Schools borrowing – States lend a hand

A growing number of independent schools are turning to tax-exempt bonds to raise money, The Wall Street Journal reported Oct. 25.

Credit-rating agency Standard & Poor’s says the number of debt issues of independent schools it rates has grown to 59 from 52 in the summer of 1999 and 34 in the summer of 1998.

Schools using bonds to borrow include Groton, St. Mark’s and Milton Academy in Massachusetts, and Nightingale-Bamford in New York City.

“The spectrum of rates schools has expanded” to include many small schools outside New England, says an S&P publication.

More states have created agencies to allow schools to issue tax-exempt debt or to expand the powers of existing agencies to include schools, S&P says.

S&P expects “additional growth” for tax-exempt bonds issued by independent schools.

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