A r c h i v e d  I n f o r m a t i o n

Designing a Dream

A School Deputy Superintendent?s Perspective on Using QZABs

In September1998, the Clovis and Fresno United School Districts of Fresno County, California jointly issued California?s first QZAB. Terry Bradley, deputy superintendent of Clovis Unified School District, shares his thoughts on the QZAB program:

"When we first heard about the Qualified Zone Academy Bond program, our initial reaction was less than enthusiastic. We mistakenly believed that once the Treasury Department, the Internal Revenue Service, and the U.S. Department of Education developed implementation regulations, it would be very time consuming and difficult to qualify for these zero interest bonds. How wrong we were.

After the proposed regulations were initially reviewed by our staff, financial consultant, and bond counsel, everyone thought we were missing something because the regulations to qualify for these bonds appeared to be much too userfriendly.

The California Department of Education immediately recognized the financial benefits of the QZAB program and developed a short application document for school districts.

On September 30, 1998 (nine months after the adoption of the QZAB program), our school district combined with the Fresno Unified School District successfully issued the first QZAB in California. The funds from this bond issue are being used to finance the renovation of an existing warehouse/manufacturing plant into our Center for Advanced Research and Technology (CART). This state-of-the-art technology high school will house 1,600 students from our school districts when it opens in September 2000.

We found the QZAB program to be one of the most user friendly federal programs for the following reasons:

• decisions regarding the use of funds are determined at the local level;
• federal and state requirements are minimal;
• no additional federal appropriation is required; and
• significant savings are realized by local school districts.

Meeting the 10 percent contribution requirement was a very exciting and easy task for our two school districts. After explaining the program to members of our local private sector, we received a tremendous response both prior to receiving authorization and subsequent to beginning construction. We are still receiving significant private contributions today.

With the renovation of our facility almost completed, all parties in our two school districts are convinced that our vision for this technology high school would not have been realized without the assistance provided through the QZAB program. We were able to reduce our financing costs by close to $13 million, which allowed us to develop a program that will be second to none. Everyone (students, teachers, business, taxpayers) in our two communities is benefiting because of our ability to use QZAB funds. Our newly renovated facility is a dream come true, and it would not have been possible without the savings we realized by using the QZAB program."

[Qualified Zone Academy Bonds: State Allocations]

[Fostering A Dream: A Financier's Perspective on Using QZABS]