A school district outside of Austin, Texas, sold $163.3 million in bonds to finance capital improvements and refund previously issued securities.
The bonds, issued by Dripping Springs Independent School District, mature between 2024 and 2053, yielding between 3.22% and 4.46%. They pay interest at 5%. The securities received an rating of AAA from S&P Global Ratings, which assigned an underlying rating of AA.
“The underlying rating reflects our opinion of the district’s favorable location, very strong available fund balance, good financial policies and practices, and high overall net debt,” S&P analyst Allie Jacobson said in a press release.
The issuance comes amid rising enrollment in the school district, which has created a need for bigger schools. The bond proceeds will fund a new elementary school, the expansion of a middle school, the design of new schools, and renovations and improvements at existing schools. Enrollment has increased by about 60% since 2014.
The school previously expanded in 2017, when a new middle school and new elementary school opened, and in 2021, when an additional elementary school opened. Those projects were also funded by bonds.
Dripping Springs ISD now enrolls 8,500 students at eight schools in Hays and Travis Counties, around 25 miles east of Austin. The bonds are direct obligations of the district, payable by property taxes.
Raymond James & Associates, Inc served as lead underwriter on the issuance.