Financing the Plan

A bond issue is the most cost-effective means of financing large building projects. It will allow the district to accomplish all of the necessary work in the School Preservation Plan in a few years, while spreading the cost of the work over several years. A bond is very much like a mortgage. It allows the district to provide substantial improvements that are otherwise incapable of being funded in an annual budget, due to the large tax impacts that would result.

By using the bond referendum, the district will avoid substantial capital project investments in the annual budget that may not generate aid for the district, thereby costing taxpayers more.

The district will receive approximately $38.1 million in New York State building aid to offset the cost of the School Preservation Plan. It is projected the district will receive additional state aid from interest on the bond. The district’s bond rating is extremely favorable (currently A-1), which will buy low interest rates and save taxpayers in additional interest expense.

Repayment of the School Preservation Bond will be spread out over 23 years. The district will borrow the funds over four installments from January 2010 to January 2013. These tax-free bonds will be repaid with interest, currently estimated between 5.0% and 5.25%.

After applying $38.1 million in NYS building aid, the average monthly impact to the average homeowner over the course of the entire 23-year repayment period is approximately $19 per month, based on a home with an assessed value of $673,200. This is an average cost over the course of the repayment and will fluctuate year-to-year in accordance with the debt repayment schedule. The tax impact will not be felt until 2011.

The total amount that will be bonded is $92,726,525. This is due to the fact that $6,249,175 in emergency funds has already been dedicated for the repair of the exterior façade.

Additional Savings through Efficiency
By installing more efficient building systems, including new windows, lighting, mechanical systems, boilers, etc., the district can realize savings in future utility costs. Older systems currently used in our buildings are largely not energy-efficient, and are using more fuel and costing more than necessary.

The School Preservation Plan is a prioritization of the needs that were identified through the three-year Master Planning process, which unveiled close to $350 million in potential projects to address educational and building infrastructure needs.