Getting more for less with bond premium

Getting more for less with bond premium
Posted on 11/15/2017

District 51 is earning more from the 2017 bonds than anticipated, while still costing taxpayers less than anticipated.

Investment bankers are telling the district that bonds without premiums are not in demand, and that the district will have a better chance at selling 3B bonds by attaching a $26 million premium. On Nov. 14, 2017, the D51 School Board voted to follow this advice when introducing bonds for Ballot Measure 3B onto the market this winter.

Ballot Measure 3B, which voters approved by a 10-point margin on Nov. 7, stated on the Coordinated Election Ballot that voters approved allowing the district to spend up to $219 million to repay the bonds for 3B.

Even with the addition of a premium, the cost of 3B to taxpayers will remain under $10 per month on a $200,000 home for both the bond and mill levy override. The district originally predicted 3B and mill levy override measure 3A would cost the owner of a $200,000 home $9.89 combined. However, updated data shows the cost will actually be $9.42 per month.

The savings from issuing premium bonds can only be used to pay off capital projects and expenses. The board voted to have any proceeds from the premiums pay off construction of the R-5 High School/Summit School Program building, which was built in 2016 using certificates of participation.

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