The South Central School Board has finalized the issuance of $1.9-million in general obligation school bonds.
Kendall King of King Financial says unlike other bonds, the district will incur no interest costs because the district will receive the money over four years as property tax money is received from district residents.
Superintendent Kerry Herdes is pleased the bonds can be issued without a major change in the district’s current tax rate since it is replacing a prior working cash bond issue. He notes the district is in better financial condition now, so doesn’t need the money up front.
“If they reduce our payments like Governor Pritzker talked about doing after the Graduated Income Tax not passing, that is $450,000 per year. What we are doing is $2-million over 4 years. We are covering ourselves. That is basically what this whole plan is, to cover status-quo.”
Herdes says if the state cuts don’t come about, the district has building needs that can be addressed.
“We know we have needs and desires to improve our facilities, specifically our middle school and bus garage, but we are not going to be spending money until we know the unrest is settled on the financial side of it.”
Herdes says the district will save $138,000 by not having to pay the interest cost of receiving all the bond proceeds at once.
While King told the board they may want to capture all of the increased valuation available due to the rise in farmland assessments, Herdes says the board doesn’t want to put more of a burden on taxpayers and are pleased they currently have the fourth lowest tax rate of school districts in Marion County.
To get prepared for the upcoming bond sale proceeds, the board moved $950,000 currently in the work cash fund to the education fund.
