Understanding Public School Bonds for Building

As part of our ongoing commitment to transparency regarding our community's investments in our education system, we're shedding some light on an essential topic: public school bonds.  

What are Public School Bonds?  

In straightforward terms, a school bond is a financial tool to gather funds to replace, upgrade, or repair our schools, including construction and renovation, technology upgrades, safety enhancements, energy efficiency initiatives, transportation, and athletic facility improvements.   

Bonds are a long-term investment, typically spanning 12 to 20 years. Bonds are sold to investors and repaid with interest over time using property tax collections. Passing a bond measure requires our community's 60% +1 supermajority vote.  

How do Bonds Work?  

When a school district issues a bond, it borrows money from investors. This borrowed amount and an agreed-upon interest are repaid over a specified period. The funds acquired through bond sales are then earmarked for designated projects, ensuring essential improvements across our schools.  

The repayment of school bonds primarily relies on property taxes within our district. These taxes cover the principal amount and interest over the bond's term, which varies depending on the borrowed amount and terms. This mechanism ensures that the financial burden is distributed across the community over time.  

Understanding Credit Ratings:  

A crucial aspect to consider is the credit rating of a bond. This rating, determined by nationally recognized credit rating agencies based on the district's financial condition, indicates the risk to potential investors. Higher ratings signify lower risk, leading to lower interest rates for taxpayers and ensuring efficient use of public funds.   

Puyallup School District has earned 11 straight years of perfect audits by the Washington State Auditor. Recently, the district refinanced bonds, saving taxpayers 23.2 million dollars.   

To learn more about public school funding, visit our funding webpage.