New Citizen's Bond Oversight Committee (COC) Composition
SMUSD COC Scores High On Transparency in San Diego Taxpayer's Educational Foundation Report
The San Diego Taxpayer's Educational Foundation in its June 2015 Transparency Scorecard again ranked the SMUSD COC among the highest COCs. The only Scorecard item missed was the lack of contact information for the COC members on the website. After discussions with bond counsel and District staff and considering privacy and tracking considerations, the COC determined that it would be appropriate for the District to provide an email for communications to the COC Chair.
The Citizens Bond Oversight Committee (the COC) was established to actively review and report on the proper expenditure of taxpayer money for school construction. The COC is required to report on compliance with Article XIIIA, Section 1(b)(3) of the California Constitution including:
The COC may also make specific recommendations related to maximizing bond revenues by implementing cost-saving measures.
The COC may not directly involve itself with the issuance of bonds or the negotiation of contracts.
Citizens Oversight Committee Meetings
COC meetings are open to the public and the public is encouraged to attend.
Meetings are held at district headquarters 255 Pico Ave, San Marcos
The COC will present its annual report to the Governing Board at the April 19, 2016 Governing Board meeting.
The next regularly scheduled COC meeting is Wednesday, April 27, 2016 at 6 pm.
Future COC meetings will be held at La Costa Meadows, Alvin Dunn and San Marcos Middle School as these major projects get underway.
Proposition K Bond Issuance
Bonds authorized: $287,000,000.
In accordance with Proposition K the maximum interest rate on any bond cannot exceed 12% and the final maturity of any bond cannot exceed 40 years. Recent legislation restricts Capital Appreciation Bonds to no more than 25 years along with other restrictions. Based on the initial financing plan a tax rate of $44 per $100,000 of assessed value was expected to be sufficient to support the debt service on the bonds; however, the maximum statutory tax rate is $60 per $100,000 of assessed value and the Series C Bonds were issued relying on the $60 per $100,000 cap based on the Resolution of Issuance adopted by the Governing Board on March 10, 2014. The Governing Board held workshops and public hearings to review the financing plan in light of AB 182. Recognizing that using the statutory limit would save an estimated $23 million in debt service savings the Governing Board authorized use of the full statutory limit.
Bonds issued to date: $281.7 million;
$142 million Series A bonds issued June 22, 2011; yields ranged from 1.38% for the shortest maturity to 6.65% for the longest maturity with an All-In True Interest Cost (calculation of borrowing cost including underwriter's discount and costs of issuance) of 5.234377%; maximum maturity at issue was 28 years with a weighted average maturity of 21.2 years (reflects that bonds mature beginning in 2013)
$65 million Series B bonds issued May 8, 2012; yields ranged from 0.75% for the shortest maturity to 5.80% for the longest maturity with a True Interest Cost of 5.689025%; maximum maturity at issue was 40 years with a weighted average maturity of 30.8 years (reflects that bonds mature beginning in 2013, however most of the issue was Capital Appreciation Bonds maturing in 2047 and 2051).
$74.7 million of Series C bonds issued May 15, 2014; yields ranged from 0.250% for the shortest maturity to 5.310% for the longest maturity with a True Interest Cost of 4.616904%; maximum maturity at issue was 26 years with a weighted average maturity of 21.886 years (maximum maturity of Capital Appreciation Bonds Current Interest Bonds was 24 years and 26 years respectively.
Remaining planned bond issuance: $5.3 million of potential issuance remains under Proposition K authorization.
For a summary of the construction budget and status for the project you are interested in click on the thumbnail above or the link in the left margin. Project budget and status information is updated quarterly after COC meetings.
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Results of Independent Financial & Performance Audits
The District is required to obtain annual financial and performance audits related to the expenditure of Proposition K bond proceeds. Christy White Associates completed independent financial and performance audit reports for the fiscal year ended June 30, 2015. As recommended by the COC and adopted by the Governing Board, the auditor met with the COC at its January 29, 2016 meeting.
The audit reports:
The full reports are available by clicking on the links in the left margin.
Compliance with Article XIIIA, Section 1(b)(3) of the California Constitution and Recently Adopted AB 182
Based on its review of information provided by the District and the independent auditor to the COC, and its inspections of the projects to date, the COC concludes that expenditures of Proposition K Bond Building Fund have been in compliance with the requirements of Section 1(b)(3) of Article XIIIA of the California Constitution. Issuance of Series C Bonds were issued in compliance with AB 182 adopted in 2013 which added restrictions on the issuance of school bonds, especially Capital Appreciation Bonds.