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California School Projects Face Billions in Cuts

SACRAMENTO, Calif. — Several hundred California school projects could be delayed or jeopardized following a decision by state officials to halt nearly $4 billion in state funding for public works projects.


The state’s three-member Pooled Money Investment Board, which includes the state treasurer, controller and finance director, voted to not fund approximately 2,000 construction projects planned throughout California due to a growing $15 billion state deficit.


As of press time, lawmakers were still at an impasse with the state budget, which was constitutionally mandated to be ready by June 15, and the states coffers are nearly drained.


Officials say the state must put a stop to infrastructure projects, including school construction, park restorations, levee repairs and road work, it does not have enough money to loan to them during fiscal year 2009. The total value of the projects is estimated at more than $16.2 billion, according to reports.


Of the 2,000 projects that will be affected by the funding freeze, more than 900 are K-12 school projects.


Nearly every county in the state is expected to lose state school funds, with school districts in southern California getting hit the hardest:


• Los Angeles County: More than $1 billion in projects under way or ready to start
• San Bernardino County: More than $330 million in projects under way or ready to start
• Orange County Schools: More than $187 million in projects under way or ready to start


Schools systems in the Bay Area and central California are also going to feel the crunch:


• Merced County: More than $57.1 million in projects under way or ready to start
• Alameda County: $53.2 million in projects under way or ready to start
• Fresno County: $44.7 million in projects under way or ready to start


Many school districts had earmarked state funds for projects such as campus modernizations, new school construction and technology upgrades.


While the funding freeze may not immediately halt all projects currently under way due to a slow construction period, school officials estimate districts will have to start taking money from other sources to keep projects on track once construction picks up after winter season.


Alternative funding sources include savings left over from completed projects that finished at or below cost.


Community colleges also received a budget blow, resulting in $2 billion worth of planned projects put on hold. State community college officials estimate that 192 projects planned at 102 campuses throughout California will be affected.


The state investment board is responsible for managing cash and investments to achieve maximum return of the state’s idle money and designating the amount of money available for investment.