02-12-2013 Regular School Board Meeting
Agenda Item #33

Refunding Portions of the District's Outstanding Certificates of Participation (COP)


As reported to you at the January 22, 2013 Board meeting, Financial Services staff and the District's Financial Advisor, RBC Capital Markets, have been closely monitoring financial market conditions and are currently seeing historical lows in interest rates. While no one can predict how long this trend will continue, consensus seems to be that interest rates will remain at these low levels for weeks to come. District staff and the Financial Advisor have been exploring opportunities that might achieve some savings through refinancing of some of the District's outstanding Certificates of Participation (COP). Staff believes there are some savings to be gained from refunding all outstanding 2002 COP and portions of the outstanding 2004A and 2004B COP. The Financing team is also examining whether opportunities exist to refund portions of the outstanding 2006 and 2007 COP. Based on today's current market conditions, analysis shows that the District can realize approximately $4.9 million in net present value savings (NPV), or 6.02 percent. Based on guidance provided by the Government Finance Officers Association (GFOA), achieving a level of 3-5 percent NPV savings threshold is considered a best practice. 

After careful consideration and lengthy discussions with the Financial Advisor and the School Board Attorney, staff  is recommending the following Underwriting Team along with Bond and Disclosure Counsel, primarily due to their continued relationships and the ongoing services they have provided  to the District since the 2007 COP issues.  The recommendation for the Underwriting Team is: CitiGroup Global Markets Inc; Raymond James/Morgan Keegan; Stifel, Nicolaus and Company, Incorporated; and Wells Fargo Securities.  We are also recommending the continued services of Bryant Miller Olive as Bond and Disclosure Counsel, along with RBC Capital Markets as the District's Financial Advisor. 

Staff is also requesting the Board to delegate authority to the Superintendent to authorize the Financial Services team to move forward at such time that all legal documents are prepared and the market conditions are in place to allow the District to achieve at least a 3 percent NPV savings. Legal documents, along with the authorizing resolution, will be presented at the February 26, 2013 Board meeting. We will also provide an updated estimate for present value savings as of that date.


Approve the delegation of the Superintendent to authorize the Financial Services team to move forward with the refinancing plan at the optimum time to allow the District to achieve at least a 3 percent net present value savings.  Approve members of the Financing team, to include Financial Advisor, Bond and Disclosure Counsel and the Underwriting team as delineated.

Meeting Date(s)
Information - 2/12/2013
Consent after Information2/26/2013

Authority for Action
FS Chapter 1001, 1003, 1013

Involves Expenditure of Funds Directly in the Classroom

Source of Funding
Agenda Item will not Require the Expenditure of Funds

Cost Center


Jo Ann Clark, Director of Accounting Services, ext. 660

Judy Preston, Associate Superintendent of Financial Services, ext. 600