Illinois State Board of Education (ISBE) on Feb. 10 approved 29 school districts to sell their local bonds with a federal interest subsidy for construction projects through the Qualified School Construction Bond program (QSCB). However, the Highland School District was not one of them.
“We were too low on the Priority 1 list,” said Highland School District Business Manager Tim Bair.
Highland was No. 129 of 193 applications.
Rankings were based on percentage of low income students, tax rate over median, available local resources and percentage of unhoused students and the ability to issue bonds and begin the project. Funds for the program came from the federal government.
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“No state dollars are being spent, and local taxpayers will not have to help foot the bill for high interest costs,” said State Superintendent of Education Tony Smith, Ph.D.
Last month, the Highland School Board authorized issuing about $450,000 in bonds to help partially fund health/life safety work needed throughout the district. The newly issued bonds have yet to be earmarked for any specific projects, but the bonds represent just 5.6 percent of total health/life safety that needs to be done. A recently completed health/life safety survey identified more than $8 million in such projects for the district.
The district had hoped to pay for most — if not all — of its health/life safety projects with QSCB offered through the state. The funding would have covered the interest on Highland’s bonds.
“Which would have been a nice savings for our taxpayers,” Bair said. “I guess not surprising that it all stayed in Chicago area.”
No metro-east schools received QSCB funding.
ISBE accepted applications for the QSCB program from Dec. 1 to Jan. 15. Collectively, applicants were seeking $2.4 billion. ISBE staff reviewed the applications using a priority ranking process approved by the Board and recommended $495 million-plus to 29 districts for approval.
School districts that applied for the QSCB program were limited to a maximum request of $50 million each. If an authorized district does not issue the bonds within 18 months, the authority will revert back to ISBE. Bond proceeds also must be spent within three years of the issue date.
There will not be another round of QSCB funding.
“All funds are being distributed this year, apparently,” Bair said.
About the QSCB Program
The Qualified School Construction Bond program was created under Section 1521(a) of the American Recovery and Reinvestment Act of 2009. The program is a source of limited financial bonding for school districts to fund the rehabilitation or repair of an existing public school facility, construction of a new public school facility, equipment associated with repair or construction, or for land acquisition related to the construction of a new facility. Bond proceeds can be used for building rehabilitation and repair allowing districts to issue low- to no-interest bonds in lieu of higher interest rate Fire Prevention (health, life, and safety) bonds.