Capital Outlay Bureau Spring Budget Workshop 2012

1. Capital Outlay Bureau Spring Budget Workshop 2012 Moriarty High School Performing Arts Center

2. Presenters • Antonio Ortíz-Director (505) 827-6613 antonio.ortiz1@state.nm.us • Chris Thweatt-Financial Coordinator (505) 827-6609 christopher.thweatt@state.nm.us • Iris K. Romero-Financial Coordinator (505) 827-7646 irisk.romero@state.nm.us

3. Purpose:To Educate School Districts Regarding • Roles and responsibilities of the Public Education Department (PED), Capital Outlay Bureau (COB) • The overall process of accessing capital outlay funds administered by PED – COB

4. Capital Outlay Bureau Goals: • Reduce turnaround time for project plan approvals and reimbursement requests • Improve and develop internal systems to provide better customer service • Streamline processes and workflows to make them as transparent as possible • Use information technology to make documents user friendly and easily accessible

5. Agenda • New Legislation • Operating Budget Management System (OBMS) • Direct Appropriation Approval Process • Reimbursement Requests • Capital Improvements Act (SB-9) • Public School Buildings Act (HB-33) • Miscellaneous Issues • Question & Answer Session

6. 2012 Legislative Session HB-191 – Severance Tax Bond Projects • $2,500.0 – school bus purchase • $322.0 – robot systems • 47 projects totaling $4,335.5 to school districts and charter schools • $2,500.0 – pre-kindergarten classrooms • PSFA or PED will send out notification of applications HB-190 – Reauthorized Projects • 10 reauthorized projects statewide

7. 2012 Legislative Session SB-66 – General Obligation Bond Projects • $3,000.0 – to acquire library books and library resources Needs voter approval in the November 2012 General Election

8. OBMS • PED COB work with districts and charters establishing budgets for these funds: • 27106 – 2010 GOB Public School Library Acquisitions • 27107 – 2012 GOB Public School Library Acquisitions • 27174 – 2010 Pre-K Capital • 31200 – PSCOC – Lease Payment Assistance • 31400 – Direct Appropriations • 31700 – SB-9 • Budget Adjustment Requests

9. OBMSBudgeting Capital Outlay Funds • Carryover balances of state funds budgeted in 43204 • 2012 GOB Public School Library will be budgeted through a BAR upon receipt of award letter • New awards of state funds budgeted in 43210 (fund 31400) and 43202 (fund 31700)

10. OBMSBudgeting Capital Outlay Funds • State Share of PSCOC standards based awards should not be budgeted • District should account for PSFA’s expenditures with a Financial Statement journal entry • 2012-2013 Lease Assistance Awards will not be projected. BAR upon receipt of award letter

11. OBMSBudgeting Capital Outlay Funds • 2012-2013 SB-9 State Match Award will not be projected. BAR upon receipt of award letter • Estimated column should include all outstanding balances as of July 1, 2011 • This method is unique to funds administered by the PED COB

12. Direct Appropriation Process • Before a school district may expend any funds from an allocation, the district must secure prior written approval • Disbursement and/or reimbursement will not occur until prior written approval is requested and granted

13. Direct Appropriation ProcessWhat projects must be approved & by whom? • The Public School Facilities Authority (PSFA) approves building plans for all projects related to public school construction when total project costs are greater than $200,000 • The PED approves direct legislative appropriations for all non-construction projects and construction projects totaling $200,000 or less

14. Direct Appropriation Process • Use correct project plan approval form • PSFA - Request for Approval of School Construction (RASC) • PED - Request to Obligate Funds (RTOF) • Clearly identify funding sources • Breakdown of items (bids, quotes) and timeline for project completion • PED reviews for legislative intent and funding source

15. Direct Appropriation Process • Funds must be “expended” on or before the reversion date • Funds are considered “expended” with an “expenditure” occurring as of the date goods are delivered to and received by the Grantee • It is not sufficient to “encumber” the funds on or before the reversion date

16. Direct Appropriation ProcessNew Steps • Grant agreements are for direct appropriations beginning in 2010 • Grant Agreements are a DFA initiative to use standard terms and conditions for capital projects among Agencies • Grant agreements will be issued for the appropriation amount (adjusted for art-in-public-places) for all projects

17. Direct Appropriation Process New Steps • Certification Form - to be submitted to PED when all funding is in place and project is ready to proceed • Grant Agreement – Contract between the district/charter and PED • Request to Obligate Funds form (Replaces request for project plan approval form) – not required if submitting a RASC to PSFA

18. Direct Appropriation ProcessNew Steps • Notice of Obligation (Replaces PED’s Project Plan Approval Letter) • Allows the grantee to enter into 3rd Party Obligations • Monthly reporting requirements • Grantee will submit the monthly report online in the Capital Project Monitoring System (CPMS) • Early termination clause

19. Reimbursement Requests in OBMS: • Fund 27106 – 2010 GOB Public School Library Acquisitions • Fund 27107 – 2012 GOB Public School Library Acquisitions • Fund 27174 – 2010 Pre-K Capital • Fund 31400 – FY 2008 to present

20. Reimbursement Requests in OBMS: • Fund 31700 – FY 2008 to present • Fund 31200 - PSCOC lease payment is NOT processed through OBMS but hardcopy to Gerald Pertner with PSFA – (505) 988-5989

21. Reimbursement RequestsSubmitted Manually/Hardcopy • SB-9 State Match (Fund 31700) for FY 2006, & 2007 • FIFO – First in, First out • Expend and draw down older year balances first

22. Reimbursement RequestsSteps of Program Review • Collect all required documentation from checklist • Ensure Grant Agreement finalized and notice of obligation issued • Ensure expenditures meet legislative intent

23. Reimbursement RequestsSteps of Program Review • Ensure funds are expended with goods and services received on or before the reversion date • Ensure draw request is ≥ $1,500 for STB’s • Submit approved request to Flowthrough

24. Reimbursement RequestsRequired Documentation • Draw Request Form – Authorized Signature • Signature Authorization Form • Wire Transfer Form • Expenditure Summary Report - New • Invoice and proof of payment • Update CPMS for fund 31400 only

25. Reimbursement RequestsProjects Expiring June 30, 2012 • 2008 Construction Projects • 2010 Non-Construction Projects • Projects reauthorized in 2009 that did not extend time. • Please note that final draw requests must be received no later than July 6, 2012 for projects expiring June 30, 2012, or any remaining balance will be reverted.

26. Reimbursement RequestsFiscal Personnel • Vince Vigil (505) 827-6464 vince.vigil@state.nm.us

27. Public School Capital Improvements Act (SB-9 State Match) • SB-9 funds will be distributed to charter schools on a membership basis using 40th day of prior school year • No distribution to charters schools who did not commence instruction in prior year • State charter schools included • Funds distributed on reimbursement basis • Expenditures are not reimbursable if incurred more than 60 days prior to the date the bonds are sold

28. Public School Capital Improvements Act (SB-9 Local Tax) • Charter School needs shall be included in all SB-9 elections held after July 1, 2009 • If charter school provides information timely to district to include in resolution • Information identifies how the revenues will be used • Distributed by county treasurer to each charter school

29. Public School Buildings Act(HB-33) • School Districts shall include the needs of charter schools after July 1, 2007 • If charter school provides information timely to district to include in resolution • Information identifies how the revenues will be used

30. Public School Buildings Act (HB-33) • Capital needs included in districts 5-year master facilities plan for local charters • State charters include in their 5-year plan • Distributed by county treasurer to each charter school

31. Miscellaneous IssuesCharter School Reports for HB-33 and SB-9 • Proposed expenditure reports due December 1st of each year • Report shall include the proposed uses • Submit to PED and the chartering authority • Within 20 days, PED shall advise if, in its opinion, the expenditures are consistent with the law • Report prior year expenses to PED and the chartering authority by January 31

32. Miscellaneous IssuesDisposition of Property • Need Approval Prior to Disposition • Approving Entity Determined by Value and Whether Property is Personal or Real • Checklist on COB Website • PED Form 947 Along With Supporting Documentation

33. Miscellaneous IssuesDisposition of Property • SAO – RalenRandel (505) 476-3800 • SBF – Stephanie Schardin (505) 827-4980 • PED – Chris Thweatt (505) 827-6609 or Iris K. Romero (505) 827-7646

34. Miscellaneous IssuesClosing Out Prior Projects • SB-9 (2006-2008) • 2008 Direct Appropriations (Construction) • 2010 Direct Appropriations (Non-Construction) • Projects reauthorized in 2009 that did not extend time • 2008 GOB Public School Library Acquisitions

35. Miscellaneous IssuesRequiredElection Documents SB-9 & HB-33 • Signed Minutes • Signed Resolution • Legal Publication of Resolution • Legal Publication of Notice of Election • Legal Publication of Canvass Results • Signed Certification of Canvass (Documents due April 20, 2012)

36. Miscellaneous IssuesLease Purchase Process • You must obtain PSFA approval before submitting to PED • Cover letter • School Board or Governing Body minutes • Certification of attorney • Copy of proposed lease purchase arrangement • List source of funds • Charter schools submit to Charter School Division and school districts submit to COB

37. Miscellaneous IssuesQualified Zone Academy Bond (QZAB) • What is a QZAB? • New Mexico’s total allocation available is $14,471.0 • Information available at:www.qzab.org • Application will be sent out April 13th

38. Summary • Balances for 27106, 27174, 31400, and 31700 are on the PED website • Understanding new changes to the direct appropriation process • How to obtain reimbursement for all capital outlay projects • SB-9 and HB-33 Updates

39. Evaluation & Questions