Guilford County taxpayers aren’t done voting on school debt.
As Elon Musk can tell you, $2 billion doesn’t go as far as it once did.
According to Chairman of the Guilford County Board of Commissioners Skip Alston, county voters could be looking at a $550 million school bond within the next few years – a move he said may be unavoidable given escalating construction costs, inflation since the pandemic, and the number of schools that still aren’t funded after the 2020 and 2022 referenda.
Those two referenda totaled $2 billion for school construction and renovation. However, once you add the interest cost over the life of the debt, the county taxpayers’ total obligation comes to roughly $3.1 billion.
Guilford County has only recently begun paying that back, and those payments will continue for decades.
Even with that amount on the books, Alston said it’s still not enough to build all the schools the district had planned.
He laid out the problem succinctly.
“The real number they needed back in 2018 was $2.6 billion to $2.8 billion,” Alston said. “But they dared not put that amount on the ballot; so, that’s why they said $2 billion.”
That shortfall, he said, was baked in before anyone had ever heard of COVID-19. Once the pandemic hit, construction inflation soared.
“That added at least another 30 percent onto that,” Alston said. “Everything went up – supplies, labor, all of it.”
Add inflation on top of the original gap between the needs study and the referendum amount, he said, and the school system ended up hundreds of millions of dollars short.
According to Alston, that combination of factors created “a deficit there of about $1.3 billion.”
The result, Alston said, is that schools the county expected to build with the 2020 and 2022 bond money now can’t be built because of the lack of funds.
“We’ve got about six or seven schools that are on the list that aren’t going to be able to be built based on this $2 billion,” Alston said. “The money’s running out.”
Alston also said that the number he’s hearing now from school officials is that a new $550 million bond would be needed to close part of the gap. That still wouldn’t cover everything, but it would keep the long-term school construction plan alive, he added.
“I’m thinking about another at least $550 million over the next three to four years,” the chairman said.
He emphasized that no decision has been made and no referendum is scheduled yet; however, he added that the need is real and growing. He estimated any new bond vote would likely come in 2028 or 2029.
Meanwhile, the county is still paying back the $3.1 billion and change.
According to the 2025-2026 county budget adopted in June, the total combined debt service for school capital projects – including both the repayment of principal and interest – is projected to be over $3.1 billion through fiscal year 2052. The underlying bond principal, meanwhile, totals about $2.08 billion, based on the $1.7 billion referendum in 2022, the $300 million referendum in 2020, and about $79 million in prior outstanding debt service included from earlier years.
That means Guilford County is projected to pay more than half of the original amount borrowed in interest over the life of the bonds.
The debt service schedule spreads the debt across nearly three decades, with principal and interest payments continuing through 2052.
The largest annual debt service obligations will occur between 2030 and 2038 – when payments are expected to exceed $180 million annually for multiple years, based on scheduled bond issuances and a model of cash flow timing provided in the budget.
The 2025-2026 fiscal budget includes $53.2 million in recurring property tax revenue – roughly 10 percent of the total property tax rate – dedicated exclusively to school capital debt.
Guilford County issued $570 million of the $1.7 billion bond referendum in March of last year. Two more issuances – each amounting to about $585 million – are expected in fiscal 2027-2028 and in 2029-2030, according to the county’s updated cash flow models.
In the end, depending on what interest rates do, Guilford County’s taxpayers could get lucky and pay less interest than anticipated; however, if interest rates go up, they could end up paying more than the current estimated amount.
In peak years such as 2032 and 2033, when total debt service is expected to approach or exceed $190 million, the interest portion of the debt alone could exceed $80 million a year – depending on the amortization schedules of the remaining bond issuances.
