CFW - Bond Program Update.pdf AWS
Burbank Unified School District Administrative Services REPORT TO THE BOARD TO:
Members of the Board of Education
FROM:
David Jaynes, Assistant Superintendent, Administrative Services
PREPARED BY:
Ruthie DiFonzo, Senior Administrative Assistant
SUBMITTED BY:
Ruthie DiFonzo, Senior Administrative Assistant
DATE:
November 2, 2017
SUBJECT:
Annual Bond Program Update by Caldwell Flores Winters, Inc.
Background: Following the passage of Burbank Unified School District’s GO Bonds – Measure S, on March 5, 2013, the Board of Education of the Burbank Unified School District authorized the sale of the first issuance of these bonds in May 2013 for $41 million; the second issuance in July 2015 for $35 million; and the third issuance in March 2017 for $34 million. The District has issued the entire amount of the Measure “S” bond authorization. Discussion/Issues: Caldwell Flores Winters, Inc. (CFW) managing director, John Greenlee, will present an overview of the bond program. Fiscal Impact: None Recommendation: David Jaynes, Assistant Superintendent of Administrative Services, will introduce John Greenlee, Managing Director of Caldwell Flores Winters, Inc., who will report on the bond program, as presented.
Burbank Unified School District Los Angeles County, California
Bond Program Update Board Presentation – November 2nd, 2017
Facilities Planning, Public Finance, Program Administration
Measure “S” – Overview
The District placed Measure “S”, a $110 million bond measure, on the March 2013 ballot; Measure “S” was approved by 61% of voters
In May 2013, the District sold Series A Bonds in the amount of $41 million
In July 2015, the District sold Series B Bonds in the amount of $35 million
In March 2017, the District, sold Series C Bonds in the amount of $34 million
Following the sale of the 2017 Series C Bonds, the District has issued the entire amount of the Measure “S” Bond Authorization
The total tax rate projected at the time of the 2013 Election was $55.18 per $100,000 of assessed valuation
The total tax rate in the current 2017-18 year is $49.94
Page 1
District Bond Authorizations
Series
Burbank Unified School District Debt Summary Actual 2015-16 Amount Sold Tax Rate
Issue Date
Actual 2016-17 Tax Rate
Actual 2017-18 Tax Rate
$3.23 $16.23 $19.53
$3.36 $16.95 $26.47
$3.05 $15.36 $22.89
$5.98 N/A N/A
$4.22 N/A N/A
$3.48 $5.16 N/A
$44.97
$51.00
$49.94
Measure "B" - $112.5 Million Authorization 1997A 1998B 2002C
August 21, 1997 August 20, 1998 July 1, 2002 Total: Remaining Authorization:
$7,497,787 $39,996,370 $65,000,839 $112,494,996 $0.00
Measure "S" - $110 Million Authorization 2013 2015 2017
May 30, 2013 July 30, 2015 March 9, 2017
$40,997,990 $34,998,497 $34,001,109 Total:
Remaining Authorization:
$109,997,596 $0.00 Total Tax Rate:
Page 2
Assessed Valuation
The District’s long-term 15-year growth has averaged 4.75% annually
County data shows the District’s AV increased by approximately $1.6 billion (7.60%) in FY 2017-18 Historical Assessed Value
$25
Billions
$20 $15 $10 $5 $0
Page 3
Historical Assessed Value Period Ending In
Total
%Δ
2003
$11,600,068,855
-
2004
$12,224,033,147
5.38%
2005
$12,976,715,661
6.16%
2006
$14,120,774,748
8.82%
2007
$15,557,958,932
10.18%
2008
$16,892,237,833
8.58%
2009
$18,132,926,429
7.34%
2010
$18,286,291,575
0.85%
2011
$18,287,098,564
0.00%
2012
$18,157,701,466
-0.71%
2013
$18,451,410,370
1.62%
2014
$19,004,068,820
3.00%
2015
$19,716,798,485
3.75%
2016
$20,744,136,125
5.21%
2017
$21,456,853,618
3.44%
2018
$23,088,309,691
7.60%
5-Year Average
4.60%
10-Year Average
3.21%
15-Year Average
4.75%
Historical Tax Rates
In the period ending in 2017-18, the outstanding Measure “S” bonds shall be repaid at a tax rate of $8.64 per $100,000 of AV with a total combined tax rate of $49.94 The total tax rate projected at the time of the 2013 Election was $55.18 per $100,000 of assessed valuation Per Proposition 39, the District is allowed to levy up to $60.00 per $100,000 of AV The projected AV annual growth rate at the time of each Bond issuance was 3.50% to 3.75% Given the higher 5-year average growth rate of 4.60%, the tax rate has been declining Page 4
Historical Tax Rate per $100,000 in AV (1997 and 2013 Elections)
Period Ending In
AV Growth
Total Tax Rate
2008
8.58%
$42.63
2009
7.34%
$42.99
2010
0.85%
$44.21
2011
0.00%
$46.11
2012
-0.71%
$50.18
2013
1.62%
$42.40
2014
3.00%
$48.78
2015
3.75%
$57.53
2016
5.21%
$44.97
2017
3.44%
$51.00
2018
7.60%
$49.94
Average
$47.34
Comparable Tax Rates Los Angeles County Unified School Districts 2017-18 Tax Rates* $200
$150
Average, $103.67 $100
Burbank USD, $49.94
$50
$0
*Per
$100,000 of assessed valuation
Page 5
Bonding Capacity
Unified school districts have a statutory bonding capacity equal to 2.50% of AV
The District’s Gross Bonding Capacity is approximately $577 million
The District’s Net Bonding Capacity is approximately $439 million ITEM
FIGURE
This figure is the assessed value of all taxable property within the district's boundaries. This figure is provided by the County Tax Assessor's Office and updated annually.
A
Burbank USD Total Assessed Valuation
B
Debt Limit Factor
C
Gross Bonding Capacity (A x B =)
$577,207,742
Reflects total Bonding Capacity.
D
District's Existing G.O. Debt
$137,819,092
The District’s current principal amount of GO bonds outstanding.
$439,388,650
Remaining District Bonding capacity available today.
Net Bonding Capacity (C - D =)
$23,088,309,691
COMMENTS/ CALCULATIONS
2.50%
Page 6
This factor is utilized by elementary and K-8 school district in California.
Credit Rating Overview
Ratings serve as signal to investors regarding a district’s overall operational sustainability, creditworthiness, and ability to repay debt
In February 2017, Moody’s assigned the District a rating of Aa2 citing the following:
Large stable tax base
Strong resident wealth measures
Balances outside the General Fund
S&P’s re-affirmed the District’s ‘AA-’ long term rating with a “Stable” outlook citing the following credit strengths:
Resilient economic base in the Los Angeles region, with only a modest assessed value (AV) decline during the Great Recession
Strong income and extremely strong wealth indicators
Stable average daily attendance (ADA), the primary revenue driver under the state's funding system
Strong financial position while maintaining at least strong available reserves the past five audited fiscal years Page 7
Moody's Rating description
Longterm
Aaa Aa1 High grade Aa2 Aa3 Upper Investment- A1 grade medium A2 grade A3 Baa1 Lower medium Baa2 grade Baa3
Shortterm
Prime
P-1
P-2 P-3
Ba1
S&P Longterm AAA AA+ AA AA− A+ A A− BBB+ BBB BBB−
Shortterm
A-1+
A-1 A-2 A-3
BB+
Speculative
Noninvestment grade Highly speculative
Ba2 Ba3 B1 B2 B3
Not prime
BB BB− B+ B B−
B
Post Bond Issuance Activities As part of our ongoing service agreements with the District, CFW will continue to: 1) Monitor Refunding Opportunities 2) Provide Dissemination Agent Activities Continuing Disclosure to Bond Investors
New State Requirement for Annual Bond Information – SB 1029 3) Assist District Staff as needed
Page 8
Questions? John Greenlee
Managing Director [email protected]
Caldwell Flores Winters, Inc. 6425 Christie Avenue, Suite 270 Emeryville, CA 94608 Tele: (510) 596-8170
Cell: (415) 990-2195 www.cfwinc.com
Page 9
Members of the Board of Education
FROM:
David Jaynes, Assistant Superintendent, Administrative Services
PREPARED BY:
Ruthie DiFonzo, Senior Administrative Assistant
SUBMITTED BY:
Ruthie DiFonzo, Senior Administrative Assistant
DATE:
November 2, 2017
SUBJECT:
Annual Bond Program Update by Caldwell Flores Winters, Inc.
Background: Following the passage of Burbank Unified School District’s GO Bonds – Measure S, on March 5, 2013, the Board of Education of the Burbank Unified School District authorized the sale of the first issuance of these bonds in May 2013 for $41 million; the second issuance in July 2015 for $35 million; and the third issuance in March 2017 for $34 million. The District has issued the entire amount of the Measure “S” bond authorization. Discussion/Issues: Caldwell Flores Winters, Inc. (CFW) managing director, John Greenlee, will present an overview of the bond program. Fiscal Impact: None Recommendation: David Jaynes, Assistant Superintendent of Administrative Services, will introduce John Greenlee, Managing Director of Caldwell Flores Winters, Inc., who will report on the bond program, as presented.
Burbank Unified School District Los Angeles County, California
Bond Program Update Board Presentation – November 2nd, 2017
Facilities Planning, Public Finance, Program Administration
Measure “S” – Overview
The District placed Measure “S”, a $110 million bond measure, on the March 2013 ballot; Measure “S” was approved by 61% of voters
In May 2013, the District sold Series A Bonds in the amount of $41 million
In July 2015, the District sold Series B Bonds in the amount of $35 million
In March 2017, the District, sold Series C Bonds in the amount of $34 million
Following the sale of the 2017 Series C Bonds, the District has issued the entire amount of the Measure “S” Bond Authorization
The total tax rate projected at the time of the 2013 Election was $55.18 per $100,000 of assessed valuation
The total tax rate in the current 2017-18 year is $49.94
Page 1
District Bond Authorizations
Series
Burbank Unified School District Debt Summary Actual 2015-16 Amount Sold Tax Rate
Issue Date
Actual 2016-17 Tax Rate
Actual 2017-18 Tax Rate
$3.23 $16.23 $19.53
$3.36 $16.95 $26.47
$3.05 $15.36 $22.89
$5.98 N/A N/A
$4.22 N/A N/A
$3.48 $5.16 N/A
$44.97
$51.00
$49.94
Measure "B" - $112.5 Million Authorization 1997A 1998B 2002C
August 21, 1997 August 20, 1998 July 1, 2002 Total: Remaining Authorization:
$7,497,787 $39,996,370 $65,000,839 $112,494,996 $0.00
Measure "S" - $110 Million Authorization 2013 2015 2017
May 30, 2013 July 30, 2015 March 9, 2017
$40,997,990 $34,998,497 $34,001,109 Total:
Remaining Authorization:
$109,997,596 $0.00 Total Tax Rate:
Page 2
Assessed Valuation
The District’s long-term 15-year growth has averaged 4.75% annually
County data shows the District’s AV increased by approximately $1.6 billion (7.60%) in FY 2017-18 Historical Assessed Value
$25
Billions
$20 $15 $10 $5 $0
Page 3
Historical Assessed Value Period Ending In
Total
%Δ
2003
$11,600,068,855
-
2004
$12,224,033,147
5.38%
2005
$12,976,715,661
6.16%
2006
$14,120,774,748
8.82%
2007
$15,557,958,932
10.18%
2008
$16,892,237,833
8.58%
2009
$18,132,926,429
7.34%
2010
$18,286,291,575
0.85%
2011
$18,287,098,564
0.00%
2012
$18,157,701,466
-0.71%
2013
$18,451,410,370
1.62%
2014
$19,004,068,820
3.00%
2015
$19,716,798,485
3.75%
2016
$20,744,136,125
5.21%
2017
$21,456,853,618
3.44%
2018
$23,088,309,691
7.60%
5-Year Average
4.60%
10-Year Average
3.21%
15-Year Average
4.75%
Historical Tax Rates
In the period ending in 2017-18, the outstanding Measure “S” bonds shall be repaid at a tax rate of $8.64 per $100,000 of AV with a total combined tax rate of $49.94 The total tax rate projected at the time of the 2013 Election was $55.18 per $100,000 of assessed valuation Per Proposition 39, the District is allowed to levy up to $60.00 per $100,000 of AV The projected AV annual growth rate at the time of each Bond issuance was 3.50% to 3.75% Given the higher 5-year average growth rate of 4.60%, the tax rate has been declining Page 4
Historical Tax Rate per $100,000 in AV (1997 and 2013 Elections)
Period Ending In
AV Growth
Total Tax Rate
2008
8.58%
$42.63
2009
7.34%
$42.99
2010
0.85%
$44.21
2011
0.00%
$46.11
2012
-0.71%
$50.18
2013
1.62%
$42.40
2014
3.00%
$48.78
2015
3.75%
$57.53
2016
5.21%
$44.97
2017
3.44%
$51.00
2018
7.60%
$49.94
Average
$47.34
Comparable Tax Rates Los Angeles County Unified School Districts 2017-18 Tax Rates* $200
$150
Average, $103.67 $100
Burbank USD, $49.94
$50
$0
*Per
$100,000 of assessed valuation
Page 5
Bonding Capacity
Unified school districts have a statutory bonding capacity equal to 2.50% of AV
The District’s Gross Bonding Capacity is approximately $577 million
The District’s Net Bonding Capacity is approximately $439 million ITEM
FIGURE
This figure is the assessed value of all taxable property within the district's boundaries. This figure is provided by the County Tax Assessor's Office and updated annually.
A
Burbank USD Total Assessed Valuation
B
Debt Limit Factor
C
Gross Bonding Capacity (A x B =)
$577,207,742
Reflects total Bonding Capacity.
D
District's Existing G.O. Debt
$137,819,092
The District’s current principal amount of GO bonds outstanding.
$439,388,650
Remaining District Bonding capacity available today.
Net Bonding Capacity (C - D =)
$23,088,309,691
COMMENTS/ CALCULATIONS
2.50%
Page 6
This factor is utilized by elementary and K-8 school district in California.
Credit Rating Overview
Ratings serve as signal to investors regarding a district’s overall operational sustainability, creditworthiness, and ability to repay debt
In February 2017, Moody’s assigned the District a rating of Aa2 citing the following:
Large stable tax base
Strong resident wealth measures
Balances outside the General Fund
S&P’s re-affirmed the District’s ‘AA-’ long term rating with a “Stable” outlook citing the following credit strengths:
Resilient economic base in the Los Angeles region, with only a modest assessed value (AV) decline during the Great Recession
Strong income and extremely strong wealth indicators
Stable average daily attendance (ADA), the primary revenue driver under the state's funding system
Strong financial position while maintaining at least strong available reserves the past five audited fiscal years Page 7
Moody's Rating description
Longterm
Aaa Aa1 High grade Aa2 Aa3 Upper Investment- A1 grade medium A2 grade A3 Baa1 Lower medium Baa2 grade Baa3
Shortterm
Prime
P-1
P-2 P-3
Ba1
S&P Longterm AAA AA+ AA AA− A+ A A− BBB+ BBB BBB−
Shortterm
A-1+
A-1 A-2 A-3
BB+
Speculative
Noninvestment grade Highly speculative
Ba2 Ba3 B1 B2 B3
Not prime
BB BB− B+ B B−
B
Post Bond Issuance Activities As part of our ongoing service agreements with the District, CFW will continue to: 1) Monitor Refunding Opportunities 2) Provide Dissemination Agent Activities Continuing Disclosure to Bond Investors
New State Requirement for Annual Bond Information – SB 1029 3) Assist District Staff as needed
Page 8
Questions? John Greenlee
Managing Director [email protected]
Caldwell Flores Winters, Inc. 6425 Christie Avenue, Suite 270 Emeryville, CA 94608 Tele: (510) 596-8170
Cell: (415) 990-2195 www.cfwinc.com
Page 9
