Bond Refunding Results

April 27, 2015

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Discussion Topics

I. Bond Market UpdateII. Bond Refunding GoalsIII. Refunding ResultsIV. Next Steps

I. Bond Market Update

Bond interest rates remain near historic lows but volatility has increased recently due to:– Continued global economic uncertainty– Strong investor demand– Long-awaited U.S. economic recovery is slow to arrive

Bond interest rates are lower than when we began monitoring this refunding over the past year

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3%

4%

5%

6%

7%

8%

9%

10%

11%

12%

13%

14%

1980

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

Historic Tax-Exempt Bond Rates

Bond Buyer 20 GO Index

3.000%

3.500%

4.000%

4.500%

5.000%

0.00

0.50

1.00

1.50

2.00

2.50

3.00

3.50

4.00

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21

% R

ate

Years

Market Yield CurveMunicipal Market Data Index

Year Ago Month Ago Current

II. Bond Refunding Goals

Evaluate and potentially refund a portion of the District’s 2005 UTGO Bonds, if a refunding would result in significant interest savings for taxpayers Tax-exempt bonds Minimum present value savings of 3.00% Target savings to smooth future bond tax rates where possible Minimize savings in the years for which the bond levy has already been set Utilize existing funds available in the Debt Service Fund as appropriate

Utilize a negotiated bond sale to best accomplish the District’s goals while providing the lowest cost of borrowing

Navigate potential issues from the Federal debt ceiling

Renew the District’s “A1” credit rating from Moody’s Investors Service

Participate in the Washington State School District Credit Enhancement Program (“State Guarantee Program”)

III. Preliminary Refunding Results

Refunding Bond Candidates

Bonds Issued: 2005Principal Amount of refunded bonds:

$2,640,000

Callable Maturities: 2016-2024Average Coupon: 3.36%Call Date: 12/1/2015

Preliminary Refunding Results

Final ResultsBoard Update

3/23/15Date of Analysis 4/21/15 3/18/15Dated Date of Refunding 5/19/15 4/21/15Maturities Included 2016-2024 2016-2024Principal Amount of New Bonds $2,600,000 $2,560,000Call Feature Non-callable Non-callableFinal Maturity 12/1/24 12/1/24True Interest Cost 1.75% 1.98%Total Savings – Net of costs $261,031 $232,134Present Value of Net Savings $241,422 $214,926PV as % of Old Bonds 9.15% 8.14%

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III. Next Steps

Date Event Responsibility

March 2015 Establish bond sale goals District, FA, UW

March 23Brief Board on bond sale planningBoard consideration of bond resolutionRating presentation

District, BC, FA

District, FA

March 23-April 14 Prepare bond legal and disclosure documents All

April 21 Conduct bond sale All

April 27 Brief Board on bond sale results District, FA

May 19* Bond closing BC, UW, County

* Preliminary