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ERIC Number: EJ904648
Record Type: Journal
Publication Date: 2010-Mar
Pages: 2
Abstractor: ERIC
Reference Count: 0
ISBN: N/A
ISSN: ISSN-0036-651X
New Ways for School Districts to Issue Bonds under the Recovery Act
Cowburn, Laura; Phillips, Kenneth A.; Unkovic, David
School Business Affairs, v76 n2 p14-15 Mar 2010
The federal government has traditionally given local school districts an indirect subsidy by allowing them to issue tax-exempt bonds. Because the bondholders pay no tax on the interest income, they are willing to take a bond bearing interest at, say, 4.5% rather than 6%. Such lower interest is great for the school district because it saves the district the 1.5% difference in interest expense. On the other hand, it costs the federal government the tax revenue it would have received on 6% taxable income. This article describes two new ways for school districts to issue bonds under the American Recovery and Reinvestment Act of 2009. These two methods include: (1) a direct federal subsidy to school districts through Build America Bonds; and (2) another indirect subsidy using tax credits through Qualified School Construction Bonds.
Association of School Business Officials International (ASBO). 11401 North Shore Drive, Reston, VA 20190. Tel: 866-682-2729; Fax: 703-478-0205; e-mail: asboreq@asbointl.org; Web site: http://www.asbointl.org
Publication Type: Journal Articles; Reports - Descriptive
Education Level: Elementary Secondary Education
Audience: N/A
Language: English
Sponsor: N/A
Authoring Institution: N/A