On Monday, trustees at Prosper ISD, a relatively small but growing school district north of Dallas, agreed to present voters with a massive new bond package in November. The district’s proposal is so large, in fact, that it practically dwarfs all others this election cycle.
In total, Prosper ISD officials want voters to approve four bond propositions worth a staggering $2.8 billion (and that’s principal only, not interest). To my knowledge, that is the biggest school bond package in Texas, well in excess of the next largest few, which include Conroe ISD’s $2.0 billion proposal, Midland ISD’s $1.4 billion pitch, and Lewisville ISD’s $1.2 billion package (which the district wants in addition to a voter-approval tax rate election to raise the M&O rate).
For Prosper ISD, the addition of so much new debt could have a jaw-dropping effect.
Consider that, according to the Bond Review Board, the district’s debt today totals $2.3 billion (includes principal and interest). That means the district owes $92,823 owed for every student currently enrolled. That is very high by today’s standards!
Approving and issuing bonds worth billions more will, of course, skyrocket those figures. Remember that the $2.8 billion figure represents only the principal amount sought. It does not include any interest that would also be owed. To get a sense of what that might look like, consider the district’s existing debt picture. In fiscal year 2022, its principal outstanding was $1.37 billion (70% of the total) and the interest owed stood at $953.9 million (30% of the total). Were a similar situation to arise with respect to the $2.8 billion in new debt sought, the final price tag could be truly stunning.
On a per capita basis, Prosper ISD is asking its voters to approve an extra $112,356 in new debt for every student currently enrolled. That is a tsunami of red ink.