Comments on: Who donated to Measure C campaign?

By: Late MDUSD campaign contributions reveal nearly $100,000 in donations | On Assignment

Thu, 05 Aug 2010 01:57:18 +0000

[...] I outlined earlier campaign contributions in this post: http://www.ibabuzz.com/onassignment/2010/06/07/who-donated-to-measure-c-campaign/. [...]

By: tharrington

tharrington — Sat, 19 Jun 2010 00:49:30 +0000

I spoke to the district’s financial adviser Jon Isom and he told me the interest rate he used to estimate the $1.8 billion cost was a little more than 7 percent. However, he said the total cost could be below $1.8 billion and it is impossible to know for sure what the interest rates will be until the bonds are sold. He also said that the longer the term of the loan, the higher the interest rate.

By: Doctor J

Doctor J — Thu, 10 Jun 2010 14:48:28 +0000

DIABLOGATE is starting to get interesting. I hope CCT pursues the records request relentlessly. Someone has to get to the truth.

By: tharrington

tharrington — Thu, 10 Jun 2010 01:19:22 +0000

Fiscal services director Bryan Richards told me: “No one knows what the interest rate on the bond will be until the day of the bond sale, because the market’s continually fluctuating. The bond market can go any which way at any given time, it can vary quite widely.”
Interest rates on the 2002 Measure C bonds, which averaged 25 year terms for maturity, ranged from 1.559 percent to 5.19 percent.
A table at the bottom of Dan Borenstein’s column regarding Measure C shows a spreadsheet with estimates for debt service on the 2010 Measure C bonds at http://www.contracostatimes.com/ci_14992231?IADID=Search-www.contracostatimes.com-www.contracostatimes.com.
According to this chart, debt service would start at about $1.9 million a year in 2010 and rise to $29.7 million by 2031, when the 2002 Measure C bonds would be paid off. Then, debt service on the 2010 bonds would jump to $45.9 million in 2032 and rise to $100.2 million in 2048, $105.2 million in 2049, $110.5 million in 2050, $116 million in 2051 and $89.9 million in 2052. In other words, taxpayers would spend more than $520 million in payments on the $348 million bonds in the last five years, compared to about $12.1 million over the first five years.
The Acalanes district also approved bonds with 40-year maturity rates in 2008.
According to the Mt. Diablo district’s bond resolution, “the maximum rate of interest on any bond shall not exceed the maximum rate allowed by Education Code Sections 15140 to 15143, as modified by Government Code Section 53531.”

By: Trapped in MDUSD

Trapped in MDUSD — Wed, 09 Jun 2010 19:31:10 +0000

Does the MDUSD Board have a reliable estimate of the interest rate that investors will expect for such an unusual bond with a 42-year life and deferred principal payments (all to stay within the existing bond service cap)? A brief Google search suggests that this will be a very unusual bond issue for the muni market. If they need to offer a rate higher than what the bankers have promised to get the deal, they will have to borrow less, to stay within the current bond service cap. That will mean even fewer benefits for current students, in return for the exorbitant interest costs. It’s one thing to estimate the rate investors will require for a plain vanilla security. It’s another thing entirely to estimate the interest rate required to borrow money with a crazy bond like this.

By: tharrington

tharrington — Wed, 09 Jun 2010 07:17:20 +0000

I’ll be writing a follow-up story tomorrow. The board expects to vote on more budget cuts June 15 and June 22.
Trustees will also need to prioritize the projects, establish a new Measure C oversight committee and decide when to start selling bonds.

By: Doctor J

Doctor J — Wed, 09 Jun 2010 07:07:55 +0000

The voters spoke after getting barraged with campaign flyers. I hope you keep up with your records request. I have a feeling that Diablogate coverup isn’t over yet. When the voters realize the extent of the moving target, and the budget cuts that will be coming down even with the bond passage, there will be backlash.

By: tharrington

tharrington — Wed, 09 Jun 2010 00:41:12 +0000

I didn’t get officially invited, but I did find out about it. I won’t be attending, because we’ll be updating election coverage as results are released online. We may send a photographer, though. I’ll be in contact with the campaign spokeswoman by cell phone, as well as with Kris Hunt from the Contra Costa Taxpayers Association.

By: Nobody

Nobody — Wed, 09 Jun 2010 00:07:42 +0000

Hopefully interview them on their crushing defeat.

By: Doctor J

Doctor J — Tue, 08 Jun 2010 18:24:05 +0000

Theresa, did you get invited to the Victory party tonight at El Torito at 8 pm ? You could probably interview all 5 of the Board plus the Supt.