The federal government has traditionally given local school districts an indirect subsidy by allowing them to issue tax-exempt bonds. Because the bondholders pay no tax on the interest income, they are willing to take a bond bearing interest at, say, 4.5% rather than 6%. Such lower interest is great for the school district because it saves the district the 1.5% difference in interest expense. On the other hand, it costs the federal government the tax revenue it would have received on 6% taxable income. This article describes two new ways for school districts to issue bonds under the American Recovery and Reinvestment Act of 2009. These two methods include: (1) a direct federal subsidy to school districts through Build America Bonds; and (2) another indirect subsidy using tax credits through Qualified School Construction Bonds.