Tuesday, July 23, 2013
The Dorchester District Two Board of Trustees approved the issuance of $60,000,000 in Bond Anticipation Notes (BAN) Monday night.
A BAN is a short-term interest-bearing security issued in advance of a larger, future bond issue. BANs are smaller short-term bonds that are issued by corporations and governments, such as local municipalities wishing to generate funds for upcoming projects. The issuing bodies use the bond anticipation notes as short-term financing, with the expectation that the proceeds of the larger, future bond issue will cover the anticipation notes.
Simply put, a BAN is type of loan to a school district or municipality guaranteed by taxes. In this case, the bond referendum guarantees that the BANs will be paid with the increase in millage (rate per 1/1000 of a dollar).
The next step, said Allyson Duke, director of business services, is to create a prospectus, watch the market and be ready to make a decision to sell as soon as a good offer comes in.
Summerville Journal Scene is pleased to offer readers the enhanced ability to comment on stories. We expect our readers to engage in lively, yet civil discourse. We do not edit user submitted statements and we cannot promise that readers will not occasionally find offensive or inaccurate comments posted in the comments area. Responsibility for the statements posted lies with the person submitting the comment, not Summerville Journal Scene.