Court ruling on Pa. education funding puts school infrastructure in spotlight

As residents of Hempfield recently learned, the cost associated with school building projects can easily climb above $100 million.

For decades, school administrators could turn to what was known as PlanCon to pursue state funding to help ease the local burden.

PlanCon — short for the Planning and Construction Workbook — was a set of forms and procedures school districts could use to apply for state reimbursement of large building projects.

That ground to a halt in 2012.

PlanCon has fallen by the wayside as a potential funding source for new projects, but a recent state court decision has led to an upcoming series of fall hearings across the state, where school infrastructure once again will be a big part of the discussion.

When PlanCon was active, school districts underwent a lengthy process to enroll renovation and construction projects in the program in order to secure a percentage of reimbursement, but a backlog of projects waiting on those payments — estimated at more than $1 billion in the mid-2010s — ultimately led to a 2012 moratorium on new applications.

While partial state reimbursement for school construction projects has been happening in some form since the 1950s, PlanCon’s current form took shape in the 1970s, and the state has contributed more than $8 billion to the program since the late 1970s.

‘Continued erosion’

When the 2012 moratorium took effect, school districts such as Penn Hills, which was in the midst of two major construction projects for a new high school and a new elementary center, found themselves on the hook for money they’d expected to receive from the state. Projects that were in the PlanCon pipeline were anticipated to continue receiving reimbursements.

Legislators made an attempt to keep pace. In 2014, Pennsylvania’s budget boosted statewide PlanCon funding by $10 million. But to put that figure in perspective, at the time, Penn Hills alone was due to receive $4 million in PlanCon reimbursements.

Not far away in the Franklin Regional School District, officials undertook construction of a consolidated elementary campus in 2018, which meant they were not eligible to apply for PlanCon reimbursement. School administrators estimated PlanCon could have brought more than $10 million of the roughly $54 million project back to the district.

“We’re committed to providing our students with the best and safest learning environment, but the lack of funding is causing us to do it in small stages,” said Franklin Regional Superintendent Gennaro Piraino. “This isn’t the most efficient or cost-effective way to maintain facilities.”

Piraino was part of a 2017 series of public hearings across the state exploring ways to modify and revive PlanCon.

“There were some recommendations made, but unfortunately they weren’t followed up on,” Piraino said. “The lack of funding has contributed to the continued erosion of Pennsylvania’s school infrastructure.”

That erosion took center stage this summer with the Pennsylvania Commonwealth Court’s ruling that the state’s system for basic education funding is not equitably applied across its 500 school districts.

So while PlanCon specifically may not be a hot topic among legislators, school infrastructure in general is back on the table.

“The Commonwealth Court talked specifically about facilities as part of that inequity,” said Sen. Lindsey Williams, D-West View, co-chair of the Senate’s Education Committee. “In my district, we’ve had some schools cutting the ribbon on brand new expansions that are gorgeous, but then we also have the Pittsburgh Public School District that’s really struggling.”

Williams said she’s spoken recently with the heads of local career and technology centers who said their facilities should be eligible for some sort of PlanCon-style reimbursement, particularly with the push over the past decade to introduce more students to the skilled trades.

Fall hearings

In the wake of the Commonwealth Court ruling, Williams said, a series of hearings by the Pennsylvania Basic Education Funding Commission will take place this fall. She is a member of the commission.

“One of those hearings will be in Pittsburgh, and facilities will be a big part of the discussion,” Williams said. “If we’re looking at changes to the basic education funding, schools need to be able to use the money we provide for their facility needs. Whether it’s PlanCon or some other type of program, schools need a way to fund some of these long-overdue projects.”

In the Hempfield Area School District, extensive renovations to Wendover Middle School and several other capital projects made it into the PlanCon pipeline and will be reimbursed to the tune of $760,726 in the coming school year, just under 20% of their total cost, according to business manager Paul Schott.

But if and when Hempfield Area officials move ahead with a massive high school renovation project, it will not be eligible for PlanCon as things stand today.

Kiski Area business manager Richard Liberto said reimbursements from previous projects there are expected to bring back about $800,000 to the district, but “we are planning on about $15 million in renovations in the near future.”

Those projects also will not be eligible for PlanCon.

“Without PlanCon, it greatly impacts the funding and financials of any future building project,” Penn-Trafford Superintendent Matt Harris said.

Sherri Smith, executive director for the Pennsylvania Association of School Administrators, said some of the recommendations from 2018 public hearings on PlanCon did get rolled up into the state’s Act 70 in 2019, which was meant to modernize and streamline the PlanCon process.

“The problem is they haven’t funded it,” Smith said. “So the framework is there, and there’s been a lot of discussion about it. School construction is another big facet of ensuring opportunities for students based on an equitable method of funding.”

Ripple effect

Piraino said if there is good news to be had, it’s that school infrastructure funding — whatever form it might take — has been reintroduced as a topic in Harrisburg.

“Our students, staff and families have seen the tremendous benefits of improved learning environments at the (renovated and newly built) primary and intermediate schools, and we aim to extend that same vision to our secondary schools,” Piraino said.

While the 2023-24 state budget signed by Gov. Josh Shapiro does include a $700 million increase in overall education funding, $100 million earmarked for the state’s most underfunded districts is part of a series of code bills that have yet to go into effect.

Williams said the PlanCon moratorium ripples out into other areas of education.

“A couple months ago, the state auditor general criticized some districts for keeping their fund balance reserves and still raising property taxes,” she said. “But if you talk to a lot of districts, the reason they keep those balances is because there’s no PlanCon — and when they go out on the open fund market, they want to be able to get a reasonable interest rate for a large-scale school project.”

Williams said state officials shouldn’t be criticizing local education choices “when the state itself is not investing in schools.”

“It’s both directly impacting people’s property taxes and it’s impacting the equity we have in our schools,” she said.