CFW Caldwell Flores Winters, Inc. Facilities Planning, Public Finance, Program Administration Calistoga Joint Unified School District Financing Options Board Workshop February 23, 2011

1 Background of Measure “A” Bond Program Measure “A” is a $42 million General Obligation Bond authorization approved by voters in November 2010 The estimated tax rate for Measure “A” is $34 per $100,000 of Assessed Valuation Identified Measure “A” improvements include the need to renovate and improve Calistoga schools, construct a new gym and multipurpose/student union, modernize the elementary school, improve libraries, classrooms, roofing, HVAC, technology, and provide renewable energy projects The District has also received a Clean Renewable Energy Bond (CREB) allocation in the amount of $1.5 million to fund renewable energy improvements

2 Recent Changes in Bond Market Conditions

3 Original Plan Assumed First Bond Issue of $16.3 Million Recent changes in bond market conditions and higher interest rates alter original expectations for initial Measure A bond issue of $16.3 million Easier to control tax rate outcome by issuing bonds corresponding to phases of planning, design and construction of Measure A projects Scheduling series of smaller bond issues over future years will allow more certainty regarding future tax base growth Take advantage of low borrowing costs with District’s allocation of Clean Renewable Energy Bonds (CREBs) Seek similar financing opportunity with Qualified Zone Academy Bonds (QZABs) to reduce interest cost for elementary school modernization

4 Alternate Plan of Projects to be Funded from Series A Due to the prevailing higher interest rate environment for long term debt, it may be prudent to fund only costs incurred until ground breaking for the gym, multipurpose, and elementary modernization Delay the second series of bonds until the beginning of construction allowing the finance team to continue to research and apply for any additional programs that may reduce the cost of borrowing and to allow time for possible improvements in bond market conditions Projects*Estimated Costs Planning & Associated Costs for New Gymnasium$1,800,000 Planning & Associated Costs for New Multipurpose/Student Union $1,150,000 Planning & Associated Costs for Calistoga Elementary School Phase I Modernization $550,000 Technology Improvements$600,000 Implement Renewable Energy Program$1,500,000 Total$5,600,000 *Note: Estimates include allowance for reserves and contingencies

5 Recommend Smaller First Bond Issue of $5.6 Million Prepare for First Bond Issuance of $5.6 Million in Spring 2011  Portion of proceeds used for planning and design Gymnasium Multipurpose/cafeteria (student union) Elementary school modernization  Renewable energy projects Clean Renewable Energy Bonds (CREBs) Federal interest subsidy reduces borrowing cost  Technology improvements Consider Second Bond Issuance of $10.7 Million in Fall 2012  Amount and timing of bonds influenced by tax base growth and bond interest rates  Apply for allocation of Qualified Zone Academy Bonds Use for elementary school modernization Federal interest subsidy reduces borrowing cost  Construction funds for gym and student union projects

6 Preliminary Timeline March 7, 2011Board to Decide on Financing Plan April 4, 2011Board Adopts Legal Documents April 15, 2011District Staff Meets with Rating Agencies May 9, 2011Price Bonds May 23, 2011Close Transaction