Presentation on theme: "Updated Bond Tax Rate Projections February 11, 2014 J ON G ORES M ANAGING D IRECTOR (206) 389-4043 DADCO. COM SEQUIM SCHOOL DISTRICT."— Presentation transcript:
Updated Bond Tax Rate Projections February 11, 2014 J ON G ORES M ANAGING D IRECTOR (206) DADCO. COM SEQUIM SCHOOL DISTRICT
Assumptions for Bond Tax Rate Planning Interest Rates Bond Rating Assessed Value Bond Structure 1 Bond Issue Planning
A. Interest Rates - Lower interest rates result in lower tax rates for bonds. - Interest rates are determined when bonds are actually sold. - Assumption: Future Bond Sales Current rates plus 1.50 % (150 basis points). 2 Bond Issue Planning
B.Bond Rating - A higher bond rating results in lower interest rates. - Assumption: Aa1 (with State Guaranty) Aa2 (District Rating) pending A Guide to Bond Ratings Moody’s Investors Service – Founded 1918 Highest QualityAaa Aa1, Aa2, Aa3 A1, A2, A3 Baa1, Baa2, Baa3 Lowest QualityNR (Nonrated) 3 Bond Issue Planning
Bond raters consider the local economy, District finances, and other factors Assumption: Aa1 (State Guarantee) Aa2 (District Rating) 4 Bond Rating Factors The Rating Debt Factors Economy Governmental Factors Financial Performance
Assessed Value 5
7 Bond Issue Planning Projected Assessed Value Growth – Final 2014: -0.55% growth – Projected : 1.0% annual growth – Projected : 2.0% annual growth Higher assessed values will lower the District’s tax rates (but not the overall payment) An individual’s taxes will be based on the assessed value for their property New construction vs. increase in value of existing property Assessed Value
8 Bond Issue Planning Bond Structure State law gives Districts great flexibility in determining bond structures Options: – Level Debt – Level Tax Rate – Stepped Level Tax Rate
Scenario #45#48#49#50 Total Amount $ 154,325,000 $ 150,575,000 Bond Sale Dates and Amounts June 2014 Dec 2015 Dec 2016 Dec 2017 $ 37,550,000 $ 63,040,000 $ 44,835,000 $ 8,900,000 $ 37,550,000 $ 63,040,000 $ 44,835,000 $ 8,900,000 $ 33,800,000 $ 63,040,000 $ 44,835,000 $ 8,900,000 $ 33,800,000 $ 63,040,000 $ 44,835,000 $ 8,900,000 Total Tax Rates Actual 2013 Projected $ $ $ $ Total Interest Cost$ 107,819,000$ 154,475,000$ 102,539,000$ 150,338,000 Final Maturity Term20 Yrs25 Yrs20 Yrs25 Yrs Projected 2015 Total Tax Rate increase over 2014 Total Tax Rate $ 1.74$ 1.48$ 1.70$ Interest Rates: Future bond sales current plus 150 basis points (1.50%) Bond Rating: Aa1 State Guarantee District Rating: Aa2 (Pending) Assessed Value Growth: Final 2014: -0.55% growth; Projected : 1.0% growth; Projected : 2.0% annual growth Bond Structure: Level Tax Rate Bond Tax Rate Projection Summary
18 Clallam County School Districts 2013 Total Tax Rates District Assessed Value (1) ($)Bonds ($)M&O ($) Capital Projects ($)Trans. ($)Total ($) Crescent School District No ,505, Sequim School District No ,651,014, Port Angeles School District No. 1212,689,472, Quillayute Valley School District No ,714, Cape Flattery School District No ,452, (1) Assessed Value does not include TAV. Source: County Assessors Offices. Total Tax Rate Comparison
19 Total Tax Rate Comparison Washington School Districts 2013 Total Tax Rates District Assessed Value ($) (1) Bonds ($)M&O ($) Capital Projects ($)Trans. ($)Total ($) Sequim School District No. 3233,684,210, Blaine School District No. 5033,601,518, Moses Lake School District No. 1613,606,659, Monroe School District No. 1033,614,847, Tumwater School District No. 333,897,877, Tahoma School District No. 4093,934,735, Mount Vernon School District No. 3203,023,754, (1) Assessed Value includes TAV. Source: Multiple County Assessors Offices. Similar sized school districts
20 Total Tax Rate Comparison Districts in the Olympic League 2013 Total Tax Rates District Assessed Value (1) ($)Bonds ($)M&O ($) Capital Projects ($)Trans. ($)Total ($) Sequim School District No ,651,014, North Mason School District No ,991,227, Peninsula School District No ,774,015, Port Angeles School District No ,689,472, North Kitsap School District No. 4005,712,645, Bremerton School District No. 100-C2,993,597, Central Kitsap School District No ,016,126, (1) Assessed Value does not include TAV. Source: County Assessors Offices.
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