Little Elm ISD Long-Range Facilities Planning Committee Meeting 2: - - PowerPoint PPT Presentation
Little Elm ISD Long-Range Facilities Planning Committee Meeting 2: Monday, April 10, 2017 Zellars Center for Learning & Leadership 300 Lobo Lane Little Elm, TX 75068 AGENDA Welcome, Meeting 1 Recap & Website Review How School
Zellars Center for Learning & Leadership 300 Lobo Lane Little Elm, TX 75068
www.LittleElmISDPlanning.net
FEDERAL LOCAL STATE
Revenue Sources
Federal State Local
provide services to a specific group of students
dollars to fund a program
school districts while the remainder goes to the state or to regional service centers
FEDERAL
Revenue Sources
Federal State Local
Foundation School Program
regardless of property wealth, receive "substantially equal access to similar revenue per student at similar tax effort, considering all state and local tax revenues of districts after acknowledging all legitimate student and district cost differences.”
FEDERAL STATE
Revenue Sources
Federal State Local
State funding system is VERY COMPLICATED The simplest explanation:
funding
by looking at “wealth per student”
FEDERAL STATE
Revenue Sources
Federal State Local
FEDERAL LOCAL
Revenue Sources
Federal State Local
FEDERAL LOCAL For the average citizen this is similar to:
✓ House repairs ✓ Car fuel ✓ Routine services ✓ Groceries ✓ Cleaning supplies ✓ Utilities
Source of Revenue 2016-2017 Proposed Budget % $ Per Student (7,509 students)
Local $36.2 58.8% $4,828 State $24.2 39.2% $3,218 Federal $1.3 2% $166 Total $61.7 100% $8,212
FEDERAL LOCAL For the average citizen this is similar to:
✓ New home purchase ✓ House renovations ✓ Land for a home ✓ New appliances ✓ New home computer ✓ New car
Also referred to as Debt Service.
I&S funds may only be used to repay debt. They cannot be used for salaries, utilities or other day-to-day expenses.
If a district wants to raise the rate beyond the cap, it can only go as high as $1.17; however, it requires voter approval through the holding of a Tax Ratification Election.
Every cent requires voter approval in a Bond Election.
per $100
(For example: A home valued at $200,000 after any homestead/other exemptions would have an annual LEISD tax of $3080)
*The Little Elm ISD Board of Trustees called for a TRE, which was held September 2015. Thirteen pennies were moved from the I&S rate to the M&O side of the budget. This was to generate additional funds for the ongoing M&O budget.
Fiscal Year General Operating (M&O) Debt Service (I&S) Total
2002- 2003 $1.275
$0.436 $1.71
2009 - 2010 $1.04
$0.50 $1.54
2010 - 2011 $1.04
$0.50 $1.54
2011 - 2012 $1.04
$0.50 $1.54
2012 - 2013 $1.04
$0.50 $1.54
2013 - 2014 $1.04
$0.50 $1.54
2014 - 2015 $1.04
$0.50 $1.54
2015 - 2016 $1.04
$0.50 $1.54
2016 - 2017 $1.17 $0.37 $1.54
Little Elm Independent School District
Preliminary Bond Capacity Analysis April 10, 2017
RBC Capital Markets 1
Disclaimer
Disclaimer: This presentation was prepared exclusively for the benefit of and internal use by the recipient for the purpose of considering the transaction or transactions contemplated herein. This presentation is confidential and proprietary to RBC Capital Markets, LLC (“RBC CM”) and may not be disclosed, reproduced, distributed or used for any other purpose by the recipient without RBC CM’ express written consent. By acceptance of these materials, and notwithstanding any other express or implied agreement, arrangement, or understanding to the contrary, RBC CM, its affiliates and the recipient agree that the recipient (and its employees, representatives, and other agents) may disclose to any and all persons, without limitation of any kind from the commencement
any kind (including opinions or other tax analyses) that are provided to the recipient relating to such tax treatment, structure, or strategy. The information and any analyses contained in this presentation are taken from, or based upon, information obtained from the recipient or from publicly available sources, the completeness and accuracy of which has not been independently verified, and cannot be assured by RBC CM. The information and any analyses in these materials reflect prevailing conditions and RBC CM’ views as of this date, all of which are subject to change. To the extent projections and financial analyses are set forth herein, they may be based on estimated financial performance prepared by or in consultation with the recipient and are intended only to suggest reasonable ranges of results. The printed presentation is incomplete without reference to the oral presentation or other written materials that supplement it. IRS Circular 230 Disclosure: RBC CM and its affiliates do not provide tax advice and nothing contained herein should be construed as tax advice. Any discussion of U.S. tax matters contained herein (including any attachments) (i) was not intended or written to be used, and cannot be used, by you for the purpose of avoiding tax penalties; and (ii) was written in connection with the promotion or marketing of the matters addressed herein. Accordingly, you should seek advice based upon your particular circumstances from an independent tax advisor.
RBC Capital Markets 2
Table of Contents
Section 1 Review of Existing Debt Section 2 Current Market Review Section 3 Preliminary Tax Rate Impact Analysis Section 4 Bond Election Timetable
Review of Existing Debt
SECTION 1
RBC Capital Markets 4
Outstanding Callable Coupon / Yield First Tax Exempt Issued Par Amount at Par Range of Call % Advance Final Use of Issue Par Amount Apr-10-2017 Amount Callable Bonds Date Refundable Maturity Structure Proceeds Series 1995A $8,795,000 $90,000
Fixed Rate Refunding Series 1999 9,601,087 1,525,079
Fixed Rate Sch Bldg & Ref Series 2002 3,646,376 2,975,742
Fixed Rate Sch Bldg & Ref Series 2003 13,082,633 51,928
Fixed Rate Sch Bldg & Ref Series 2008A 7,500,000 7,335,000 6,880,000 4.00% - 4.50% 8/15/18 82.26% 8/15/42 Fixed Rate School Building Series 2008B* 1,067,333 865,000 585,000 4.27% - 4.45% 8/15/18 82.26% 8/15/23 Fixed Rate Refunding Series 2010* 19,960,000 19,960,000 18,090,000 3.44% - 4.25% 8/15/20 0.00% 8/15/35 Fixed Rate Refunding Series 2012* 48,265,000 48,265,000 48,155,000 2.64% - 5.00% 8/15/21 82.16% 8/15/42 Fixed Rate Sch Bldg & Ref Series 2013* 5,920,000 5,880,000 5,870,000 4.00% - 5.00% 8/15/23 48.82% 8/15/38 Fixed Rate Sch Bldg & Ref Series 2014 5,000,000 4,960,000 4,960,000 4.25% 2/15/24 99.29% 8/15/37 Fixed Rate Refunding Series 2015A 12,045,000 11,095,000 7,320,000 4.00% 2/15/25 96.92% 8/15/37 Fixed Rate Refunding Series 2015B 8,565,000 8,410,000 5,635,000 3.00% - 4.00% 2/15/25 0.00% 8/15/37 Fixed Rate Refunding Series 2016 38,595,000 38,595,000 27,010,000 3.00% - 4.00% 2/15/26 69.86% 8/15/40 Fixed Rate Sch Bldg & Ref Totals $182,042,429 $150,007,748 $97,495,000 Outstanding Callable Coupon / Yield First Tax Exempt Issued Par Amount at Par Range of Call % Advance Final Use of Issue Par Amount Apr-10-2017 Amount Callable Bonds Date Refundable Maturity Structure Proceeds Series 2014 $4,515,000 $4,215,000 $2,760,000 3.50% - 4.25% 2/15/24 100% 08/15/33 Fixed Rate Renovations Totals $4,515,000 $4,215,000 $2,760,000
Review of Existing Debt
Summary of Outstanding Debt
* Includes capital appreciation bonds that are callable at their respective accreted values, not their original principal values.
Limited Tax Debt Profile Unlimited Tax Debt Profile
RBC Capital Markets 5
Review of Existing Debt
Unlimited Tax Debt (by Principal & Interest)
Note: Debt service payments reflect payments from September 1 through August 31.
$0 $2,000,000 $4,000,000 $6,000,000 $8,000,000 $10,000,000 $12,000,000 $14,000,000 2017 2019 2021 2023 2025 2027 2029 2031 2033 2035 2037 2039 2041 Debt Service
Principal Interest
Fiscal Year Percent of Ending Principal Interest Debt Service Principal Retired 2017 $4,058,560 $8,011,133 $12,069,692 2.71% 2018 3,911,158 8,056,604 11,967,761 5.31% 2019 3,998,818 7,965,638 11,964,456 7.98% 2020 4,000,215 7,967,734 11,967,949 10.65% 2021 3,812,589 8,001,771 11,814,361 13.19% 2022 3,756,267 8,054,239 11,810,506 15.69% 2023 2,889,267 8,924,139 11,813,406 17.62% 2024 2,813,138 8,516,944 11,330,081 19.49% 2025 3,306,678 8,031,953 11,338,631 21.70% 2026 3,304,306 8,033,925 11,338,231 23.90% 2027 3,300,249 8,063,382 11,363,631 26.10% 2028 3,500,090 7,868,492 11,368,581 28.43% 2029 5,551,249 5,821,932 11,373,181 32.13% 2030 6,205,164 5,164,717 11,369,881 36.27% 2031 7,180,000 4,192,206 11,372,206 41.06% 2032 7,435,000 3,929,925 11,364,925 46.01% 2033 7,750,000 3,615,775 11,365,775 51.18% 2034 8,065,000 3,290,925 11,355,925 56.56% 2035 8,420,000 2,935,350 11,355,350 62.17% 2036 9,020,000 2,558,000 11,578,000 68.18% 2037 9,425,000 2,138,000 11,563,000 74.46% 2038 9,855,000 1,706,375 11,561,375 81.03% 2039 10,560,000 1,258,375 11,818,375 88.07% 2040 11,005,000 808,025 11,813,025 95.41% 2041 3,360,000 338,475 3,698,475 97.65% 2042 3,525,000 173,300 3,698,300 100.00% Total $150,007,748 $135,427,334 $285,435,082
RBC Capital Markets 6
$0 $2,000,000 $4,000,000 $6,000,000 $8,000,000 $10,000,000 $12,000,000 $14,000,000 2017 2019 2021 2023 2025 2027 2029 2031 2033 2035 2037 2039 2041 Debt Service
Ser 1995A Ser 1999 Ser 2002 Ser 2003 Ser 2008A Ser 2008B Ser 2010 Ser 2012 Ser 2013 Ser 2014 Ser 2015A Ser 2015B Ser 2016
Fiscal Year Ending UL Tax Sch Bldg & Ref Bds Ser 2012 U/L Tax Sch Bldg & Ref Bds Ser 2013 U/L Tax Ref Bds Ser 2014 U/L Tax Ref Bds Ser 2015A U/L Tax Ref Bds Ser 2015B U/L Tax Sch Bldg & Ref Bds Ser 2016 Total 2017 $2,156,650 $266,575 $210,800 $816,319 $332,950 $3,165,750 $12,069,692 2018 2,156,650 266,575 210,800 821,719 332,350 3,151,150 11,967,761 2019 2,156,650 266,575 210,800 821,819 331,750 3,156,150 11,964,456 2020 2,156,650 266,575 210,800 816,719 486,150 3,006,650 11,967,949 2021 2,431,650 266,575 210,800 726,519 1,055,600 2,375,150 11,814,361 2022 2,436,650 266,575 210,800 727,919 1,052,800 2,371,450 11,810,506 2023 2,436,650 266,575 210,800 724,719 724,400 1,847,350 11,813,406 2024 2,431,650 266,575 210,800 726,219 722,525 1,851,200 11,330,081 2025 3,029,775 266,575 210,800 727,269 725,400 1,859,300 11,338,631 2026 3,633,375 266,575 210,800 727,869 470,400 1,466,500 11,338,231 2027 3,573,075 356,575 210,800 728,069 469,800 1,469,800 11,363,631 2028 3,533,225 396,575 210,800 732,469 468,800 1,463,600 11,368,581 2029 3,558,225 366,575 210,800 731,269 467,400 1,467,000 11,373,181 2030 4,496,125 292,325 210,800 544,619 425,600 1,404,600 11,369,881 2031 4,406,281 381,050 210,800 547,588 770,000 1,919,000 11,372,206 2032 3,431,750 1,355,950 210,800 545,088 765,200 1,922,200 11,364,925 2033 3,439,250 1,354,200 210,800 541,763 764,600 1,918,800 11,365,775 2034 5,012,250 698,400 860,800 543,113 763,000 1,924,000 11,355,925 2035 5,347,250 142,000 1,423,175 543,975 765,400 1,917,400 11,355,350 2036 6,902,000 142,000 2,130,475 683,225 221,600 1,084,400 11,578,000 2037 6,904,250 142,000 1,115,475 1,687,050 218,400 1,083,000 11,563,000 2038 3,082,250 2,982,000 4,876,200 11,561,375 2039 3,081,500 8,117,200 11,818,375 2040 3,084,750 8,112,000 11,813,025 2041 3,081,500 3,698,475 2042 3,081,750 3,698,300 Total $91,041,781 $11,275,400 $9,113,525 $15,465,313 $12,334,125 $62,929,850 $285,435,082 Fiscal Year Ending UL Tax Ref Bonds Ser 1995A UL Tax Sch Bldg & Ref Bds Ser 1999 UL Tax Sch Bldg & Ref Bds Ser 2002 UL Tax Sch Bldg & Ref Bds Ser 2003 UL Tax Sch Bldg Bds Ser 2008A UL Tax Ref Bds Ser 2008B UL Tax Ref Bds Ser 2010 2017 $434,936 $1,925,000 $105,000 $552,913 $340,000 $1,762,800 2018 442,805 1,925,000 552,913 340,000 1,767,800 2019 440,000 1,925,000 552,913 340,000 1,762,800 2020 438,693 1,925,000 552,913 340,000 1,767,800 2021 437,754 557,513 340,000 3,412,800 2022 440,000 556,513 340,000 3,407,800 2023 $860,000 440,000 555,113 340,000 3,407,800 2024 855,000 440,000 413,313 3,412,800 2025 855,000 440,000 411,713 2,812,800 2026 865,000 430,000 414,913 2,852,800 2027 860,000 435,000 412,713 2,847,800 2028 860,000 435,000 415,313 2,852,800 2029 855,000 440,000 412,513 2,864,400 2030 890,000 414,013 2,691,800 2031 415,088 2,722,400 2032 415,738 2,718,200 2033 415,963 2,720,400 2034 410,763 1,143,600 2035 415,350 800,800 2036 414,300 2037 412,825 2038 620,925 2039 619,675 2040 616,275 2041 616,975 2042 616,550 Total $6,010,000 $6,584,188 $7,700,000 $105,000 $12,765,700 $2,380,000 $47,730,200
Review of Existing Debt
Unlimited Tax Debt (by Series)
Note: Debt service payments reflect payments from September 1 through August 31.
RBC Capital Markets 7
Review of Existing Debt
Limited Tax Debt – Maintenance Tax Notes, Series 2014
Note: Debt service payments reflect payments from September 1 through August 31. $0 $50,000 $100,000 $150,000 $200,000 $250,000 $300,000 $350,000 2016 2018 2020 2022 2024 2026 2028 2030 2032 Debt Service Principal Interest
Fiscal Year Percent of Ending Principal Interest Debt Service Principal Retired 2017 $195,000 $147,538 $342,538 4.63% 2018 200,000 143,638 343,638 9.37% 2019 200,000 139,638 339,638 14.12% 2020 205,000 134,638 339,638 18.98% 2021 210,000 129,513 339,513 23.96% 2022 220,000 123,213 343,213 29.18% 2023 225,000 116,613 341,613 34.52% 2024 230,000 109,863 339,863 39.98% 2025 240,000 101,813 341,813 45.67% 2026 250,000 93,413 343,413 51.60% 2027 260,000 84,038 344,038 57.77% 2028 265,000 74,288 339,288 64.06% 2029 280,000 63,688 343,688 70.70% 2030 290,000 52,488 342,488 77.58% 2031 300,000 40,163 340,163 84.70% 2032 315,000 27,413 342,413 92.17% 2033 330,000 14,025 344,025 100.00% Total $4,215,000 $1,595,975 $5,810,975 $0 $50,000 $100,000 $150,000 $200,000 $250,000 $300,000 $350,000 $400,000 2017 2019 2021 2023 2025 2027 2029 2031 2033 Debt Service
Principal Interest
RBC Capital Markets 8
Election Date Authorized Bond Series Delivery Date Issued to Date 02/02/2002 $144,500,000 U/L Tax Sch Bldg & Ref Bds, Series 2002 04/17/2002 $25,000,000.00 U/L Tax Sch Bldg & Ref Bds, Series 2002A 09/25/2002 32,000,000.00 U/L Tax Sch Bldg & Ref Bds, Series 2003 08/12/2003 13,000,000.00 U/L Tax Sch Bldg & Ref Bds, Series 2004 09/02/2004 14,000,000.00 U/L Tax Sch Bldg & Ref Bds, Series 2006 09/21/2006 14,000,000.00 U/L Tax Sch Bldg Bds, Series 2008A 07/16/2008 7,500,000.00 U/L Tax Sch Bldg & Ref Bds, Series 2012 08/07/2012 15,000,000.00 U/L Tax Sch Bldg & Ref Bds, Series 2013 09/26/2013 3,000,000.00 U/L Tax Sch Bldg & Ref Bds, Series 2016 05/19/2016 21,000,000.00 Total Bonds Issued $144,500,000.00 08/28/1999 $30,435,000 U/L Tax Sch Bldg & Ref Bds, Series 1999 11/08/1999 $9,405,667.35 U/L Tax Sch Bldg & Ref Bds, Series 2000 06/07/2000 4,203,561.30 U/L Tax Sch Bldg & Ref Bds, Series 2001 02/21/2001 15,002,464.70 U/L Tax Sch Bldg & Ref Bds, Series 2002 04/17/2002 1,823,306.65 Total Bonds Issued $30,435,000.00 10/01/1994 $10,850,000 U/L Tax Sch Bldg & Ref Bds, Series 1995 02/22/1995 $10,850,000.00 *** *** U/L Tax Sch Bldg Bds, Series 1986 02/15/1986 $1,975,000.00 *** *** Sch Bldg Bds, Series 1973 03/15/1973 $550,000.00
Little Elm ISD Bond Elections Summary
Review of Existing Debt
Bond Election History
Note: Documentation not available for elections held prior to October 1994.
RBC Capital Markets 9
Review of Existing Debt
Credit Ratings History
highest rating available from S&P and Fitch. The District’s ratings are considered to be in the high grade / high quality rating category. Previously, in March 2015, S&P confirmed the District’s underlying credit ratings of “AA-”. Previously, in February 2014, S&P and Fitch confirmed the District’s underlying credit ratings of “AA-”. Previously, in August 2013, S&P and Fitch confirmed the District’s underlying credit ratings of “AA-”. Previously, in July 2012, S&P upgraded the District’s underlying credit rating from “A+” to “AA-”. Previously, in October 2010, S&P updated the District’s underlying credit rating from “A” to “A+”.
Access to the diverse Dallas-Fort Worth metropolitan statistical area; Strong wealth and good income indicators; and Very strong financial position, as evidenced by its very strong reserves.
Fitch Standard & Poor's Highest Quality (Lowest Default Risk) AAA AAA High Grade / High Quality AA+ AA+ AA AA AA- AA- Upper Medium Grade A+ A+ A A A- A- Minimum Investment Grade BBB+ BBB+ BBB BBB BBB- BBB- Speculative Grade BB(+,-) BB(+,-) B (+,-) B (+,-) Highly Speculative Grade CCC (+,-) CCC (+,-) CC CC C C Imminent Default or In Default SD SD D D Credit Rating Levels
PSF
RBC Capital Markets 10
Review of Existing Debt
Savings History
Bond Series Delivery Date Gross Savings NPV Savings U/L Tax Sch Bldg & Ref Bds, Series 2016 05/19/2016 $4,305,943.99 $3,359,080.82 U/L Tax Ref Bds, Series 2015B 04/28/2015 2,201,972.64 1,744,993.87 U/L Tax Ref Bds, Series 2015A 04/09/2015 2,844,497.72 2,044,164.92 U/L Tax Ref Bds, Series 2014 03/18/2014 1,007,510.00 680,191.99 U/L Tax Sch Bldg & Ref Bds, Series 2013 09/26/2013 424,224.00 313,751.00 U/L Tax Sch Bldg & Ref Bds, Series 2012 08/07/2012 11,649,715.00 7,553,080.00 U/L Tax Ref Bds, Series 2010 11/18/2010 6,905,064.00 4,813,404.00 Total $29,338,927.35 $20,508,666.60
Little Elm ISD Bond Refunding Summary
Current Market Review
SECTION 2
RBC Capital Markets 12
1Q-17 2Q-17 3Q-17 4Q-17 2018 Real GDP (q/q) 2.00 2.70 2.50 2.60 3.00 Core Inflation (y/y) 2.20 2.10 2.40 2.30 2.30 Unemployment 4.70 4.50 4.30 4.20 4.00 IOER 1.00 1.25 1.25 1.50 2.50 2-Year Note 1.25 1.45 1.60 1.90 2.80 5-Year Note 1.93 2.10 2.25 2.50 3.20 10-Year Note 2.40 2.65 2.80 3.00 3.60 30-Year Note 3.03 3.20 3.35 3.50 3.90
Current Market Review
Macro and Interest Rate Drivers May Lead to Continued Volatility
‒ While the shifting economic narrative has been centered on the potential impact from the GOP sweep (and commensurate fiscal package), we have to be cognizant of the fact that the US economy was already building momentum well ahead of the election. Thus, heading into 2017 we were already poised for an economic backdrop that was likely to see real GDP growth advance ahead of the post-recession average. ‒ In round numbers, we were baking in a 2.5% growth profile for the year-ahead even with the auspice of political gridlock.
‒ There was a lot of focus on the Fed’s dot medians both before and after the March FOMC statement hit the tape. The fact that the median did not move for either 2017
‒ We think the Fed remains on track for 3 hikes this year and look for another +25 basis points in June. In September, we think the Fed will announce that it intends to start shrinking its balance sheet—given that tapering reinvestment is a form of tightening
Then we look for the Fed to squeeze in hike #3 in the last meeting of 2017.
‒ 10 year: 3.00% forecasted for end of 2017 (2.40% as of March 31, 2017) ‒ 30 year: 3.50% forecasted for end of 2017 (3.02% as of March 31, 2017)
RBC Economic Outlook and Interest Rate Forecasts(1) Markets Have Experienced Significant Volatility Over the Last Year
(1) RBC Rate and Economic Forecast as of March 31, 2017.
1.50% 1.75% 2.00% 2.25% 2.50% 2.75% 3.00% 3.25% 3.50% 3/31/16 4/30/16 5/31/16 6/30/16 7/31/16 8/31/16 9/30/16 10/31/16 11/30/16 12/31/16 1/31/17 2/28/17 3/31/17
MMD AAA GO (30-Yr) TSY (30-Yr)
RBC Capital Markets 13
1.000% 2.000% 3.000% 4.000% 5.000% 6.000% Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12 Jan-13 Jan-14 Jan-15 Jan-16 Jan-17 10 Yr 20 Yr 30 Yr
Current Market Review
After closing at 3.18% the previous week, the 30-year “AAA” MMD decreased by 11 bps from March 17th – March 24th, closing at the current rate of 3.07%.
“AAA” MMD January 1, 2007 to Present Shift in “AAA” MMD Since March 2016
Source: TM3, Thomson Reuters 10, 20, and 30 year “AAA” MMD shown to represent different average lives of municipal transactions Rates as of March 24, 2017
1.100% 1.300% 1.500% 1.700% 1.900% 2.100% 2.300% 2.500% 2.700% 2.900% 3.100% 3.300% 3.500% Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan FebMar
January 1, 2007 to Present
Maximum Minimum Current
Shift in 30-year "AAA" MMD
2010 2011 2012 2013 2014 2015 2016 0.520%
1.330%
0.270% 30 Year 5.940% 1.930% 3.070% 10 Year 4.860% 1.290% 2.280% 20 Year 5.740% 1.800% 2.960%
March 1, 2016 to Present
10 Year 20 Year 30 Year Maximum 2.580% 3.200% 3.350% Minimum 1.290% 1.800% 1.930% Average 1.836% 2.472% 2.629%
RBC Capital Markets 14
Current Market Review
Historical Perspective
Today’s 3.91% level is lower than 82.96% of historical rates since January 1961.
Source: Bloomberg as of March 23, 2017 Weekly yields and indexes released by the Bond Buyer. Updated every Thursday at approximately 6:00pm EST. 20 Bond General Obligation Yield with 20 year maturity, rated AA2 by Moody's Arithmetic Average of 20 bonds' yield to maturity.
Bond Buyer 20 GO Index since January 1961 % of Time in Each Range Since 1961
0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% 14.0%
Bond Buyer 20 GO Bond Index Today's Rate at 3.91%
Yield Range Less than 3.50% 10.12% 3.50% - 4.00% 8.62% 4.01% - 4.50% 11.04% 4.51% - 5.00% 10.29% 5.01% - 5.50% 14.35% 5.51% - 6.00% 9.99% 6.01% - 6.50% 7.74% 6.51% - 7.00% 7.06% 7.01% - 7.50% 6.37% 7.51% - 8.00% 3.75% Greater than 8.00% 10.67% Total 100.00%
Preliminary Tax Rate Impact Analysis
SECTION 3
RBC Capital Markets 16 Scenario 2 Project the District’s bonding capacity with no increase to the District’s I&S tax rate of $0.37. This scenario assumes the District sells new bond authorization in the following installment: Series 2018 : Issue $65,000,000 of unlimited tax bonds, utilizing a 30-year amortization, in August 2018.
Preliminary Tax Rate Impact Analysis
Summary of Financing Scenarios
Scenario 1 Existing debt and tax rate structure assuming no issuance of additional debt. Please note that the above scenarios are preliminary and the projected results are subject to change as interest rates fluctuate, more structuring dialogue takes place with District administration and Bond/Tax Counsel have a chance to thoroughly review the financing plan and do a full tax analysis on any contemplated
proposed bond issue. This analysis does not contemplate the average life of the assets being financed and as such, the ultimate tax rate impact and debt service associated with the new financing may be different than what is shown herein. Scenario 3 Project the District’s maximum bonding capacity in two installments. This scenario assumes the District sells new bond authorization in the following two installments: Series 2018 : Issue $115,000,000 of unlimited tax bonds, utilizing a 30-year amortization, in August 2018 Series 2020 : Issue $40,000,000 of unlimited tax bonds, utilizing a 30-year amortization, in August 2020. We present the following scenarios:
RBC Capital Markets 17 $1,401,235,698 $1,568,335,086 $1,595,249,850 $1,538,276,268 $1,662,064,834 $1,667,190,090 $1,827,584,700 $2,113,714,237 $2,385,225,111 $2,819,398,964 $3,030,853,886 $3,258,167,928 $3,421,076,324 $3,592,130,140 $3,771,736,647 $3,771,736,647
$0 $500,000,000 $1,000,000,000 $1,500,000,000 $2,000,000,000 $2,500,000,000 $3,000,000,000 $3,500,000,000 $4,000,000,000 2007/08 2008/09 2009/10 2010/11 2011/12 2012/13 2013/14 2014/15 2015/16 2016/17 2017/18 2018/19 2019/20 2020/21 2021/22 … 2050/51
Taxable Assessed Valuation
Preliminary Tax Rate Impact Analysis
Historical and Projected Taxable Assessed Valuation Growth (Net of Frozen Levy)
Historical Historical Historical Average Annual Average Annual Average Annual Increase - Years Increase - Years Increase - Years 2007/08-2016/17 2012/13-2016/17 2014/15-2016/17 Fiscal Year 2007/08 2008/09 2009/10 2010/11 2011/12 2012/13 2013/14 2014/15 2015/16 2016/17 (10-Years) (5-Years) (3-Years) Taxable Assessed Valuation $1,401,235,698 $1,568,335,086 $1,595,249,850 $1,538,276,268 $1,662,064,834 $1,667,190,090 $1,827,584,700 $2,113,714,237 $2,385,225,111 $2,819,398,964 Percentage Change 13.66% 11.93% 1.72%
8.05% 0.31% 9.62% 15.66% 12.85% 18.20% 8.84% 11.33% 15.57% Dollar Change $168,438,451 $167,099,388 $26,914,764
$123,788,566 $5,125,256 $160,394,610 $286,129,537 $271,510,874 $434,173,853 $158,660,172 $231,466,826 $330,604,755 Projected Average Annual Increase - Years 2022/23 & 2017/18-2021/22 Fiscal Year 2017/18 2018/19 2019/20 2020/21 2021/22 Thereafter (5-Years) Taxable Assessed Valuation $3,030,853,886 $3,258,167,928 $3,421,076,324 $3,592,130,140 $3,771,736,647 $3,771,736,647 Percentage Change 7.50% 7.50% 5.00% 5.00% 5.00% 0.00% 6.00% Dollar Change $211,454,922 $227,314,041 $162,908,396 $171,053,816 $179,606,507 $0 $190,467,537
RBC Capital Markets 18 Description Scenario 1 Scenario 2 Scenario 3
Bond Proceeds to District - Series 2018 $ - $ 65,000,000 $ 115,000,000 Bond Proceeds to District - Series 2020
Total Bond Proceeds to District $ - $ 65,000,000 $ 155,000,000 Amortization - Series 2018
30 Years Amortization - Series 2020
Current I&S Fund Tax Rate $ 0.370 $ 0.370 $ 0.370 I&S Fund Tax Rate Increase (2019 - 2021) 0.000 0.000 0.130 Maximum I&S Fund Tax Rate $ 0.370 $ 0.370 $ 0.500 Gross Outstanding Debt Service $ 285,435,082 $ 285,435,082 $ 285,435,082 Plus: Projected Series 2018 Debt Service
270,155,300 Plus: Projected Series 2020 Debt Service
Less: Projected Frozen Levy Revenues (30,743,584) (41,600,000) (58,600,000) Less: Other Available Revenues (337,000) (4,930,000) (2,750,500) Total Projected Outstanding Debt Service $ 254,354,498 $ 391,164,182 $ 599,263,007
Preliminary Tax Rate Impact Analysis
Summary of Findings
RBC Capital Markets 19
Preliminary Tax Rate Impact Analysis
Peer Analysis
2017 2016/17 2017 Outstanding Debt Total M&O I&S Credit School District Population TAV ADA Debt Per ADA Tax Rate Tax Rate Tax Rate Rating Aubrey 11,472 $741,069,420 2,246 $48,695,891 $21,681 $1.5100 $1.1700 $0.3400 A1 Argyle ISD 9,101 1,360,020,910 2,326 88,840,743 38,195 1.5701 1.1001 0.4700 Aa3/A+ Lake Dallas ISD 19,972 1,452,258,614 3,757 82,662,581 22,002 1.6700 1.1700 0.5000 A1/AA- Sanger ISD 13,366 849,493,050 2,521 21,450,631 8,509 1.3721 1.1700 0.2021 A1 Krum ISD 10,883 669,310,000 1,990 42,291,556 21,252 1.5400 1.1700 0.3700 AA- Carroll ISD 28,989 7,408,797,867 7,811 192,030,246 24,585 1.3950 1.0400 0.3550 Aa1/AA+ Celina ISD 12,898 907,967,155 2,313 86,637,771 37,457 1.6400 1.1400 0.5000 A1 Prosper ISD 60,917 4,700,520,822 9,684 454,893,211 46,974 1.6700 1.1700 0.5000 Aa3/A+ Coppell ISD 55,007 10,403,841,780 11,950 288,134,166 24,112 1.4927 1.1700 0.3227 Aa1/AA+ McKinney ISD 112,042 11,461,455,223 23,449 491,725,000 20,970 1.6200 1.1700 0.4500 Aa2/AA Allen ISD 95,103 10,503,363,836 20,163 565,374,087 28,040 1.5900 1.1400 0.4500 Aa2/AA Lovejoy ISD 19,588 1,830,793,911 3,926 167,695,234 42,714 1.6700 1.1700 0.5000 Aa2/AA- Princeton ISD 19,754 699,042,232 3,875 94,875,641 24,484 1.6200 1.1700 0.4500 A2 Peer Group Average 36,084 $4,075,994,986 7,385 $201,946,674 $27,767 $1.5661 $1.1500 $0.4161 Little Elm ISD 33,793 $2,819,398,964 6,864 $150,007,748 $21,854 $1.5400 $1.1700 $0.3700 AA-/AA- Post Sale - $65MM……………………………………………………………… $215,007,748 $31,324 $1.5400 $1.1700 $0.3700 TBD Post Sale - $155MM…………………………………………………………… $305,007,748 $44,436 $1.6700 $1.1700 $0.5000 TBD
Bond Election Timetable
SECTION 4
RBC Capital Markets 21
Bond Election Timetable
2017 Bond Election Dates
Note: The calendar above represents our understanding of the Election code for the subject year. Consult legal counsel for final decisions.
January February March April
S M T W T F S S M T W T F S S M T W T F S S M T W T F S
1 2 3 4 5 6 7 1 2 3 4 1 2 3 4 1 8 9 10 11 12 13 14 5 6 7 8 9 10 11 5 6 7 8 9 10 11 2 3 4 5 6 7 8 15 16 17 18 19 20 21 12 13 14 15 16 17 18 12 13 14 15 16 17 18 9 10 11 12 13 14 15 22 23 24 25 26 27 28 19 20 21 22 23 24 25 19 20 21 22 23 24 25 16 17 18 19 20 21 22 29 30 31 26 27 28 26 27 28 29 30 31 23 24 25 26 27 28 29 30
May June July August
S M T W T F S S M T W T F S S M T W T F S S M T W T F S
1 2 3 4 5 6 1 2 3 1 1 2 3 4 5 7 8 9 10 11 12 13 4 5 6 7 8 9 10 2 3 4 5 6 7 8 6 7 8 9 10 11 12 14 15 16 17 18 19 20 11 12 13 14 15 16 17 9 10 11 12 13 14 15 13 14 15 16 17 18 19 21 22 23 24 25 26 27 18 19 20 21 22 23 24 16 17 18 19 20 21 22 20 21 22 23 24 25 26 28 29 30 31 25 26 27 28 29 30 23 24 25 26 27 28 29 27 28 29 30 31 30 31
September October November December
S M T W T F S S M T W T F S S M T W T F S S M T W T F S
1 2 1 2 3 4 5 6 7 1 2 3 4 1 2 3 4 5 6 7 8 9 8 9 10 11 12 13 14 5 6 7 8 9 10 11 3 4 5 6 7 8 9 10 11 12 13 14 15 16 15 16 17 18 19 20 21 12 13 14 15 16 17 18 10 11 12 13 14 15 16 17 18 19 20 21 22 23 22 23 24 25 26 27 28 19 20 21 22 23 24 25 17 18 19 20 21 22 23 24 25 26 27 28 29 30 29 30 31 26 27 28 29 30 24 25 26 27 28 29 30 31 Last Date to Call Election Early Voting Period Uniform Election Dates Earliest Date to Canvas Returns
2017
RBC Capital Markets 22
Bond Election Timetable
Bond Election Date Requirements
Date Action Responsibility
At Least 78 Days Prior to a May or November Election School Board Meeting - Board Calls the Bond Election District, Municipal Advisor, Bond Counsel 30 Days Prior to Election Publish Election Order (No later than 10 days prior to election and no earlier than 30 days prior to election) District, Bond Counsel 21 Days Prior to Election Post Election Order at Administration Building (No later than 21 days prior to election) District, Bond Counsel 12 Days Prior to a May Election or 17 Days Prior to a November Election Early Voting Period (Ends 4 days prior to election) District, Bond Counsel Uniform Election Date Bond Election District, Bond Counsel 3-11 Days After a May Election or 8-11 Days After a November Election School Board Meeting - Canvass Election and Declare Results (2 members constitute a quorum for this purpose) District, Bond Counsel 30 Days Post Canvassing Election 30-Day Contest Period N/A 45 Days Post Election Bond Sale (Interest Rates Locked-In) District, Municipal Advisor, Bond Counsel 75 Days Post Election Bond Closing (Issuer Receives Bond Proceeds) District, Municipal Advisor, Bond Counsel
Learn from Yesterday… Understand Today… Plan for Tomorrow
2
Unemployment Rate
112,800 new jobs National rate 1.5%
Job Growth
3,350 more starts than 2015
Annual Home Starts
Sources: Texas Workforce Commission & Metrostudy
U.S. 4.5% Texas 4.6% DFW MSA 3.7% Little Elm 2.5%
7.51% 49.31% 30.91% 8.14% 4.13%
2016 Resale Homes by Price
4.55% 17.53% 46.23% 21.56% 10.13%
2016 New Home Sales by Price
< $150K $150K - $250K $250K-$350K $350K-$500K > $500K
2016 Home Sales by Price Point
3
ISD Ranked by Annual Closings – 4Q16
*Adjusted based on additional research by Templeton Demographics staff ** This table includes the age restricted community of Frisco Lakes
4
Source: Metrostudy
Rank District Name Annual Starts Annual Closings VDL Future 1 Frisco ISD 2,639 2,542 3,569 7,931 2 Denton ISD 1,971 2,103 2,420 17,033 3 Prosper ISD 2,569 2,050 4,675 27,142 4 Lewisville ISD 1,313 1,387 1,468 4,494 5 Northwest ISD 1,670 1,282 2,207 21,091 6 Dallas ISD 1,574 1,223 2,233 6,029 7 Little Elm ISD** 1,006 1,056 1,550 5,032* 8 Eagle Mt.-Saginaw ISD 768 856 1,277 19,855 9 Rockwall ISD 984 850 1,887 8,116 10 Keller ISD 778 788 970 1,746 11 Crowley ISD 714 783 662 9,714 12 McKinney ISD 789 723 1,610 5,965 13 Mansfield ISD 763 708 898 6,612 14 Wylie ISD 798 707 1,042 4,500 15 Forney ISD 688 552 884 14,232 16 Allen ISD 570 515 1,052 1,597 17 Coppell ISD 461 483 588 329 18 Waxahachie ISD 447 477 801 9,817 19 Plano ISD 463 453 1,030 2,660 20 Midlothian ISD 553 445 1,295 19,947
the most annual closings in more than 14 years
improve to 5.5 months’ supply
5
Little Elm ISD
50 100 150 200 250 300 350 400 450
Starts Closings
Starts 2010 2011 2012 2013 2014 2015 2016 Closings 2010 2011 2012 2013 2014 2015 2016 1Q 93 114 85 174 136 167 381 1Q 79 75 99 143 114 155 256 2Q 154 87 148 175 126 261 243 2Q 148 127 125 180 146 182 262 3Q 141 142 174 141 240 389 162 3Q 125 108 132 155 124 211 378 4Q 107 110 175 109 138 258 302 4Q 139 134 175 121 160 308 203 Total 495 453 582 599 640 1,075 1,088 Total 491 444 531 599 544 856 1,099
6
available to build on
future lots planned Active Subdivision Future Subdivision
7
Top 10 Subdivisions - 4Q16 (Ranked by Annual Closings) Rank Subdivision Elementary Zone Annual Closings VDL Future 1 FRISCO LAKES (LEISD) AGE RESTRICTED 255 305 593 2 THE TRIBUTE PRESTWICK 202 341 1,010 3 RIVENDALE BY THE LAKE HACKBERRY 175 27 225 4 HIDDEN COVE (DENTON CO) HACKBERRY 170 113 5 PALOMA CREEK SOUTH (LEISD) OAK POINT 70 158 141 6 WILDRIDGE (LEISD) OAK POINT 54 214 395 7 SUNSET POINTE (LEISD) LAKEVIEW 45 8 WELLINGTON TRACE OAK POINT 37 2 9 WOODRIDGE EST (OAK POINT) OAK POINT 21 64 132 10 WATERSTONE (LEISD) PRESTWICK 9 TOTALS 1,038 1,224 2,501
The Tribute
(400 lots)
units at this time
The Tribute- City of The Colony
8
Lewisville ISD
Rivendale by the Lake Rivendale by the Lake
underway anticipated delivery 1Q17
9 Phase 4 106 homes U/C
225 future lots
Paloma Creek South Lakeview
10
Paloma Creek South
South Lakeview
remaining 130 lots anticipated delivery summer 2018
Lakeview Ph. 2D1 157 lots Lakeview Phase 2D2 130 lots Denton ISD
Rivendale Pointe
11
Rivendale Pointe
By Grade Level
*Yellow box = largest grade per year *Green box = second largest grade per year
12
Year (Oct.) EE/PK K 1st 2nd 3rd 4th 5th 6th 7th 8th 9th 10th 11th 12th Total Total Growth % Growth 2012/13 201 536 559 534 525 515 478 472 484 461 525 398 379 333 6,400 2013/14 226 512 551 570 537 521 524 483 481 494 611 492 299 336 6,637 237 3.7% 2014/15 224 528 553 567 593 549 545 528 497 500 623 553 388 302 6,950 313 4.7% 2015/16 230 575 548 560 604 579 549 518 526 502 628 606 407 362 7,194 244 3.5% 2016/17 227 548 598 564 574 619 611 536 511 549 613 574 445 413 7,382 188 2.6% 2017/18 227 558 579 610 588 584 630 594 528 518 672 570 430 436 7,524 142 1.9% 2018/19 227 574 591 598 645 601 594 623 597 544 650 630 427 415 7,716 192 2.6% 2019/20 227 573 606 619 616 665 621 580 618 617 672 596 468 414 7,892 176 2.3% 2020/21 227 583 601 619 641 625 678 604 576 633 763 624 445 455 8,074 182 2.3% 2021/22 227 602 621 615 639 663 640 684 602 595 786 708 466 431 8,279 205 2.5% 2022/23 227 601 642 637 629 656 680 621 680 619 737 727 528 452 8,436 157 1.9% 2023/24 227 610 636 656 654 642 662 658 618 698 767 683 542 513 8,566 130 1.5% 2024/25 227 614 647 651 671 668 656 642 655 637 865 711 509 526 8,679 113 1.3% 2025/26 227 623 652 661 671 683 682 636 639 675 789 801 530 494 8,763 84 1.0% 2026/27 227 624 660 669 679 683 692 662 633 659 836 731 597 515 8,867 104 1.2%
By Elementary Campus
Notes:
*Yellow box = enrollment exceeds stated capacity **Does not include portables’ capacity
13
Functional Current
PROJECTIONS
Campus Capacity 2016/17 2017/18 2018/19 2019/20 2020/21 2021/22 2022/23 2023/24 2024/25 2025/26 2026/27 Brent Elementary 843 666 666 656 670 655 657 688 680 679 693 692 Chavez Elementary 843 722 693 672 652 652 629 630 632 634 636 632 Hackberry Elementary 823 605 597 635 679 695 716 723 733 747 754 767 Lakeview Elementary 823 629 625 620 617 611 602 600 608 621 648 672 Oak Point Elementary 823 702 748 778 814 856 884 905 906 915 925 931 Prestwick Elementary (EE-5th) 400** 417 447 469 495 505 519 526 528 538 543 540 ELEMENTARY SCHOOL TOTAL 4,555 3,741 3,776 3,830 3,927 3,974 4,007 4,072 4,087 4,134 4,199 4,234 Elementary Absolute Growth 96 35 54 97 47 33 65 15 47 65 35 Elementary Percent Growth 2.63% 0.94% 1.43% 2.53% 1.20% 0.83% 1.62% 0.37% 1.15% 1.57% 0.83%
14
By Elementary Campus with Special Programs
Functional Current
PROJECTIONS
Campus Capacity 2016/17 2017/18 2018/19 2019/20 2020/21 2021/22 2022/23 2023/24 2024/25 2025/26 2026/27 Brent Elementary 743 666 666 656 670 655 657 688 680 679 693 692 Chavez Elementary 625 722 693 672 652 652 629 630 632 634 636 632 Hackberry Elementary 605 605 597 635 679 695 716 723 733 747 754 767 Lakeview Elementary 605 629 625 620 617 611 602 600 608 621 648 672 Oak Point Elementary 684 702 748 778 814 856 884 905 906 915 925 931 Prestwick Elementary (EE-5th) 382** 417 447 469 495 505 519 526 528 538 543 540 ELEMENTARY SCHOOL TOTAL 4,555 3,741 3,776 3,830 3,927 3,974 4,007 4,072 4,087 4,134 4,199 4,234 Elementary Absolute Growth 96 35 54 97 47 33 65 15 47 65 35 Elementary Percent Growth 2.63% 0.94% 1.43% 2.53% 1.20% 0.83% 1.62% 0.37% 1.15% 1.57% 0.83%
*Yellow box = enrollment exceeds stated capacity **Does not include portables’ capacity
Notes:
excluded from total classroom count.
smaller w/o cubbies but are used as standard classrooms.
By Middle School & High School Campus
Notes:
could reach 2,100 students this fall
15
*Yellow box = enrollment exceeds stated capacity
Functional Current
PROJECTIONS
Campus Capacity 2016/17 2017/18 2018/19 2019/20 2020/21 2021/22 2022/23 2023/24 2024/25 2025/26 2026/27 Prestwick Junior High (6th-8th) 432 340 341 344 338 341 351 347 334 319 317 322 Lakeside Middle School 1,512 1,255 1,298 1,419 1,476 1,471 1,529 1,572 1,639 1,614 1,632 1,631 MIDDLE SCHOOL TOTAL 1,595 1,639 1,763 1,814 1,812 1,880 1,919 1,973 1,933 1,949 1,953 Middle School Absolute Growth 52 44 124 51
68 39 54
16 4 Middle School Percent Growth 3.37% 2.76% 7.57% 2.89%
3.75% 2.07% 2.81%
0.83% 0.21% Little Elm High School 2,500 2,041 2,104 2,118 2,146 2,283 2,387 2,440 2,501 2,607 2,610 2,675 Denton County JJ AEP 5 5 5 5 5 5 5 5 5 5 5 HIGH SCHOOL TOTAL 2,046 2,109 2,123 2,151 2,288 2,392 2,445 2,506 2,612 2,615 2,680 High School Absolute Growth 40 63 14 28 137 104 53 61 106 3 65 High School Percent Growth 1.99% 3.08% 0.66% 1.32% 6.37% 4.55% 2.22% 2.49% 4.23% 0.11% 2.49% DISTRICT TOTAL 7,382 7,524 7,716 7,892 8,074 8,279 8,436 8,566 8,679 8,763 8,867 District Absolute Growth 188 142 192 176 182 205 157 130 113 84 104 District Percent Growth 2.61% 1.92% 2.55% 2.28% 2.31% 2.54% 1.90% 1.54% 1.32% 0.97% 1.19%
$300,000 within Little Elm ISD.
homes in the 4th quarter of 2016.
during the next 5 years.
the 2026/27 school year.
16
TUESDAY, APRIL 25, 2017
Zellars Center for Learning & Leadership 300 Lobo Lane Little Elm, TX 75068 5:30 p.m. Dinner; 6:00 p.m. Meeting Start