- What is a bond issue? How does a bond issue work?
A bond issue is essentially similar to a mortgage. It is a way for a government body to “borrow” money for major projects that cannot be paid for in more direct ways. Bond issues are how the CPSB has traditionally financed school construction, expansion, and renovation. (Example for a $40M Bond Issue)
If voters approve, borrowing the money is authorized as well as the levy of a property tax for 20 years.
After the approval, CPSB will sell $40M in bonds and put the money in a separate account dedicated specifically for the construction associated with the bond issue.
Projects will be bid and completed in phases to maximize efficiency and minimize disruption and pricing.
Taxes are collected over the next 20 years to pay off the principle and interest on the bonds. If the total assessed values increase, the tax paid by each individual can actually decrease. The “tax rate” for property taxes is called a “millage” and it is charged on a percent of the assessed value of the property.