Illinois school districts can now apply for low-interest bonds to defray school construction costs and pay for other building needs through the federal Qualified School Construction Bond program.
Program guidelines and application procedures were finalized by the Illinois State Board of Education (ISBE) at its Nov. 20 meeting. The state expects to distribute more than $495 million in bonding authority to school districts.
“These low- to zero-interest bonds will enable school districts to use more of their existing funds for educational uses and educator professional development rather than paying off interest,” said State Superintendent of Education Tony Smith. Smith encouraged eligible districts to take advantage of the program.
Initiated under the American Recovery and Reinvestment Act of 2009 – the program offers limited loans for districts to pay for repair or rehabilitation of an existing public school, construction of a new public school, equipment for repair or construction, or for land acquisition related to construction of a new facility.
Because bond proceeds can be used for building rehabilitation and repair, districts will be able to issue such bonds in lieu of fire prevention bonds (health, life, and safety bonds) that would be at a higher interest rate.
All districts that apply for the QSCB program must have their 2014 Annual Financial Report on file and complete an ISBE-approved application. School districts may request up to $50 million.
Applications are being accepted now through January 15, 2016, and will be reviewed and scored. Districts eligible for an allocation based on the scoring matrix will be recommended to the state board for approval.
The state board has posted application details, forms, and instructions.