View
1
Download
0
Category
Preview:
Citation preview
1300 Clay Street, Suite 1000, Oakland, CA 94612
phone 510-839-8200 fax 510-208-8282
1451 Quail Street, Suite 200, Newport Beach, CA 92660
phone 949-346-4900 fax 510-208-8282
A Division of Zions Public Finance, Inc.
Piedmont Unified School District
Overview of 2016 General Obligation Bond Authorization
January 13, 2016
Blake Boehm, Director
bboehm@knninc.com; (949) 346-4902
Piedmont Unified School District | page 1
Current Bond Program Overview
Election of 2004 $11,000,000
Series Dated Date Par Bond Type Final Maturity Amount Outstanding
(as of 8/7/2015) Call Feature
Series 2004 12/16/2004 6,002,953.85 CIBs, CABs 8/1/2029 212,953.85 CIBs - 8/1/15@par
2006B 6/15/2006 2,570,903.50 CIBs, CABs 8/1/2030 1,781,813.25 Non-callable
2007C 3/14/2007 2,426,015.90 CIBs, CABs 2/1/2032 2,011,015.90 CIBs - 8/1/17@par
2015 Ref (Direct
Purchase) 3/31/2015 4,140,000.00 Direct Loan 8/1/2025 4,080,000.00 Non-callable
Total Issued 10,999,873.25
Election of 2008 $24,900,000
Series Dated Date Par Bond Type Final Maturity
Amount Outstanding
(as of 8/7/2015) Call Feature
Series 2009 8/11/2009 6,254,805.15 CABs 8/1/2044 5,988,687.60 Non-callable
Remaining Authorization $18,645,194.85
The District voters have authorized (3) bond measures for a total of $84.2 million.
All bonds authorized under the three measures have been issued.
Measure Series Dated Date Original Par Amount
Issued
Final
Maturity Date
Amount
Outstanding
(1/5/16)
Call Date / Refunded? Original
Repayment Ratio
Current
Repayment Ratio
1994 Measures H & I Series A 7/1/1994 $4,700,000 8/1/2018 $0 Refunded in 2001 1.94
Series B 7/14/1994 $7,201,875 8/1/2018 $0 Refunded in 2001 2.71
Series C 7/1/1994 $2,000,000 8/1/2018 $0 Refunded in 2001 1.95
Series D 5/18/1995 $6,897,456 8/1/2019 $0 Refunded in 2005 2.22
Series E 5/1/1995 $2,900,000 8/1/2019 $0 Refunded in 2005 1.91
$23,699,331
1996 Measure B Series A 7/11/1996 $4,498,781 8/1/2020 $0 Refunded in 2005 3.10
$4,498,781
2006 Measure E Series A 8/10/2006 $10,000,000 8/1/2025 $325,000 Refunded in 2015 1.66 1.05
Series B 8/10/2006 $4,999,934 8/1/2031 $0 Refunded in 2015 3.01
Series C 10/14/2009 $19,000,000 8/1/2034 $16,640,000 8/1/2019 1.98 1.83
2010 BAN 6/8/2010 $11,997,665 5/1/2015 $0 Called in Aug 2013 1.20
Series D(QSCBs)
5/4/2011 $10,000,000 5/1/2026 $10,000,000* Non Callable 1.07** 1.10**
Series E(2010 BAN Takeout)
8/21/2013 $11,998,678 8/1/2043 $11,998,678 8/1/2023 5.33 5.33
$55,998,612
6/1/2001 $17,225,000 8/1/2018 $0 Refunded in 2009 1.56
1/25/2005 $18,415,000 8/1/2020 $0 Refunded in 2014 1.38
10/14/2009 $13,145,000 8/1/2018 $5,680,000 Non Callable 1.14 1.06
11/26/2014 $9,965,000 8/1/2020 $8,575,000 Non Callable 1.12 1.11
3/24/2015 $16,075,000 8/1/2031 $16,075,000 8/1/2024 1.39 1.38
$69,293,678
** Election of 2006, Series D Bonds assumes Direct Federal Subsidy of 5.26% for Original Repayment Ratio; the Current Repayment Ratio assumes a reduction of Federal subsidies
by 7.3% from 10/1/2014 going forward.
* Does not consider Sinking Fund Deposits.
2014 Refunding
Total GO Bonds Outstanding
Total Issued under 1994 Measures H & I
Total Issued under 1996 Measure B
Total Issued under 2006 Measure E
2001 Refunding
2005 Refunding
2009 Refunding
2015 Refunding
Elements of a 2016 General
Obligation Bond Election
District Assessed Valuation
3 Piedmont Unified School District | page
Total assessed valuation in 2015-16 is $3.85 billion which is an increase of 8.26 percent
compared to the previous year.
The District has experienced varied growth in assessed value over the past 10 years:
5-Year AV Average Annual Growth Rate: 4.97%
10-Year AV Average Annual Growth Rate: 4.78%
Historical Assessed Valuation
$2,410 $2,594
$2,779 $2,931
$3,017 $3,018 $3,085 $3,203
$3,382 $3,552
$3,846
8.51%
7.61%
7.16%
5.46%
2.95%
0.02%
2.23%
3.84%
5.59%
5.02%
8.26%
0.00%
1.00%
2.00%
3.00%
4.00%
5.00%
6.00%
7.00%
8.00%
9.00%
$0
$500
$1,000
$1,500
$2,000
$2,500
$3,000
$3,500
$4,000
$4,500
A.V
. (m
illio
ns)
Bonding Capacity
Piedmont Unified School District | page 4
The California Education Code stipulates that a unified school district cannot issue bonds if
doing so causes the overall amount of bonds outstanding to exceed 2.5% of its current
assessed value.
The District’s remaining bonding capacity for fiscal year 2015-16 is approximately $27
million.
The District’s bonding capacity will increase based on future Assessed Valuation (AV)
growth and repayment of existing bond principal.
Section 33050 of the Education Code also allows the State Board of Education to waive
any provisions of the Education Code, following a public hearing on the matter (with
certain exceptions).
Total Assessed Valuation 2015-16: $3,845,936,400
Bonding Capacity @ 2.5% $96,148,410
Outstanding Bond Indebtedness* ($69,293,678)
Remaining Capacity $26,854,732
*Sinking Fund Deposits are not considered for capacity sizing
Key Considerations for General Obligation Measure
For a new general obligation bond measure, there are several considerations to determine the
optimal bond authorization.
Assessed Valuation (AV) growth assumptions.
Tax rate options – statutory maximum ($60 per $100k of AV) versus voter approval threshold.
Number of issues – plan of finance for project spending over life of authorization.
Bond repayment term – 25 to 40 years.
Repayment ratios/interest costs – current interest bonds versus capital appreciation bonds.
Statutory bonding capacity – 2.5% of total AV
Information and guidance from the District’s financing team is important when planning a
future bond election.
Polling firm.
Election Consultant.
Financial Advisor.
Bond Counsel.
Piedmont Unified School District | page 5
New Bond Authorization – A Team Approach
6 Piedmont Unified School District | page
Collaboration amongst District, Election
Consultant, Polling Firm, Bond Counsel and
Financial Advisor.
Financial analysis is an instrumental piece to long-
range capital planning and consideration of a
future bond measure.
Financial Advisor:
Provides quantitative analysis and advice regarding facility funding,
bond authorization, tax rates, bond structure and timing; ensures project funding needs can be
delivered on time.
Bond Counsel
Drafts ballot language, election and bond resolutions
and other financing documents. Affirms issuer’s
bond authorization and confirms tax-exempt status.
Provides guidance in structuring issues related to
tax law.
Election Consultant & Polling Firm:
Evaluates voter profile and designs a community
outreach strategy. Provides input regarding project
prioritization and tax rate sensitivity. Prepares and conducts voter survey to
obtain data regarding voter support and priorities.
District’s Consulting Team
Component Description
Funding Analysis
• Analyze potential GO bond funding based upon
bonding capacity limits, tax rate constraints, and
financing assumptions.
• Align timing and availability of funding with prioritized
construction projects and schedule.
Political Strategy
• Design a voter survey that identifies key messages,
voter sensitivities and project specific information.
• Provide strategic recommendations based on voter
profile, community characteristics and polling data.
Voter Survey
• Voter survey identifies voter preferences,
sensitivities, and levels of support for various funding
scenarios.
Legal Analysis
• Ballot resolution outlines statutory bond parameters,
planned expenditures/use of bond proceeds and
other legal terms required of a new bond measure.
Range of Options
Given consistent structural assumptions (i.e. repayment term, CIBs only), the District has
several possible bond authorization amounts based on projected AV growth and targeted
tax rate.
Piedmont Unified School District | page 7
* Subject to change based on market conditions
** Conservative growth assumption relative to District’s 5-year average annual A.V. growth
Tax Rate
Estimate
AV
Growth Rate
Bond
Type
Number
of Series
Repayment
Term
Total
Authorization*Scenario
$35 4.00%** CIBs 2 29 years $38,350,000 A
$40 4.00%** CIBs 3 29 years $43,835,000 B
$45 4.00%** CIBs 3 29 years $49,315,000 C
$50 4.00%** CIBs 3 29 years $54,805,000 D
$55 4.00%** CIBs 3 29 years $60,270,000 E
$60 4.00%** CIBs 3 29 years $65,765,000 F
Tax Rate Scenario: $38 Million
Summary: Based on a tax rate of $35 per $100,000 of assessed value and projected AV
growth of 4.0%, the District can seek bond authorization of approximately $38.35 million.
Piedmont Unified School District | page 8
Proposed Issuance Schedule
Issue Issue Date Proceeds
Series A 2/1/2017 $20,000,000
Series B 2/1/2019 18,350,000
Total $38,350,000
Assumptions: Current interest bonds only
Interest rates: - Series A: 3.981%
- Series B: 4.050%
Financing term: - Series A: 29 years
- Series B: 27 years
4.00% annual AV growth
rates
Estimated Tax Rates
$-
$10
$20
$30
$40
$50
$60
Estimated Tax Rate (Series A) Estimated Tax Rate (Series B)
Estimated Tax Rate (Series C) Maximum Tax Rate @ 4% AV
Targeted Tax Rate @ 4% AV
Tax Rate Scenario: $49 Million
Summary: Based on a tax rate of $45 per $100,000 of assessed value and projected AV
growth of 4.0%, the District can seek bond authorization of approximately $49.32 million.
Piedmont Unified School District | page 9
Proposed Issuance Schedule
Issue Issue Date Proceeds
Series A 2/1/2017 $17,000,000
Series B 2/1/2019 16,315,000
Series C 2/1/2021 16,000,000
Total $49,315,000
Assumptions: Current interest bonds only
Interest rates: - Series A: 3.960%
- Series B: 4.135%
- Series C: 4.246%
Financing term: - Series A: 29 years
- Series B: 29 years
- Series C: 27 years
4.00% annual AV growth
rates
Estimated Tax Rates
$-
$10
$20
$30
$40
$50
$60
20
17
20
18
20
19
20
20
20
21
20
22
20
23
20
24
20
25
20
26
20
27
20
28
20
29
20
30
20
31
20
32
20
33
20
34
20
35
20
36
20
37
20
38
20
39
20
40
20
41
20
42
20
43
20
44
20
45
20
46
20
47
Estimated Tax Rate (Series A) Estimated Tax Rate (Series B)
Estimated Tax Rate (Series C) Maximum Tax Rate @ 4% AV
Targeted Tax Rate @ 4% AV
Maximum Tax Rate Scenario: $66 Million
Summary: Based on a tax rate of $60 per $100,000 of assessed value and projected AV
growth of 4.0%, the District can seek bond authorization of approximately $66 million.
Piedmont Unified School District | page 10
Proposed Issuance Schedule
Issue Issue Date Proceeds
Series A 2/1/2017 $25,085,000
Series B 2/1/2019 26,940,000
Series C 2/1/2021 13,740,000
Total $65,765,000
Assumptions: Current interest bonds only
Interest rates: - Series A: 3.987%
- Series B: 4.195%
- Series C: 4.274%
Financing term: - Series A: 29 years
- Series B: 29 years
- Series C: 27 years
4.00% annual AV growth
rates
Estimated Tax Rates
$-
$10
$20
$30
$40
$50
$60
Estimated Tax Rate (Series A) Estimated Tax Rate (Series B)
Estimated Tax Rate (Series C) Maximum Tax Rate @ 4% AV
Bond Capacity – Scenario F
Piedmont Unified School District | page 11
Fiscal Year 2015-16 2016-17 2017-18 2018-19 2019-20
Total A.V.* $3,845,936,400 $3,999,773,856 $4,159,764,810 $4,326,155,403 $4,499,201,619
Statutory Bonding Capacity @ 2.5% $96,148,410 $99,994,346 $103,994,120 $108,153,885 $112,480,040
Less Current Outstanding Bonds as of Aug. 1** $69,293,678 $65,498,678 $62,158,678 $58,663,678 $55,988,678
Less 2016 Election Series, Series A*** $25,085,000 $22,645,000 $22,550,000 $25,085,000
Less 2016 Election Series, Series B*** $26,940,000 $24,300,000
Less 2016 Election Series, Series C***
Remaining Capacity $26,854,732 $9,410,668 $19,190,442 $207 $7,106,362*A.V. assumes a 4% annual growth rate
**Sinking Fund Deposits are not considered for capacity sizing
***Subject to change. Based on AA GO market rates as 8/11/2015
Fiscal Year 2020-21 2021-22 2022-23 2023-24 2024-25
Total A.V.* $4,679,169,684 $4,866,336,471 $5,060,989,930 $5,263,429,527 $5,473,966,708
Statutory Bonding Capacity @ 2.5% $116,979,242 $121,658,412 $126,524,748 $131,585,738 $136,849,168
Less Current Outstanding Bonds as of Aug. 1** $53,023,678 $52,338,678 $51,553,678 $50,643,678 $49,613,678
Less 2016 Election Series, Series A*** $25,085,000 $25,085,000 $25,085,000 $25,070,000 $25,025,000
Less 2016 Election Series, Series B*** $25,130,000 $26,940,000 $26,940,000 $26,940,000 $26,940,000
Less 2016 Election Series, Series C*** $13,740,000 $12,070,000 $12,900,000 $13,075,000 $13,740,000
Remaining Capacity $564 $5,224,733 $10,046,070 $15,857,060 $21,530,489*A.V. assumes a 4% annual growth rate
**Sinking Fund Deposits are not considered for capacity sizing
***Subject to change. Based on AA GO market rates as 8/11/2015
Process Timeline – GO Bond Election
Piedmont Unified School District | page 12
Election Day
November 8, 2016
February March April May June July August September October November
Feasibility Study/Needs Assessment:
(January-April)
Conduct poll, deliver poll results, deliver
final Facilities Master Plan and identify
key issues
Build Consensus:
(April-August)
Determine ballot question, non-advocacy
communication, develop priority project list,
community outreach, write resolution and
Board vote
Campaign Phase:
(Following Board decision)
Form campaign committee, fundraising, develop campaign
materials, create website, phone banking, and “get out the vote”
initiatives
Deadline for Board
to Call Election
(88 days prior to
election)
August 12, 2016
Facilities Planning/Community Outreach
(6 – 9 months)
January
Recommended