High school district: Raising bond funds without raising property tax rates High school district: Raising bond funds without raising property tax rates (July 21, 2004)

Here is how the Sequoia Union High School District plans to raise as much as $70 million more in construction bonds without raising the tax rate. This information is based on estimates provided by Craig Hill, a financial adviser to the district.

Property owners in the district currently pay about $24 a year per $100,000 of assessed value to pay off interest and principal on two bond measures: $45 million, approved by voters in 1996, and $88 million, approved in 2001. The district sold the bonds and used the proceeds ($133 million) for construction projects.

The tax rate the county sets each year is based on the total assessed value in the district -- currently about $40 billion -- and the amount needed to pay off the bonds.

If the assessed value grows, and interest rates stay relatively low, the tax rate can decline (see chart). The rate is set to decline from about $24 to about $19.50 in the current fiscal year, then decline further in following years.

But if voters approve the proposed new measure, which could raise as much as $70 million more through bond issues, the tax rate would remain at $24 a year for 10 additional years before declining.

The owner of a home with an assessed value of $500,000 would pay an estimated $2,750 over 35 years, instead of $1,915 over 28 years -- a difference of $835 paid over 35 years.

These projections are based on current assumptions regarding trends in interest rates and a 3-percent annual growth rate in assessed values.

-- David Boyce

E-mail a friend a link to this story.