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BOND UPDATE: Successful Series 2019 Measure H Bond Sale
Posted 4/4/19

On March 20, 2019, Hayward Unified School District successfully issued its Series 2019 bonds. The Series 2019 bonds represents the first series of bonds under Measure H, authorizing the District to issue up to $381.7 million in general obligation bonds.  The District was able to issue the Series 2019 bonds less than five months after District voters approved Measure H in November 2018.

 

In conjunction with the issuance of the Series 2019 bonds, the District reviewed its existing bond program and found that there was an opportunity to reduce interest rates on some of its outstanding bonds.  A refunding of the District’s outstanding General Obligation Bonds, Election of 2008, Series 2010B (Build America Bonds) generated taxpayer savings of over $14 million over time, or present value (PV) savings of over 10% as a percentage of refunded bond par amount!

 

The Series 2019 Measure H bonds generated $145 million in project proceeds, which will be used to begin critical school facility improvements across the District.  The Series 2019 bonds were conservatively structured as traditional current interest bonds.  A portion of the Series 2019 bonds were designated as Build America Mutual (BAM) GreenStar bonds because the bond proceeds will be used for projects that “protects or restores the environment.”   

 

“We are investing in solar at Hayward schools to maximize our educational dollars for educational purposes and reduce our carbon footprint,” said Allan Garde, Assistant Superintendent of Business Services at Hayward USD.  “The green bonds were a great fit for Hayward USD as we want to attract socially responsible investors to our bonds and increase competition that will result in a lower borrowing cost to our community.”

 

For the bond issuance, the District also increased investor outreach by putting together an investor presentation booklet that summarized key financial information to facilitate investor credit review.  An advisement of the bond sale was placed in the East Bay Times to engage community members that may be interested in investing in Hayward schools.

 

Increased focus on investor outreach was successful.  The District’s bond sale attracted 35 different investors – of which only five were previously listed as bondholders of Hayward USD bonds.  The District was also able to reduce financing costs significantly from original estimates provided to the public during the Measure H planning process.

 

“We are tremendously appreciative of the support that our Hayward community provides to our local schools,” said Superintendent Matt Wayne.  “We are thrilled that we were able to take advantage of low interest rates to lock in these savings for our taxpayers.”

 

The Series 2019 bonds have a true interest cost (TIC) of approximately 3.80% with a final maturity in 2048.  The refunding bonds have a TIC of approximately 3.83% with a final maturity in 2043.