We’ve heard questions and seen some inaccurate information regarding how the proposed bond would be financed, so we want to clarify.
One of the most common misconceptions is that the existing bond would be combined or refinanced with the proposed bond.
That is not the case.
ARE THE TWO BONDS BEING COMBINED?
No.
The existing bond and the proposed bond would remain separate bond issues. The district is not refinancing or consolidating the existing bond into the proposed bond.
If approved, the proposed bond would run alongside the existing bond.
ABOUT THE EXISTING BOND
The existing bond, which was refinanced in 2018, has a very favorable interest rate.
Because that refinancing occurred when interest rates were lower, the district currently benefits from that lower rate.
Replacing or consolidating that bond into a new issue would subject that portion to current market interest rates, which are higher.
STATE AID DIFFERENCES
The existing bond qualifies for approximately 50% state aid reimbursement.
This means the State of Kansas reimburses about half of the eligible bond costs associated with that issue.
Recent legislative changes altered how state aid applies to new bond issues.
The proposed bond would qualify for approximately 3% state aid, rather than 50%.
If the two bonds were consolidated:
The higher state aid reimbursement on the existing bond would be lost
The interest rate on that portion would increase
The overall long-term cost would increase
For these reasons, the bonds are structured to remain separate.
HOW THE STRUCTURE WORKS
The existing bond continues under its current terms, including:
Its refinanced interest rate
Its state aid eligibility
If approved, the proposed bond would be issued separately and financed under current market conditions and current state aid rules.
Each bond would be financed independently.
Learn More
Early Voting In Person - Lansing Fire Station: February 28, 8 AM - 12 PM
General Election: March 3