More bonding authority approved for school renovation, repair
Seven South Dakota school districts have been approved for nearly $2.5 million in bonding authority under the federal government’s Qualified Zone Academy Bond Program. The bonding authority available statewide in fiscal year 2009 was tripled by the American Recovery and Reinvestment Act.
“This program allows schools to stretch their funds by saving them literally thousands of dollars they otherwise would pay in interest,” said Gov. Mike Rounds. “It eases the burden of financing needed renovation projects.”
The QZAB is a financial tool districts can use for school renovations or repairs; it may not be used for new construction. South Dakota schools also may use QZAB proceeds to invest in equipment and technology, develop challenging curriculum and train quality teachers.
Under the program, the federal government provides bondholders with tax credits in lieu of interest payments. As a result, school districts are responsible only for repayment of the principal, but not interest. Schools must secure their own lenders.
Schools must meet certain criteria in order to be eligible for the program. In particular, at least 35 percent of students must be eligible for free or reduced-price lunches under the National School Lunch Program.
South Dakota has nearly $5 million in QZAB authority for FY 2007, 2008 and 2009. So far, the state Department of Education has received only $2.5 million in requests. The department will allocate the remaining authority on a first-come, first-served basis. Allocation authority lasts for two years.
Approved for QZAB Bonding Authority
Corsica School District: $250,000.00
Jones County School District: $250,000.00
Kimball School District: $325,000.00
Meade School District: $500,000.00
Mount Vernon School District: $400,000.00
Redfield School District: $500,000.00
Wilmot School District: $250,000.00