Citizens for Schools will host a community meeting to learn more about the Bond Issue for additions and renovations to our buildings on Thursday, October 24th at 6:00 pm at CHS in the gymnasium. Please stop in and learn about the project and have your questions answered. If you are interested in a yard sign, please stop by one of the district buildings and grab one. We are approaching 300 signs throughout the community. This is the most we have ever placed in yards in my 16 years as superintendent. I THANK YOU for your support of CLSD!
On November 5th, CLSD will have a 2-mill RENEWAL PI levy, Issue #18, and a 4.88 Bond Issue, Issue #17, on the ballot. To provide you with as much information as possible, I will highlight a different aspect of the bond issue in my articles, until the election. This week, I will share how the district arrived at the millage for the bond issue.
CLSD was proactive and deliberate in determining the appropriate millage for the bond issue. First, the district considered the tax year 2025 reappraisal values received from the County Auditor when we calculated the bond millage and cost per $100,000 home for ballot purposes. By doing so, it lowered the bond millage to best represent the true cost to the taxpayers in tax year 2025. The millage would have been higher if the district utilized tax year 2024 values and misleading (inflated) due to the known growth in the tax base.
Secondly, the district used a conservative interest rate assumption on the potential bond issue for ballot purposes (5.00%). The district (along with its underwriter) had to estimate a bond interest rate back in June 2024 for calculating the bond millage rate to be on the ballot in November 2024. It is typical, to be conservative on interest rate assumptions for ballot purposes because interest rates are not locked in until the bonds are sold. Assuming the passage of the bond levy in November, the bonds may be sold in February or March 2025. Future interest rates are volatile and it is impossible to predict where interest rates may be when it becomes time to sell the bonds and lock in the interest rates. As of today, if the bonds were to be sold, the interest rate would be approximately 0.65% lower (4.35%) than what we originally conservatively estimated back in June 2024. This lower interest rate may result in lower bond millage required/collected by the County Auditor. Estimated as of today, assuming the lower interest rate, the bond millage to be collected could be approximately 4.56 mills.
The Federal Reserve Board lowered the Fed Funds Rate by 0.50% in September. It is anticipated by many economists that the Federal Reserve Board will lower the Fed Funds Rate again for a second time later this year and a third time most likely early 2025. Future rate reductions should result in lower bond interest rates for the district and therefore lower bond millage rates and cost per homeowner as well. With Columbia Township’s construction growth, this would also generate additional tax savings in future years. In addition, similar to your home mortgage, we will continue to evaluate and consider all refinancing bond opportunities; which will further lower the bond millage rate in the future for the taxpayers of CLSD.
In summary, CLSD has taken a thoughtful approach in determining the bond millage for Issue #17. By considering the reappraisal values and using conservative interest rate estimates, the district is aiming to minimize financing costs for taxpayers while ensuring that funding needs are met for the project. The potential for lower interest rates and future construction growth could further reduce the bond millage in coming years, which is a positive outlook for homeowners. Rising construction costs are definitely a critical factor to consider if the levy were not to pass. We estimate that this project will increase by a minimum of $3 million if not passed this November. With our space issues and needs for our students, this project will continue to be our number one priority and the need will not go away, most likely the need will only get larger and more expensive.
Thank you for reading these important articles the last couple months in regards to Issue #17 and #18. For more information, please visit clsdraiders.org or citizensforschools.com
Graig Bansek
Superintendent