PlanCon and School Construction

Uncertainty about when the 2015-16 (and future) PlanCon reimbursements will flow continues to exist. However, some recent progress has been made. With all parties agreeing that changes to the current PlanCon program were necessary, a plan was developed in June 2015 to make significant changes to the PlanCon program and to borrow to cover the state obligations for those projects currently in the PlanCon pipeline. Various iterations of this proposal were tweaked and tossed around for a year before being included in Act 25 of 2016.

Act 25 of 2016 included the following PlanCon-related language:
  • Authorized up to $2.5 billion of borrowing through the Commonwealth Financing Authority to cover the state's obligations for those projects currently in the pipeline. This would allow the state to pay those districts currently owed reimbursements and those districts with projects in the pipeline. It would also ensure that new dollars were available for new projects. The debt would be repaid by maintaining the 2014-15 line item of $306 million, so there would be no additional obligation of the state.
  • Created a PlanCon Advisory Committee to review the current PlanCon program and make recommendations about a new and streamlined program by May 15, 2017. The committee would include 1 PASBO member in addition to legislators.
  • Instituted a moratorium on new projects entering the program while the Advisory Committee crafts a new program. Under Act 25, the moratorium goes into effect on May 15, 2016 and will expire on June 30, 2017. 
  • Required PDE to post information about the status of each current PlanCon program in a searchable database on their website.
  • Permitted PDE to prioritize those projects that have submitted all appropriate paperwork (removing, temporarily, from the payment queue those districts that have not yet submitted complete information).
In early July 2016, the Commonwealth Financing Authority approved a bond resolution to borrow up to $850 million (the first in a series of borrowings) to begin to get state reimbursement out to those districts that have been waiting for it. There are still several steps in the process before money makes it to school districts, but the process is moving forward, and we are hopeful that districts waiting for 2015-16 reimbursement will receive it by the end of the calendar year (assuming all goes well).

Additional PlanCon information

Additional Information on PlanCon and School Construction