| Bond deal will save taxpayers millions Several schools to get renovations 04/12/2001 By Michael Tate / The Dallas Morning News
Mesquite school trustees approved the sale of school renovation bonds that will save taxpayers about $3.4 million in interest over the next 14 years.
The $5.2 million in what's known as Qualified Zone Academy bonds will finance renovation projects at Florence, Hanby, Hodges, McKenzie, McWhorter and Range elementary schools and A.C. New Middle School.
Board President Randy Dobbs summed up the complex financial dealings in simple terms after the presentation on the sale by First Southwest Co. representative Dan Rosevear.
"For those of you who didn't follow the math, we're actually paying back less than we borrowed," he said.
This is the first time the Mesquite district has issued this type of bond, which is from a program created by the federal Taxpayer Relief Act of 1997. The bonds reduce the financial burden for qualifying districts by giving the institution that buys the bonds a tax credit in place of interest payments from the schools.
To qualify for the bonds, a district must receive 10 percent of the total from a corporate donation and have 35 percent of its students on a free or reduced-price lunch plan.
Lucent Technologies made the 10 percent donation to MISD, and Bank of America has purchased the bonds and will receive the tax credit.
To repay the debt principle, MISD will budget $265,516 into a special account every year for the next 14 years. This makes its total debt service payment $3.7 million. If the projects were financed with regular general obligation bonds, First Southwest estimates the district would have paid just over $7 million.
"Total debt service savings to the taxpayer for this vs. a regular GO [general obligation] bond is $3.4 million," Mr. Rosevear said.
Superintendent John Horn thanked Deputy Superintendent James Terry and his staff for working out the details that made the bond sale possible. He described it as a process that had "millions of pieces" to sort through just to find projects that fall within the parameters of the special bond program.
"It's just sort of unbelievable that we have this opportunity to enhance our construction program," Dr. Horn said.
The final plan for which projects the bonds could finance was not completed until late in the day of the board meeting. Some hoped-for projects were left out because they constituted new construction and not renovation. The bonds may be used only to rehabilitate or repair public school buildings, provide equipment for public school use, develop course materials, and train teachers and other personnel.
"At 3 this afternoon when I talked with Dr. Horn, we still didn't know how close it was," Mr. Dobbs said.
Dr. Terry thanked Mr. Rosevear and credited him with working out an acceptable plan.
"We've been working on them for well over a year, and only today, through his efforts, did we get some approval," Dr. Terry told the board. "Dan has really done a yeoman's job of getting this into place, and we really appreciate that."
Mr. Rosevear complimented the district for working through its construction plan, finding suitable projects for the bonds and ultimately saving the taxpayers money.
"Congratulations," he told the board. "Your staff has worked really hard and really long to facilitate this process."
Staff writer Michael Tate can be reached at 972-278-9949 and at .
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