Cool Schools On Ice

Last fall, gubernatorial candidate John Kitzhaber campaigned on what seemed a novel concept. He proposed renovating hundreds of Oregon schools to make them more energy efficient and create jobs.

To do that, Kitzhaber proposed issuing $100 million in state bonds, which he said would lead to 1,000 new jobs.

But nearly five months into the legislative session, Kitzhaber's signature legislation, House Bill 2960, appears stuck in the budget-writing Ways and Means Committee.

The idea is generating little enthusiasm among some potential beneficiaries. And it's not actually all that new.

During a session in which K-12 education is getting about $1 billion less than advocates wanted, some who might derive advantages from Kitzhaber's plan, dubbed "Cool Schools," call it a distraction.

"I'm not sure how many jobs this would really create, and when we're putting teachers out of work and trying hard just to keep school doors open, it's hard to get excited," says Chuck Bennett, a lobbyist for the Confederation of Oregon School Administrators.

Personnel costs are about 80 percent of school expenses, but energy is also high on the list, costing the average district more than textbooks and computers combined.

Kitzhaber's aim is to free up instructional dollars by reducing energy costs. He and proponents of a $548 million Portland schools bond (see our endorsement of that measure, page 14), say educators can protect school programs by making sure districts' limited budgets pay for teachers' salaries, not new roofs.

There's a difference, however, between the Portland capital bond and Cool Schools.

Portland lacks sufficient funds to spend on building improvements, but there's already money available for energy retrofits. 

A law enacted in 2002, when Kitzhaber was last governor, carves off a 3 percent "public purpose charge" on utility bills. That charge yielded about $80 million last year, 10 percent of which was set aside for energy audits and retrofits of schools located in the service territories of either Portland General Electric or PacifiCorp. 

Prior to Kitzhaber's 2010 victory, nearly 750 schools—about 90 percent of those eligible—had already used public purpose money to pay for energy audits. 

After getting their audit results, some districts upgraded their buildings, but most chose to do nothing, even though there was funding available.

Scott Nelson, Kitzhaber's point man on Cool Schools, acknowledges demand has been tepid, leaving as much as $15 million of the schools' public purpose money unspent.

In addition to that existing stream of money, Nelson says there is also a hefty pot of federal stimulus money—about $39 million—already available. Those funds are effectively free, because the U.S. Treasury pays the interest on the bonds.

But Nelson says trying to use those federal dollars, which can be spent regardless of whether the Cool Schools bill passes, requires extensive coordination of many different jurisdictions. 

"There was never any doubt that it would be complicated," Nelson says.

He says he's aware that school districts are embroiled in pressing budget crises and may share the criticism that COSA's Bennett expressed. 

Yet Nelson says the Cool Schools legislation, which would establish a pilot program within the Oregon Department of Energy and enlist utilities to advance money to districts against future energy savings, is intended to create an administrative framework that would absorb the burden of managing retrofits.

"What we are trying to do is work this through administratively and make it as easy as possible for [local districts] and take the load off for them," Nelson says.

Rep. Mark Johnson (R-Hood River), a contractor who chairs the Hood River School Board and saw his district use public purpose money to repair schools, is skeptical about the need for a new program.

"There's [public purpose] money and other funds just sitting out there already," Johnson says. “These guys are a little late to the play.” 

WWeek 2015