Aug. 25 deadline for new school bond program
Published: August 1, 2009
A new bond financing opportunity under the federal stimulus program can help school districts, county offices of education and charter schools construct new facilities, purchase land, and repair and renovate existing schools—and a new CSBA partnership can help applicants meet all the requirements in time for the first-round deadline of Aug. 25.
The American Recovery and Reinvestment Act provides a total of $22 billion nationwide for the new Qualified School Construction Bond program. California schools are in line to receive more than $773 million in tax credits this year, and additional credits will be issued in 2010.
QSCBs are a new category of zero-interest bonds that provide federal tax credits to investors. The federal government pays most or all of the interest on the bonds, so more of a local educational agency’s construction dollars can go toward actual construction costs and not to debt service. The program does not require local matching funds or partnerships, as the Qualified Zone Academy Bond program does.
QSCBs are “QZABs without the pain,” says Joey McLiney, who is currently working with a large network of nationwide buyers interested in investing in the bonds. CSBA has partnered with McLiney and Company to work with association members to arrange QSCB financing, just as the firm already does with QZABs. McLiney and Company can handle all of the work necessary to meet federal and state requirements for the bonds.
The deadline to apply for the first round of QSCB bonds is Aug. 25; application must be made through the California Department of Education. CDE representatives have said the department will approve applications on a first-come, first-served basis through Oct. 1.
“QSCB … has the potential to jump-start new construction and modernization projects throughout the state,” said State Superintendent of Public Instruction Jack O’Connell. “While this program does not provide new money to school districts for construction, it allows them to more efficiently issue local authorized bonds. This will make local bond dollars go further to repair, renovate, and construct much-needed schools, as well as stimulate the economy and generate jobs.”
Related link:
Read more about the Qualified School Construction Bond Program @ www.csba.org/Services/Services/FinancialServices/FederalBondPrograms.aspx