of forming a unified union school district; or

  (ii) a school district with an average daily membership of at least 2,000 students.

  (b) Emergency aid. Notwithstanding any other provision of this section, the Secretary may grant aid for a project the Secretary deems to be an emergency in the amount of 30 percent of eligible project costs, up to a maximum eligible total project cost of $300,000.00.

  (c) Wage requirements. Any contract awarded for school construction that is paid for with State aid shall adhere to the higher of:

  (1) the prevailing wage requirements established for State construction projects under 29 V.S.A. § 161(b); or

  (2) the prevailing local wage requirements as determined by the U.S. Department of Labor under the Davis-Bacon Act, 40 U.S.C. §§ 3141–3148, and related federal acts and regulations. (Added 2025, No. 73, § 17, eff. July 1, 2026; amended 2025, No. 170 (Adj. Sess.), § 72, eff. July 1, 2026; 2025, No. 130 (Adj. Sess.), § 3, eff. July 2, 2026.)