A total of 193 Illinois school districts have applied for authority to use the low-interest borrowing method to cover $2.36 billion worth of school renovations, repairs, and construction projects. The loans may total up to $50 million per applicant district, and the estimated savings can be quite substantial. For example, one district has stated it could potentially save $750,000 in interest for every $1 million borrowed.
The problem is, the state has authority to allocate only $495 million for school districts under the program, which means many of the applicant districts will be disappointed when the allocations are announced by ISBE. Submissions have been reviewed and scored by ISBE and districts eligible for an allocation based on the scoring matrix were recommended for approval.
First priority will go to school districts having “shovel-ready” projects in the works, according to ISBE, and those districts that have the ability to borrow money. Because the requests far exceed availability, the state will also look at the proportion of low-income residents in the district; the amount of local revenue the district can draw upon per pupil; as well as the age of district buildings; and the square-foot-per-student capacity of those structures, compared to the national average.
The QSCB program was created under Section 1521(a) of the American Recovery and Reinvestment Act of 2009 (ARRA) in response to the great recession. Most of the funds in the nationwide program have long since been spent, and like most large city school districts, Chicago District 299 already has received a separate allocation direct from the federal government.