Bond sale approved for O’Fallon school expansion, district office move
O’Fallon’s Central School District 104’s Board of Education recently approved the sale of $2 million general obligation bonds to fund facility improvements at its schools and to relocate the district office.
Superintendent Gabrielle Rodriguez said part of the bond proceeds will be used to purchase a house at 101 Belt Ave., located next to the current district office, and to move district offices there.
The current district office is adjacent to Dawn Elser Elementary School. Rodriguez said the current district office will be demolished to add more parking at the elementary school.
The bond sale will also fund completion of the final four classrooms at Joseph Arthur Middle School, which were framed during a 2023 addition, in addition to other facilities projects at both schools, Rodriguez said.
As the district works through its levy request for tax year 2025, it appears the new bond issuance will have only a minor impact on the total property tax rate homeowners see on their bills, Rodriguez said.
Similar to loans, bonds are a form of debt that school districts use to finance capital improvements. Districts are required to repay the principal amount plus interest over a set number of years.
In this case, the district will repay the bonds over 17 years with a 4.43% annual interest rate, using a portion of property tax revenue. There will be two payments per year, beginning in 2026 and continuing through December 2043.
Spacing payments over an extended period is common practice, helping districts reduce the burden on taxpayers, Rodriguez said. She added the district may adjust how much it collects for its tort or retirement fund to keep the total 2025 tax rate as close as possible to the previous year’s rate of 2.832.
“We try to keep (our tax rate) steady and have the most minimal impact on the taxpayers each year,” Rodriguez said.
The bond issuance did not require voter approval under a legally permitted process known as a “backdoor referendum.” The district posted a notice of intent to issue bonds in a local newspaper, beginning a 30-day window for residents to petition. If 10% of registered voters within the district boundaries had signed a petition, the matter would have gone to the ballot. No petition was filed, allowing Central 104 to proceed with the bond issuance.
The board also approved a resolution allowing bond proceeds to reimburse expenses the district has already incurred or is currently incurring for facility improvements.
