P E R A L T A C O M M U N I T Y C O L L E G E D I S T R I C T 2011 - - PowerPoint PPT Presentation

P E R A L T A C O M M U N I T Y C O L L E G E D I S T R I C T

2011 Taxable Revenue Bonds - Investor Presentation

October 10, 2011

2011 Taxable Revenue Bonds Investor Presentation

C O N F I D E N T I A L P R I V A T E A N D S T R I C T L Y

This electronic Investor Presentation you are about to view is provided as of October 10, 2011 for a proposed offering by the y p , p p g y Peralta Community College District (the “District”) of its 2011 Taxable Refunding Bonds (the “Bonds”). If you are viewing this presentation after October 10, 2011, there may have been events that occurred subsequent to such date that would have a material adverse effect on the financial information that is presented herein, and neither the District nor J.P. Morgan Securities LLC (“J.P. Morgan”), as the Underwriter, has undertaken any obligation to update this electronic presentation. All market prices, financial presentation prices, data and other information provided herein are not warranted as to completeness or accuracy and are subject to change without notice. This Investor Presentation is provided for your information and convenience only. Any investment decisions regarding the Bonds should only be made after a careful review of the complete Preliminary Official Statement, dated October 10, 2011. By accessing this presentation, you agree not to duplicate, copy, download, screen capture, electronically store or record this Investor Presentation, nor to produce, publish or distribute this Investor Presentation in any form whatsoever. In no event shall the Underwriter or the District be liable for any use by any party of, for any decision made or action taken by any party in reliance upon, or for any inaccuracies or errors in, or omissions from, the information contained herein and such information may not be relied upon by you in evaluating the merits of participating in any transaction mentioned herein. The Underwriter makes no representations as to the legal, tax, credit or accounting treatment of any transactions mentioned herein, or any other effects such transactions may have on you and your affiliates or any other parties to such transactions and their

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y y y y y p respective affiliates. You should consult with your own advisors as to such matters and the consequences of the purchase and

• wnership of the Bonds. Nothing in these materials constitutes a commitment by the Underwriter or any of their affiliates to enter

into any transaction. No assurance can be given that any transaction mentioned herein could in fact be executed. Past performance is not indicative of future returns, which will vary. Transactions involving the Bonds may not be suitable for all

• investors. You should consult with your own advisors as to the suitability of the Bonds for your particular circumstances. Clients

O L L E G E D I S T R I

should contact their salesperson at, and execute transactions through, an entity of the Underwriter or other syndicate member entity qualified in their home jurisdiction unless governing law permits otherwise. This Investor Presentation does not constitute a recommendation or an offer or solicitation for the purchase or sale of any security

• r other financial instrument, including the Bonds, or the adoption of any investment strategy. Any offer or solicitation with respect

to the Bonds will be made solely by means of the Preliminary Official Statement and Official Statement, which describe the actual

C O M M U N I T Y C O

terms of such Bonds.

P E R A L T A

Transaction Overview Transaction Overview

Estimated Par Amount: $53 855 000

Bond Structure*

Estimated Par Amount: $53,855,000 Structure: Fixed rate taxable bonds maturing from August 1, 2013 to August 1, 2031 Tax Status: Federally Taxable, California State Tax-Exempt Confirmed Ratings: Moody's: A1 / S&P: A+ (Negative) R d ti P i i M k h l ll i i Redemption Provisions: Make whole call provision Security:

• The District is obligated to satisfy its obligations under all of its OPEB Bond obligations, including the

Series 2011 Bonds from any money lawfully available in any fund of the District, including its General Fund Use of Proceeds: To (i) refund the outstanding principal amount of the 2009 Taxable Other Post-Employment Benefit Use of Proceeds: To (i) refund the outstanding principal amount of the 2009 Taxable Other Post Employment Benefit (OPEB) Refunding Bonds to create a smoother ascending aggregate debt service structure; and (ii) pay the costs of issuance of the Series 2011 Bonds. Sole Manager: J.P. Morgan

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Price Guidance / Indications of Interest: Monday, October 17 Pricing Date & Signing of the BPA: Tuesday, October 18 Closing Date: Friday October 28

Pricing Schedule*

O L L E G E D I S T R I

Closing Date: Friday, October 28 *Preliminary, subject to change

C O M M U N I T Y C O

1

P E R A L T A

Presentation Participants Presentation Participants

P lt C it C ll Di t i t

Ron Gerhard

Peralta Community College District

Ron Gerhard Vice Chancellor for Finance & Administration Mr Gerhard joined the Peralta Community College

• Mr. Gerhard joined the Peralta Community College

District in 2010. Previously, Mr. Gerhard served as Chief Business Officer at Compton Community College District and as

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Officer at Compton Community College District and as Business Manager and Internal Auditor at San Bernardino Community College District.

• Mr. Gerhard is a CPA and also holds an MBA from

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University of California – Riverside.

C O M M U N I T Y C O

2

P E R A L T A

Overview of the Peralta Community College District Overview of the Peralta Community College District

 Founded in 1964, the Peralta Community

College District (the “District”) serves six

Peralta Community College District

College District (the District ) serves six cities in the East Bay including Albany, Alameda, Berkeley, Emeryville, Oakland and Piedmont

 Operates 4 two-year community colleges:

Berkeley City College, College of Alameda, and Laney and Merritt Colleges in Oakland

 Serves approximately 18,500 Full-Time

Equivalent Students (including credit and noncredit FTES) for FY2011-12 M i t i b t 850 f ll ti l

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 Maintains about 850 full-time employees

and over 1,250 part-time faculty and staff

O L L E G E D I S T R I C O M M U N I T Y C O

3

P E R A L T A

Local Community at a Glance Local Community at a Glance

 Geography: The District is located in the very large San Francisco Bay Area tax

base base

 Economy: A large residential and commercial base exists in the District. The vast

majority of secured parcels are residential properties, with a significant commercial and industrial base in Oakland and Berkeley

 Transportation: Local residents commute to jobs throughout the San Francisco Bay

• Area. The District is connected to the region by Bay Area Rapid Transportation, AC

Transit and Interstates 13, 24, 80, 580 and 880. Also contained within the District are the Oakland International Airport and Port of Oakland

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P E R A L T A

Agenda Agenda

Page The District’s Financial and Budget Overview 5 The District’s Financial and Budget Overview 5 Overcoming Past Challenges 11 Summary of the District’s OPEB Program 16 Current Plan of Finance 22

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P E R A L T A

2011 12 General Fund Revenue and Expenses 2011-12 General Fund Revenue and Expenses

E T O V E R V I E W I A L A N D B U D G E R I C T ’ S F I N A N C

Source: Peralta Community College District 6

T H E D I S T

Source: Peralta Community College District.

Peralta Full Time Equivalent Students (FTES) Peralta Full Time Equivalent Students (FTES)

 In response to reduced general apportionment payments from the State, the District

narrowed the gap between Total FTES (students served) and Funded FTES Fiscal Year Total FTES FTES Funded Unfunded FTES

24,000 Total FTEs Funded FTEs

Full-Time Equivalent Students (FTEs)

Year FTES Funded FTES 2006 18,443 18,443 2007 19 058 19 058

22,000 23,000

2007 19,058 19,058 2008 19,414 19,414

20,000 21,000

E T O V E R V I E W

2009 20,359 19,805 554 2010 22,160 19,010 3,150(2)

19,000

I A L A N D B U D G E

2011 19,926 19,501 425 2012(1) 18,500 18,289 211

17,000 18,000 2007 2008 2009 2010 2011 2012

(1) R I C T ’ S F I N A N C

(1) Projected. (2) Due to the late adoption of the State Budget in FY 2010, the District was not able to adjust course offerings to reflect actual State funding levels.

Source: Peralta Community College District.

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T H E D I S T

FY 2012 Final Budget Assumptions

 General Assumptions

 Budget will be balanced

FY 2012 Final Budget Assumptions

 Budget will have a contingency reserve no less than 5%  District and colleges use a defined planning process for development of budgets  In June 2011, the District completed an $18 million Tax and Revenue Anticipation Note through the League of California Community Colleges through the League of California Community Colleges

 Revenue Assumptions

 Workload reductions incorporated into budget due to State Budget cuts  D f l f i t l $18 illi i l f d ti t  Deferral of approximately $18 million in general fund apportionment  General apportionment deficit factor 0.5%  COLA of 0%  Enrollment growth funds of 0%

E T O V E R V I E W

 Enrollment growth funds of 0%  Funded base credit FTES of 18,185 and non-credit FTES of 105

 Expenditure Assumptions

 St d l l i d f $1 5 illi

I A L A N D B U D G E

 Step and column salary increased of $1.5 million  PERS increase of 1.323% to 11.030%  Expenditure reduction with OPEB restructuring  Maintain DSPS contribution of $1 15 million

R I C T ’ S F I N A N C

 Maintain DSPS contribution of $1.15 million  Restricted funding cuts or cost increases bore by respective program

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T H E D I S T

Unrestricted General Fund Expenditures Revenues and Change in Fund Balance Unrestricted General Fund Expenditures, Revenues and Change in Fund Balance

Fiscal Year Fiscal Year Fiscal Year Fiscal Year Fiscal Year Fiscal Year 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 Audited Audited Audited Audited Unaudited(1) Budgeted REVENUES REVENUES: Federal

• $602
• State

$73,614,131 $72,329,303 $75,427,527 $69,917,049 70,314,963 $66,456,104 Local 33,454,088 36,063,147 39,695,813 41,616,771 40,309,085 39,121,683 TOTAL REVENUES 107,068,219 108,392,450 115,123,340 110,533,820 110,624,649 105,577,787 EXPENDITURES: EXPENDITURES: Academic Salaries 42,752,683 46,867,600 49,848,617 46,166,443 43,446,042 37,988,186 Classified Salaries 20,536,764 22,228,649 23,665,903 22,028,069 21,535,493 20,314,427 Employee Benefits(2) 23,150,001 25,471,935 26,886,126 30,732,936 34,845,391 37,323,210 Supplies and Materials 1,120,748 1,138,650 1,334,741 1,398,668 1,151,272 937,711 Other Operating Expenses and Services 13 006 516 14 715 210 16 844 683 14 313 714 14 188 107 12 084 131 Other Operating Expenses and Services 13,006,516 14,715,210 16,844,683 14,313,714 14,188,107 12,084,131 Capital Outlay 175,116 201,347 150,392

• 967,027

188,068 109,995 TOTAL EXPENDITURES 100,741,828 110,623,390 118,730,462 113,672,805 115,354,373 108,757,660 EXCESS (DEFICIENCY) OF REVENUE OVER EXPENDITURES 6,326,391 (2,230,940) (3,607,123) (3,138,984) (4,729,723) (3,179,873) OTHER FINANCING SOURCES (USES) 1,233,600 2,036,690 1,864,350 3,998,876 8,995,366 8,466,550

E T O V E R V I E W

OTHER FINANCING SOURCES (USES) – NET(3) 1,233,600 2,036,690 1,864,350 3,998,876 8,995,366 8,466,550 OTHER OUTGO(4) 1,162,705 1,120,538 1,011,843 3,060,882 3,386,534 5,286,677 NET INCREASE (DECREASE) IN FUND BALANCES 6,397,286

• 1,314,788
• 2,754,615
• 2,200,990

879,109

• BEGINNING FUND BALANCE, JULY 1

7,382,580 13,779,866 12,310,625 8,731,597 7,509,473 9,162,641

(5)

I A L A N D B U D G E

Prior Year Adjustments

(5)

• 154,454

978,865 774,058

• Adjusted Beginning Balance

7,382,580 13,779,866 12,465,078 9,710,463 8,283,532 9,162,641 ENDING FUND BALANCE, JUNE 30 $13,779,866 $12,465,078 $9,710,463 $7,509,473 $9,162,641 $9,162,641

(1) As of October 6, 2011. Note that the estimated actual ending balances for fiscal year 2010-11 shown in the POS “APPENDIX I - FISCAL YEAR 2011-12 ADOPTED BUDGET OF

THE DISTRICT” are no longer current. The District can make no representations regarding variances between unaudited figures presented herein.

(2) Employee Benefits includes pay-as-you-go contributions towards Post-Employment Benefits and deposits to the OPEB Trust resulting from the application of the OPEB Charge.

R I C T ’ S F I N A N C

p y p y y g p y p g pp g For fiscal year 2011-12, this includes $10,000,000 budgeted for pay-as-you-go contributions, and $6,492,306 of deposits relating to the OPEB Charge.

(3) Other Financing Sources includes reimbursement from the OPEB Trust for pay-as-you-go expenditures on Post-Employment Benefits. (4) Other Outgo represents the unrestricted general fund contributions towards debt service on bond issuances related to the Post-Employment Benefit Program. (5) Reflects audit restatements for accruals to the District’s accounts payable.

Source: Peralta Community College District.

9

T H E D I S T

District’s Response to State Actions

P lt ’ G l F d d d b $5 8 illi lt f St t b d t t

District s Response to State Actions

June 2011 State Budget Reaction

 Peralta’s General Fund was reduced by $5.8 million as a result of State budget cuts  Implemented cuts through workload reduction (reduction of classes, part time faculty)  Reduced funded FTEs by 1,205 in FY 2011  If State revenues fall below budgeted projections, additional expenditure cuts will

be triggered Updated Revenue Projections versus 2011 Budget Act Projections Cuts to Peralta Peralta’s Action

December 2011 State Budget Triggers

E T O V E R V I E W

Budget Act Projections Cuts to Peralta Peralta s Action

<$1 Billion Lower $0 Absorb any December Cuts offset by $10 increase in per-credit

I A L A N D B U D G E

reductions through enrollment reductions $1 - $2 Billion Lower increase in per-credit student fees. Additional $600K cut $2+ Billion Lower $1 5 Million

R I C T ’ S F I N A N C

$2+ Billion Lower $1.5 Million

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T H E D I S T

Agenda Agenda

Page The District’s Financial and Budget Overview 5 Overcoming Past Challenges 11 The District s Financial and Budget Overview 5 Summary of the District’s OPEB Program 16 Current Plan of Finance 22

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P E R A L T A

Overcoming Past Challenges

 Civil Grand Jury Inquiry

Overcoming Past Challenges

 In 2009, Alameda County Grand Jury reviewed the District’s management and fiscal oversight. As a

result, the District (a) changed high level personnel (b) appointed expert and highly regarded consultants to guide fiscal changes (c) developed a multi-year recovery plan (d) created a corrective action matrix

 In regards to its OPEB Program, the District hired a financial advisor to review the program and

recommend long term course of action. Civil Grand Jury concluded that the District is now stable and moving in the correct direction

 Internal Fiscal Controls  Internal Fiscal Controls  FY 2010 audit sets out 32 findings identifying material deficiencies in the District’s fiscal controls,

including weaknesses relating to the review of investment activities for the OPEB Trust

 The District is up to date on all of the required continuing disclosure documents with EMMA  The District is up to date on all of the required continuing disclosure documents with EMMA  Accrediting Commission for Community and Junior Colleges (ACCJC) Inquiry  In July 2010 the ACCJC put Peralta CCD on probation citing issues with fiscal management

L L E N G E S

 As of June 2011, the ACCJC has removed Peralta CCD from probation and placed the District on

• warning. The District has shown continued improvement in policy and fiscal matters

 There will be a final review in March 2012 and announcement in June 2012, at which time the District

expects have its full accreditation restored. The District is fully accredited at this time

M I N G P A S T C H A

expects have its full accreditation restored. The District is fully accredited at this time

12

O V E R C O M

Solutions Afforded to Result in Positive Civil Grand Jury Findings Solutions Afforded to Result in Positive Civil Grand Jury Findings

 The Alameda County Civil Grand Jury (the “Grand Jury”) conducted investigations of

the District in FY 2010 and FY 2011 responding to public concerns on management the District in FY 2010 and FY 2011, responding to public concerns on management and oversight

Positive Measures Implemented to Address Financial, Management, and Post-Employment Benefit Concerns

Recruitment of experienced Appointment of expert consultants t id th Corrective Action Matrix (CAM): Development of a experienced administrators to guide the District’s recovery multi-year recovery plan Implement timely and accurate Oversight of Creation of an OPEB Charge to

L L E N G E S

and accurate financial reporting policy measures Oversight of OPEB Trust Investments OPEB Charge to supplement Post- Employment Benefits

M I N G P A S T C H A

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O V E R C O M

Regaining Internal Fiscal Controls

f f f f

Regaining Internal Fiscal Controls

Identification of Fiscal Control Deficiencies

 FY 2010 audit sets out 32 findings identifying material deficiencies in the District’s fiscal controls  Weakness in review and reconciliation of investment activities concerning the OPEB Trust  Weakness in use of interest rate swap agreements  District hired reputable outside consultants:

Pro-Active Measures Implemented to Regain Internal Fiscal Controls

 Educational Management and

Assistance Corp (EDMac)

 Bartel & Associates as actuarial firm  Swap Financial Group as swap advisor  KNN Public Finance as financial advisor  In response to recommendations from the auditor, the District is also addressing long-term stability

• f its OPEB Program

 Commencing October 2010, policy required all OPEB Trust investment accounts to be

reconciled and re ie ed on a monthl basis and q arterl reports taken to the Board

L L E N G E S

reconciled and reviewed on a monthly basis and quarterly reports taken to the Board

 Implement OPEB charge District adopted budgeting calendar that was adhered to

throughout FY 2011

M I N G P A S T C H A

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O V E R C O M

Steps to Maintain Accreditation Status and Removing All Conditions

 In June 2010, the ACCJC placed the District on probationary status

Steps to Maintain Accreditation Status and Removing All Conditions

 In June 2011, the ACCJC:  Removed Peralta CCD’s probationary status  Issued a warning to the District citing certain deficiencies identified in the  Issued a warning to the District, citing certain deficiencies identified in the

District’s financial audits

Maintaining Solid Accreditation Status

 The District recognizes that its accreditation status was primarily revised due to

financial reporting deficiencies

 The District pledges to make a continued effort to manage the negative audit findings

p g g g g and rectify these deficiencies

 A follow-up report to the ACCJC is due from the District by March 15, 2012, and is

likely to be followed by a site visit from the ACCJC

L L E N G E S

y y

 Final decision on the rescission of the warning is expected by June of 2012

M I N G P A S T C H A

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O V E R C O M

Agenda Agenda

Page The District’s Financial and Budget Overview 5 The District s Financial and Budget Overview 5 Overcoming Past Challenges 11 Summary of the District’s OPEB Program 16 Current Plan of Finance 22

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P E R A L T A

Overview of the District’s OPEB Financing Program Overview of the District s OPEB Financing Program

 The District operates a single-employer defined benefit plan that provides post- employment healthcare benefits in accordance with negotiated labor contracts that is employment healthcare benefits in accordance with negotiated labor contracts that is currently funded on a pay-as-you-go basis  Employees hired prior to July 1, 2004 – Provides life-time post-retirement healthcare benefits to eligible retirees, spouses and dependent children  Employees hired after July 1, 2004 – District is only responsible for healthcare benefit premiums for eligible employees until the age of Medicare eligibility  District issued long-term debt obligations to finance its OPEB liabilities in 2005  The 2005 current interest bonds and first series of CARS were restructured in

R O G R A M

2006 and 2009 to reduce near-term debt service and eliminate exposure to the auction rate securities market for the Series B-1 Bonds  A revocable OPEB Trust was formed in connection with the 2005 Bonds

R I C T ’ S O P E B P R

 A revocable OPEB Trust was formed in connection with the 2005 Bonds  Interest earnings on Trust utilized for pay-as-you-go OPEB costs  Trust monies and interest earnings pledged to finance Accrued Actuarial

Y O F T H E D I S T R

 Trust monies and interest earnings pledged to finance Accrued Actuarial Liability (AAL)

17

S U M M A R Y

Background on Outstanding Debt and Swap Agreements

 2005 Bond issuance – Funded $133.82 million of the District’s AAL

Background on Outstanding Debt and Swap Agreements

 Structured as current interest and Convertible Auction Rate Securities (CARS)  In 2006, the District instituted 6 swap agreements on the CARS  Restructuring the 2005 Bonds  Restructuring the 2005 Bonds  2006 Restructuring – Refunded the a portion of the 2005 current interest bonds  2009 Refunding – Refunded the remaining 2005 current interest bonds and the Series B-1 tranche of the CARS Series B 1 tranche of the CARS  Proposed 2011 Bonds – Issued to refund all outstanding 2009 OPEB Bonds to reduce a $8.7 million spike in debt service in FY2016 and create a smoother aggregate debt service structure

R O G R A M

service structure

Outstanding 2005 Bond Swap Agreements

R I C T ’ S O P E B P R Y O F T H E D I S T R

18

S U M M A R Y

District has put in place OPEB funding plan that addresses pay go and AAL(1) District has put in place OPEB funding plan that addresses pay-go and AAL(1)

OPEB R

OPEB Charge OPEB Program – Flow of Funds Breakdown of ARC Annual Required

Unrestricted General Fund OPEB Reserve $12,403,816 (3) Unrestricted General Fund

OPEB Charge $6,492,306 (2) Normal Cost Contribution (ARC) $20,364,000 OPEB Pay go Pay-go Reimbursement UAAL Payment

OPEB Trust $164,751,560 (7)

Charge $10,000,000 (6) $ $ OPEB Debt Service Pay-go healthcare costs

Pension Reservoir for

$8,104,283(4)* $10,000,000 (5) $4,341,000 $16,023,000

R O G R A M

* Preliminary subject to change

Bond- holders Health Insurance Companies Pension Reservoir for OPEB Liability

R I C T ’ S O P E B P R

* Preliminary, subject to change. (1) As of October 6, 2011. (2) Budgeted OPEB Charge is included in the “Employee Benefits” line item under FY2011-12 Budget. (3) Projected OPEB Reserve Fund Balance as of FY2011-12, taking into account the transfer of the OPEB Charge to the OPEB Trust. The District is under no obligation to maintain the OPEB Reserve Fund, nor to maintain any particular fund balance. The only funds which are restricted for use in connection with the Post-Employment Benefit program are deposits attributable to the OPEB Charge. (4) Total debt service on the 2005 Bonds, Modified 2005 Bonds and 2009 Bonds due in FY2011-12 (not including effect of 2011 Bonds restructuring).

Y O F T H E D I S T R

( ) , ( g g) (5) “Pay-as-you-go” costs are included as a portion of the $37,988,186 Employee Benefits shown in FY2011-12 Budget. (6) District reimbursement to general fund from OPEB Trust for “pay-as-you-go” Post-Employment Benefit costs. (7) Market valuation of OPEB Trust as of June 30, 2011 valuation date. 19

S U M M A R Y

OPEB Trust Fund OPEB Trust Fund

R ti t B d d T t t bli h d ti t i t

OPEB Trust Fund

 Retirement Board and Trust were established as retirement program requirements

and GASB 45

 CalPERS and Alameda County Employees Retirement Association were the model

for asset allocation and a 7% rate of return was targeted for asset allocation, and a 7% rate of return was targeted

 Trust is pledged to:  Reimburse the General Fund for Post-Employment Benefits, then  Debt service on the 2005 Bonds  Neuberger Berman LLC serves as the investment advisor to the Trust  R ti

t B d t thl f i f i t t d t

R O G R A M

 Retirement Board meets monthly for review of investments and returns

OPEB Trust Assets Amount Initial Assets (as of 1/31/2006) $150,307,485 N t C h Fl (23 400 000)

R I C T ’ S O P E B P R

Net Cash Flows (23,400,000) Net Amount 126,907,485 Income/Market Value Change 37,844,075 Current Assets (as of 6/30/2011) $164,751,560

Y O F T H E D I S T R

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S U M M A R Y

OPEB Reserve Fund OPEB Reserve Fund

OPEB Reserve Fund

Th Di t i t t bli h d f d i d d t f th OPEB T t it l

 The District established a reserve fund independent of the OPEB Trust or its general

fund, which it has set aside surplus funds

 Funds are invested in the County of Alameda Investment Pool  Funds are available to pay:  Swap Agreement termination payments

D bt i OPEB B d

R O G R A M

 Debt service on OPEB Bonds  Post-Employment Benefits, or  Amounts can be taken by the General Fund and used for any lawful purpose of

Fiscal Year (as of June 30) Ending Balance

R I C T ’ S O P E B P R

Amounts can be taken by the General Fund and used for any lawful purpose of the District

2010 $14,441,420 2011 14,007,286 2012 12,403,816(1)

S P lt C it C ll Di t i t

Y O F T H E D I S T R

Source: Peralta Community College District. (1) Projected.

21

S U M M A R Y

Agenda Agenda

Page The District’s Financial and Budget Overview 5 The District s Financial and Budget Overview 5 Overcoming Past Challenges 11 Current Plan of Finance 22 Summary of the District’s OPEB Program 16

C T O L L E G E D I S T R I C O M M U N I T Y C O

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P E R A L T A

Current Plan of Finance Current Plan of Finance

 The 2009 Bond debt service escalates by approximately $10 million from November 2011 to November 2015 2011 to November 2015  The final maturity of the 2009 Bonds is in 2015; however, the final maturity of the

• riginal 2005 Bonds is 2049

 Through the issuance of the 2011 Bonds, the District will  Reduce the current spike in the 2009 Bond debt service in FY 2016  Create a smoother aggregate debt service structure  Create a smoother aggregate debt service structure  Amortize the refunding over 20 years  Take advantage of the historically low interest rate environment

N C E P L A N O F F I N A

23

C U R R E N T

Summary of the Proposed Structure Summary of the Proposed Structure

Source of Security

 The 2011 Bonds are general fund obligations of the District, and are not secured by the OPEB Trust

Aggregate Debt Service – Current Versus after 2011 Issuance Aggregate Debt Service Current Versus after 2011 Issuance

20 25

$ Millions

Current Aggregate DS Aggregate DS after 2011 Issuance 15 5 10

N C E

2012 2014 2016 2018 2020 2022 2024 2026 2028 2030 2032 2034 2036 2038 2040 2042 2044 2046 2048 2050

Note: Assumes an average coupon of 7 0% following a conversion of the 2005 CARS to fixed rate bonds pursuant to the

P L A N O F F I N A

Note: Assumes an average coupon of 7.0% following a conversion of the 2005 CARS to fixed rate bonds pursuant to the 2005 Indenture.

24

C U R R E N T

Conclusion Conclusion

Attracted experienced management team, focused on corrective action Retained solid team of outside experts to guide the District Retained solid team of outside experts to guide the District Demonstrated discipline to maintain adequate reserves Demonstrated discipline to maintain adequate reserves OPEB Trust affords the flexibility to fund the AAL

N C E P L A N O F F I N A

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C U R R E N T

Contact Information Contact Information

Peralta Community College District Underwriter Ron Gerhard Phone: (510) 466-7254 Email: rgerhard@peralta.edu Gary Hall, J.P. Morgan Phone: (415) 315-5652 Email: gary.x.hall@jpmorgan.com Marshall Kitain, J.P. Morgan Phone: (212) 834-5673 Email: marshall.r.kitain@jpmorgan.com Joanna Bowes, KNN Public Finance Ph (510) 208 8227 Financial Advisor David G. Casnocha, Stradling Yocca Carlson & R th Bond Counsel Phone: (510) 208-8227 Email: jbowes@knninc.com Rauth Phone: (415) 283-2241 Email: dcasnocha@sycr.com

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