BISMARCK – A Senate bill that would give Air Force base schools access to low interest loans from the state’s school construction fund drew no opposition at a Senate Education Committee hearing Wednesday. However, the committee plans to further review the bill to determine potential impact on funds available for other projects.

Building projects on air bases are prioritized by the federal government, which provides 80% funding to projects that rise to the top of the list, said Sen. Donald Schaible, R-Mott, sponsor of Senate Bill 2149.

“The problem that this creates is there is a local contribution of 20 percent that would put a financial burden on the Air Force base,” he said.

Bonds or building funds currently are the only accepted repayment of loan money from the school construction assistance revolving loan fund. Air base property is not taxable, which eliminates those repayment methods. Instead bases receive federal in lieu of property tax dollars. SB 2149 would allow base schools to receive loans for their 20% matches and repay the money over 20 years using the lieu of property tax dollars.

Schaible said getting access to the loan fund is important at this time because North Dakota’s bases at Grand Forks and Minot are rising on the federal priority list.

No Minot representatives testified at the hearing, but Minot School Superintendent Scott Faul said the bill is important to the Minot district for Dakota and North Plains elementaries and Memorial Middle School at Minot Air Force Base. The schools were built in the early 1960s and need maintenance but also could use a major remodel, or potential replacement if that is more cost effective, he said. In looking down the road, there’s conversation about building one larger school with wings for different class levels, but the district will need to engage with base leadership and parents on their wishes for the schools, he said.

Federal assessors will be visiting military schools this year to reassess building conditions and priority rankings, Faul said.

“We are hopeful, and kind of crossing our fingers, that we move up on that list,” he said.

SB 2149 sets aside $20 million in the school loan fund through June 2027, or until the money is utilized, to provide matching funds for construction of air base school facilities.

The fund currently has about $400 million in assets, according to Kylee Merkel, business banker with the Bank of North Dakota. There are about $340 million in loans outstanding. The fund revolves about $65 million each biennium, which becomes available for new loans, she said.

The committee questioned whether setting aside $20 million would leave enough for schools already in the queue for funding. It plans to request more information from the Department of Public Instruction and make a recommendation on the bill at a future time.