A school district in Dallas, Texas, issued $378 million in bonds to make improvements to its facilities.
The bonds, issued by the Carrollton-Farmers Branch Independent School District, mature between 2024 and 2053, yielding between 2.84% and 4.33%. The securities received an underlying rating of Aa1 from Moody’s Investors Service and AA+ from S&P Global Ratings.
“The Aa1 issuer rating reflects the district’s healthy local economy, strong financial performance as demonstrated by ample reserves and liquidity,” according to Moody’s.
The issuance comes at a time of falling enrollment in the school district, even as enrollment rises at school districts elsewhere in the Dallas suburbs. Enrollment for the 2022-23 school year fell 0.77% from the year prior to 24,747 students. The district projects enrollment to continue to drop over the next five years.
Proceeds from the sale of the bonds will finance replacement buildings at three of the district’s elementary schools and renovations to every school in the district. They will also pay for safety and security upgrades.
Voters authorized the district to sell up to $716.4 million in bonds in a May referendum, which passed with 64.6% of the vote. The projects financed by the bonds will build upon previous work that began with a similar bond authorization in 2018.
The school district includes almost all of the city of Carrollton, most of the city of Farmers Branch, and parts of Dallas. The bonds are direct obligations of the district, payable by property taxes.
Frost Bank Capital Markets served as lead underwriter on the issuance.