A billion here, a billion there – pretty soon it can add up to real money.
Guilford County’s school construction program, supported by two major bond referenda in the last five years – a $300 million referendum in 2020 and a $1.7 billion one in 2022 – is expected to cost county taxpayers more than $3.2 billion by the time the debt is fully repaid with interest. About $1.2 billion will be interest on the $2 billion debt, according to estimates.
The figures are derived from debt information provided in Guilford County Manager Mike Halford’s proposed 2025-2026 fiscal county budget, which outlines the county’s long-range financing plan to repay the bond debt that was approved by voters in 2020 and 2022. The $1.7 billion referendum in 2022 was the largest school construction bond in county history and one of the largest in the country that year.
The proposed budget doesn’t explicitly separate out the interest portion of the debt service. However, it provides a clear projection of total debt service obligations over the next several decades, which makes it possible to calculate that county budget officials are assuming a 5 percent interest rate for the payback over the decades.
Guilford County Communications and PR Director Linda McElroy confirmed that the county’s projections contain an assumed and modeled 5 percent interest rate, which would amount to $1.125 billion given the size and the length of time of the debt. The total payback is greater than $3.125 billion because the county also had some outstanding school debt from earlier school bonds and also the $ 2billion in approved debt raised slightly more than that due to something called bond premiums.
According to Halford’s recommended budget, the total combined debt service for school capital projects – including both the repayment of principal and interest – is projected to be $3.289 billion through fiscal year 2052. The underlying bond principal, meanwhile, totals approximately $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 that 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 county’s financial strategy includes a “save and pay” model meant to ease it into peak repayment periods. Earlier years—like 2025 and 2026—include surpluses, where projected revenues exceed required payments. These surpluses are designed to be banked or reinvested to soften the impact of those future giant spikes in payments.
The proposed budget earmarks recurring revenues, including property taxes and sales tax revenues, specifically for debt service. For example, the proposed 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.
The county issued $570 million of the $1.7 billion bond referendum in March 2024. Two more issuances – each representing about $585 million – are expected in fiscal 2027-2028 and in 2029-2030, according to the county’s updated cash flow models.
This could be one reason Chairman of the Guilford County Board of Commissioners Skip Alston has seemingly committed the board to keeping the property tax rate at the same level after the countywide revaluation causes a drastic rise in assessed property values and therefore a major hike in tax bills.
The manager’s proposed budget currently on the table before the Board of Commissioners also includes $34 million in bond premium proceeds from the March 2024 issuance. That’s being used to cover first-year interest payments – effectively reducing the immediate burden on county revenues while establishing a predictable repayment schedule going forward.
Despite the huge size of the interest payments, the budget language states that “sufficient revenues are planned to meet existing school capital needs.”
That plan relies heavily on financial discipline and dedicated revenue streams that are meant to ensure the debt service remains manageable.
The size of the interest payments underscores the long-term nature of bond financing. Bonds allow governments to raise capital for major infrastructure projects – like school construction – by borrowing money and repaying it over time with interest. While this spreads the cost over decades, it also results in whale-sized interest obligations for tax payers.
Years ago, the Guilford County Board of Commissioners planned to save up money and then have a “pay as you go” policy for school construction, but that plan is long gone and now the county is instead simply taking on massive debt and paying well over a billion in interest.
In the end, depending on what interest rates do, the county could get lucky and pay less that that $1.3 billion in interest or, if interest rates rise, the county could end up paying more than the current estimated interest amount. In the case of Guilford County’s debt, the $1.3 billion interest estimate assumes that all planned issuances go ahead as scheduled and that interest rates remain consistent with current projections.
The $1.3 billion in projected interest equates to an average of $43 million per year in interest payments over the next 28 years. 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 annually – depending on the amortization schedules of the remaining bond issuances.
The heavy weight of the long-term debt will remain a central element of Guilford County’s finances for decades. The school bond investments are expected to support construction, renovation, and modernization of dozens of school buildings throughout Guilford County, addressing overcrowding, aging facilities, and security upgrades.
Still, commissioners argue this isn’t enough money for the schools and Alston has already spoken of a need for another $1 billion school bond in the not too distant future.
As these new and renovated schools open in coming years, the benefits will be visible – but the financial obligations will remain in place for a very long time after the ribbon cuttings.
How future Guilford County Boards of Commissioners manage the remaining bond issuances and long-term debt service will determine whether the plan stays on track. The current model depends on disciplined adherence to revenue allocations and issuance schedules, along with continued economic growth to support county revenues.
Voters supported the bonds and now that support is being translated into the largest capital repayment efforts in county history – one that will define a generation of public finance in Guilford County.
The interest payment on the school debt alone is hundreds of millions more than the entire Guilford County budget.
If the voters do not remove Alston and the rest of his democrat minions, Greensboro will go broke. It never ceases to amaze me that the people of this town continue to re-elect the same people who are so detrimental to the county. I can only hope that people will read this in the Rhino Times and understand what is happening, because I’m sure it will not be reported by local news.
Just one of the many reasons why I moved away from my hometown. Good luck.
Me, too. To the Land of Randolph.
Why do you think that HUGE Toyota battery plant in Randolph County? Drive out 421 and take the old Julian Airport exit. You can drive around the Plant area. Mucho dinero invested in Randolph County, not in Guilford. Toyota is smart.
“Financial discipline” has not existed for years in Guilford County or Greensboro and you see and feel the results each day. Great article Scott but the progressives have yet to show any budget reductions, only increases. We are screwed until we can move away from a once nice small city.
Huh. Maybe the “education lottery” could help with that.
Now there is a scam!
A scam that brings in billions of dollars to the government that was supposed to be for schools only. A democrat changed that. Politicians are so deceitful; premeditated deceit; deception that is planned or thought about in advance to manipulate and mislead. In the school year 2023-2024, $1.09 billion in revenue was raised for schools. However, because schools use up so much money, the lottery revenue represents a small percentage of the total revenue spent on education.
The General assembly controls the budget allocation. Conservatives have been in control NC spending since 2015. Since the lottery was enacted back in 2006. Looks like it is 50/50 democrat versus republicans in control over the last 20 years.
Don’t fall for the party versus party BS pushed by those that believe politics is a zero-sum game. In this case neither party can claim superiority on education spending or the use of lottery funds. Both have made a mess of NC education systems.
Yeah right lol
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The Government Schools in this country are an obscene financial black hole.
We worked hard for that money.
We don’t even get halfway educated kids. We get ill educated young people who can’t compare with other countries.
It’s sick. Just sick.
What is your thinking on a solution?
A first step would be to STOP giving taxpayer money to so called
NONPROFITS with no input or oversight from taxpayers. They could put that
1.7 million towards paying off bond
debt.
Rebel, the so-called non-profits (in Geekboro and other cities) are nothing more than “boots on the ground” for the elected officials who then turn around and give their chosen few some money for pet projects. Yvonne Johnson was a master at it, even had some of her family members getting in on the “mu nay”. As long as politicians get into a closed room (with one short of a majority), they can do almost anything, and the city & county management can do nothing if they want to keep their jobs.
Joe you and I are on the same page my friend
1.7 million doesn’t even cover a single project in the bond. So that really isn’t a solution, just another excuse to express your lack support for public funds being used to support people in need within Guilford County by non-profits.
But you be you.
“Voters supported the bonds and now that support is being translated into the largest capital repayment efforts in county history”
Not all of us did. I propose that those who did vote for it be stuck with the bill for it. $3.3 billion is $6,000 for every man, woman and child in this county. And long before it is paid off, the school board will be demanding MORE money for them to waste. Debt is a curse, and so are our democrat county commissioners and school board members.
That is the cost of years of neglect on capital improvement spending on the schools after decades of neglecting leaking roofs, long broken HAVC units, etc… etc… etc… etc…
I do not know about the “cost of neglect,” but I do know that if every repair need was scheduled to be completed, the cost would be nowhere near $3.3 billion. There is a huge amount of vanity and desire cost in the $3.3 billion. It would be an interesting exercise for a qualified estimator to price out the cost of repairs only.
51 schools need major repair even need replacement. That is out of 125 schools (300 buildings total).
New Construction or Rebuilds are about 25 to 50 mil each approximately depending on the size of the school – Phase 1 has 20 of those projects. Would have been easier and cheaper to maintain and modernize on an ongoing basis than to have to Rebuild or Replace. It is a common theme with much of US public infrastructure. Tax cuts hurt and we have cut a lot of taxes at both the State and Federal level for many decades. Now we borrow the money to make up for the past mistakes.
I don’t know how they determined if a remodel or rebuild was required. But having seen just the worn-out facilities of the schools my kids attended, I am not surprised at the number at all.
Having worked in government in the past, the neglect is based on the decisions of those in office. Also, you never hear about a staffing reduction in school systems. Why not? School systems are political, and they want to retain their place in public offices. . .the same as regular employees in city and county government.
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What…??
WHERE HAS ALL THE MONEY GONE?
“Bonds allow governments to raise capital for major infrastructure projects – like school construction – by borrowing money and repaying it over time with interest. While this spreads the cost over decades, it also results in whale-sized interest obligations for tax payers.”
Could pretty easily read “Mortgages allow individuals to raise capital to make major purchases – like buying a house – by borrowing money and repaying it over time with interest. While this spreads the cost over decades, it also results in whale-sized interest obligations for the borrower.”
If you have worries about the county’s ability to its bills, that’s one thing, but debt is a part of life in a capitalist society for individuals, institutions, and government entities. I don’t see any reason why taking out a loan for necessary repairs based on projected revenues is any worse for a county than it is for an individual homeowner.
Wrong. The bonds were approved by the majority of those who voted. However, the repayment and the interest will be paid by all property owners. How many of the “yes” voters will be paying property taxes? I would like to know. It is unfair to allow individuals to vote on bonds when they are not the ones repaying the debt through higher and higher property taxes. In the simplistic example you gave above, mortgages are the product of an individual’s commitment to repay the debt and build wealth. Issuing bonds by a government that were voted on by those who may not be responsible for repaying the debt is wrong. There is so much wrong with property taxes. North Carolina must find another way to finance schools and local governments rather than property taxes.
$1.3 Billion in interest added on to $2 Billion in bonds to be repaid. Since the existing budget items for the County (and City) which already produce a property tax rate $1.40 per $100, it makes you wonder what the new combined rate will be. It also makes the coast look even more inviting. After the latest revision, I noticed that the combined rate for Emerald Isle/Cataret County is $0.39 per $100. Admittedly, they do not have some of our local attractions, but still, they have the beach…
“A Billion here, a Billion there, and pretty soon you’re talking real money” – attributed to Sen Everett Dirksen (R) of Illinois.
That was when only the Federal Govt. spoke in Billions. Now that kind of money is spent at county level.
Our county.
Elon Must and Rand Paul are right. Government is a drug addict, the biggest drug addict in our society – and it’s drug of choice is our money.
Remember, you have people in this county that can vote for all these projects, for all these “representatives”, for all these tax increases who not only DON’T have skin in the game, they are going to be gone in 2-4 years after they graduate, only to be replaced by a new incoming batch.
You can’t get blood from a turnip, but that;s not going to stop Board of Commissars from trying, and trying, and trying. It’s only a matter of time before somebody (maybe it’ll be Tillman) will move to reinstate debtors prison.
When this gargantuan bond was first discussed, I said that the county has 10 years to spend the money and 20 years to pay if off once it is spent. that means a child BORN TODAY will be 30 years old with a family of their own and will STILL BE PAYING for this bond. WHAT A GREAT GIFT PARENTS ARE LEAVING TO THEIR KIDS AND GRANDKIDS. Former Guilford County Commissioner Republican Alan Branson spent his own money filing a law suit questioning the ‘tactics’ (collusion) of the Commissioners and the School Board used to trick voters into approving the $1.7 BILLION school bond. A democrat NC judge agreed they had illegally worked together to get the bond passed but said since 60% of voters approved the bond, he said it was okay with him. At the time , ole skippy, the democrat controlled county board and the school board did not mention the true cost of the bonds. They kept saying it was a $1.7 BILLION bond issue intentionally keeping taxpayers in the dark about the true cost and putting taxpayers on the hook for $3 BILLION. NOW we find out the NEW TOTAL COST IS $3.3 BILLION DOLLARS. But don’t be concerned, that is only $300 MILLION MORE. Its really just chump change in the county budget. BUT, to pay back SO-O-O-O MUCH MONEY, you better believe that old skippy and the democrat controlled county board will raise taxes next year so they pay back the bonds.
When you vote for dems, this is what you get. MORE DEBT AND HIGHER TAXES TO PAY THE DEBT. DON’T FORGET THAT OLE SKIPPY AND THE DEMOCRAT CONTROLLED COUNTY AGAIN WANT TO RAISE THE SALES TAX. This will be their 4th attempt to take more money out of your family’s pocket. WHEN YOU VOTE, TELL THEM NO AGAIN.
If you want HONEST GOVERNMENT RUN BY PEOPLE THAT WON’T TAX AND SPEND EVERY PENNY YOU EARN, YOU MUST VOTE FOR EVERY REPUBLICAN IN EVERY OFFICE, IN EVERY VILLAGE, CITY AND COUNTY.
Weird. Conservatives have pushed up the use of deficit spending since Reagan and my taxes having changed much at all. Oh right, the tax benefit was for the wealthy folks who were supposed to trickle down to us working stiffs. Conservatives haven’t been fiscally responsible since Reagan personally tripled the national debt by adding 2 trillion dollars.
Heck Trump has even increased spending since the DOGE failure and plans to increase deficit spending yet again while cutting public services.
Stop pretending this is a liberal issue. Fiscal irresponsibility has not been a concern for decades by either party. (Except for Clinton who ran a surplus…hint he was a democrat).
Both parties are guilty of deficit spending. However, only Republican representatives speak out about it and make efforts to reduce spending. Deficit spending is a way for politicians to get votes and remain in office. If there were term limits, deficit spending would decrease, another reason for term limits. Clinton had a unique situation, including the economic boom of the 1990s. Keynesian deficit spending was not meant to be a way of life but used in certain times.
Trump increased spending even after DOGE. You have been conned.
You must be forgetting that the state tax rate CONTINUES TO DROP NOW THAT REPUBLICANS HAVE A VETO PROOF LEGISLATURE. Newly elected democrat Josh Stein is not happy about that and wants to delay the next income tax rate cut that is scheduled to go into effect next year. Ole joshey wants to keep the money from hardworking NC taxpayers so he can spend it. Tell him NO! We are tired of the tax and spend policies that is part of the DNA of democrats. The REPUBLICAN DNA INCLUDES REDUCING TAXES AND THE SIZE OF GOVERNMENT. dems want more money so they can expand the size of government and handouts. Ole sleepy joe grew the size of the federal government. Did that improve the live of Americans? NO!
If you want bloated federal. state or local government, vote for dems and watch your taxes go up. If you want the government to forgive your student debt so you could study Underwater Basket Weaving, Toxic Masculinity, and other degrees that contribute ABSOLUTELY NOTHING to improve our country, then vote for dems and watch your taxes go up. if you want LOWER TAXES, IF YOU WANT SAFE STREETS, IF YOU WANT PEOPLE TO ACTUALLY GET ALONG WITH EACH OTHER AND WORK FOR A BETTER AMERICA, THEN YOU MUST VOTE FOR REPUBLICANS FOR EVERY OFFICE, IN EVERY VILLAGE, CITY, COUNTY AND STATE. REPUBLICANS RESPECT YOU AND YOUR FAMILY’S MONEY AND KNOW HOW HARD YOU WORK TO SUPPORT YOUR FAMILY. dems don’t have a clue and could not care less. VOTE REPUBLICANS FOR A FREER, MORE SUCCESSFUL AND SAFER COUNTRY. TOSS THE dems to the curb and the ash heap of history where they belong.
To do that they have to reduce spending per student. Hense the need for local governments to take out massive bonds to make up for all the lack of investment in school infrastructure for the last several decades.
You are gonna pay one way or the other.
Right now, the Republicans are not doing anything to reduce the deficit. They are adding more to it.
Chris I really hate to pee on your parade but during Clinton’s 8 years in office, Republicans controlled the House and Senate his last 6 years. That’s why he was able to balance the budget.
Funny that didn’t happen when republicans controlled all three. But you be you.
No you be you you twerp you cannot stand it when anyone points out that you don’t always know everything. IDIOT
My bad. Didn’t mean for facts to trigger you so badly. My mistake.
To the residents of Guilford County: YOUR VOICE MATTERS. YOUT VOTE COUNTS. The only way to make change happen is to get to the poles and vote! Local elections are IMPORTANT and you can make a difference by casting your vote!
“Neither a borrower or a lender be.” (best as I remember the quote). Anyone ever heard of “pay as you go”? 1.2 BILLION interest. Throwing money at schools will not improve the result in our government schools, but only the enhanced indoctrination. And, more vote-buying.
I am included out.
To paraphrase what the Irishman said to William Wallace in the movie – the Good Lord tells me we’re fooked.
Disgusting waste of our taxpayer dollars just to pay interests! Our commissars will be dead and gone long before this debt is paid off! They should be ashamed of themselves, but they never will. There are never any consequences for poor decisions and bad ideas! That is close to the famous quote by Thomas Sowell.
How about school budgets be based upon student test scores on academic excellence? When more students are proficient in reading, math, history, civics, then they get more money. When scores go down, then the budget goes down. At least there is a reward/punishment system that helps makes decisions tied into achievements.
So, if the bonds of $2 billion actually end up costing $1.2 billion in interest, then the estimated interest rate is roughly 6%. Not sure why they even bothered with the bonds…..Rocket Mortgage would have offered a better deal.
I know this is not allowed, but it seems to me they would be far better off having a school designed so that it is built to maximize the space per dollar. Simple, boxy, easily maintained, using whatever structure is most cost-effective at that time. Put it out for competitive bids among a selected group of GCs and get an ACTUAL PRICE, not a half-ass guess from 6 years ago. Then just finance that project for that amount, so that the taxpayers know what they are paying for and how much they are paying in current dollars. Instead, now we are going to get schools built, which appear to be more of a one-off monument to the architect. That also likely means much harder and costly to maintain in a county where the school board, by its own admissions, has a history of deferring maintenance. Oh, and did I mention that they also cost double what they budgeted?
In my opinion, by voting time, they already knew that many of those 51 planned projects were NEVER going to happen. But they had to claim they would, so each district felt they were getting a piece of that $2 billion pie. By allowing this lie to happen, they had an army of unpaid parent/lobbyists encouraging friends, family, and neighbors to vote in favor of it so that their children would see a benefit. Now, roughly 50% of those children will get nothing…..that borderline on fraud, it seems to me.
All observations and complaints above are valid but it doesn’t change the collusion between Deena Hayes-Greene and Skip Alston who are both bathed in the victimhood of blackness, nor does it change that property owners are the ones who are responsible for paying Guilford County government bills and Guilford County schools’ bills. Property taxes are the largest source of revenue for Guilford County, representing 64% of revenue. Regardless, if you voted for the bonds or not, it is time for the property owners to speak up and DEMAND no more bond issuance until school results improve. Even though bonds were approved by a small percentage of voters, they are not required to be issued. Things change and one change that is clearer than ever is that Alston and Hayes-Greene have no idea how to solve a problem and throwing someone else’s money at a failure will not right the ship. Cameras in classrooms are a must. I think we all would be shocked to learn not only what is taught but the way teaching occurs.
Another demand is for the end of property taxes to be replaced by another source of revenue that everyone contributes to not a one-sided affair like property taxes. That demand must be addressed to your representatives in Raleigh.
Everyone pays property taxes either directly or indirectly. Rents pay their share of the complexes taxes. Not sure how it could be any more equitable.
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As they mortgage our children’s future and shackle them with debt, they have the nerve to bleat “It’s for the children”.
No, it’s not.
It’s for you education bureaucrats and self-proclaimed “educators”. Your blatant self-interest is as obvious as your incompetence.
All this and public schools are experiencing a drop in attendance!
Yes, you’re right. It’s strange that when baby boomers entered school, then Governor “Food Tax Terry” Sanford used growing enrolment as an excuse to impose Sales Tax on groceries – as a temporary measure.
So now that enrolment is dropping, we should repeal that tax and spend less on government schools – right?
But we still pay the tax, and spending on Guilford County Schools is at an all time high.
The Parasitic Sector uses any and every excuse to grab more dollars, but never are their tax grabs ever rescinded.
Margaret Thatcher used to call it “The Ratchet Effect”.
Interestingly enough, if you look around us, the school systems seem to all have hit a wall.
The enormity of this debt insures there will never ever be a property tax reduction in my lifetime.
If you are wondering why all this hard-earned money extorted from the taxpayer doesn’t result in anything but waste, look at most any govt-run agency to see whey. Today’s example is ye olde USPS, perhaps still headed by Greensboro’s own Mr. DeJoy. His efficiency and cost-cutting methods have succeeded on one count; that is the cost-cutting has resulted in service-cutting.
A recent visit to the W. Market St. branch resulted in a 28 minute wait to ship two flat rate boxes, despite having arrived at the moment of their opening, but fourth in line. Only two people workers there, only one at the counters. Add to that one customer who couldn’t listen but could take up a lot of time asking dumb questions.
We have a hold mail request beginning today, but we got mail at home anyway. I tried contacting USPS on line, but without success. I tried three different local branches by phone, told to wait for the oporater, a few rings, then disconnected. I ghen visited a local branch…..and got a shrug. The govt employees don’t really care. They keep their jobs whether good or lousy, whether smart or not. They are careful not to look to good, or they will make everyone look bad.
Our bloated and mal-effective govt (in)action.
I am halfway through my second hearing of “Atlas Shrugged”. What is happening here, and all over the world, is right out of Ayn Rand’s book. “Socialism works, until you run out of everyone else’s money”, according to Mrs. Thatcher.
According to some of the polys, “people vote their pocketbooks”. This is correct. And it’s more like NOW, not what is best in the future. Millions are dependent on the Govt for their three hots and a cot, cell phones, medical, child care, food, etc. etc. In Guilford County, some 37% of the citizens receive Medicaid, which is health care for indigents (no employment required) . So those on the Left and the Right have to promise the goodies to stay in power. If you see all the looters wanting their cut of money extorted from people who actually produce, you know this to be true.
Miller is right. We learned nothing from the fall of Rome.
Right now, the Republicans are not doing anything to reduce the deficit. They are adding more to it.
While I see the regulars continue to dominate comments. My comment is easy and hopefully clear. County needs to get their priorities right. Float a sales tax and you will lose. Float a school bond, you may win if you show you are actually interested in the education of our youth. The President is going to rip away national funding for education…Commissioners need to think about the future of our n county and not themselves. Stop funding unknown nonprofits of your buddies. Stop funding crap and get to the true duties of a County…human services, social services, planning, education, fire and safety.
We can build a community center for 100M counting all sources of funds but leave our schools short. Makes no sense.
put schooling in that center; add teachers. dun.