Change in interest rate lowers expected tax increase for PNGISD bond
Published 12:29 am Friday, May 21, 2021
A decision made to cash in on the second half of a $130 million bond issue next week will likely result in savings for the Port Neches-Groves Independent School District and its taxpayers, according to a recent report made to the board of trustees by a financial advisor.
Lewis Wilks with Houston-based U.S. Capital Advisors told board members that interest rates have changed since the bond was first proposed to the public in 2019. The firm intends to sell the final $65 million May 25 — an action that mirrors 2020, when the first $65 million of the bond was sold. Funds would be made available to the district June 24.
“All is looking very well,” Wilks told trustees during his presentation. “I think it’s been a wise move to move forward and issue this next round because…project rates will be higher in the future.”
Information from the district shows the 2021 estimated tax increase would be 12.4 cents per $100 of taxable value. A $100,000 home would see a maximum annual tax increase of $68.20.
That amount is now expected to be lower.
Wilks said the current interest rate should be about 2.5 cents less than first estimated to the public for the 2021 year.
“We originally had estimates of how much tax impact the bond election would create, so we’re under that estimate,” he told Port Arthur Newsmedia Thursday. “That’s good for the district, that’s good for the taxpayers, that’s good for everyone.”
With the projected lower rate, a $100,000 house would see a maximum annual tax increase of $54.45.
The bond election approved in 2019 will consolidate four Groves schools and three Port Neches schools into four campuses.
Ridgewood and Woodcrest elementary schools in Port Neches, and Taft and Van Buren elementary in Groves, will merge to create one pre-K-2nd grade campus in each city. Students currently enrolled in pre-K at West Groves Education Center will attend one of the two.
Port Neches and Groves elementary schools will be replaced by one 3rd-5th grade campus in each city.
In April, Deputy Superintendent Julie Gauthier said that, despite the impacts from COVID-19, progression on the new schools continued.
“We were able to do a lot of things virtually,” she said. “We’re still on track with where we need to be.”
Ground has been broken on multiple schools. Gauthier said the intent is to open the intermediate schools in the fall of 2022 and the two elementary schools in the fall of 2023.
PNGISD administrators previously said the current elementary schools are 60-70 years old, expensive to maintain and not built to educate the number of students now enrolled.
The new schools are designed for a 25 percent increase in current enrollment, with convertible teacher areas that allow for an additional 10-15 percent.