Oakland USD, GO Refunding 2017ABCD

Oakland Unified School District
$293,560,000 GO
Refunding Bonds 2017 Series ABCD

Oakland USD achieves lowest financing cost for the District since the Great Recession

On May 11th SCS served as the sole manager of the District’s $293.6 million 2017 Series A, B, C, and D General Obligation Refunding Bonds which produced approximately $60 million of cashflow savings. Present value savings achieved total approximately $50 million or 16.8% of the refunded par and the refunding structure produced level annual savings.

With this refunding the District successfully defeased all of its remaining outstanding non-rated bonds and replaced them with bonds rated in the investment grade category (Aa3/AA-/AAA). Via a crossover refunding structure, the District refinanced all of its non-rated taxable Build America Bonds, issued during the 2009 economic recession, with lower cost taxable bonds that produced $14.2 million of present value savings or 20.1% of refunded par.

28 new investors submitted orders for the 2017 Refunding Bonds and 5 existing investors participated, resulting in oversubscription of 1.8x. As a result of the strong investor interest, spreads were re-priced lower by 1 to 2 basis points, including on the majority of the maturities in the belly of the curve.

In aggregate, the bonds priced with an All-in TIC of 3.23%, which was the lowest financing cost for the District since the Great Recession.