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Board authorizes municipal advisory work for $6.5 million GO bond to fund capital projects
Summary
The board approved engaging municipal advisory services to plan a proposed $6.5 million general obligation bond to fund HVAC and structural projects, with an estimated tax-rate impact of about one penny (0.12 to 0.13) over a seven-year repayment plan.
The School City of East Chicago Board of Trustees on Jan. 28 authorized municipal advisory services to prepare a proposed $6.5 million general obligation (GO) bond to fund upcoming capital projects, chiefly completion of HVAC work and structural repairs at Central High School.
Aaron Finley, a municipal advisor on the presentation team, told trustees the recommendation is to issue $6.5 million because state statute limits the district's total direct-debt capacity; after accounting for existing obligations the district's remaining statutory capacity was described as slightly more than $6.5 million. The advisor recommended a seven-year amortization to reduce annual payments.
Finley said property taxes would pay bond debt service and estimated an annual payment of "a little over $1,000,000," which he said would require a tax-rate increase from 0.12 to about 0.13 '1 a change he characterized as roughly a one-cent increase. He said formal approval to issue a bond would come at a future meeting after finalizing structure and numbers; the board authorized the advisory engagement to prepare that work.
Why it matters: If the district proceeds with the bond, property taxpayers would fund annual debt service. The funds are proposed to complete district capital needs identified by staff, including HVAC at Central High and structural repairs on stairways.
Board discussion and next steps: Trustees asked for clarification on the nature of a GO bond and whether current debt was sunsetting; Finley confirmed existing obligations will be paid off during the bond period, limiting additional tax pressure. One trustee asked about market conditions; Finley deferred citing licensing limitations and recommended the board ask the firm's licensed municipal advisor (Steve Dalton) for market advice when the board considers final issuance.
Finley and district staff said they expect to bring a formal bond authorization for board action in a future meeting (presentation and closing timeline discussed). Trustees requested a work session to review bond details and market conditions before final authorization.
