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Qualified Zone Academy Bonds

History

• Tax credit bonds, currently issued by local school districts for the repair and rehabilitation of schools and other qualified purposes
• First authorized in 2000
• Can be issued as tax credit bonds or direct pay subsidy taxable bonds
• Under direct pay option, subsidy is equal to 100% of the interest rate on the bonds or the tax credit rate, whichever is less.
• Maturity and tax credit rates set daily by Treasury (see www.treasurydirect.gov)
• Unused allocation may be carried forward 2 years
• All proceeds and interest earnings thereon must be spent within three years of issuance

Qualified Zone

Any public school where:

• the school or program is designed in cooperation with business to enhance the academic curriculum, increase graduation and employment rates and prepare students for college
• students subject to same academic standards as other students in the district
• the education plan is approved by the district, and
• the school is located in either
  • an empowerment zone or enterprise community, or
  • 35% of the students are eligible for free or reduced lunch.

Qualified Zone Academy Bond

An issuance, in whole or in part:

• where 100% of proceeds used for a qualified purpose with respect to an qualified academy established by an local education agency;
• issued by State or local government within the jurisdiction of which such academy is located; and
• the issuer
  • designates the bond as a QZAB
  • certifies that it has written assurances for the private sector match
  • certifies that it has the written approval of the local education agency

Qualified Issuers

• State and local governments
• Certain “on-behalf-of” issuers

Qualified Purpose

• rehab or repair of public school facilities
• equipment
• development of course material
• training teachers and other school personnel.

ARRA and HIRE Provisions

• US allocation increased from $400 million to $1.4 billion for both 2009 and 2010
• Unused allocation can be carried forward 2 years
• Davis-Bacon wage rates apply

Georgia 2009 allocation: $46,376,000
Georgia 2010 allocation: $47,428,000
Georgia 2011 allocation: $14,161,000

Total available to allocate: $107,965,000

Application Process

• Georgia Department of Education (DOE) will release application to school districts in March 2011
• State allocations must be approved by the Georgia State Financing and Investment Commission (GSFIC)

Contacts
DOE: Lynn Jackson, lyjackso@doe.k12.ga.us
GSFIC: Susan Ridley, susan.ridley@gsfic.ga.gov