LOCAL SCHOOLS
The Big Picture: How Lakota can Anticipate No Increase in the Bond Tax Rate
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The Big Picture: How Lakota can Anticipate No Increase in the Bond Tax Rate
Think of a school bond like a home mortgage. When interest rates drop, homeowners refinance their entire mortgage to lower their monthly payments.
School districts do the exact same thing, except a school's overall debt is divided into smaller pieces called "series." Instead of refinancing the whole debt at once, the District selectively refunds (refinances) individual series, or parts of a series, to lock in lower interest rates and lower costs for taxpayers.
Refinancing for Millage Drops
Working with Lakota’s financial advisors, former Treasurer Jenni Logan restructured two of the District’s bond series. This accelerated debt payments and opened up new financing options sooner. By delaying new bond tax collections until 2029, Lakota can ask voters to consider a bond issue in November that is not anticipated to raise the bond tax rate, six years earlier than the original schedule.
How Lakota’s Current Debt will Roll Off (2026–2034)
Lakota currently has four outstanding bond series totaling $34.9 million. The average millage required to pay the bond debt services between 2026-2028 is 2.28 mills.
Because the bond series mature at different times, debt payments will drop off naturally over the coming years.
|
Year |
Lakota’s Unlimited Tax General Obligation (UTGO) |
|---|---|
| 2026 | 2005 Series: Fully paid off. |
| 2027 | 2020 Series: Fully paid off. |
| 2028 | 2020A Series: Fully paid off At this point, approximately 2.2 bond millage rolls off. |
| 2029 | New collection would begin on approximately 2.2 mills if voters approve the November 2026 bond. |
Why the November 2026 Bond Issue is not Projected to Increase Taxes
The key to keeping bond tax rates flat is timing:
- The Expiration: In 2028, the 2005, 2020 and 2020A series are fully paid off. This means the approximately 2.2 mills currently being collected from residents for this series will expire and “roll off,” or stop being collected.
- The New Bond Issue: If voters approve the November 2026 bond issue, collection for the new approximately 2.2 mills would not begin until 2029.
- The Result: Because one bond tax rolls off (ends) right as the new one would begin, the total millage rate is anticipated to remain the same for taxpayers.
Visit our master facilities website to learn more about the plan and the November ballot issue.
- facilities
- finance