Financing Program Overview September 29, 2016 GO Bonds: Outstanding - - PowerPoint PPT Presentation

Financing Program Overview

September 29, 2016

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GO Bonds: Outstanding Debt Summary

Date Measure Authorization Amount % Approval Tax Rate Limit (per $100k AV) June 2006 Measure H $37,000,000 57.3% $60 November 2008 Measure P $47,000,000* 62.4% $55 Total $84,000,000

* Measure P has $12,566,223 in remaining authorization.

Measure H Election of 2006 GO Bonds Series 2006 $18,000,000 9/14/2006 Measure H 2014 GO Refunding Bonds $33,490,000 11/13/2014 Measure H Election of 2006 GO Bonds Series 2008 $19,000,000 9/18/2008

Measure H, Election of 2006 Bonds Measure P, Election of 2008 Bonds

Measure P Election of 2008 GO Bonds

(CIBs and CABs)

Series 2009 $34,433,777 8/25/2009

Series Issue Date Original Par Amount Final Maturity Amount Outstanding (as of 8/1/16) Call Date / Refunded Election of 2006 (Measure H) Series 2006 9/14/2006 $18,000,000 8/1/2031

• Refunded in 2014

Series 2008 9/18/2008 $19,000,000 8/1/2033

• Refunded in 2014

Total Outstanding $0 Election of 2008 (Measure P) Series 2009 (CIBs) 8/25/2009 $30,550,000 8/1/2034 28,420,000 8/1/2019 Series 2009 (CABs) 8/25/2009 $3,883,777 8/1/2036 3,883,777 Non-callable Total Outstanding $32,303,777 Refunding Bonds 2014 Refunding 11/13/2014 $33,490,000 8/1/2033 $32,105,000 8/1/2024 Total Amount Outstanding $64,408,777

Bond Measures Outstanding Debt

Assessed Value and Bonding Capacity

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Compounded Annual Growth Rate 1 – Year 3.78% 5 – Year 2.16% 10 – Year 0.81% 15 – Year 4.47% Total Assessed Valuation 2016-17: $3,856,499,091 Bonding Capacity @ 2.5% 96,412,477 Outstanding Bonded Indebtedness (64,408,777) Remaining Capacity $32,003,700

* Total AV comprised of Yuba County portion (99%) and Butte County portion (1%). $1.81 $1.86 $1.92 $2.00 $2.10 $2.22 $2.43 $2.91 $3.56 $3.99 $3.97 $3.72 $3.53 $3.47 $3.39 $3.43 $3.57 $3.72 $3.86

• 15%
• 10%
• 5%

0% 5% 10% 15% 20% 25% 30%

$0.0 $0.5 $1.0 $1.5 $2.0 $2.5 $3.0 $3.5 $4.0 $4.5 Total AV ($billions)

• The District’s total assessed value is approximately $3.86 billion in fiscal year 2016-17, which

represents growth of 3.78% from the prior year (up from $3.72 billion).

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Refunding Overview

• Similar to refinancing a home mortgage.
• Paying off existing debt by borrowing money in a lower interest rate environment leads to savings,

which are passed on to taxpayers. Refunding bonds may only be issued if taxpayers will save money.

• Unlike a home mortgage, the term of the debt may not be extended.
• Two types of Refundings:
• Current Refunding – A refunding transaction where the bonds being refunded will mature or

be redeemed within 90 days or less after the issuance of the refunding bonds.

• Advance Refunding – A refunding transaction where the bonds being refunded will not

mature or be redeemed within 90 days or less after the issuance of the refunding bonds.

• Only One Advance Refunding – a new bond issue can only be advanced refunded once

under tax law.

Refunding Analysis

• The Series 2009 Current Interest Bonds are callable beginning 8/1/2019, however, they can be

advance refunded to take advantage of the current low interest rate environment.

• The purpose of refunding the bonds would be to (1) achieve taxpayer savings, (2) manage tax

rates, and (3) create capacity to access additional Measure P authorization.

• Based on current market conditions, estimated taxpayer savings are $3,791,519 (present value

savings of 11.28% of the refunded bonds).

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Series 2016 Refunding Bonds Series Refunded Series 2009 (CIBs Only) Call Date 8/1/2019 at par Refunding Par Amount $24,755,000 Par Amount Refunded $26,220,000 True Interest Cost 3.06% Negative Arbitrage $1,109,828 Nominal Savings $3,791,519 Present Value Savings $2,956,477 (11.28%)

$0 $500,000 $1,000,000 $1,500,000 $2,000,000 $2,500,000 $3,000,000 $3,500,000 $4,000,000 $4,500,000 Prior Debt Service Refunding Debt Service

Debt Service Comparison

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Refunding Sensitivity Analysis

Series 2009 (Current Interest Bonds) Refunding Type Advance Current Issuance Date 11/10/2016 5/1/2019 Refunding Par Amount $24,755,000 $21,770,000 Par Amount Refunded $26,220,000 $26,220,000 Final Maturity 8/1/2034 8/1/2034 Negative Arbitrage $1,109,828 $123,503.82 Nominal Savings $3,791,519 $7,419,769 Present Value Savings $2,956,476 (11.28%) $6,066,111 (23.14%)

Historical Bond Buyer 20 Bond GO Index Bond Buyer 20 Bond GO Index – One Year Trend

Interest Rate Change Current Refunding Total Net Present Value Savings PV Savings as % of Refunded Bonds Current Rates $6,066,111 23.14% +0.25% $5,319,345 20.29% +0.50% $4,603,937 17.56% +0.75% $3,909,434 14.91% +1.00% $3,234,252 12.34% +1.25% $2,578,272 9.83%

0.00 1.00 2.00 3.00 4.00 5.00 6.00 7.00 8/29/1996 8/29/1997 8/29/1998 8/29/1999 8/29/2000 8/29/2001 8/29/2002 8/29/2003 8/29/2004 8/29/2005 8/29/2006 8/29/2007 8/29/2008 8/29/2009 8/29/2010 8/29/2011 8/29/2012 8/29/2013 8/29/2014 8/29/2015 8/29/2016 0.00 0.50 1.00 1.50 2.00 2.50 3.00 3.50 4.00 4.50

Sensitivity Analysis Refunding Comparison

Break-even point

Potential Timeline for Refunding Transaction

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Date Activity

Thursday, September 29 Board Workshop Week of October 3 Meeting with Rating Agencies Week of October 10 Receive ratings Tuesday, October 11 Board approval of resolution, legal documents, and preliminary official statement Monday, October 17 Preliminary official statement posted and delivered to investors Week of October 17 Investor outreach Wednesday, October 25 Pricing Thursday, November 10 Closing

Measure P (Post-Refunding)

• Measure P (2008 Election) has $12,566,223 in remaining authorization.
• Following a refunding of the Series 2009 Current Interest Bonds, the District will have tax rate

capacity to issue additional bonds from the Measure P authorization.

• The amount of funding available from the next Measure P issuance will depend on (1) savings

generated from the refunding of the Series 2009 bonds, (2) future assessed value growth, and (3) market conditions at the time of issuance.

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Measure P – Debt Service Overview

$0 $500,000 $1,000,000 $1,500,000 $2,000,000 $2,500,000 $3,000,000 $3,500,000 $4,000,000 $4,500,000 $5,000,000 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 Total Debt Service

Series 2009 2016 Estimated Refunding Savings Estimated Revenue

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Certificates of Participation

Series Issue Date Original Par Amount Final Maturity Amount Outstanding (as of 8/1/16) Call Date / Refunded 2006 COPs 8/31/2006 $22,145,000.00 8/1/2021 $2,490,000.00 Callable 8/1/16 @ par; partially refunded in 2012 2012 COPs 7/17/2012 18,376,098.50 6/1/2042 18,376,098.50 6/1/2022 @ accreted value Total Amount Outstanding $20,866,098.50

Outstanding Debt COPs Debt Service

$0 $500,000 $1,000,000 $1,500,000 $2,000,000 $2,500,000 $3,000,000

Total Debt Service FY Ending

2006 COPs 2012 COPs

Looking Forward

• Addressing and prioritizing facilities needs identified in the District’s

Facilities Master Plan.

• Determining the funding amount available from the next issuance from

Measure P (if desired).

• Identifying financing sources available for long-range facilities needs.
• Planning for debt service payments for the 2012 COPs.

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