By PAT NEWMAN
pnewman@TheCitizenNews.com

Claude Paquin believes he has come up with the most equitable plan for funding new school construction in the form of long-term bonds.

Comparing bonds to a sales tax, he has concluded that:

Bonds let you have a precise amount of money up front at the precise time you select.

Bonds spread the tax burden over the people who enjoy the expenditure's benefit as they enjoy it.

Bonds let businesses share the burden.

School bonds carry low interest rates because the interest is income-tax-free to the investor.

The tax burden from bonds is initially much lower, steadily decreasing and generally deductible on income tax returns.

For school bonds, the tax burden reduces or stops at age 65.

Property tax collections for bonds go 100 percent toward bonds and thus, toward schools, with no commissions to merchants or the state.

Paquin's suggested recommendations to the Fayette County School Board include 12 points. Some of the key issues are:

establishing a target limit of 24 mills for the total school tax.

adding new schools on a slow steady basis and financing them with long-term bonds.

informing all citizens about the bonds' impact on their taxes.

encouraging donations and bequests to the school system.

holding school bond referendums along with regular elections.

Paquin's model for what a new school costs in property tax is as follows: If a school costs $15 million and the annual payment for each million borrowed is $66,917, the total annual repayment is $1,003,755. This is based on the formula that a tax produced by one mill generates $2,650,000.

This means that the initial millage needed per school is 0.3788 mills. The tax from one mill for household valued at $200,000 is $80. The same household's tax for a new school is $30.30. With a 33 percent income tax deduction, the possible net cost is 20.30, Paquin said.