California school construction companies are about to enter a golden age.
A new California law is set to go into effect in January that will bring in up to $550 million annually for efficiency and clean energy school construction projects.
Details for the distribution of these funds are still being worked out, but the end result will be a huge success for the state's construction trades.
Last month, California voters overwhelmingly approved a measure, Proposition 39, that closes a corporate tax loophole for out-of-state businesses.
The new tax revenue will bring in roughly $2.75 billion total for the next five years from businesses located outside of California. A little known part of Prop 39 directs a portion of the money towards installing new windows, providing better insulation, updating to LED lighting and creating other green projects for California public schools.
The biggest beneficiaries of this new money for upgrades to state schools will be the construction industry.
"This is really great news for us," said Cesar Diaz, legislative director for the State Building and Construction Trades Council of California. "We expect this to be huge boost for our businesses, particularly those that do green schools construction work."
Most of the Prop 39 school money will likely be directed towards upgrading school facilities and not constructing new buildings.
"(Prop 39) will drive more business towards retrofitting existing structures," said Nicole Biggard, a professor at UC Davis' Energy Efficiency Center. "I think the revenue coming in will be a big boost for our businesses. It will really increase the market of the construction industry. It will also grow the workforce as well."
Diaz said his organization actively campaigned for Prop 39 during the California election season.
"We worked really hard to let voters know how important Prop 39 is for our schools' buildings. It's not just about construction. It's about making our schools more energy efficient. This is our chance to finally upgrade facilities which have fallen apart in recent years."
Kate Gordon, vice president for energy and environment at the Center for American Progress in Washington, D.C. recently wrote a white paper on Prop 39. Gordon said there are huge clean energy projects that California schools need.
"Every school in a district is different, but AC/HV is particularly important," Gordon said. "Airflow has a big impact on students."
Diaz said schools need to be retrofitted in almost every area.
"We're talking about plumbing, roofing, windows, water, electricity -- you name it and the schools need it."
Gordon said an effective energy retrofit comes about with high quality construction and a good maintenance plan.
Next page: Distributing the money
"It's not just the technology that goes into these buildings," Gordon said. "It's also about who builds and the maintenance of the work that determine how efficient they are."
Many school facilities in California are in poor shape. This is particularly true for large urban districts and farming communities in the state's Central Valley area.
"There are schools that are literally falling apart, " Gordon said. "There are huge air quality issues in some classrooms. There are a lot of portable classrooms that are not in great shape, so this is an obvious place to invest California dollars."
Diaz said that construction companies are ready to begin applying for school projects.
"We're really eager to get started," he said.
"The legislature is figuring out how to distribute the money," Gordon said. "Right now, there are three pieces of legislature before (the state assembly) and we expect the governor in January to put something in the budget that hopefully the legislature will consider."
State officials cautioned on the timing for distributing the tax money.
"Right now we really don't know how this will all shake out," said Eric Lamoureux, a spokesperson for the California Department of General Services, which oversees school construction. "We're expecting a lot of activity around getting these funds to the construction business, but we just don't know how long it will take and what (distribution) will look like."