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Students and teachers make their way around Fairview Elementary School in Hayward, Calif., on Wednesday, Aug. 29, 2012. Students have returned to a rebuilt campus after being away for two years. During the economic downturn, hundreds of California school and community college districts, including Hayward Unified, turned to a risky tool known as a capital appreciation bond to borrow at least some of the money voters approved for school construction and other improvements. Hayward Unified only issued about $21 million of its $205 million Measure I (approved in 2008) in this way. But for that $21 million alone, Hayward homeowners will repay $120 million during a 30-year period, according to a Los Angeles Times analysis. (Anda Chu/Staff Archives)

Hey taxpayers, we've got a great deal for you: How about we commit you to a long-term financing plan to help fix our schools, but because the economy is lousy right now we can defer most of the interest payments on the work until later? Sure, the cost will be more, but we can have now what we could not otherwise afford.

Interested? We hope not.

Does any of this sound vaguely familiar? Let us insert the words "balloon payments" into that scenario and see if it jogs the memory. How about this pitch: Buy a house now with little down and make low payments until the interest comes due later, because things will be better then. Right?

Surely, we remember that whole home mortgage meltdown thingy. You know, the one that was at the heart of the economy's headlong dive to near oblivion.

Apparently the lessons of that adventure have been lost on school districts statewide that are choosing to issue capital appreciation bonds instead of regular bonds for construction projects.

The capital appreciation bonds -- or CABs in bureaucratic parlance -- allow districts to forgo most interest payments now in exchange for much greater, and much more expensive, long-term debt.

An analysis by the Los Angeles Times has revealed that 200 districts statewide are using CABs right now.

The poster child for abusing this practice apparently is Poway in Southern California where taxpayers are on the hook for $1 billion to pay off $100 million in construction funding.

Not surprisingly, the L.A. Times' analysis reveals dozens of Bay Area players in the game.

For example, Hayward taxpayers will spend $131 million for a $21 million CAB issued in 2010 and Acalanes Union in Lafayette will pay $136.2 million for $13.6 million in CABs it issued in 2011.

Districts complain that sinking property values have made it harder for them to keep tax rates to repay the bonds below the state's cap of $60 per $100,000 in assessed valuation, per bond measure.

With lower-than-average construction costs at the moment, districts argue that using CABs can get projects under way with lower labor costs.

Such is the logic advanced by the West Contra Costa Unified School District. It issued a $2.5 million CAB in 2010 to raise the money to issue a $25 million federally subsidized bond. The $2.5 million CAB requires $33.8 million total to pay off.

Board President Charles Ramsey argued that the CAB allowed the district to access the federal funds and thus build a school for 1 percent interest. He said the board felt that was the responsible thing to do.

One of the many problems with CABs is that while voters approve each bond measure, they have no say in the financing methods used. That is simply wrong.

If a school district is going to choose to use such a risky method and expensive method of financing, those paying for it should be informed up front in plain English about the risk and cost. Anything short of that is deceptive and wrong.