'High school dropout crisis' continues in U.S., study says
Based on the latest data, around 7,200 students drop out of high school each day, or about 1.3 million a year. Nationally, about 68.8 percent of students who start high school graduate four years later. (New Week, June 14, 2010) The Silent Epidemic High school drop-out rate in major US cities at nearly 50 percent STEM Crisis in US K-12 Education
“STEM education in the United States is woefully inadequate for the future of our nation. It is insufficient to produce a robust field of opportunity for our children." Chuck Vest - President of National Academy of Engineering
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THE FUNDING QUALIFIED ZONE ACADEMY BONDS (QZAB)
QZABs also encourage schools and businesses to cooperate in innovative ways that expand students' learning opportunities and help schools prepare students with the kinds of skills employers, and our nation, need to compete in the global economy. The QZAB is a loan that must be repaid within a specified time. The rate of the tax credit and the maximum term of the bond are determined by the Treasury Department for each particular month the bonds were issued for such month. The tax credit mechanism eliminates the cost of interest only, not the bond principal. Under the Recovery Act, allocations for the federal fiscal year (FY) 2009 were increased from $400 million annually to $1.4 billion and an allocation of an additional $1.4 billion was authorized for FY2010. The U.S. Treasury Department announced the allocation amounts and provided additional guidance resulting from the Recovery Act in Internal Revenue Services (IRS) Notice 2009-30. Qualified Zone Academy Bond Allocations for the State of California was $44,364,000 for 2008 and $155,275,000 for 2009. According to the IRS Notice 2011-19, the national limitation for QZABs issued under § 54E for calendar year 2011 is $400 million. Qualified Zone Academy Bond Allocations for the State of California is $45,855,000 for the calendar year 2011. It is noted that unused allocations for a particular year may be carried forward for a limited number of years. For example, the 2009 and 2010 allocations will expire at the end of 2011 and 2012, respectively. The 2011 allocation ($400 Million) expires on December 31, 2013.
WHO QUALIFIES? "Eligible schools must be located in an empowerment zone or an enterprise community or expect to have at least 35 percent or more of their students eligible for free or reduced lunch under the National School Lunch Act. Students in a Qualified Zone Academy must be subject to the same academic standards and assessments as other students educated by the local school In the simplest terms, an established Zone Academy (school) with 35% or greater of their student body on the free and/or reduced lunch program, will qualify. A single district or a coalition of districts may apply. District partnerships may be formed so long as the contribution of business(es) is no less than ten percent of the bond's value to the school site, with a specific curriculum, and the QZAB plan is approved by each school district. If your school district fits this, or has a reasonable expectation of having students that "could" qualify, then Another way of qualifying is if you are in a Federal Empowerment Zone or Federal Enterprise Community.
HOW TO ESTABLISH AN ADVANCED VEHICLE TECHNOLOGY ACADEMY USING QZAB FINANCING 1. Establish an Advanced Vehicle Academy in your school district, or an individual school within your district, as a Zone Academy by completing a 1 page application form (in California) (download a MS Word file) 2. Once the Zone Academy is established, you need to determine your project's scope and details. 3. Once the size and scope of your project is determined, a public/private partnership needs to be created to better facilitate education in the Zone Academy. "QZABs are issued in support of Qualified Zone Academies, schools (or programs within a school) that enter into partnerships with local businesses to enhance the academic curriculum, increase graduation and employment rates, and better prepare students for the rigors of college and the workforce under a plan approved by the local school system." (US DOE) 4. The partnership must locate a "Qualified Contributor" to supply a 10% matching grant. 5. With 1-3 completed, your state department of education should be notified and a request for allocation submitted. 6. After your QZAB allocation has been approved, you must locate a "Qualified Buyer" who is willing to take your debt and a tax credit instead of an interest check. Issue the QZAB to your qualified buyer.
RESOURCES & REFERENCE: Rockefeller Bill Would Extend QZABs, QSCBs Through 2015 (Bond Buyer- April 21, 2011) List of California Counties with Free and Reduced Price Meal Data (download a MS Word file) Sample of Contribution Letter (download a MS Word file) Qualified Tax Credit Bond rates Empowerment Zone/ Enterprise Community Address Locator
THE LAW: 2009 Stimulus H.R. 1 Section 1522 SEC. 1522. EXTENSION AND EXPANSION OF QUALIFIED ZONE ACADEMY (a) IN GENERAL.—Section 54E(c)(1) is amended by striking ‘‘and (b) EFFECTIVE DATE.—The amendment made by this section H.R. 1424 IRC Section 54A IRS Notice 2009-30 of QZAB State Allocations for 2008 and 2009. IRS Notice 2011-19 of QZAB State Allocation for 2011
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