DETROIT - Detroiters would pay construction debt for an additional 15 years if they approve a $500 million bond issue to build or renovate a number of school buildings, according to the Detroit Free Press.
Voters will go to the polls in November to decide whether to authorize Detroit Public Schools to sell the bonds, the Free Press and other media reported. District residents already are paying off a $1.5 billion construction bond from 1994; if the new bond is approved, the existing 13-mill debt levy would not increase, but would be extended, according to the Free Press.
The money would be used to renovate or rebuild 18 school buildings while closing others, for a net decrease of 1 million square feet and a $12 million reduction in fixed operating costs, according to The Detroit News.
Terry Stanton, spokesman for the Michigan Department of Treasury, told The News that the district can save money by borrowing through two federal stimulus programs, one of which offers interest-free loans and another that will reimburse 35 percent of interest costs. Detroit plans to participate in both, The News reported. The treasury department already has approved the bond initiative.
The News reported that some area residents are concerned that mismanagement of the 1994 bond proceeds would carry over into the new bond program.
Detroit Free Press, "$500.5M bond for DPS set for vote," Aug. 25, 2009
The Detroit News, "DPS seeks $500M bond to rebuild, renovate 18 schools," Aug. 26, 2009
Mackinac Center for Public Policy, "Detroit's Schools Are Going Bankrupt, Too," Aug. 4, 2009