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How Glenbard District 87 will use $25 million bond issue cash

After the state rejected its bid to borrow millions at low- to no-interest rates, Glenbard High School District 87 is pressing ahead with taking out loans to pay for improvements to its four schools.

Later this month, the district expects to receive the proceeds from issuing $25.2 million in bonds, the last in a plan authorized by voters in a 2014 referendum.

Interest and principal payments on the referendum debt won't exceed $4.1 million a year, said Chris McClain, assistant superintendent of finance and operations. The district now anticipates paying off the bonds 2 to 2½ years earlier than previously thought because of expected low interest rates, he said.

"It's part of a total pool of money that is allowing us to do some things that we otherwise would not be able to do," McClain said. "We would not have been able to do the addition at (Glenbard) West without the referendum passage. It would have been difficult for us to do these major mechanical investments without the support of that."

The Glenbard West addition marks the first to the original building since 1963. The $10.5 million project will build the three-story wing for chemistry and physics classes, convert existing science labs into general education classrooms, and consolidate science department offices into one on the fourth floor of the Glen Ellyn school.

The project remains on schedule and on budget, McClain said. Masonry work on the north side of the addition should begin this month, and crews should start installing the roof in April.

By the start of the school year, construction should be complete on the 28,000-square-foot addition and a new chiller plant that will air-condition the entire Glen Ellyn school, the last in the district without A/C.

The Glenbard West addition is part of a $100 million, decadelong plan to improve schools. Funding comes from several sources: $35 million raised by extending debt due to retire, a move approved by voters in the 2014 ballot question; $20 million from so-called "alternative revenue source" bonds; and the district's operational budget.

At Glenbard East alone, the district spent more than $10 million on air-conditioning the Lombard school and other mechanical and electrical work last summer. Glenbard North in Carol Stream is due for a major renovation of its aging mechanical system in summer 2017.

Even with the addition of air conditioning, McClain anticipates districtwide annual savings of more than $200,000 on energy costs.

"Once we get over the Glenbard North cycle, for the most part, Glenbard high schools are going to have current upgraded mechanical systems with state-of-the art digital controls for managing climate," McClain said. "They'll be more energy-efficient systems."

He expressed disappointment that the district was unable to issue the $25.2 million as qualified school construction bonds under a program set up by the American Recovery and Reinvestment Act in 2009. The district had expected to save almost $15 million in interest costs over the life of the bonds.

"It's a shame that we weren't able to receive an award, but there was just so much more demand than supply," McClain said.

Indeed, more than 190 school districts across the state applied - a "one-time shot," McClain said. But only 29 districts were awarded the bonding authority - up to a $50 million cap - by the Illinois State Board of Education, which prioritized districts that are "shovel ready."

ISBE also ranked districts based on factors that include the number of students from low-income families.

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