July 26, 2017 BOT Meeting Agenda Item #26 Solar Feasibility Study

CUSD hired San Francisco based Arc Alternatives to do a Solar Feasibility Study on seven high schools and the district office. The study cost $43,840.00. 

Solar Power Purchase Agreement (PPA Financing):

http://www.seia.org/research-resources/solar-power-purchase-agreements

 

May 10, 2017 BOT Meeting Contract with ARC Alternatives

May 10, 2017 Agenda page 80

CUSD paid $43,830.00 for the ARC Feasibility Study

 

District should submit an application for financing the solar projects with Clean Renewable Energy Bonds (CREBs), which are a low interest cost method of financing subsidized by the United States Department of Treasury.
 
 
Author: 
Courtesy of CASBO Associate Member SunPower
Date: 
Tuesday, August 23, 2016

 

With the new $9 billion state school bond on the November ballot, now is a great time for your district to generate new projects and seek avenues to secure matching local Qualified Zone Academy Bonds (QZABs) or Clean Renewable Energy Bonds (CREBs) financing to alleviate general fund pressures by lowering operating costs with energy-efficiency and solar projects. 

By using federally subsidized low-cost financing such as CREBs, districts will be able to stretch their project dollars further to complete a greater number of important and valuable projects.

Proceeds from the $9 billion in bonds proposed by this initiative would be stored in a 2016 State School Facilities Fund and a 2016 California Community College Capital Outlay Bond Fund.  These proceeds would be allocated for: 

  • $3 billion for the construction of new school facilities
  • $500 million for providing school facilities for charter schools
  • $3 billion for the modernization of school facilities
  • $500 million for providing facilities for career technical education programs
  • $2 billion for acquiring, constructing, renovating and equipping community college facilities
     

Generating local general obligation (GO) bonds through California school bond elections has grown more successful in recent years with 81.53 percent of bond measures approved in 2014 and 90 percent approved in 2015, according to Ballotpedia.  

School districts with local GO bonds can receive matching funds from the state bond to complete projects which can lower your school district’s operating cash flow and free up cash in your general fund.

Particularly attractive opportunities to lower operating cash flows exist in modernization of facilities and lowering of utility costs.

Lowering utility costs can be done by improving energy efficient lighting and HVAC systems, managing energy better with energy intelligence software, or shaving high-cost peak energy usage with solar installations.

In addition to local funding sources, the federal government has additional programs that school districts can take advantage of. Federal QZAB matching — or zero-interest funding — can be used for renovation, energy, tech, equipment and curriculum projects.

CREBs are another source of low-cost financing given that bondholders receive a 70 percent subsidy in the form of federal tax credits in lieu of a portion of traditional bond interest, resulting in a lower effective interest rate for the borrower. This allows districts to ultimately borrow more total funding to complete more projects.

There are two main approaches to using CREBs to finance energy projects depending on whether a district prefers to back the bond with the general fund or GO bonds.

When CREBs are backed by the general fund as a revenue bond, there is no resulting tax burden from constituents. This allows the district to then pursue GO bonds that can be used for other important projects in the district’s project pipeline.

Alternatively, CREB financing can be backed by general obligation through taxes from local constituents. In this case, the general fund is not liable for these general obligation payments, alleviating pressure from the general fund. Furthermore, given the low interest rates, the district can issue more total GO bonds.

A great example of a successful project that leveraged the power of local bonds combined with CREBs is the Mt. Diablo Unified School District solar project.

Mt. Diablo Unified is saving an estimated $220 million over 30 years after installing solar across 51 school campuses.

The district sought local bonds in order to engage in capital expenditures to improve its long-term economic outlook.

The district also earned more than 60 percent voter approval in 2010 for its Measure C bond initiative. Harnessing solar power to qualify for CREBs, it was able to combine GO bonds with the CREBs to make the project financially attractive.

Beyond offering industry-leading solar power, SunPower helps schools thrive in an era of tight budgets, and brings solar innovation and knowledge into the classroom.

CASBO associate members are businesses and organizations that are actively engaged in supplying products or providing services to education agencies in California. If your business is interested in becoming a CASBO associate member, we encourage you to learn more about membership and consider making an investment that pays in school business relationships with the state’s K-14 decision makers.

Other Resources:

Brighter Future: A study on Solar in US Schools http://www.seia.org/research-resources/brighter-future-study-solar-us-schools-report#Understand

National Solar Schools Census: http://www.thesolarfoundation.org/solar-schools/brighter-future/

Solar Map: http://www.seia.org/map/solar-schools.php

Note: All of the southern California Schools did these projects in 2010-11 and nothing since. Wonder Why?

*Top of the World in Laguna Beach installed theirs in 2005