Old Adobe Union School District

Measure L - 55% Approval Required

COUNTY COUNSEL'S IMPARTIAL ANALYSIS OF MEASURE L

California law permits school districts to issue bonds to pay for construction, repair, replacement, and acquisition of school facilities provided 55 percent of voters who vote on the measure approve the sale of the bonds. The Old Adobe Union School District Board of Trustees has placed on the ballot the question of whether to issue $38,500,000 in bonds for such purposes.

Money raised by bond sales may only be used for the purposes and projects stated in the Bond Project List set forth in Measure L, following this analysis. Proceeds could be used to modernize, renovate, construct, acquire, equip, expand, or otherwise im- prove educational and support facilities. The Bond Project List includes a complete list of projects and allowed expenditures. As required by law, Measure L prohibits using bond proceeds for teacher or administrator salaries or other operating expenses.

The Board of Trustees has certified that it evaluated safety, class size, and infor- mation technology needs in developing the Bond Project List. Inclusion of a project on the Bond Project List does not guarantee it will be funded or completed. The District may seek State funds to augment Bond proceeds to advance the Bond Project List. The Board of Trustees will establish the priority and order in which projects are undertaken.

If adopted, Measure L includes “Accountability Safeguards” that require the Board of Trustees to: annually conduct independent financial and performance audits; establish an Independent Citizens’ Oversight Committee; and maintain bond proceeds in a separate account in the County Treasury. Measure L further requires District Superintendent to provide an annual report to the Board on the status of projects undertaken and the amount of bond proceeds received and expended in each year.

If approved, Measure L authorizes Old Adobe Union School District to issue and sell general obligation bonds in series, at different times, as projects are under- taken. Bonds of any series must mature within the statutory maximum number of years from date of issue. The interest rate on the bonds will depend on the market rate at the time bonds are sold, but cannot exceed the maximum rate set by law. Bonds will be repaid from property taxes levied on real property within the District based on the value of land and improvements on each property. Those taxes would be in addition to current property taxes on real property within the District.

BRUCE D. GOLDSTEIN County Counsel  By: s/ Robert Pittman Assistant County Counsel

The amount of tax needed each year will depend upon the amount needed to repay outstanding principal and interest. The District’s Tax Rate Statement, which fol- lows this analysis, estimates the highest tax rate necessary to fund the bonds is $30 per $100,000 of assessed value. Those tax levies are projections, and could go up or down, depending on a number of factors including the timing and amount of bond sales, and changes in assessed property values in the District.

If all bonds are sold, the total debt service (including principal and interest) will be $79,000,000. The tax will raise approximately $2,200,000 annually.

A “yes” vote on Measure L will authorize the District to issue the bonds and levy taxes to pay for the indebtedness. A “no” vote on Measure L will not authorize either the issuance of bonds or the associated levy of taxes.

TAX RATE STATEMENT — MEASURE L

An election will be held in the Old Adobe Union School District (the “District”) on November 6, 2018, to authorize the sale of up to $38.5 million in bonds of the District to finance school facilities as described in the measure. If such bonds are authorized and sold, principal and interest on the bonds will be payable only from the proceeds of ad valorem tax levies made upon the taxable property in the District. The following information is provided in compliance with Sections 9400-9404 of the Elections Code of the State of California. Such information is based upon the best estimates and projections presently available from official sources, upon experience within the District, and other demonstrable factors.

Based upon the foregoing and projections of the District’s assessed valuation, the following information is provided:

1. The best estimate of the average annual tax rate which would be required to be levied to fund this bond issue over the entire duration of the bond debt service, based on a projection of assessed valuations available at the time of filing of this statement, is $0.03 per $100 of assessed valuation (or $30 per $100,000 of assessed value). The final fiscal year in which it is anticipated that the tax will be collected is 2052-53.

2. The best estimate of the highest tax rate which would be required to be levied to fund this bond issue, based on a projection of assessed valuations available at the time of filing of this statement, is $0.03 per $100 of as- sessed valuation (or $30 per $100,000 of assessed value). It is estimated that such rate would be levied starting in fiscal year 2019-20 and following.

3. The best estimate of the total debt service, including the principal and interest, that would be required to be repaid if all the bonds are issued and sold is approximately $79,000,000.

Voters should note the estimated tax rate is based on the assessed value (not market value) of taxable property on the County’s official tax rolls. In addition, taxpayers eligible for a property tax exemption, such as the homeowner’s exemption, will be taxed at a lower effective tax rate than described above. Property owners should consult their own property tax bills and tax advisors to determine their property’s assessed value and any applicable tax exemptions.

The attention of all voters is directed to the fact that the foregoing information is based upon projections and estimates only, which amounts are not maximum amounts and durations and are not binding upon the District. The actual debt service, tax rates and the years in which they will apply may vary from those used to provide the estimates set forth above, due to factors such as variations in the timing of bond sales, the par amount of bonds sold and market interest rates available at the time of each sale, actual assessed valuations over the term of the bonds, and other factors. The date and amount of bonds sold at any given time will be determined by the District based on the need for project funds and other considerations. The actual interest rates at which the bonds will be sold will depend on conditions in the bond market at the time of sale. Actual future assessed valuations will depend upon the amount and value of taxable property within the District as determined by the County Assessor in the annual assessment and the equalization process.

  s/ Craig Conte Superintendent Old Adobe Union School District