WCCUSD responds to bonds questions 3

I hope this signals that WCCUSD will start to be more responsive to information requests and even become proactive.

1.          What are the costs associated with a bond sale?

The costs of a financing are dependent to some degree on size and complexity of the bond issuance. For the upcoming bond issuance, our estimate is that financings costs (for bond counsel, disclosure counsel, ratings, financial advisor and other associated costs) will be approximately $500,000. We expect underwriters fees to be between $600, 00 and $700,000.

2.          Will the bonds be sold at a premium in order to cover the costs of the bond sale?

The generation of premium on the bonds will largely be driven by market preferences. To the extent that the District receives any premium (net of underwriter’s discount and municipal bond insurance (if any)), the District will deposit all of such premium into the debt service fund. The District will pay for upfront financing costs (other than underwriter’s discount and municipal bond insurance (if any) out of bond proceeds (not premium).

3.          Have construction costs increased since the November election? If so were those costs planned for?

The District prepares estimates for all projects. The actual bid may be higher or lower than the estimate for the project. If the bid is higher than the estimate, the District takes a revised budget to the Board of Education for approval. If the bid is lower than the project estimate, the budget is reduced. Since November 2012, some projects have received bids higher than estimates and some projects have received bids lower than District estimates.

4.          Are there documents and videos available to help the public understand the district’s bond program?

There is information at http://emma.msrb.org . EMMA is the Electronic Municipal Market Access where public access to information on Municipal Securities can be found. The West Contra Costa Unified School District website (http://www.wccusd.net ) has information on the bond program. The District has a video copy of all Board of Education meetings.

5.          How much does the district currently owe? How much does it expect to owe 5, 10, and 15 years from now?

As of October 1, 2013 District owed $ 776,677,930 in general obligation bonds. In August 2013, the District paid $18,752,206 on the outstanding bond principal. Of the bonds currently outstanding, the District will pay down $109.1 million in 5 years, another $144.2 million between 6 and 10 years, and yet another $170.4 million between 11 and 15 years based on the existing debt service obligations (assumes no refunding, etc.).  During this time, the District will be issuing additional bonds and repaying principal on the new bond issuances. The issuances schedule and debt service on future bonds have not been set.

Sincerely,

Debbie Haynie

Executive Secretary