OPSC Clarifies a Path for Piggyback Contracts: Here’s How Your Project Can Qualify
Piggyback contracts are legal, but there are restrictions on use and OPSC clarified the pivotal ones at the 2023 Coalition for Adequate School Housing Conference last month. Here’s a quick recap of what you need to know—and do—to piggyback your next project.
Everybody agrees: piggyback contracts are a valuable procurement tool that can save California school districts time and money on much-needed school modernization projects.
But everything else has been subject to ongoing debate.
After years of back and forth, an informative panel discussion at February’s CASH Conference provided a path forward, as the Office of Public School Construction (OPSC) offered additional clarification on what makes a project piggybackable—and what excludes it from eligibility.
The distinction is crucial for districts evaluating funding and procurement options for new school construction.
9 Key Takeaways from the Piggyback Presentation at CASH
The February 23rd CASH workshop “Piggyback, Procurement, Policy and Practice: The Path to Compliance” looked at piggybacks from the perspectives of builders, legal and compliance, with AMS President Dan Sarich providing critical support for differentiating portable/relocatable buildings from modular building components, based on state tax code.
Presenter Barbara Kampmeinert, OPSC’s chief advisor on policy and fiscal matters, summarized key findings, providing 9 takeaways from the presentation and discussion.
1. OPSC did not take exception to what was presented at the workshop by other presenters.
2. OPSC acknowledged a piggyback contract was a legal method of procurement by a District.
3. OPSC stated it is immaterial the type of foundation a portable building is placed upon when using the piggyback contract method. It was confirmed a portable may be placed on a concrete foundation.
4. OPSC will only fund a portable building project using the piggyback contract method if the building meets the portable definition per EDC 15070.15(j).
5. OPSC acknowledges the definition of a relocatable building. However OPSC does not recognize the term for state funded projects because the term “Relocatable Classroom” is not in the Education Code statute. Furthermore, OPSC regards the term as another term for portable and will continue to refer to such buildings as portable.
6. OPSC stated the 2006 AG opinion specifically addressed modular building components. Portable buildings were specifically outside the scope of the AG opinion.
7. OPSC confirmed a TK project is not eligible for state funding if the project utilizes a portable building as defined in EC 17375(f)(3). (Portable building that does not exceed 2,000 square feet.)
8. OPSC stated a TK project may be piggybacked using portable buildings if the District does not require state funding.
9. OPSC acknowledged that a Portable/Relocatable classroom that meets the definition of a portable classroom is considered personal property while modular building components are real property.
PERSONAL PROPERTY
Relocatable/Portable Classroom
REAL PROPERTY
Modular Building Components
What Exactly Is a Portable/Relocatable Classroom?
Much of the recent piggyback uncertainty has revolved around the application of various California statutes to different types of buildings. Alternate interpretations of the term “portable classroom” have been the crux of piggyback ambiguity, with many districts unsure whether their projects meet the definition of “portable.”
OPSC interprets this directly from code, citing statute EC 17070.15(j) as the definitive basis:
“Portable classroom” means a classroom building of one or more stories that is designed and constructed to be relocatable and transportable over public streets, and with respect to a single story portable classroom, is designed and constructed for relocation without the separation of the roof or floor from the building and when measured at the most exterior walls, has a floor area not in excess of 2,000 square feet.
This is an important clarification since OPSC has stated it will only fund a piggyback project if buildings meet the EDC 15070.15(j) definition of portable.
What This Means for Your AMS Project
The new OPSC communication provides more than clarity; it provides new direction for districts looking to move forward on facilities modernization and expansion projects.
From a practical standpoint, the OPSC comments confirm that piggybacks are a legal option that can help districts meet the challenge of providing modern facilities to accommodate growth, advance learning and facilitate new program development.
As “personal property,” AMS portable/relocatable buildings can be purchased using a piggyback contract. All onsite work must be competitively bid and paid at prevailing wages, eCPR as required.
Pairing an AMS DSA-approved design with a piggyback contract streamlines procurement, allowing any district to shorten schedules and reduce costs while successfully delivering projects to exact specs.
PERSONAL PROPERTY
Relocatable/Portable Classroom
REAL PROPERTY
Modular Building Components
Are Piggybacks Right for My Project?
Piggyback contracts are a useful addition to any district’s toolkit. They’re an ideal procurement method for many projects, but they’re only one method. AMS offers a variety of procurement options that can be tailored to individual project needs.
Planning and procurement can be complex to navigate for even the simplest of projects. There are many things to consider and critical decisions to make.
- What type of building(s) do we need?
- How will my project be funded?
- Does my project meet the OPSC definition of a portable classroom?
- What’s the timeline for project delivery?
Making the best decisions for your project starts with having the right information—and the right partner.
How AMS Can Help
AMS helps you identify and navigate the best path for your project. Our AMS Team will provide expert guidance every step of the way, partnering with you to find the best building solution and procurement method to fit your unique needs.
Together, we’ll review your project, assess goals, evaluate options and find creative ways to add value while saving you money. AMS makes everything fast and easy, assuring a smooth process and an exceptional experience end-to-end, from project planning to on-time, on-budget delivery of a superior quality building.
CASH recently issued a communication providing additional insight on the use of piggyback contracts in facilities procurement. Read it here.
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