Hillsboro School District hears options for $312M–$380M general obligation bond, consultant says state match unlikely
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Summary
District finance consultant Lauren McMillan told the Hillsboro School District board the district could raise roughly $312M at a lower levy benchmark or about $380M at a higher benchmark; she noted an estimated $6M state matching (AWESOME) allocation is possible but unlikely to be prioritized.
At a regular meeting, the Hillsboro School District Board of Directors heard a detailed briefing from Piper Sandler managing director Lauren McMillan on options for a potential general obligation (GO) bond to be offered to voters in 2027 (November) or 2026 (May).
McMillan explained GO bonds are repaid by an unlimited property‑tax levy dedicated to debt service and described how the county assessor sets the annual levy rate based on assessed value (AV). She warned that the district cannot set an annual levy rate in advance and can only submit the dollar amount it needs to the assessor.
The consultant stressed two benchmark scenarios: using this year’s lower levy‑rate estimate (about $1.58) would raise roughly $312 million; using a three‑year average (about $1.81) would raise roughly $380 million. Both scenarios assumed issuing debt in 2027 and included a 1.5 percentage‑point cushion on current interest‑rate assumptions; the total borrowing cost under the cushion was modeled at roughly 5.4–5.5%.
“You have to get voter approval,” McMillan said, summarizing legal and procedural constraints and the need to include a not‑to‑exceed amount and permitted uses in the ballot title. She also noted that assessed‑value growth matters: the district reported nearly 30% AV growth this fiscal year, in part because of changes tied to a large private employer (discussed in the presentation as Intel), which could reduce the projected levy rate in the near term but could also be temporary.
McMillan described the state matching program commonly termed the AWESOME grant and said Hillsboro’s eligibility was roughly $6 million under the new ranking formula; because the district ranked about 166 of 197 districts, she said it was unlikely to receive a priority match but might qualify in a first‑come, first‑served pot depending on other applicants.
Board members pressed for more analysis on the durability of the AV spike, the effect of declining enrollment on long‑term obligations, and how to craft ballot messaging. Staff and consultants said they would consult the county assessor about AV depreciation risk, refine levy and growth assumptions, and present package options to the Bond Development Committee and the board in December.
Next steps: the bond team will prepare two or three package options for the December board meeting, continue community outreach, and refine ballot language and levy estimates before any decision to place a measure on a future ballot.
