FINANCE 101: A Facilities Financing Odyssey Understanding School District Finance February 25, 2014

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1 FINANCE 101: A Facilities Financing Odyssey Understanding School District Finance February 25, 2014 MODERATOR: John R. Baracy Managing Director Stifel, Nicolaus & Company, Incorporated PANELISTS: Gary Black Assistant Superintendent, Business and Facilities San Ramon Valley USD Mark Epstein Managing Director California Financial Services Donald S. Field, Esq. Partner Orrick, Herrington & Sutcliffe LLP What is Debt Financing? Mechanism for obtaining money today through an agreement to repay the money over time with interest Conversion of expected future stream of income (whether from tax receipts, developer mitigation, general fund revenues or other sources) into currently available dollars 1 1

2 What Can Debt Financing Be Used for? Through debt financing School Districts may: Acquire land Construct/improve buildings Install improvements and facilities Acquire equipment and furnishings Fund working capital 2 How Does It Work? School Districts raise funds by selling their debt to private investors in the municipal credit market Investors make loans to School Districts by purchasing the debt directly or through brokers and salesmen working for investment banks Unlike U.S. Treasury or Corporate debt, most School District debt generates tax-exempt interest income for investors 3 2

3 Advantage of Tax-Exempt Interest Municipal bond investors acknowledge value tax-exemption by accepting lower interest rates on tax-exempt debt Example: 4.00% tax-exempt interest rate = 6.15% equivalent taxable yield for investor in 35% tax bracket As a result, School District s borrowing cost is lower than taxable debt issued by banks and corporations with similar risks and terms 4 Who Buys Debt? National outstanding municipal debt totaled $3.68 trillion in 2013 Individuals/Retail Investors High tax bracket investors seeking low-risk assets and tax free income Institutional Investors Mutual Funds for resale to small investors Insurance Companies for their own portfolios Commercial Banks for their own portfolios Money Managers for their individual clients portfolios 5 3

4 How is Debt Sold? Competitive Sale/Public Sale: The sale of debt awarded to the Underwriter presenting the lowest bid at a predetermined time and place Negotiated Sale: The sale of debt in which an Underwriter is hired early in the process to buy and market an issuer s debt Private Placement: The placement of debt with one or a few sophisticated investors Direct Placement: The purchase of debt directly by a bank as a bank investment 6 The Financing Team Role of the Professionals Issuer Internal Team: Superintendent Chief Business Official Facilities Director District Counsel Issuer Consultants: Bond Counsel Financial Advisor Disclosure Counsel Trustee Dissemination Agent Underwriter Third Parties: County Treasurer/Auditor/Counsel County Office of Education Rating Agencies Credit Enhancer Investment Advisors Campaign Consultants 7 4

5 The Financing Team Their Collective Role Optimal structuring to accomplish District goals Proper matching of cash flows to project schedule Proper matching of debt funds to state grants Proper matching of debt instrument to project funding list Maximize potential to execute funding of facility projects on a timely and cost effective basis Better market acceptance of debt being sold Minimize potential for legal liability 8 The Financing Team Bond Counsel Provides legal parameters and guidelines to School District and Financing Team Drafts legal documents pursuant to which ballot measures are formulated and/or debt is issued/secured Provides the legal opinion stating that debt is being validly issued under state law and exempt from federal and state income taxes (California) 9 5

6 The Financing Team Financial Advisor Advises and assists in the formulation/execution of facility funding and financing plans Acts as District fiduciary in negotiating terms of debt, and shall not purchase or underwrite debt Financial Advisor is typically hired at the beginning of facility planning or bonding process, depending on the array of services needed Role of financial advisor depends on (1) the needs of the School District (2) the complexity of the financing and/or (3) the method of sale chosen 10 The Financing Team Underwriter Purchases debt with the intent to resell to investors In a negotiated sale the underwriter is hired early in the process and assists the School District and other members of the financing team In a competitive sale, the Underwriter simply delivers a sealed bid on the date of sale committing to purchase the debt at fixed interest rates and prices of the bonds are awarded by the School District 11 6

7 The Financing Team Disclosure Counsel A law firm retained to assist the District in fairly disclosing all pertinent facts relating to the debt offering Disclosure counsel works with School District staff to prepare an Official Statement of the District s financial condition, risks related to the debt, and a discussion of local economic conditions, all of which are provided to investors before they buy debt Bond Trustee / Registrar / Paying Agent Usually a bank with trust powers, which acts in a fiduciary capacity to the bondholders in enforcing the terms of the debt documents In some cases, disburses bond construction funds to vendors at the direction of the District Maintains records on behalf of the School District and for the purpose of notifying the owners of registered bonds Collects interest and principal from the School District and remits payments on the bonds to investors on behalf of the issuer 12 Other Team Members Dissemination Agent Every School District debt creates an obligation for information regarding the School District to be regularly updated on a web-based platform for use by investors The Dissemination Agent takes responsibility for filing the Annual Report under the Continuing Disclosure Agreement and filing Notices of Material Events County Treasurer / Auditor The principal duties include the management and investment of County, School and Special District funds Bond Administration (general obligation bonds) Collection of taxes and revenues County Counsel may review and comment on School District Bonds documents in instances where The County Board of Supervisors are required to act in the issuance of School District Debt 13 7

8 Other Team Members Underwriter s Counsel A law firm retained by the Underwriter to represent the Underwriter s interests Rating Agency An independent service that provides a credit quality evaluation of bonds and notes to potential investors by assigning letter grade ratings to School District debt. Standard & Poor s, Moody s and Fitch are common rating agencies for school district credit ratings Credit Enhancement Provider An institution that lends its credit rating for a premium fee to provide a school district lower cost of borrowing (i.e., Bond Insurance, Liquidity Facility or Letter of Credit) through utilizing a higher quality rating than its own assigned rating 14 Basic Legal Documents Resolution of Issuance Provides Parameters of Sale (amount, max interest rate, term, costs of issuance) Authorized Officers Bond Purchase Contract or Notice of Sale Competitive vs. Negotiated Method Sets forth terms and conditions of debt sale to Underwriter including interest rates and fees Bond Indenture/Trust Agreement Security Covenants (School District duties and obligations) Denominations & Interest and Principal Payment Dates Project Fund Requisition Process for releasing funds Investment of Funds Remedies to investors for defaults and non-performance Prepayment or Redemption Terms 15 8

9 School District Disclosure Documents and Duties Official Statement Preliminary: Marketing/Disclosure to Potential Investors Final: Delivered to Purchasers Marketing / Sales/Disclosure document Discloses Material Information Issuer s Document Continuing Disclosure Agreement Required by Securities and Exchange Commission s Rule 15c2-12 Issuer s Duty to file Annual Reports and to report Material Events 16 Best Planning Practices Leading up to a Comprehensive Debt Program Task 1 District determines need for facility master plan. Task 2 District surveys and/or interviews key administrators, site administrators custodial and maintenance staff to identify needs for existing facilities. Task 3 District retains State School Facility Program (SFP) consultant to calculate potential eligibility for various SFP grant programs. Task 4 District retains developer fee consultant to establish projected development activity, income and student generation Task 5 District retains demographer to update enrollment projections by sites and incorporate birth rate and development related growth Task 6 District retains architect and/or cost estimator to develop site budgets for identified needs Task 7 District retains Financial Advisor and/or Underwriter to evaluate debt capacity from various revenue sources Task 8 District surveys staff at every school site to identify potential needs by site and room to aid in identifying needs related to curriculum delivery, growth, health & safety, code compliance, parity-equity between school sites, modernization/upgrades, 17 overcrowding/growth and major/deferred maintenance. 9

10 Best Planning Practices Leading up to a Comprehensive Debt Program Task 9 District walks sites to verify survey and interview data and to evaluate parity issues by site, year of construction and design. Task 10 Financial Advisor/Underwriter completes debt capacity analysis of various revenues streams including development, redevelopment, special taxes, ongoing asset management revenue and the G.O. bond measure potential. Task 11 District completes Draft Facility Master Plan integrated all needs for 5 to 10 years with cost estimates, phasing plan, escalation and contingency. Task 12 District completes Draft Financial Master Plan that identifies the maximum amount of funding for the Facility Master Plan integrating existing fund balances, SFP grants, developer mitigation (fees and special taxes), COP and bond issuances and a potential additional G.O. bond measure. Task 13 District presents both draft plans to Board in study session or open session as discussion item inviting staff and public comment. Task 14 Board adopts both plans 18 Steps to Debt Issuance Task 1 School District decides to finance a project Task 2 Finance Team is selected and assembled if not in place already from Facility Master Process. Task 3 Revenue stream securing the debt is identified and analyzed Task 4 Staff and the Finance Team determine the debt structure Task 5 Election/formation proceedings documents are prepared and approved (if applicable) Task 6 Voter approval (if applicable) Task 7 Legal and disclosure documents are drafted 19 10

11 Steps to Debt Issuance Task 8 Credit ratings/bond insurance secured (if applicable) Task 9 Board approves the legal and disclosure documents and authorizes the debt issuance Task 10 Underwriter begins marketing the debt to investors (Negotiated Sale) Task 11 Underwriter commits to buy the debt from School District/Debt Awarded to Underwriter (Competitive Sale) Task 12 Transaction is closed and the project is funded 20 Other Financing Documents & Reports Tax Rate Statement (GO) Ballot Measure and Resolution calling bond election (GO) Lease Agreement (COPs) Assignment Agreement (COPs) Title Insurance Policy (COPs) Resolution of Formation (CFD) Appraisal Report (CFD) Rate and Method of Apportionment (CFD) Absorption / Market Study (CFD) Letter of Credit / Reimbursement Agreement (All) Closing Documents and Certificates (All) Legal Opinions (All) 21 11

12 The Bond Funds Project or Construction Fund Amount needed for all construction acquisition and soft costs Debt Service Reserve Fund Required to protect the investor against a revenue/payment shortfall/casualty loss for some but not all types of debt 22 The Bond Funds Capitalized Interest Fund Used to pay interest on the debt while a project is being constructed/acquired Costs of Issuance Fund Fees and expenses associated with the bond sale: Bond Counsel Financial Advisor Disclosure Counsel Trustee/Paying Agent/Registrar Ratings Credit Enhancement (if any) Preliminary and Official Statement Printing Underwriter s Discount Dissemination Agent District Counsel Appraisal (if any) Title Insurance (if any) Special Tax Consultant (if any) 23 12

13 Sources & Uses Example SOURCES: Bond Proceeds: Par Amount $4,000, Total Sources $4,000, USES: Project Fund Deposit: $3,287, Other Fund Deposits: Debt Service Reserve Fund 348, Capitalized Interest Fund 199, Subtotal 547, Delivery Date Expenses: Cost of Issuance Fund 125, Underwriter s Discount 40, Subtotal 165, Total Uses $4,000, The Rating Process Rating Agency An independent service that provides a credit quality evaluation of bonds Recently changed rating scale to correspond with corporate ratings Duties: (1) Reviews four broad factors to determine ratings The financial strength of the Issuer The economic health of the community Managerial and governance practices Debt position direct and overlapping debt, overall debt to wealth position (2) Interviews Issuer, others (3) Assigns a letter rating to bonds 25 13

14 The Spectrum of Ratings 26 Credit Enhancement Credit enhancement is provided by insurance companies and banks that maintain high quality ratings and enhance the rating of School District debt by lending the enhanced rating to a School District that has a lower rating on its own. Credit enhancement is used to improve the credit quality of a bond issue in order to increase the marketability of the security and thereby obtain lower interest rates. Generally, credit enhancement is utilized when the savings through enhancementrelated interest rate reductions are greater than the cost of the credit enhancement itself

15 Common Financing Options General Obligation Bonds (GO) / Bond Anticipation Notes (BANs) Lease Financing/Certificates of Participation (COPs) Land-Secured Bonds/Mello-Roos Special Tax Bonds (CFDs) SN9 28 Comparison Of General Obligation Bonds, Certificates of Participation, and Mello-Roos Bonds CHARACTERISTICS GENERAL OBLIGATION BONDS COPS MELLO-ROOS Vote Required? Yes. No. Yes. Minimum Affirmative Votes Two-thirds of votes cast, or 55% of votes N/A Two-thirds of votes cast. cast pursuant to Proposition 39. Qualified Electors Registered voters residing in entire school district (or only portion of school district if establish school facilities improvement district pursuant to Ed. Code 15300). N/A Registered voters in community facilities district (CFD), if 12 or more voters reside in CFD. If fewer than 12 registered voters reside in CFD, vote is of landowners, one vote per acre. Boundary of Area to be Taxed Entire school district (or only portion of school district if establish school facilities improvement district pursuant to Ed. Code 15300). N/A Territory of CFD, as defined by school board. CFD could be entire school district or a portion of district, including noncontiguous areas. Basis of Tax Assessed value of property. N/A Any reasonable method, except assessed value. Method of Tax Collection Annual property tax bill. N/A Annual property tax bill. Can Seniors be Exempt from Tax? No. N/A Yes. Typical Use of Technique Finance school facilities. Finance school facilities. Finance school facilities

16 Slide 29 SN9 Pages could be converted to two or three charts. Stifel Nicolaus, 1/29/2014

17 Comparison Of General Obligation Bonds, Certificates of Participation, and Mello-Roos Bonds CHARACTERISTICS GENERAL OBLIGATION BONDS COPS MELLO-ROOS Facilities Eligible for Financing Can School Furnishings and Equipment be Financed? Can Tax Revenues be Used for Purposes Other than Debt Service on Bonds? Are Operating Expenses Eligible for Financing with Tax? Separate Authority Required to Issue Bonds? Maximum Annual Tax Request With 2/3 vote, purchase or improvement of real property (purchase of land or construction of buildings). With 55% vote pursuant to Proposition 39, construction, reconstruction, rehabilitation, or replacement of school facilities, including furnishings and equipment, and the acquisition or lease of real property. No with 2/3 vote. Yes with 55% vote pursuant to Proposition 39. Any lawful purpose. Yes, without limitation. Any facility with useful life of five years or more (including school furnishings and buses). Yes, provided the equipment has a useful life of five years or longer. No. No. Yes. Bond debt service and payas-you-go expenses. No. No. Yes. Maintenance of school sites and structures. Also, annual cost of administering the financing and the CFD. No. School Board and County Office No. approval. Not limited with 2/3 vote. With 55% vote pursuant to Proposition 39, annual tax is limited to $30 per $100,000 of assessed valuation in elementary or high school district, $60 per $100,000 of assessed valuation in unified school district, and $25 per $100,000 of assessed valuation in community college district. N/A Voters must approve a maximum annual tax amount per taxable unit and a method for levying and apportioning the tax. 30 Comparison Of General Obligation Bonds, Certificates of Participation, and Mello-Roos Bonds CHARACTERISTICS GENERAL OBLIGATION BONDS COPS MELLO-ROOS Type of Bond Sale Negotiated or competitive sale. Negotiated or competitive sale. Negotiated or competitive sale. Debt Limit Bond Security Maximum Term of Tax Levy Amount of bonds outstanding at any time cannot exceed 2.5% of total assessed value in a unified school district or 1.25% of assessed value in a non-unified school district. School district's unrestricted ability to raise property taxes to meet debt service requirements. Property tax is a lien on property. County has authority to foreclose on lien for payment of delinquent taxes. As long as necessary to repay bonds authorized by voters. None. All legally available funds, including the General Fund, usually earmarked to State revenue, redevelopment passthrough, or other sources. N/A Value of property in the CFD subject to special tax must be at least three times the amount of outstanding bonds. Under certain conditions the school board can approve an amount of bonds exceeding this limit. Mello-Roos special tax is a lien on property. School district has authority to initiate accelerated foreclosure on property for payment of delinquent taxes, so long as bonds have been issued by the CFD. As long as necessary to repay bonds or to pay directly for facilities authorized by voters. Final year of tax must be specified. Maximum Term of Bonds Up to 25 years under Education Code, or up to 40 years under Government Code. Up to useful life of facility being financed. 40 Years

18 Board Approval Proposition 46 Requires simple majority approval of school board members Proposition 39 Requires 2/3rds approval of school board members 32 Election Dates Proposition 46 Generally any Tuesday Proposition 39 Statewide primary, general or special elections Election Date Filing Date June 3, 2014 March 6, 2014 November 4, 2014 August 7, 2014 Other dates only if coincide with regularly scheduled districtwide election 33 17

19 Summary of AB 182 What Are the New Rules? The primary effect of AB 182 is limitation on the use of CABs Reduces the maximum maturity of CABs issued by school districts to 25 years from 40 years and requires that CABs be issued under the Education Code. CIBS may still be repaid over a period of up to 40 years under the Government Code, but additional disclosure is required for CIBs repaid over more than 30 years. The maximum maturity for general obligation bonds issued by other local public agencies in California, which now ranges from 30 to 40 years, would be unchanged. Requires that the ratio of total debt service payments to the principal amount of general obligation bonds not exceed 4-to-1 for any single series of bonds. A limit on the debt repayment ratio does not apply to general obligation bonds issued by other local public agencies. Requires that all CABs maturing more than 10 years after the issuance of the bonds be subject to optional redemption beginning not later than the 10th year. 34 Summary of AB 182 (continued) Reduces the maximum interest rate on school district CABs to 8% from 12%. The maximum interest rate for the debt of all other local public agencies in California remains at 12%. Requires Board of Education to adopt a resolution prior to the sale of any CABs that identifies the district s intent to sell CABs, provides reasons for using CABs, and includes certain information on the CABs including the length of borrowing, repayment rate, and assessed value growth assumptions. The resolution must be discussed at two consecutive board meetings, first as an information item and second as an action item. The board must be presented with information on the overall cost of the CABs, a cost comparison if current interest bonds were used instead, and the reason for recommending CABs. Allows any school district that issued BANs before December 31, 2013, to seek a one-time waiver from those provisions of AB 182 regarding debt repayment ratio, optional prepayment of CABs, and the board resolution that discloses the issuance of CABs and the reasons for using CABs instead of CIBs. The proceeds of any bonds issued pursuant to such waivers must be used only to repay the BANs

20 Effect of AB 182 on Bond Financing Programs Shorter repayment period for bonds would result in smaller bond issues, longer spacing between issues, and more years over which bonds would be sold, extending the elapsed time to complete a single bond authorization. Increased likelihood that multiple future bond elections would be needed to achieve adequate funding source for facility needs. Delayed issuance of bonds would reduce the purchasing power of bond proceeds because of the effect of inflation. Limiting the debt repayment ratio to 4-to-1 could have a significant effect on bond issuance during periods of higher interest rates. Combination of a shorter repayment period and a limit on debt repayment ratio would make it much more difficult to conduct a new tax rate extension bond measure, and more difficult to achieve a level pattern of taxes for an existing authorization for which only a portion of the bonds have been issued. 36 Effect of AB 182 on Bond Financing Programs (continued) Requirement for optional redemption of CABs maturing more than 10 years after the issuance of the bonds will result in higher interest rates for CABs compared with non-callable CABs, but difference is likely to remain significant but diminish over time as investors become accustomed to callable CABs and no longer have the option to purchase non-callable CABs. Lowering the maximum interest rate for CABs to 8% is not likely to cause a significant near-term problem given today s low interest rates, but could become a greater constraint during periods in the future when interest rates are higher. The current limit of 12% was established in 1981 when bond interest rates averaged more than 12%

21 Comprehensive School Bond Election Results School District GO Election Results: January 1986 November Issues ($92.4 B Authorization) Prop Issues ($22.9 B Authorization) Prop % 45.6% 17% 54% 46% 144 Issues ($9.6 B Authorization) 430 Issues ($17.7 B Authorization) PASS FAIL (1) Proposition 39 elections commenced in Spring Source: School Services of California 38 Bond Anticipation Notes (BANs) Notes and renewals thereof must be payable not more than five years from the date of the original issuance of the note Total amount of notes or renewals thereof issued and outstanding may not exceed the total amount of unsold (authorized) bonds The proceeds from the sale of the notes must be used only for authorized purposes of the bonds or to repay outstanding notes previously issued Rating agencies have recently changed their criteria in rating BANS which may lead to less issuance 39 20

22 Annual K-12 GO Bond Volume Millions $8,000 $7,000 $6,000 $6,925 $6,449 $6,624 $7,344 $5,871 $5,797 $6, Issues in 2013* $5,000 $5,084 $5,361 $4,000 $3,285 $3,000 $2,000 $1,000 $ * Does not include private placement issues. Source: California Debt and Investment Advisory Commission (CDIAC) 40 A.B. No Lease and COP Financings Existing law requires school districts to notify the county superintendent of schools and the county auditor of the approval by the governing board of a school district to proceed with the issuance of certificates of participation and lease revenue bonds The school district superintendent is required to provide repayment schedules and evidence of the ability of the school district to repay the obligation to the county superintendent, the county auditor, the district governing board and the public A.B. No requires notification be given 30 days in advance of board approval and that certain additional information be provided to the county superintendent, the county auditor, the district governing board and the public 41 21

23 Annual K-12 COPs Volume Millions $1,200 $1,114 $1,000 $891 $893 $800 $808 $770 $774 $684 $600 $400 $465 $ Issues in 2013* $233 $200 $ * Does not include private placement issues. Source: California Debt and Investment Advisory Commission (CDIAC) 42 Why Use Mello-Roos? Why do Public Agencies and developers use this type of finance? Land-secured bonds can generate a new revenue source to fund needed facilities in growing areas (schools, roads, water, sewer, etc.) CFD boundaries can be tailored to specific project or larger areas of support Developer can fund infrastructure at tax-exempt rates and pass-tax through to end-users, enhancing the developer s proforma (and making it worthwhile to go through the public agency process) Tax can be designed to reduce carrying costs during development 43 22

24 Annual K-12 Mello-Roos Bond Volume Millions $900 $800 $854 $700 $666 $600 $500 $532 $556 $400 $366 $ Issues in 2013* $300 $200 $163 $126 $142 $212 $100 $ * Does not include private placement issues. Source: California Debt and Investment Advisory Commission (CDIAC) 44 School Facilities Debt Financing Summary Talk to your peers about their financing experiences Conduct due diligence before selecting your team Carefully evaluate unsolicited financing proposals Review your legal and disclosure documents Ask questions utilize your financing team/ask the experts Contact your local COE or tap professional resources (e.g. CASH, CASBO and CDIAC) 45 23

25 Great Questions and Answers 46 Moderator John R. Baracy 515 South Figueroa Street, Suite 1800 Los Angeles, California Phone (213) Fax (213) John R. Baracy Managing Director Stifel, Nicolaus & Company, Incorporated ( Stifel ) John Baracy is a Managing Director in the Los Angeles office of Stifel. Mr. Baracy brings over 19 years of experience to California and Arizona education finance. Mr. Baracy has expertise in the managing and structuring of new money and refunding issues, analysis of debt capacity, tax rate analysis, rating agency credit presentations, arbitrage rebate requirements, derivative financings, and investment of bond proceeds for general obligation bonds, bond anticipation notes, certificates of participation, tax credit bonds, Mello-Roos bonds and all other California education finance vehicles. Mr. Baracy is also a registered member of C.A.S.H., CASBO, CSBA and CALSA. Stifel has successfully assisted California school districts pass over 125 bond elections exceeding $5.0 billion since Stifel Stifel is nationally recognized as a leading financial services firm, with a 80-year tradition of excellence. We trade and underwrite more Arizona and California municipal bonds, land-secured debt, and redevelopment financing than any other firm in the United States. Institutions and individuals rely on us for innovative investment approaches that reflect our traditions of independence and professionalism. As we have expanded our locations to major markets across the country, Stifel remains focused on the growing needs of America s cities, counties, school districts and states, as well as individual and institutional investors. The firm s website is

26 Panelist Mark Epstein Mark Epstein Managing Director California Financial Services 412 Humboldt Street Santa Rosa, California Phone R. Mark Epstein co-founded California Financial Services after spending almost a decade as Vice President of Public Finance in charge of California K-12 Education for Smith Barney (now Citigroup) which at the time was Wall Street s largest privately held investment bank. He is an active owner of CFS and manages the Northern California Region including both the Sacramento and Santa Rosa office from CFS Santa Rosa Office and has participated in more than $4 billion in municipal funding programs during his 29 year career in public finance. In addition to his background in finance, Mr. Epstein served for 6 1/2 years on the Rincon Valley School District Board of Trustees in Sonoma County where he expanded his understanding of the operations, culture and political realities of running a California school district. While at Rincon Valley, Mr. Epstein was the lead Board member in conducting the District s G.O. Bond election and one of two Board members with lead responsibility for the two parcel tax measures passed by the District during his tenure. Through this and other experiences in his three decades serving schools, he has developed a multi-disciplinary approach to providing financial/facility planning services including the evaluation of facility planning, demographics, development projections, debt management and credit factors relating to each district s unique circumstances. Mr. Epstein has an A.B. degree in Humanities from Stanford University. About California Financial Services California Financial Services (CFS) was founded in 1986 as a financial planning firm and today provides a wide range of financial and facility planning services to California school districts and local governments. CFS maintains offices throughout California in Mission Viejo, San Gabriel, Sacramento and Santa Rosa. The firm is staffed with two bankers, one facility planner, two former CBOs, two former OPSC and CDE management personnel, two account administrators and three office administrators. CFS s staff includes industry specialists that offer expertise for an array of services addressing the enormous and complex problems facing local government today -- especially California School districts and the unique and complex environment in which they operate. CFS staff provides the leadership and support necessary to implement the best practices for Facility Master Plans and Financial Plans as well as virtually any financial planning or facility project that address a problem facing school districts. 48 Panelist Donald S. Field, Esq Main Street Suite 1100 Irvine, California Phone Fax dfield@orrick.com Donald S. Field, Esq. Partner Orrick, Herrington & Sutcliffe LLP Mr. Field is a Partner in the Public Finance Department of Orrick, Herrington & Sutcliffe LLP and the Co-Chair of Orrick s School Finance/General Obligation Bonds Practice Group. He is also a member of Orrick s Assessment/Mello-Roos Practice Group, Leasing Practice Group and Revenue Practice Group. He has extensive experience, as both bond counsel and disclosure counsel, in the financing techniques used by school districts, redevelopment agencies, cities and counties in California. His practice focuses on local governmental infrastructure financing, including general obligation bond financing, land-secured financing and municipal lease financing. He has appeared as a panelist and lecturer for numerous organizations, including the Coalition for Adequate School Housing, the California Community College League, the Associated Press News Editor s Council, the League of California Cities and the California Society of Municipal Finance Officers. Mr. Field is the principal author and editor of the third edition of The XYZs of California School District Debt Financing, published by Orrick in Orrick, Herrington & Sutcliffe LLP Orrick, Herrington & Sutcliffe LLP has maintained a substantial practice in the area of public finance for over a century. It has been the premier bond counsel firm in California throughout that period, and has been ranked first in the country for most of the last ten years in total volume of financings for which it served as bond counsel. Orrick s public finance attorneys are located in Los Angeles, Orange County, San Francisco, Sacramento, New York, Seattle, Portland and Washington, D.C. From these offices, Orrick serves as bond counsel for issuers in more than 40 states, several territories and other countries. The firm s website is