School operations

School-funded Capital Projects


This policy sets out requirements for schools contributing or raising money to build or upgrade facilities. This includes new facilities, upgrades of existing facilities, maintenance projects and school contributions to Victorian School Building Authority (VSBA)-led building projects.



Schools may raise money to build or upgrade facilities or contribute funds to building projects led by the VSBA.

This policy supports the Department and school councils to fulfill their obligations under the Project Development and Construction Management Act 1994 (Vic) and Ministerial Order No 1280 – Constitution of Government School Councils 2020.

This policy also ensures that school contributions to facilities align with the Government’s education provision, asset management and financial management objectives.

Planning school-funded capital or maintenance projects

When planning a school-funded project, schools are encouraged to speak to their regional Provision and Planning Manager as early as possible. This will help to avoid issues later, such as having to resubmit an approval request if a project’s cost exceeds the VSBA approved amount.

Schools wishing to contribute school-raised funds to a VSBA-led building project should speak to the VSBA Delivery Project Manager assigned to their project.  

Checklists have been developed to assist schools plan school-funded projects and school-funded contributions to VSBA-led building projects, on the Guidance tab.

Approval requirements

Schools do not require VSBA approval for school-funded projects less than or equal to $50,000 (including GST). They must still comply with the Procuring Low-Value Construction Works and Services Policy and the Repurposing and Renaming School Spaces Policy.

Schools must receive VSBA approval before commencing works or entering contracts for school-funded projects estimated to exceed $50,000 (including GST). VSBA approval must be sought via the online project proposal approval form.

All school-funded contributions to VSBA-led building projects (no matter the value) must receive VSBA approval via the online project proposal approval form.

Schools must receive approval from their school council before submitting a VSBA approval request.

Approval form

The online project proposal approval form (staff login required) is tailored to the type and estimated value of the proposed project.

Schools must complete each section of the form and attach all required documents.

There may be instances where the VSBA ask schools to provide further evidence of compliance with this policy before their proposal is approved.

Approval assessment

The VSBA will consider the following when assessing a school’s project approval request.

Funding sources

  • Schools must provide details of their proposal’s funding source/s.
  • Schools must not fund new capital building projects with equity funding or Student Resource Package (SRP) maintenance, annual contracts, or grounds allowance funding. However, SRP funding can be used to fund maintenance projects, including maintenance projects that exceed $50,000 (including GST).
  • School must demonstrate sustainable ongoing funding for any proposed facilities outside the schools’ designated facility area. Facilities built outside a school’s designated facility area are ineligible for SRP funding. Schools may demonstrate ongoing funding through a Community Joint Use Agreement or hire and license fees. For more information, refer to the Community Use of Schools – Hiring, Licensing and Community Joint Use Agreements Policy.

Condition and Maintenance of existing facilities

  • Schools must demonstrate that existing facilities are in good condition before new facilities are proposed.
  • Schools must demonstrate good asset management practices either through an endorsed and implemented School Maintenance Plan (SMP), if a Rolling Facilities Evaluation (RFE) has been conducted, or by the school’s maintenance activities history, if a RFE has not been conducted. For this purpose, schools must code revenue and expenditure in CASES21 as outlined in the Finance Manual.
  • Schools are encouraged to invest in capital or maintenance projects in line with their existing SMP, if applicable.
  • Where the proposed project is not consistent with the school’s SMP, schools need to provide reasoning behind deprioritising maintenance priorities.

Facility area

  • Schools are encouraged to ensure projects are in line with their designated facility area and, if applicable, with any existing Asset Management Plan (AMP). Schools proposing departures from an existing AMP are required to provide reasoning behind the proposed project.  
  • Projects should not reduce the enrolment capacity of the school unless the school has excess space and the reduction in enrolment capacity is endorsed by VSBA. For more information refer to the Capacity and Area Allocation Advice.
  • All demolition projects must comply with the Demolition Policy.

Approval decisions and timelines

Approvals will be facilitated by the VSBA within 2 to 8 weeks of the school submitting their online project proposal approval form.

Approval timelines are dependent on the value and complexity of the project. All maintenance projects and low-value contributions to VSBA-led projects (under $50,000 including GST) are fast-tracked through to the tender and delivery stage.

Further information on the approval process is available on the Guidance tab.

Approval to proceed to tender and contract

Once VSBA approval is provided, schools may proceed to tender and enter a contract. However, projects valued above $500,000 (including GST) will be delivered by the VSBA, as will any projects assessed to be high-risk.

Schools must engage contractors from the Construction Supplier Register for all works over $200,000 and a commercial builder for all other works, preferably from the Construction Supplier Register.

Further information on proceeding to tender, entering a contract and the Construction Supplier Register is available on the Guidance tab.

Exemptions from planning permit requirements

The Planning and Environment Act 1987 (Vic) establishes a planning system that sets out how land may be used and developed. Under these schemes, planning permits provide legal permission for using or developing a piece of land.

The Minister for Education is exempt from obtaining planning permits for government schools under section 16 of the Act. As such, the VSBA and schools do not require local planning permits to undertake capital building projects.

However, schools must consult with relevant municipal councils during the key planning phases of high value school-led capital projects that may impact the local community. For example, a new auditorium or sports field and where possible, design buildings that comply with the intent of local planning schemes.

Good neighbour guide

The Department has developed the Good neighbour guide to support schools in informing and preparing their school and local communities for any change or disruption that capital works may cause.

The Good neighbour guide includes templates and examples of letters that can assist schools engaging with their local community. These are also extracted as downloadable Word documents in the Resources tab.

School-funded facilities on non-school land

Schools seeking to fund capital building projects on non-school land may do so via a Community Joint Use Agreement. For more information, refer to the Community Use of Schools Policy.

Recording of school-funded contributions

To ensure transparency, all funding from ‘third-party’ contributors (such as schools) is captured in the Victorian Government’s annual Budget Paper 4.


Construction Supplier Register (CSR)
The CSR is the pre-qualification scheme for building contractors and consultants interested in obtaining work from Victorian Government departments and agencies.

Designated facility area
To ensure equity across schools, the Department has developed the Facility Area Schedules which indicate the spaces required for a school to deliver the curriculum for a certain number of enrolments.

The Facility Area Schedules are tables that set out the number and type of learning spaces and/or square metres of space that are required for a school of a certain size and type – for example primary, secondary, special and special developmental. This space is known as a school's designated facility area. A school’s designated facility area allocation is key to calculating resource allocations and determining the size of new facilities in capital works projects

Relevant legislation

Department policy on requirements for schools contributing or raising money to build or upgrade facilities

Reviewed 24 August 2021

Policy last updated

21 May 2021


  • Schools
  • School councils


Victorian School Building Authority

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