Funding a Second High School (October 2022)
We receive many questions from parents, teachers, local leaders, and community members about the need for a second high school. Below are some of the commonly-asked questions about the funding of the second high school and steps the District is taking to serve current residents and a growing student population. Click here to download the FAQ PDF in English. Descarga las preguntas frecuentes en español.
How are school facilities funded?
California public schools can be funded in the following ways:
State School Facilities Program (SFP) for New Construction and Modernization
- The SFP is funded through statewide General Obligation Bonds (“GO Bonds”). Currently,
funding from statewide GO bonds has been exhausted. A future State school bond measure
may allocate additional funds to this program. There is an estimated five to seven-year delay in
receiving any State funding due to existing waiting lists.
Local General Obligation Bonds
- The community can support school construction funding through local GO bond measures. GO
Bonds are loans authorized by the voters and repaid from property taxes levied on the assessed
value of property. The assessed value is based on the purchase price of a home and not its
market value. District voters authorized Measure G (2014) and Measure U (2016) to fund new
construction and modernization improvements at Hollister High School. Additional voter
authorization would be required for the second high school.
- School districts collect fees from new development to reduce the impact of new students on
existing schools. Over the next five years, developer fees will fund approximately 11 percent of
the anticipated cost of a second high school.
- School districts may negotiate agreements with landowners, developers, and homebuilders to
provide additional school funding to reduce the impact of growth. Funding can be in the form of
a mitigation agreement, which places new residential housing in a Community Facilities District
(“CFD”). The District is negotiating with the Building Industry Association, local land developers
and homebuilders on mitigation agreements, which are necessary for a second high school.
Currently, the District does not have any mitigation agreements in place.
Community Facilities District
- CFDs are financing districts authorized by the Mello-Roos Community Facilities Act of 1982.
Developers and homebuilders use CFDs to fund public improvements and services needed to
serve new development. Annual special taxes are levied only on homes located within the
defined area. Taxes provide additional funding for school facilities.
The City of Hollister and County of San Benito use CFDs to pay for public improvements and
services such as police, fire, streets, water, sewage, parks and landscaping and lighting.
Are school facility funds guaranteed?
No, there is no guarantee that sufficient funds will be available. State matching grants are uncertain. They are conditioned on California voters passing a statewide general obligation bond. The amount and timing of developer fees are also uncertain, and the District’s General Fund is committed to school district operations. To build a second high school, additional funding is necessary.