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Leander Independent School District Bonds and Debt Analysis

Leander Independent School District Bonds and Debt Analysis. May 22, 2018. Topics of Interest. What Matters to Rating Agencies? We Passed a Bond Election, What is Next? Future of Financial Leadership LISD. What Matters to Rating Agencies?.

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Leander Independent School District Bonds and Debt Analysis

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  1. Leander Independent School DistrictBonds and Debt Analysis May 22, 2018

  2. Topics of Interest • What Matters to Rating Agencies? • We Passed a Bond Election, What is Next? • Future of Financial Leadership LISD

  3. What Matters toRating Agencies?

  4. Excellent Academic Reputation – A Destination District • Continue to outpace the State and Nation in both ACT and SAT score performance • Continue to offer IB World Schools • Continue to have one of the highest STAAR passing rates in State • Continue to have one of the highest graduation rates

  5. Seasoned Executive Team • Core finance staff possess a strong understanding of the intricacies of Texas school funding • Proven ability to effectively manage a growing school district • Dr. Dan Troxell hired as Superintendent in Aug. 2016 – upon unanimous approval by the Board – to lead Leander ISD after superintendent Bret Champion departed amicably for an opportunity at Klein ISD

  6. Favorable Location in Austin MSA- District is Poised for Continued Growth • Leander ISD is predominantly located in Williamson County, with the southern portion extending into Travis County • Ideal location west / northwest of Austin along a transportation corridor (Hwy 183) – District is positioned for continued development and enrollment gains as the Austin MSA continues to grow • Offers proximity to Austin, a major employment center and one of the fastest growing cities in the U.S. • Median household income of $72,118 for Williamson County is 137% of the statewide and 135% of the US average1 ______________________ 1 US Census Bureau

  7. FY 2017 TAV Reaches $20 Billion, Establishing New Peak • The District’s tax base is comprised of primarily residential properties; this sector has demonstrated solid growth over the last decade and development activity remains robust • Top 10 taxpayers, combined, represent less than 4% of TAV TAV % change

  8. Enrollment Continues to Climb at a Manageable Rate • District enrollment grew by 2.25% this year (fiscal 2017) and over the past five years has grown by a compound annual growth rate (“CAGR”) of 2.56% • Enrollment growth has slowed from larger growth rates – from 2008-2012 the enrollment CAGR was 5.86% • Key Drivers • Quality of schools/education • Relative affordability of housing • Location ______________________ Source: Texas Education Agency, PEIMS data; Leander ISD.

  9. Favorable Demographics • Low economically disadvantaged population of 19% • 59% in Texas • Leander ISD ranked 3rd in Texas among ISDs with more than 20,000 students • High STAAR passage rate of 83% • 71% in Texas • Leander ISD ranked 11th in Texas among ISDs with more than 20,000 students • Highly educated population - 51% have a bachelor’s degree • 29% in Texas • 43% in Austin • High median household income level of $102,782 • Austin metro area is $71,000 http://www.leanderisd.org/users/0001/docs/Demographics/2015/Demog-Pres_2015.pdf

  10. Enrollment Continues to Climb ______________________ Source: Leander ISD 2017 Demographic Report.

  11. 2018 Budget Development • Increase of 138 positions in General Fund Budget (125 campus, 13 non-campus) • Salary increase of 3.0% off midpoint for all employees • Maintain 2-cents of the M&O tax rate for major maintenance levy • Increase for implementation of new student information system • Start-up funding for Akin Elementary School scheduled for opening in August 2017

  12. Tax Rates Unchanged from Prior Year • The I&S tax rate remains at $0.47 ($0.47187, truncated in table below) per $100 of TAV • District currently over levying to early retire bonds • The M&O tax rate remains at $1.04 per $100 of TAV • District maintains 2-cents of the M&O rate for “major maintenance” • The M&O rate could increase to $1.17 (12.5%) with voter approval; though not currently contemplated by management

  13. Evolving Debt Structure

  14. District Compares Favorably to Other Highly-RatedFast-Growth Districts

  15. We Passed a BondElection, What is Next?

  16. Tax Rate to Remain Unchanged • Plans to issue $83 million through conventional bonds for ES #27, technology, buses, and other assets • Debt life matches asset life • July 2018 • Plans to issue $64.4 million through a commercial paper program (similar to a line of credit) • Finance land acquisitions • Interest only accrues on amount borrowed • Nominal carrying costs to have access to CP • July 2018

  17. $83 million Bond Sale Funds Projects Beginning in Summer 2018

  18. Other Bond Projects

  19. District Regularly Presents Multi-Year Financing DebtStrategy to School Board

  20. Future of Financial Leadership LISD

  21. Thank you forServing on this Committee!

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