1 Capital Financing Options Jane A. Russo, Superintendent Michael P. Bishop, Associate Superintendent, Business Services Joe Dixon, Assistant Superintendent, Facilities & Governmental Affairs Kelvin Tsunezumi, Executive Director, Business Services October 12, 2010 2 Measure G Measure G (Summary of Events) Measure G approved by voters (68.8% approval) in June 2008 Total authorization: $200 million Bonds issued to date: $154.1 million 2008: $100 million 2009: $54.1 million (including $19.24 million in Qualified School Construction Bonds) Remaining authorization: $45.9 million Qualified School Construction Bonds (QSCBs) A form of bond financing Purpose: To stimulate the economy & attract new investors to the market Interest expense subsidized in part by the Federal government Property tax payers benefit from the lower interest rate Limited amount of QSCB authorization Authorization expires at the end of 2010 SAUSDs allocation of QSCBs for 2010: $17.5 million 3 3 Completed Projects Lowell Martin Kennedy Madison Carr Completed in the last year: 8 new classroom buildings 156 classrooms Greenville Diamond Santiago 3 4 4 Saddleback High Solar & Energy Efficiency Project Completed Projects Lincoln Elementary Modernization 5 Santa Ana High Modernization Projects Underway New Brick New Framing New Plumbing Santa Ana HighSpurgeon IntermediateHeninger Elementary Projects Underway Century High Sierra Intermediate 8 new classroom buildings currently under construction 134 classrooms 6 7 Mitchell Child Development Center Funded Modernization New Classroom and Multipurpose Room Buildings Garfield Elementary Funded New 12 Classroom Building New Joint Use Multipurpose Room Building ___________________________________________________________________________________________________________________ ____ Davis Elementary New 12 Classroom Building Edison Elementary New 24 Classroom Building Saddleback High Modernization Willard Intermediate Modernization & New 12 Classroom Building Spurgeon Intermediate Modernization Projects To Come 8 Pending State Funding ProgramState Funding School Facilities Program Reimbursements (Modernization) $16,431,478 Emergency Repair Program$34,756,496 9 Measure G (Contd) The Board & Districts Goal with respect to Measure G Continue momentum on Measure G construction and complete projects as soon as possible Benefit from favorable construction bidding climate Manage increases in property tax rates To meet above goals, district staff recommends: Issuance of remaining $45.9 million in bond authorization as follows: QSCBs: $17.5 million Standard Tax Exempt: $28.4 million Without this issuance, work on additional Measure G projects will come to a halt by the end of this fiscal year Use of QSCBs will save Santa Ana property tax payers approximately $7.1 million Property tax rates over the term will range from approximately $36.30 to $38.80 per $100,000 of property valuation 10 Next Steps Issuance of Measure G Bonds DateEvent or Activity Nov. 9Board adopts resolution requesting County to issue bonds & approving the form of legal documents and the Preliminary Official Statement Week of Dec. 6 Sale of: (1)Measure G QSCBs (2)Measure G Tax Exempt Bonds (3)Measure C Series 2002 refinancing Week of Dec. 27 Closing and bond proceeds deposited in County Treasury for district use 11 Backup Slides 12 District Issuance Scenarios Scenario #1Scenario #2Scenario #3 Bond Issuance ($s in millions) QSCBs Tax Exempt Capital Appreciation Total $ $17.5 $ $45.9 $ 9.3 $33.0 $ 3.6 $45.9 Projected Tax Rate (per $100,000 valuation) $33.10$36.30 / $38.80 $37.00 13 Note: Scenario II is the recommended option 14 Project ACTUAL 1 st Quarter ACTUAL 2 nd Quarter rd Quarter th Quarter 2010 Totals Beg. Bal $94,759,073$87,461,316 $76,691,496$105,163,768$94,759,073 Revenue $0 $58,208,033$800,000$59,008,033 COS $1,801,218 $1,736,421$2,993,787 $9,525,213 COS Sav. $21,480 $757$182,587 $387,411 ORG Const. $585,364 $1,950,637$14,250,000$80,461,666$97,247,667 MOD (Soft) $311,717 $77,600$88,889 $567,095 MOD (New) $215,080 $466,782$78,105 $838,060 MOD Const. $352,159 $241,737$3,221,625$3,221,624$7,037,144 ERP Const. $347,356 $1,322,310$5,197,222$5,371,806$12,238,694 CTE Valley $280,820 $107,722$871,307$0$1,259,849 Priority Proj. $2,963,923 $0 $10,552,325$13,516,248 Solar $0 $4,506,989$2,418,084$0$6,925,073 Admin. Exp. $328,591 $358,866$324,204 $1,335,865 IRP $90,050 $0$109,950$0$200,000 Yearly Totals $7,297,757 $10,769,820$29,735,761$103,274,930$151,078,318 Ending Balance $87,461,316 $76, $105,163,768$2,688,838$ 2,688,788 Cash Flow (2010) 15 Project st Quarter nd Quarter rd Quarter th Quarter 2011 Totals Beg. Bal$2,688,788$(15,785,407)$(36,960,018)$(56,603,558)$2,688,788 Revenue$0 COS$0 COS Sav.$182,587$2,346,207,$2,346,207 $7,221,207 ORG Const.$0 MOD (Soft)$88,889 $355,555 MOD (New)$78,093$72,648 $296,038 MOD Const.$3,000,000$4,000,000$3,718,392$1,799,077$12,517,469 ERP Const.$4,248,097$3,790,338$2,540,875$2,040,000$12,619,311 CTE Valley$0 Priority Proj.$10,552,325 $42,209,300 Solar$0 Admin. Exp.$324,204 $1,296,816 IRP$0 Yearly Totals $18,474,195$21,174,611$19,643,540$17,223,349$76,515,695 Ending Balance $(15,785,407)$(36,960,018)$(56,603,558)$(73,826,907) Cash Flow (2011) 16 Project st Quarter nd Quarter rd Quarter th Quarter 2012 Totals Beg. Bal$(73,826,907)$(87,521,945)$(90,353,737)$(93,169,809)$(93,626,850) Revenue$0 COS$0 COS Sav.$2,346,207 $0$7,038,620 ORG Const.$0 MOD (Soft)$88,889 $355,555 MOD (New)$72,648$72,493$56,773$43,948$245,862 MOD Const.$0 ERP Const.$310,766$0 $310,766 CTE Valley$0 Priority Proj$10,552,325$0 $10,552,325 Solar$0 Admin. Exp.$324,204 $1,296,816 IRP$0 Yearly Totals$13,695,068$2,831,792$2,816,072$457,041$19,799,943 Ending Balance$(87,521,945)$(90,353,737)$(93,169,809)$(93,626,850) Cash Flow (2012) 17 Project st Quarter nd Quarter rd Quarter th Quarter 2013 Totals Beg. Bal$(93,626,850)$(94,062,471)$(94,475,564)$(94,888,656)$(93,626,850) Revenue$0 COS$0 COS Sav.$0 ORG Const.$0 MOD (Soft)$88,889 $355,555 MOD (New)$22,528$0 $22,528 MOD Const.$0 ERP Const.$0 CTE Valley$0 Priority Proj$0 Solar$0 Admin. Exp.$324,204 $1,296,816 IRP$0 Yearly Totals$435,621$413,093 $1,674,899 Ending Balance$(94,062,471)$(94,475,564)$(94,888,656)$(95,301,749) Cash Flow (2013)