$105 Million Bond Would Cost About $1 Billion When Finally Repaid In 2051
12:06 AM, Aug 21, 2012
Poway residents packed the Poway Unified School District headquarters on Monday to express their anger after learning a $105 million bond measure to improve their schools will now cost about $1 billion to repay.
Most who attended the meeting were furious."I think this board should resign and I think they should not run again," said one attendee.Last year, Poway Unified School District board members signed a $105 million capital appreciation bond to reconstruct some older schools within the district.Although residents voted to pass the bond measure, they claim the board never notified the public that by passing the measure, nearly $1 billion dollars would be owed about 40 years from now.The district does not have to start paying on the bond for another 20 years but all the while, interest compounds at nine times the principal. That means the $105 million, when it is finally repaid in the year 2051, will cost about $1 billion. "Either you think that we are naïve or irretrievably stupid to think that 9.1 to a dollar is an OK return," said Poway resident Clariece Tally.Poway resident Joyce Haus said, "It's appalling... It's just appalling. Where do you think this money is going to come from? It's not going to come from me because I'm going to be dead and buried."Board members on Monday stood behind their decision, saying they knew just as much as residents when it came time to vote and that there was no backroom deal."All of this was done in open session," said Poway Unified School District board member Penny Ranftle. "I understand that you're upset and I appreciate that, but I do believe that our property values were protected because we have a quality of schools throughout this district."