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The Credit Enhancement program provides a guaranty which reduces borrowing costs on voter-approved general obligation bonds of Idaho school districts. The plan augments the School Bond Guaranty program administered by the Idaho State Treasurer’s Office. The Credit Enhancement program helps school districts achieve the highest credit ratings of Aaa from Moody’s and AAA from Standard & Poor’s. It allows school districts to reduce borrowing costs on bonds issued to support construction or renovation of new schools.
The Endowment Fund Investment Board (EFIB) provides a non-cancellable commitment that allows the Treasurer to borrow from the Public School Endowment Fund to make a bond payment. That would occur only if both the school district and the State’s School Bond Guaranty program are unable to make scheduled payments. The Public School Endowment Fund earns a return in the process.
The Credit Enhancement program is governed by the following:
- Idaho School Bond Guaranty Act, Idaho Code, Title 33, Chapter 53
- Investment of Permanent Endowment and Earnings Reserve Funds, Idaho Code, Title 57, Chapter 7
- Rules Governing the Credit Enhancement Program for School Districts, IDAPA 32.01.01
- EFIB School Bond Credit Enhancement Policy
Application Process
The application process is listed on the Idaho State Treasurer’s School Bond Guaranty program web page.
Application materials will be reviewed by the Treasurer, the EFIB, and the Department of Education. If approved, the school district will receive a Certificate of Eligibility from the Treasurer and, if applicable, the EFIB.