Citizens Bond Committee
The Citizens Bond Committee (CBC) subcommittees will meet to review presentations and information and create a report of their findings and recommendations for the Board of Trustees. The CBC is expected to update the Board in April and provide a recommendation at that time on whether the Board should consider an election in November 2018 or May 2019.
The CBC will propose and prioritize projects based on the following criteria:
- Safety and security
- Demographics and growth
- Financial efficiency
- District vision, strategic plan, and learning framework
The CBC will be comprised of three subcommittees:
- The Districtwide Subcommittee will focus on safety, technology, and instructional programs that impact the entire district.
- The Growth Subcommittee will focus on facility needs to address growth and overcrowding, including new schools, land, additions, renovations.
- The Capital Renewal and Replacement Subcommittee will focus on critical components of existing facility infrastructure.
What are bonds?
School districts can only sell bonds if authorization is received by voters. A bond is a debt instrument in which an investor loans money to the District. The proceeds from the bond are used to finance capital projects and other long term items. The District repays the principal of the bonds, along with interest, over a period of time.
Check out the Bond projects completed this summer
Voters approved all three Round Rock ISD propositions on May 10, 2014 as part of a $299 million Round Rock ISD bond package that addresses growth, capital improvements, increased access to technology and the addition of new fine art facilities for the district.
What are bonds? How long does it take to pay them off?
Under current Texas laws, the maximum maturity of a bond is 40 years. However, the maximum maturity ever issued by Round Rock ISD is 25 years, even though projects financed by the bonds have a longer life than 25 years. Assets financed by the bonds that have a shorter asset life, are sold with shorter maturities that align with their useful life.
How do bonds work?
Bonds are sold in multiple maturities meaning they mature at different times over a period of years. The interest rate is typically different depending on the maturity date. Longer maturities typically carry a higher interest rate. The interest rate is determined based on market conditions and the quality of the credit. In other words, the better the credit rating, the lower the interest rate on the bond and the lower the cost of borrowing.
Round Rock ISD is the only school district in Texas to achieve a AAA Bond Rating from both Moody’s and Fitch credit rating agencies.
Principal and interest on the bonds are repaid over a period of time with funds from the Debt Service tax rate.
How can bond money be used?
Why are bonds used to finance non-facility items?
In addition, it is advantageous to the District to pay for capital items such as technology, buses, land and portable buildings with bond money rather than from the General Fund as the cost can be spread over the life of the asset rather than a single purchase diluting the General Operating Fund.
If the bond election is passed, does the school district immediately incur the debt?
If the bonds are approved, is the district obligated to spend the money?
What makes up a district tax rate?
The Debt Service tax pays for school bonds and can be used only to retire the principal, interest and expenditures of bonds sold for specific purposes.
The Board of Trustees adopts the tax rate each year, typically in September.