BUNKER HILL — Maconaquah School Corp. officials hope those opposing the planned renovation project at two schools will change their minds in light of news of zero-interest bonds bringing the cost down.

Superintendent Debra Jones said Friday she had heard from Tony Bennett, state superintendent of public instruction, that Maconaquah is eligible for a no-interest loan of up to $10 million for the project, which is subject to a referendum vote from 6 a.m. to 6 p.m. June 20 in the Maconaquah High School cafeteria.

She said the bonds would save about $9 million in interest over the term of the loan. The tax impact would drop from about 25 cents per $100 of assessed valuation to about 12 cents per $100, a decrease of about 50 percent.

At a rate of 25 cents per $100 of assessed valuation, Jones said financial advisors estimated a cost to the average homeowner of about $4.50 per month more in taxes because of the project. The rate was not available Friday based on 12 cents per $100, but it would be less than $4.50 per month.

Jones has said the project will not start being paid out of debt service until the Maconaquah Elementary bonds are paid.

At a meeting of project supporters, board president Dick Wood said even with the new project, he does not expect property taxes to be any higher than in 2008, because the state is now funding the general fund and because the elementary project will be paid off.

Jones said schools may apply for the funds only after all public approvals are received. The first round of applications are due Aug. 3, she said, and administrators have started the paperwork to apply.

She added, however, that if the referendum is defeated, the board will have to wait a year before it can try for a similar project, and there is no guarantee the zero-interest loans will still be available.

“There will never be a less expensive way to complete these required repairs,” she said.

Bennett said in a letter to superintendents the Qualified School Construction Bond has been issued through the American Recovery and Reinvestment Act of 2009. Indiana’s authorization for 2009 is $177,861,000.

Board member Mimi Berkshire said the board approved a project of up to $19 million, but “that was worse-case scenario ... we expect only bonding $15 to $17 million.”

Jones said the project only includes basic upgrades, repairs and replacement of equipment original to both Maconaquah High School and Maconaquah Middle School.

The high school was built in 1964, while the middle school was built in 1968.

Jones said the pneumatic controls are original to the buildings, and have a life expectancy of 25 years. Architects expect energy savings with new ones, and replacement parts are hard to find, she said.

The boilers are also original to the buildings, she said. The project also includes replacing the electrical distribution system, which is not capable of handling technology used today, and removing tiered floors in old music classrooms to make those three rooms available for other classes.

Pat Maiben, one of those opposed to the project, does not think the availability of zero interest financing for $10 million of the project will change many minds, because while the district is eligible to apply, it is not guaranteed to receive it.

She is also concerned because she’s been told reassessment for taxes begins again in 2010 and had no way of knowing how high taxes would be after that process.

“In all indications we have checked into and talked to, there’s lower taxes this year, but who knows what taxes will do next year?”

She said those who are against the project do not want to pay higher taxes, and they want to know where specifically the money is going.

“There’s a small glimmer of hope on this being eligible for a grant, but I still think my advice would be to vote no because we could still be stuck with a large project we can’t afford to pay for.”

Berkshire said Maconaquah’s referendum is being watched by state officials because the corporation has been careful about how it has moved forward, holding a series of public meetings to explain the need, and only including replacement of outdated systems past their life expectancy and infrastructure, rather than new additions and athletic facilities.

• Danielle Rush is the Kokomo Tribune education reporter. She can be reached at (765) 454-8585 or danielle.rush@kokomotribune.com.