School District 304 transfers nearly $5 million to pay debt
GENEVA – To reduce its debt payments, the Geneva School District 304 board Monday approved transferring nearly $5 million from the education fund to pay down its 2004A debt series, a voter-approved $41.2 million bond issue to build a second middle school and for school improvements.
Donna Oberg, assistant superintendent for business services, said that the amount more than $15 million in the education fund was to be used to pay down the debt.
“We’re looking to increase that debt service payment to level it off so there’s not a big shelf,” Oberg said. “I’m looking at increasing debt service payment by about $500,000 each year to kind of level it off so there is not a big shelf where we can’t abate that. Because, as you know, the debt service payments are going from $14 million to $15 million up to anywhere from $23 million to $24 million over the next 10 years, so we try to keep those dollar amounts level as much as possible.”
Oberg said she increased the debt payment to $15 million this year and plans to increase it to $15.5 million next year.
“We are trying to keep increasing it a little bit because what I don’t want to have happen – if we don’t have the excess to be able to abate back, we could go from a $15 million payment maybe to a $21 million payment, and that’s going to be a big jump,” Oberg said. “So what I am trying to do is keep that level, so if I don’t abate as much back each year, hopefully, it will meet in the middle; it will level it out.”
The board also approved a resolution for the $4.9 million to be used as a partial abatement of taxes levied for years 2012, 2013 and 2014 for the principal and interest on those particular bonds.
Property taxes are not going to decrease because of the abatement, Oberg said.
“It’s that they [taxes] are not going to increase based on debt service payments the way they were scheduled,” Oberg said. “In other words, this year, I think it would have been $17 [million] or $18 million; instead, it’s going to be $15 million. So it’s just keeping that so the increase is not as large.”