investment banking overview for jenkins independent schools april 23, 2007 chip sutherland
TRANSCRIPT
Investment Banking Overview for Jenkins Independent Schools
April 23, 2007
Chip Sutherland
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Summary of the Existing Debt
Issue Of:Origina
l Amount
InterestRates Purpose Call Features
October 1, 1997
$1,775,000
4.10% to 5.00%
Refunded 1986 and 1992 bond issues
August 1, 2007 at 102%
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Calculation of Local Bondable RevenueAvailable from Local Tax Base and State-supported FSPK Funds
Source Legislation
Calculation Amount
Local Nickel (Building Fund) KRS 157.440 TAV/100*.05 $44,432
80% Capital Outlay (ADA*$100)*80% 43,928
State FSPK ($318.50*ADA) – Local Nickel 130,456
TOTAL LOCAL BONDABLE REVENUE $218,816
ASSUMPTIONS:
2006-2007 Total Valuation of Adjusted Property = $88,864,306
2006-2008 FSPK funding level of $318.50
2006-2007 AADA Plus Growth = 549.1
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Summary of Bonding Capacity
Current Bonding Potential: Based on current interest rates and without taking into account future increases in State funding, the aforementioned revenues can bond approximately $2,124,586.
Further, JIS can bond an additional $295,414 through the use of the district’s 2004 ($21,903) SFCC offers of assistance.
The SFCC requires the following cash contributions to utilize these offers:
Summary: Based on the assumptions used in our analysis and current market conditions, JIS can meet the debt service requirements on a $2,420,000 bond issue at an FSPK funding level of $318.50 per ADA.
Building Fund Requirement
Capital Outlay Requirement
2004 Offer 168,868.20 14,162.99
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Detailed Cash Flow Analysis
• During cash flow analysis, consider: – Legislative issues (other nickels and equalization)
Local Nickel (Building Fund)Local Growth NickelLocal Equalized Growth NickelLocal Recallable NickelState FSPKState Growth Nickel EqualizationState Recallable Nickel Equalization
– FSPK funding– Leveraging more than 80% Capital Outlay– Interest rate fluctuation– Retiring old debt– Refunding existing issues– AADA fluctuation– Future SFCC Offers of Assistance
• Detailed analysis on next page explains cash flow impact of pending renovation projects on JIS bonding ability.
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Detailed Cash Flow Analysis
JENKINS INDEPENDENT SCHOOL DISTRICTLONG-TERM FACILITY PLAN EVALUATION OF BONDING POTENTIAL
(A) (B) (A)*(B) (C) ((A)*(B))+C)Estimated State Total Bonding $0.05/FSPK Revenue Breakdown 80% Total Estimated Revenues
Fiscal Local AADA Equalization Revenues From FSPK Sub Capital Bonding Est. Bonds Total Debt in excess ofYear Projections (1) Rate (2) $0.05/FSPK/CO $0.05 (3) @ 100% Total Outlay Revenues Issued (4) Service (5) Debt Service
2007 549.1 $318.50 $174,888 $44,432 $130,456 $174,888 $43,928 $218,816 $890,000 $132,299 $86,5172008 549.1 $318.50 174,888 45,765 129,123 174,888 43,928 218,816 0 166,142 52,6742009 549.1 $350.00 192,185 47,138 145,047 192,185 43,928 236,113 0 162,829 73,2842010 549.1 $350.00 192,185 48,552 143,633 192,185 43,928 236,113 0 159,188 76,9252011 549.1 $385.00 211,404 50,009 161,395 211,404 43,928 255,332 0 158,322 97,0102012 549.1 $385.00 211,404 51,509 159,895 211,404 43,928 255,332 0 157,930 97,4022013 549.1 $424.00 232,818 53,054 179,764 232,818 43,928 276,746 0 53,322 223,4242014 549.1 $424.00 232,818 54,646 178,172 232,818 43,928 276,746 0 51,782 224,9642015 549.1 $466.00 255,881 56,285 199,596 255,881 43,928 299,809 0 55,226 244,5832016 549.1 $466.00 255,881 57,974 197,907 255,881 43,928 299,809 0 53,448 246,3612017 549.1 $513.00 281,688 59,713 221,975 281,688 43,928 325,616 0 51,639 273,9772018 549.1 $513.00 281,688 61,504 220,184 281,688 43,928 325,616 0 54,798 270,8182019 549.1 $564.00 309,692 63,350 246,342 309,692 43,928 353,620 0 52,713 300,9072020 549.1 $564.00 309,692 65,250 244,442 309,692 43,928 353,620 0 55,584 298,0362021 549.1 $620.00 340,442 67,208 273,234 340,442 43,928 384,370 0 53,202 331,168
Notes:(1) AADA held constant.(2) Based on current equalization rate. Assumes equalization rate will increase to $350 and then at a rate of 10% every biennium thereafter if KERA remains in place in future years.(3) Based on 3.0% annual growth rate in total assessed valuation. Jenkins Independent actually has experienced an average of 3.5% growth year over year (2003-2007).(4) Bonding based on current interest rates and includes 2004 SFCC Offer of Assistance currently valued at $300M. No consideration to pending 2006 SFCC Offer or any other possible SFCC Offers.(5) If District issued debt in 2007, debt service obligations could continue beyond 2021.
THIS ANALYSIS IS NOT INTENDED TO REPRESENT FUTURE BONDING POTENTIAL.