wnyc.org / 93.9fm / am 820

New York City has yet to decide whether it will issue $700 million worth of school construction bonds through the federal stimulus program.

The recovery act allows districts to issue interest-free bonds to stimulate school construction projects during the weak economy. Taxpayers would still need to pay the principal. But in the case of New York City, which was allocated $700 million in construction bonds, taxpayers could save hundreds of millions of dollars in interest over the life of the program.

A spokesman for Mayor Michael Bloomberg says the city is still looking into it but that no borrowing is simple. If the city is waiting for a better deal it's not alone. The federal government made $11 billion in school construction bonds available. But only $2.3 billion have been sold according to the news organization ProPublica. Some districts had trouble finding buyers and lenders.

A Treasury spokeswoman says it's in the process of developing additional regulations.