Presentation on theme: "West Contra Costa USD Potential 2005 Measure J Bonding Capacity Waiver Presentation to the Facilities Subcommittee December 10, 2013."— Presentation transcript:
West Contra Costa USD Potential 2005 Measure J Bonding Capacity Waiver Presentation to the Facilities Subcommittee December 10, 2013
New Bond Waiver Presentation to the West Contra Costa Unified School District Facilities Subcommittee | page 1 The District Board has requested that the finance team develop a plan to pursue a new bonding capacity waiver for authorized but unissued 2005 Measure J bonds in State law prohibits unified school districts from issuing bonds if doing so causes the total amount of district bonds outstanding to exceed 2.5% of such districts then-current assessed value. Under State law, the State Board of Education has the power to waive such requirement, and the State Board has granted such waivers in the past, typically by increasing the allowable percentage to a new fixed level of bonds approved under specific authorization or a specified period of time. The District has relied upon such waivers in issuing each of its last four series of new money bonds.
An Opportune Time In many ways timing is right for such an effort. The District has nearly $80 million of bonds authorized under 2005 Measure J that cannot be issued under current circumstances. The District has outstanding facility needs and a desire to accelerate projects that will benefit the community. The District’s bond program enjoys strong local support. The State Board of Education continues to be relatively supportive of bonding capacity waivers applications. Presentation to the West Contra Costa Unified School District Facilities Subcommittee | page 2
Potential Timing Assuming the District wishes to move forward (and absent any compelling argument to the contrary) we would recommend targeting the July meeting of the State Board of Education. Presentation to the West Contra Costa Unified School District Facilities Subcommittee | page 3 DateActivity December and Early JanuaryDevelopment of application material. January and FebruaryPresentation of information to and solicitation of support from the District’s labor unions, the Facilities Subcommittee, and The Citizens Bond Oversight Committee. January and February (or later)Presentation of information to and solicitation of support from other local agencies (if necessary). Early MarchBoard approval of resolution authorizing the submission of the application to the State Board of Education. Spring and Early SummerConsideration of application by the State Board of Education; potential outreach to appropriate staff and Board members. July 9 th and July 10 th State Board of Education meeting.
Proposition 39 Limitations Regardless of the waiver stats, Proposition 39 limitations are likely to prevent the District from issuing the remaining 2005 Measure J bonds in the immediate future. Presentation to the West Contra Costa Unified School District Facilities Subcommittee | page 4 Note:Does not take into account tax rate stabilization fund. Assumes current debt service without redemption or restructuring.
Potential 2014 Election In addition, the potential 2014 bond election currently under consideration, may complicate such a waiver effort (or perhaps not). To the extent that an election is called for June, the spring will be dedicated to campaigning (which could be a positive or a negative). In the event a new authorization is approved in 2014, newly approved bonds will also require a bonding capacity waiver (which might argue in favor of a combined waiver effort after the election). State Board of Education staff has indicated its reluctance to consider a waiver application for the potential 2014 bonds in advance of their approval. Presentation to the West Contra Costa Unified School District Facilities Subcommittee | page 5
Alternative Strategy - One An alternative strategy might be to solicit support for the potential new bond measure, its waiver, and a corresponding waiver for the 2005 Measure J bonds late this spring. Provides local public officials an opportunity to express their support for a popular bond program. Provides the District an opportunity to demonstrate the broad public support enjoyed by the bond program particularly to potential critics. If an election is called, and the measure approved in June, the District can be on schedule to have its waiver application in front of the State Board in November. Presentation to the West Contra Costa Unified School District Facilities Subcommittee | page 6
Alternative Strategy - Two Another alternative would be to take a more low-key approach to both waiver processes. The waiver application does not require expressions of support from local agencies. The application form does require that materials be presented to the District’s labor groups and appropriate committees. In the past, the State Board of Education has required that we include a financing plan describing the need for the waiver and demonstrating that such bonds can be issued without exceeding Proposition 39 maximums. While such certifications could be made at any time, it might be easier to create such an argument this summer, after the 2014 measure has been achieved and, presumably, growth in the District’s tax base received. Presentation to the West Contra Costa Unified School District Facilities Subcommittee | page 7