IRS Auditing $240.8M of Bonds from a Texas School District

DALLAS – The Judson Independent School District near San Antonio has disclosed a routine IRS audit of its 2007 bond issue of $240.8 million.

The audit was reported in a disclosure notice on the Municipal Securities Rulemaking Board's EMMA site. The district received the notice, dated Oct. 27, on Nov. 28, according to the notice.

"The notice states that the service has no reason to believe that the obligations fail to comply with applicable federal tax requirements," according to the notice. "The district has complied, or expects to comply, with the requests of the service made in this notice."

The 2007 bonds, with an underlying rating of A1 and a state-enhanced rating of Aaa from Moody's Investors Service, included $165 million of new money for school facilities and a refunding portion designed to provide 4% savings on the refunded principal. Moody's has since upgraded the underlying rating to Aa2.

Located in northeast Bexar County, Judson ISD serves seven cities and saw its population grow more than 50% from 2000 to 2010. Since the 2010 census, the district's population has continued to expand and stood at an estimated 128,838 in 2015, a 13.2% increase since 2010.