DANVILLE — Danville Area Community College trustees agreed Tuesday to abate taxes that would have been used to pay the interest on general obligation bonds issued for the construction of an addition to the college’s technology center. The amount to be abated is $155,573.61.
The college issued nearly $3 million in general obligation bonds in September to pay for the Julius W. Hegeler II Advanced Technology Center, which will be built onto the existing technology center. The bond amount included a tax levy sufficient to pay the principal and interest on the bonds based on a maturity schedule.
The Bond and Interest Fund, however, has enough funds available to meet the debt service, mostly because of Julius W. Hegeler II, who offered earlier this year to pay $100,000 every year toward the interest on the $3 million bond.
“This is the result of Mr. Hegeler’s planned gift of $100,000 to cover the interest payments,” DACC President Alice Marie Jacobs said.
“To abate the taxes has been our intention all along,” she said.
The Bond and Interest Fund includes $121,825.32 of accumulated interest from the 1994 Building Bonds and $50,000 received from the DACC Foundation as a result of Hegeler’s donation this year. Hegeler will donate another $50,000 next year before the interest payment is due. The college will cover the remaining $21,000, Jacobs said.
Although the interest payment isn’t due until next fall — a year after the bonds were sold — the board of trustees has to abate the taxes now so the money to cover the interest is in the fund.
Abating the taxes is something the board of trustees will have to address every year until the bond and interest is paid back.
“The real benefactors are the students,” board president David Harby said.
Also on Wednesday, the trustees:
Heard a report from Brian Hensgen with the Job Training Partnership about the progress at the Vermilion County Workforce Development Center. The center is open, and renovations to the building will begin soon and will take approximately three to four weeks to complete.