Mississippi Administrative Code › Title 7 - Education K-12 › Part 3 - Board Policies › Chapter 64 - Qualified Zone Academy Bonds › Rule 7-3-64.1 - Qualified Zone Academy Bonds

Current through June 25, 2024
1. Background
Created by The Taxpayer Relief Act of 1997, QZABs are an
				  interest free financial instruments that provide a different form of subsidy
				  from traditional tax-exempt bonds. The difference is that the QZAB bondholder
				  (these include banks, insurance companies and corporations actively involved in
				  the business of lending money as well as any individual or private business)
				  receives a federal income tax credit in an amount equal to a percentage of the
				  face amount of the bond. The local school board will be responsible for the
				  issuance of QZAB debt under existing statutory authority and the repayment of
				  the QZAB principal upon maturity. The credit (interest) rate and maximum
				  maturity (about 14 years under current market conditions) are determined by
				  statutory formulas.
QZABs are to be issued in support of a Qualified Zone
				  Academy. A Qualified Zone Academy is defined to include a public school (not a
				  school district) or academic program within a school that enters into a
				  partnership with one or more local businesses to enhance the academic
				  curriculum, increase graduation and employment rates, and better prepare
				  students for the rigors of college and the workforce under a plan approved by
				  the local school board. Eligible schools must be located in an empowerment zone
				  or an enterprise community or expect to have at least 35 percent or more of
				  their students eligible for free or reduced lunch under the National School
				  Lunch Act. Students in a Qualified Zone Academy must be subject to the same
				  academic standards and assessments as other students educated by the local
				  school system. A Comprehensive Education Plan must be developed by the
				  partnership and must be approved by the board of education of the local school
				  district.
The Department of Education has the responsibility of
				  allocating portions (or all) of the amount of QZAB authority allocated to the
				  State to one or more Qualified Zone Academies. Amounts allocated to the State
				  for a year that are not allocated to Qualified Zone Academies during that year
				  will be carried over and allocated in any subsequent year. The Davis-Bacon Act
				  applies to projects funded with QZABs.
2. Allocation of QZAB to PUBLIC School
				Districts
The total amount of QZABs allocated to Mississippi will be
				  available to public school districts that meet established criteria on
				  first-come-first-served basis. The Department will make that determination
				  based on the date and time the QZAB Application is received from the school
				  district. The amount of QZABs available to public schools will be based on the
				  availability of funds at the time of request.
3. QZAB Application
The local school district must complete an application in
				  its entirety and submit to MDE as required.
It is the responsibility of the board of education of the
				  local school district to determine whether the purposes for which the QZAB is
				  issued conform to applicable State and Federal Law.
Public Law
				  105-34, Sec. 1397 E;
				  Public Law
				  107-217 (Revised
				  7/2015)