The changes in the District's long-term obligations during the year consisted of the following:
Balance Balance Due in
July 1, 2010 Additions Deductions June 30, 2011 One Year General obligation bonds $ 121,380,167 $ 1,986,872 $ 2,795,000 $ 120,572,039 $ 3,420,000
Premium on issuance 5,989,953 - 274,385 5,715,568 -
Certificates of participation 51,680,000 - 1,360,000 50,320,000 1,470,000
Premium on issuance 1,548,095 - 62,077 1,486,018 -
Discount on issuance (81,208) - (3,138) (78,070) -
Capital leases 5,038,312 - 1,378,173 3,660,139 1,381,139
Accumulated vacation - net 2,067,591 - 426,146 1,641,445 -
Claim liabilities 386,298 67,224 - 453,522 453,522
Supplemental Early
Retirement Plan (SERP) 5,773,494 1,719,130 1,518,839 5,973,785 1,516,958 Other postemployment
benefits 2,239,508 3,397,763 2,388,313 3,248,958 -
196,022,210
$ $ 7,170,989 $ 10,199,795 $ 192,993,404 $ 8,241,619 Payments on the General Obligation Bonds are made by the Bond Interest and Redemption Fund with local revenues. Payments for the Certificates of Participation are made by the Special Reserve Fund for Capital Outlay Projects. Payments for capital leases will be paid by the fund for which the lease was entered into. The accrued vacation will be paid by the fund for which the employee worked. When an employee retires and is paid from categorical funds, any excessive vacation payoff not earned in the last year worked, will be paid from the General Fund. Payments for claims liability are made from the Self-Insurance Fund. Payments for the Supplemental Early Retirement Program are made from the General Fund. Other postemployment benefits are generally paid by the General Fund.
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2011
49
General Obligations Bonds
The outstanding general obligation bonded debt is as follows:
Bonds Bonds
Issue Maturity Interest Original Outstanding Outstanding
Date Date Rate Issue July 1, 2010 Accreted Redeemed June 30, 2011 1997, Series A 8/1/97 8/1/22 4.80-5.15% $ 10,000,000 $ 370,000 $ - $ 370,000 $ - 1997, Series B 8/1/98 8/1/23 3.70-5.28% 9,999,278 12,874,106 686,512 750,000 12,810,618 2005, Series A 8/19/05 8/1/30 3.00-5.09% 49,998,180 48,610,598 55,187 25,000 48,640,785 2005, Series B 2/7/07 8/1/31 4.00-5.00% 30,000,000 27,975,000 - 1,650,000 26,325,000 2005, Series C 5/12/10 8/1/43 6.82-10.51% 24,990,463 24,990,463 1,245,173 - 26,235,636 2010, Refunding 5/12/10 8/1/22 2.75-4.50% 6,560,000 6,560,000 - - 6,560,000 121,380,167 $ $ 1,986,872 $ 2,795,000 $ 120,572,039
1997 General Obligation Bonds, Series A
On August 1, 1997, the District issued the 1997 Series A current General Obligation Bonds in the amount of $10,000,000 to fund school construction.
On May 12 2010, the District issued the 2010 General Obligation Refunding Bonds in the amount of $6,560,000 to advance refund $6,420,000 of the 1997 General Obligation Bonds, Series A. As a result, the refunded portion of the debt obligation has been removed as a long-term obligation from the government-wide statement of net assets. At June 30, 2011, there was no outstanding balance for the 1997 General Obligation Bonds, Series A.
1997 General Obligation Bonds, Series B
On August 1, 1998, the District issued the 1997 Series B current and capital appreciation General Obligation Bonds in the amount of $9,999,278 (accreting to $22,525,000) to fund school construction. The bonds have a final maturity to occur on August 1, 2023, with interest yields varying from 3.70 to 5.28 percent. At
June 30, 2011, 1997 General Obligation Bonds, Series B, totaling $12,810,618 were still outstanding.
2005 General Obligation Bonds, Series A
On August 19, 2005, the District issued the 2005 Series A current and capital appreciation General Obligation Bonds in the amount of $49,998,180 (accreting to $52,140,000) to finance the construction, renovation and repair of District facilities. The bonds have a final maturity to occur on August 1, 2030, with interest yields varying from 3.00 to 5.09 percent. At June 30, 2011, the principal balance outstanding (including accreted interest to date) was $48,640,785 and unamortized premium and issuance costs were $2,572,446 and $587,307, respectively.
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2011
2005 General Obligation Bonds, Series B
On February 7, 2007, the District issued the 2005 Series B General Obligation Bonds in the amount of $30,000,000 to finance the construction, renovation and repair of District facilities, to finance a portion of the interest due on the Bonds and to pay issuance costs. The bonds have a final maturity to occur on August 1, 2031, with interest yields varying from 4.00 to 5.00 percent. At June 30, 2011, the principal balance outstanding was $26,325,000 and unamortized premium and issuance costs were $1,541,293 and $387,052, respectively.
2005 General Obligation Bonds, Series C
On May 12, 2010, the District issued the 2005 Series C General Obligation Bonds in the amount of $24,990,463 to finance the construction, renovation and repair of District facilities, to finance a portion of the interest due on the Bonds and to pay issuance costs. The bonds issued were capital appreciation bonds accreting to a maturing principal balance of $143,307,445. The bonds have a final maturity to occur on August 1, 2043, with interest yields varying from 6.82 to 10.51 percent. At June 30, 2011, the principal balance outstanding was $26,235,636 and unamortized premium and issuance costs were $1,461,554 and $1,461,554, respectively.
2010 General Obligation Refunding Bonds
On May 12, 2010, the District issued the 2010 General Obligation Refunding Bonds in the amount of $6,560,000. The bonds were issued to advance refund $6,420,000 of the outstanding 1997 General Obligation Bonds, Series A. The bonds associated with the issuance were placed in an escrow account with U.S. Bank for the future redemption of Series A bonds to occur on August 1, 2010. The difference between the cash flows of the refunded debt and the new issuance was $524,952. The economic gain (the difference between the present value of the refunded debt and new issuance) resulting from the refunding was $410,889. The bonds have a final maturity to occur on August 1, 2022, with interest yields varying from 2.74 to 4.50 percent. At June 30, 2011, the principal balance outstanding was $6,560,000 and unamortized premium and issuance costs were $140,275 and $123,271, respectively.
The bonds mature as follows:
Principal Accreted Current
Including Accreted Interest to Interest to
Fiscal Year Interest to Date Maturity Maturity Total
2012 $ 3,396,707 $ 23,293 $ 3,842,856 $ 7,262,856 2013 1,933,141 61,859 3,770,613 5,765,613 2014 2,374,488 115,512 3,726,113 6,216,113 2015 2,807,171 172,829 3,659,044 6,639,044 2016 3,361,832 233,168 3,563,675 7,158,675 2017-2021 22,368,708 2,346,292 15,541,637 40,256,637 2022-2026 26,673,599 5,816,401 10,610,312 43,100,312 2027-2031 32,692,121 11,082,879 4,185,625 47,960,625 2032-2036 12,338,498 31,586,502 75,625 44,000,625 2037-2041 8,455,494 43,544,506 - 52,000,000 2042-2044 4,170,280 29,837,165 - 34,007,445 Total $ 120,572,039 $ 124,820,406 $ 48,975,500 $ 294,367,945
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2011
51
Certificates of Participation
The outstanding Certificates of Participation debt is as follows:
Issue Maturity Interest Original Outstanding Outstanding
Date Date Rate Issue July 1, 2010 Redeemed June 30, 2011
4/3/03 9/1/31 4.00% - 5.00% $ 15,500,000 $ 12,325,000 $ 700,000 $ 11,625,000 11/6/03 9/1/17 2.50% - 4.125% 3,500,000 2,110,000 260,000 1,850,000 4/11/06 9/1/36 Weekly 14,485,000 14,195,000 300,000 13,895,000 12/7/06 9/1/36 4.00%-5.25% 23,500,000 23,050,000 100,000 22,950,000 56,985,000 $ $ 51,680,000 $ 1,360,000 $ 50,320,000
2003 Certificates of Participation (School Financing Project)
On April 3, 2003, the District, in conjunction with the Riverside County Schools Financing Corporation, issued $15,500,000 in 2003 Certificates of Participation, with interest rates ranging from 4.00 to 5.00 percent, to finance the construction and renovation of school facilities and to advance refund $5,490,000 of outstanding 1991 Certificates of Participation. The 2003 Certificates have final maturity to occur on September 1, 2031. The District received net proceeds of $15,188,780 (including premium of $169,850 and after payment of $481,070 in underwriter fees, insurance, and other issuance costs). At June 30, 2011, the principal balance outstanding was $11,625,000 and unamortized premium and issuance costs were $119,805 and $339,327, respectively.
The certificates mature through 2032 as follows: Year Ending
June 30, Principal Interest Total
2012 $ 750,000 $ 541,798 $ 1,291,798 2013 800,000 508,673 1,308,673 2014 170,000 485,443 655,443 2015 200,000 478,213 678,213 2016 225,000 469,488 694,488 2017-2021 1,330,000 2,176,105 3,506,105 2022-2026 2,485,000 1,762,912 4,247,912 2027-2031 4,405,000 902,874 5,307,874 2032 1,260,000 31,500 1,291,500 Total $ 11,625,000 $ 7,357,006 $ 18,982,006
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2011
2003 Certificates of Participation (East Coachella School Facilities Project)
On November 6, 2003, the District, in conjunction with the Riverside County Schools Financing Corporation, issued $3,500,000 in 2003 Certificates of Participation (East Coachella School Facilities Project), with interest rates ranging from 2.50 to 4.125 percent, to finance the construction of school facilities, to pay for delivery costs of the Certificates, and to fund a reserve fund for the Certificates. Pursuant to a lease/purchase agreement, the District will lease a school site to the Corporation and will lease the site back from the Corporation. The 2003 Certificates have a final maturity to occur on September 1, 2017. The District received net proceeds of $3,469,544 (including a premium of $42,294 and after payment of $72,750 in underwriter fees, insurance, and other issuance costs). At June 30, 2011, the principal balance outstanding was $1,850,000 and unamortized premium and issuance costs were $19,385 and $33,346, respectively.
Year Ending
June 30, Principal Interest Total
2012 $ 285,000 $ 70,571 $ 355,571 2013 310,000 58,430 368,430 2014 250,000 46,455 296,455 2015 85,000 39,755 124,755 2016 135,000 35,287 170,287 2017-2018 785,000 41,010 826,010 Total $ 1,850,000 $ 291,508 $ 2,141,508
2006 Certificates of Participation (2006 School Financing Project)
On April 11, 2006, the District, in conjunction with the Riverside County Schools Financing Corporation, issued $14,485,000 in 2006 Certificates of Participation (2006 School Financing Project), with variable interest rate (weekly) to finance the construction, reconstruction, modernization, and improvement of existing school facilities, finance the acquisition of real property for a school site, finance a portion of the interest evidenced by the
certificates, fund a reserve fund, and pay issuance costs associated with the execution and delivery of the certificates. The 2006 Certificates have a final maturity to occur on September 1, 2036. At June 30, 2011, the principal balance outstanding was $13,895,000 and unamortized discount and issuance costs were $78,070 and $270,463, respectively.
Year Ending
June 30, Principal Interest Total
2012 $ 310,000 $ 412,200 $ 722,200 2013 320,000 402,750 722,750 2014 335,000 392,925 727,925 2015 345,000 382,725 727,725 2016 355,000 372,225 727,225 2017-2021 1,960,000 1,691,550 3,651,550 2022-2026 2,325,000 1,370,625 3,695,625 2027-2031 2,735,000 992,175 3,727,175 2032-2036 3,225,000 546,225 3,771,225 2037 1,985,000 29,775 2,014,775 Total $ 13,895,000 $ 6,593,175 $ 20,488,175
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2011
53
2006B Certificates of Participation (School Financing Project)
On December 7, 2006, the District, in conjunction with the Riverside County Schools Financing Corporation, issued $23,500,000 in 2006B Certificates of Participation (School Financing Project), with interest yields varying from 4.00 to 5.25 percent to finance the construction, reconstruction, expansion, modernization, and improvement of existing school facilities, fund a reserve fund, and pay issuance costs associated with the execution and delivery of the certificates. The 2006B Certificates have final maturity to occur on September 1, 2036. At June 30, 2011, the principal balance outstanding was $22,950,000 and unamortized premium and issuance costs were $1,346,828 and $354,207, respectively.
Year Ending
June 30, Principal Interest Total
2012 $ 125,000 $ 1,144,262 $ 1,269,262 2013 150,000 1,138,450 1,288,450 2014 185,000 1,131,750 1,316,750 2015 - 1,128,050 1,128,050 2016 - 1,128,050 1,128,050 2017-2021 1,690,000 5,514,550 7,204,550 2022-2026 4,210,000 4,680,250 8,890,250 2027-2031 5,205,000 3,554,375 8,759,375 2032-2036 8,560,000 1,520,250 10,080,250 2037 2,825,000 70,625 2,895,625 Total $ 22,950,000 $ 21,010,612 $ 43,960,612 Capital Leases
The District's liability on lease agreements with options to purchase are summarized below:
Balance, July 1, 2010 $ 5,517,386
Payments 1,606,693
Balance, June 30, 2011 $ 3,910,693
The capital leases have minimum lease payments as follows:
Year Ending Lease
June 30, Payments
2012 $ 1,536,693
2013 1,361,500
2014 1,012,500
Total 3,910,693
Less: Amount Representing Interest 250,554
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2011
Accumulated Unpaid Employee Vacation
The long-term portion of accumulated unpaid employee vacation for the District at June 30, 2011, amounted to $1,641,445.
Claims Liability
Liabilities associated with health and welfare claims are reported when it is probable that a loss has occurred and the amount of the loss can be reasonably estimated. Liabilities include an amount for claims that have been incurred but not reported (IBNR). Claim liabilities are based upon estimated ultimate cost of settling the claims, considering recent claim settlement trends including the frequency and amount of payouts and other economic and social factors. The liability for health and welfare claims is reported in the Internal Service Fund. The outstanding claims liability at June 30, 2011, amounted to $453,522.
Supplemental Early Retirement Plans (SERP)
The District has offered supplemental early retirement plans (SERP) to its certificated and classified employees as part of the union contracts since 1984. Eligible employees who meet specific criteria for participation in SERP are provided an annuity to supplement the retirement benefits they are entitled to, through their respective retirement systems. The annuities offered to the employees are paid over a five-year period. Currently, 153 employees who have retired after 2003 have elected to receive these annuities, as purchased from United of Omaha and Principal Life Insurance. 45 of these employees retired during the 2010-2011 fiscal period. Future annuity payments are as follows:
Year Ending Total
June 30, Payments 2012 $ 1,516,958 2013 1,516,958 2014 1,298,022 2015 1,298,022 2016 343,825 Total $ 5,973,785
Other Postemployment Benefits (OPEB) Obligation
The District's annual required contribution for the year ended June 30, 2011, was $3,427,598, and contributions made by the District during the year were $2,388,313. Interest on the net OPEB obligation and adjustments to the annual required contribution were $111,975 and ($141,810), respectively, which resulted in an increase to the net OPEB obligation of $1,009,450. As of June 30, 2011, the net OPEB obligation was $3,248,958. See Note 10 for additional information regarding the OPEB obligation and the postemployment benefits plan.
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2011
55