Districts land no-interest bonds
School District of Lancaster and Donegal to receive a combined $72 million from state program
By DAVID O’CONNOR
Updated Jun 03, 2010 22:36

There was good news for officials and taxpayers in two Lancaster County school districts on Thursday.

School District of Lancaster and Donegal School District were among 46 across Pennsylvania selected to receive zero-interest bond money for new construction projects.

Lancaster schools will receive $55 million and Donegal $17 million under the program, Gov. Ed Rendell announced Thursday afternoon.

Donegal had been seeking $48 million to build a new high school, while the School District of Lancaster had requested nearly $76 million for upgrades at 10 schools and an administrative center.

SDL, Donegal and the 44 other districts will receive more than $600 million in bonds made possible through the federal American Recovery and Reinvestment Act.

The ARRA program will save the districts and taxpayers an estimated $513 million in financing costs, officials said.

"We went one step further to decrease the costs," Rendell said.

For the first time, the state is "doing one single bond issue," which "means that each district will pay just a small portion of the one-time cost for the bond work," the governor said.

Under the program, the federal government pays essentially 100 percent of the interest on the Qualified School Construction Bonds.

The QSCB program offers no-interest bonds to districts that are experiencing rapid growth or have high tax rates and/or high poverty levels.

QSCB funds must be used on projects that make schools more energy-efficient; improve kindergarten or pre-kindergarten programs; reduce class sizes; increase student safety; or enhance science, technology, engineering and mathematics instruction.

The state Department of Education rated applications on those criteria to determine which schools get the money.

Rendell was joined at an announcement Thursday afternoon in Harrisburg by School District of Lancaster Superintendent Pedro Rivera.

SDL and Donegal had applied earlier this year to participate in the new government-funded, zero-interest construction bond program.

"It's a huge potential savings for the taxpayers," SDL school board member Michael Rowen said at the time.

With Donegal's new high school in the works and the district getting ready to go out to bid on the project, "the timing for us is perfect" to receive the $17 million in interest-free bonds, district business manager Amy Swartz said Thursday.

For more information, visit the state Department of Education website, www.pde.state.pa.us.

doconnor@lnpnews.com

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