2005 BOND ISSUE PLAN OF FINANCE

Ø     $16,500,000 proposed bond issue and improvement budget.

Ø     Proposed improvements include: Tornado Shelters, roofs, plumbing and electrical upgrades in each building. (1)  construct classroom additions; additions to the cafeteria/kitchen; make renovations to classrooms and administrative areas; construct a new media center/entry; construct an auxiliary gym and locker rooms; construct a 300 seat auditorium; and remodel and make improvements to the Auto-Print Shop at Parsons High School; (2) construct classroom additions; a new media center and roof replacement at Garfield Elementary; (3) construct classroom additions and roof replacement at Guthridge and Lincoln Elementary Schools; (4) asbestos abatement improvements; replace track, gym floor; and construct a parking lot at Parsons High School.

Ø     Today’s interest rates (estimated at 4.25%) are near their lowest levels of the past 40 years.  Similar bond issues have recently sold at lower rates.  Low interest rates make the cost of repayment of a bond issue more affordable.

Ø     The current state finance formula allows additional state aid to pay 40% of the principal and interest cost on the proposed bonds. The total state aid benefit (both P & I) would be approximately $9,395,225.  These are tax monies that can be brought back from Topeka to the benefit of our children and community.

Ø     More than 150 other Kansas School Districts have approved bond issues under this program in recent years.  With State budget challenges, there is a possibility that the state aid program may not be offered or may be modified by a change in law in the future.  Bond issues approved and issued prior to any change in this law are anticipated to be “grandfathered” and receive the state aid for the life of their approved bond issue.

Ø     The plan of finance is to “wrap” the proposed new bonds around the existing debt with one consistent mill levy to retire all bonds (both existing and proposed).  It is conservatively estimated that a total average levy of 19.66 mills will accomplish this goal.  As we are currently paying 7.15 mills, the average net increase to local taxpayers would be 12.5 mills.  All bonds would be retired in a total of 15 years (2020).

	$16,500,000 BOND ISSUE

 

	Estimated Assessed	Tax Impact of a 12.5 Mill Net Tax Increase
Type of Property	Valuation	Yearly	Monthly	Daily
$  20,000 Home	$ 2,300	$  28.75	$ 2.40	$ .08
$  25,000 Home	$ 2,875	$  35.94	$ 2.99	$ .10
$  35,000 Home	$ 4,045	$  50.31	$ 4.19	$ .14
$  50,000 Home	$ 5,750	$   71.88	$ 5.99	$ .20
$  75,000 Home	$ 8,625	$ 107.81	$  8.98	$ .30
$100,000 Home	$11,500	$ 143.75	$  11.98	$ .39
$125,000 Home	$14,375	$ 179.69	$  14.97	$ .50

Estimated State Aid

Benefit

40%

 

 

 

 

 

 

 

 

Repairs = $4,174,600          Renovations = $4,154,400

New Construction = $8,898,517           Subtract Federal Funds = ($727,517)

TOTAL BOND ISSUE =  $16,500,000

With today’s low interest rates, and 40% State Aid,

the cost of improving our educational facilities in Parsons

may never be more affordable!

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