ANCHORAGE - Alaska voters will go to the polls Nov. 5 to decide whether to back bonds that would give veterans lower interest rates when they buy homes.
For more Juneau Empire coverage of the November 5 general election, please visit the Juneau Empire Elections Guide.
Voting yes means the state will guarantee up to $500 million in Alaska Housing Finance Corp. revenue bonds.
Since 1983, taking advantage of a federal program, AHFC has issued more than $2.1 billion in bonds for veterans. The program has allowed more than 12,600 qualified veterans to obtain lower-interest loans.
"If you believe veterans provide some benefit to Alaska, this is a good thing," said Joe Dubler, AHFC finance director.
Revenue bonds mean the agency sells bonds to purchasers, then pays them off using money received as veterans pay off their home loans. Under state law, voters must pledge the backing of the state for AHFC to issue the bonds.
"There's never been a penny drawn (from state coffers) on prior bonds," Dubler said.
AHFC uses the money it raises to buy loans from commercial lenders.
The federal government participates by making the bonds tax exempt. Tax exempt bonds can be issued at a lower interest rate, saving the veteran money on the loan.
Money raised by the bonds cannot be used for any purpose other than mortgage loans to qualified veterans.
The program currently gives veterans about one-quarter of 1 percent break on home loans, said Sherrie Simmonds, AHFC corporate communications officer.
The election will be the fifth time voters have been asked to approve veterans mortgage bonds. Voters approved all previous bond measures by margins ranging from 64 to 75 percent.
Without changes, the federal program will slowly phase out. To qualify, a veteran must have entered active duty service prior to Jan. 1, 1977, and have been honorably discharged no more than 30 years before the loan application.
AHFC is spending money to "educate" Alaskans on the bonds. The agency bought television advertisements and sent out one flyer. Alaskans can expect another postcard in the mail with details of the sale sometime during the week before the election. Simmonds said last week she did not know how much AHFC was spending on the education campaign.