•lllllll,1•-•,,dl-1111Httllj••i.il ............. t. __________ ·--------------------·-----------.................. ...._;.,, ...

1NEWi�SUE -·_BOOK-ENTRY ONLY RATING� Moody's: Aaa

(See "MISCELLANEOUS - Rating" herein).

ln the opk1ion of Jones Hall Hill & White, A Professional Law Corporation, San Francisco, California, Bond counsel. subject, howevc�r to certain qualifications described herein, under existing law, the intewst on the Bonds is excluded from gross income for .federal income tax purposes and such interest is not an item of tax preference for purposes of the federal alternative minimum tax imposed on individuals and corporations, ;.llthough for the purpose of computing the alternative minimum tax imposed on certain corporations, such interest is taken into account in determining certain income and earnings. ln the further opinion of Bond Counsel, such interest is exempt from California personal income taxes. See "LEGAi. MATTERS - Tax Matters" herein.

IDated: Date of ID1elivery

$8,999,095. '15 COTATI-ROHNERT PARK UNIFIED SCHOOL DISTRICT

(Sonoma County, California) General Obligation Bonds, Election 1990, Series F

Capital Appreciation Bonds

(The Bonds are NOT Bank Qualified)

Due: August 1 as shown below

The Bonds are general obligations of the Cotati-Rohnert Park Unified School District (the "District"), and the Board of Supervisors of Sonoma County is empowered and is obligated to annually levy ad valorem taxes, without limitation as to rate or amount, for the payment of interest on, and principal of, the Bonds upon all property subject to taxation within tho District (except certain personal property which is taxable at limited rates), all as more fully described herein under "THE: IBONDS -- Security and Sources of Payment" and "THE DISTRICT". The Bonds will not bear current interest, but will accrete interest, at their stated Bond Yields, as defined herein, commencing on their date of delivery, from their respective Denominational Amounts, as defined herein, to their respective Maturity Values, as defined herein. The Bonds due on or before August t.. 2009, are not subject to optional redemption; the Bonds due on or after August 1, 2010 are subject to optionc1/ redemption as described herein.

The payment of the Accreted Value, as defined herein, on the Bonds when due will be guaranteed by a municipal bond insurance policy to be issued by Financial Guaranty Insurance Company, doing business in California as FGIC Insurance Company, simul1taneously with the delivery of the Bonds.

""-"' Financial Guaranty Insurance tlilt;. Company

FGIC is a rer11stered service mark used by Financial Guaranty Insurance Company. a private company not affiliated with any U.S. Government agency

Me1turity {�!!.QLISt_U

2003

2004

.WOE, 2006

2007

2008

2009

2010

:2011

:2012

The following firm, serving as financial advisor to the District, has structured this financing:

Denominational Reoffering /!!!!!)Unt Price

$ :37 ,€,52.80 73.584

77,492.80 69.666

93,200.00 65.827

193,636.60 62.079

2:31,983.50 58.730

2!59,430.60 55.198

277,012.30 51. 778

2159,036.25 48.475

281, 106.25 44.977

291,378.75 41.925

KELLING, NORTHCROSS & NOBRIGA, INC.

Reoffering Yield

4.800%

4.900

5.000

5.100

5.150

5.250

5.350

5.450

5.600

5.700

--·------ --··

MATURITY SCHEDULE

Maturity Maturity Denominational Value IAuaust_jJ Amount

$ 80,000 2013 $ 300,338.50

185,000 2014 304,222.80

250,000 2015 299,714.10

380,000 2016 635,903.70

395,000 2017 900,543.00

470,000 2018 862,013.95

535,000 2019 1,057,699.20

555,000 2020 1,348,259.50

625,000 2021 1,278,470.55

695,000

RE1offerin1J Reoffering fr.iJa Yield

39.005 5.800%

36.217 5.900

33.866 5.950

31 .637 6.000

.29.526 6.050

27.673 6.075

.25.924 6.100

:23.863 6.200

:22.449 6.200

Maturity Value

$ 770,000

840,000

885,000

2,010,000

3,050,000

3, 115,000

4,080,000

5,650,000

5,695,000

The Bonds were awarded to Merrill Lynch & Co., as Underwriter, pursuant to the terms of a public sale on January 30,. 1 g97_ The Bonds will be offered when, as and if issued and received by the Underwriter, subject to the approval of legality by Jones Hill Hall & White, A Professional Law Corporation, San Francisco .. California, Bond Counsel. It is anticipated that the Bonds, in book-entry form, will be available for delivery in New York, New York, on or about February 13, t !}9 7.

THIS COVER PAGE CONTAINS CERTAIN INFORMATION FOR QUICK REFEREI\ICE ONLY. IT IS NOT A SUMMARY OF THIS ISSUE. INVESTORS MUST READ THE ENTIRE OFFICIAL STATEMENT TO OBTAIN INFORMATION ESSENTIAL TO THE MAl<ING OF AN INFORMED INVESTMENT DECISION.

Michael Cale Supervisor, District

Paul Kelley Supervisor, District 4

SONOMA COUNTY

County Board of Supervisors

Ernie Carpenter Chairman, District 5

Tim Smith Supervisor, District 3

James Harberson Supervisor, District 2

COTATI-ROHNERT PARK UNIFIED SCHOOL DISTRICT

George Steffensen Clerk

Kim Butler Member

Board of T1rustees

Terri Palladino-King Presidtmt

District Administration

Janice L. Heffron Superintendent

Ann Huber Assistant Superintendent,

Business Services

PROFESSIONAL SERVICES

Finandal Advisor

Kelling, Northcross & Nobriga, Inc. Oakland, California

Bond Counsel

Eric Kirchmann Member

Ed Gilardi Member

Jones Hill Hall & White, A Professional Law Corporation San Francisco,, California

Paying Agent

First Trust of California, National Association Los Angeles, California

,,....,,...., ... ----·-1--1,• -------------!----------------.---------

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TABLE OF CON'TENTS

INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 The District . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 Authority for Issuance of the Bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 Sources of Payment for the Bonds . ; . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 Purpose of the Bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 Description of the Bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 Payment of The Bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 Definitions Regarding the Bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 Tax Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Professionals Involved in the Offering . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Offering and Delivery of the Bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Continuing Disclosure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Other Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

THE: :BONDS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Authority for Issuance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Purpose of The Bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Estimated Sources and Uses of Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Investment of Bond Proceeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Security and Sources of Payment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 Description of the Bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . 8 Redemption . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 Form, Denomination and Payment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 Book-Entry System . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 Discontinuation of Book-Entry System; Payment to Beneficial Owners . . . . . . . . . . . . 11

BON[) INSURANCE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

CONSTITUTIONAL AND STATUTORY PROVISIONS AFFECTING DISTRICT REVENUES AND APPROPRIATIONS . . . . . . . . . . . . . . . . . . . . 12 Article XIIIA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 Legislation Implementing Article XIIIA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 3 Unitary Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 Proposition 62 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Article XIIIB . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Propositions 98 and 111 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 5 Proposition 187 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 Proposition 218 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 7 Applications of Constitutional and Statutory Provisions . . . . . . . . . . . . . . . . . . . . . . . 18 Future Initiatives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18

Gl:MERAL SCHOOL DISTRICT FINANCIAL INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . 18 State Funding of Education . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 State Budget . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 8 State Lottery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 9 Ad Valorem Property Taxation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 Assessed Valuation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 Tax Levies, Collections and Delinquencies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 Budget Process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 Accounting Practices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21

THE: DISTRICT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 General Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 Average Daily Attendance and Revenue Limit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

Appropriations Limit . . . . . . . . . . . . . . .. . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 Lottery Income . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 Labor Relations . . . . . . . . . . . . . . . . . .. . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 Retirement Programs . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 Assessed Valuation . . . . . . . . . . . . . . .. . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 Tax Levies, Collections and Delinquencies . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 Tax Rates . . . . . . . . . . . . . . . . . . . . . .. . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25 Major Taxpayers .. . . . ..... ... , . . .. . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26 Comparative Financial Statements . . . . .. . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27 District Debt Structure . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28 Statement of Direct and Overlapping Debt . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29 Investment of District Funds . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30

ECONOMIC PROFILE . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32 Introduction . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32 Population . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33 Employment . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33 Lar9est Employers . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34 Construction Activity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35 Commercial Activity . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36 Median Houseihold Income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37

LEGAL MATTERS .. .. . .... .. .... .. .... ........ .... ..................... 37 Tax Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37 No Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38 Legality for Investment in California . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38 Legal Opinion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38

MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38 Rating . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38 Underwriting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39 Closing Papers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39 Continuing Disclosure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39 Additional Information . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40

APPENDIX A - FORM OF LEGAL OPINION ................... .. ......... . .. .. .. A- 1 APPENDIX B - EXCERPTS FROM 1 995/96 AUDITED FINANCIAL STATEMENTS ........... 8-1 APPENDIX C - FORM OF CONTINUING DISCLOSURE CERTIFICATE .... ................ C-1 APPENDIX D - BOND YIELD ACCRETED VALUE TABLES ....... .................. .. D- 1 APPENDIX E - REOFFERING YIELD ACCRETED VALUE: TABLES ............... . .. .. .. E-1 APPENDIX F - SPECIMEN OF BOND INSURANCE POLICY . . . . . . . . . . . . . . . . . . . . . . . . . . . F- 1

,'if'm��r��""J�·._1_._... ____ ._. ______ I ______________ �----.... __._

....... ,,, .. ........ ,1 •• �1,, .. , ........ -........... ,,.-,--..,. .. .............,..._ .. _,..,.. -- •····--· .. ·-�-·----- ____ .,......,.., __ ....... ___ ...... ___ , ___________ ,,___: ·�-1-l

OFFICIAL ST A TEMENT

$8,999,095. 15 COT A Tl-ROHNERT PARK UNIFIED SCHOOL DISTRICT

(Sonoma County, California) General Obligation Bonds, Election 1990, Series F

Capital Appreciation Bonds (Bank Qualified)

INTRODUCTION

This introduction is not a summary of this official statement (the "Officic1I Statement'?. It is only a brief description of and guide to, and is qualified by, more complete and detailed information contained in the entire Official Statement, including the cover page and appendices hereto, and the documents summarized or described herein. A full review should be made of the entire Official Statement. The offering of the Bonds to potential investors is made only .by means of the entire Offich1I Statement.

The Official Statement, which includes the cover page and appendices hereto, is provided to furnish information in connection with the sale of $8,999,095.15 principal amount of Cotati-Rohnert Park Unified School District (Sonoma County, California), General Obligation Bonds, Election 1990, SeriHs F, Capital Appreciation Bonds (the "Bonds"), as described more fully herein.

The District

The Cotati-Rohnert Park Unified School District (the "District") is located in Sonoma County (the "County"), in the State of California (the "State"), approximately 50 miles north of San Francisco. The District was unified in 1978. The District encompasses a total area of approximately 15.4 square miles and has an estimated population of 43,000. The District provides educational services to the residents of the Cities of Cotati and Rohnert Park and certain unincorporated areas of the County. The District's average daily attendance for fiscal year 1995/96 was 7,807 and the District's 1995/96 general fund budget was approximately $32.1 million. The District has a 1995/96 assessed valuation of approximately $2.6 billion. See "THE DISTRICT" herein.

Authority for Issuance of the Bonds

The Bonds are issued pursuant to certain provisions of the State of California Education Code (the "Education Code") and pursuant to resolutions adopted by the Board of Trustees of the District and the Board of Supervisors of the County. See "THE BONDS - Authority 1'or Issuance" herein.

Sources of Payment for the Bonds

The Bonds represent a general obligation of the District, and the Board of Supervisors of the County is empowered and is obligated to annually levy ad va/orem taxes, without limitation as to rate or amount, for the payment of the interest on and principal of the Bonds, upon all property subject to taxation within the District (except certain personal property which is taxable1 at limited rates) . See "TlliE BONDS - Security and Sources of Payment," and "THE DISTRICT" herein.

1

Purpose 011' the Bonds

The net procieeds of the Bonds are expected to be used for improvements to the Mountain Shadows rv1iddle School , the purchase of portable classrooms for the Phoenix High School , the upgrade of portable bu i ld ings at the Marguerite Hahn Elementary School , construction of a performing arts center at Flancho Cotate High Schoo l , and general improvements throughout the District . See "THE BONDS - Purpose of the Bonds" here in .

Description of the Bonds

The Bonds wi!I I be issued as fully registered bonds without coupons in denominations of $5 ,000 each Maturity Value, as defined below, or any integral multiple thereof. The Bonds wi l l be registered initially in the name of Cede & Co . , as nominee of the Depository Trust Company, New York, New York ( " DTC" ) . DTC will act as securities depository for the Bonds. See "THE BONDS - Form, Denomination and Paym1:mt; Book-Entry System and Discontinuation of Book-Entry System; Payment to Beneficial Owners" here in . So long as OTC, or Cede & Co . , as its nominee, is the registered owner of a l l the Bonds, payments on the Bonds wi l l be made d i rectly to DTC, and disbursement of such payments to the DTC Participants (defined below) wi l l be the responsibi l ity of OTC, and disbursement of such payments to the Benefic ia l Owners (defined below) wil l be the responsibi l ity of the OTC Participants, as more fu l ly described hereinafter .

The Bonds maturing on and after August 1 , 201 0, may be redeemed prior to maturity at the opt ion of the D istrict, beg inning on August 1 , 2009. See "THE BONDS - Redemption" here in .

Payment of The Bondls

ThH Bonds wi l l not bear current interest, but wi l l accrete in value, commencing on their date of de livery, from their respective Denominational Amounts to their respective Maturity Values, compounding on a semiannual basis as described below and set forth in Tables of Accreted Values i n APPENDIX D here in . The Maturity Value for each Bond represents the Accreted Value thereof, as described below and defined in the Resolutions, calculated as of its respective August 1 maturity date . Accreted Value is payable only at maturity or upon prior redemption . See "THE BONDS - Form, Denominat1ion and Payment" herein .

Definitions Regarding the Bonds

The terms set forth below have the fol lowing meanings:

Accreted lnMrest means the difference, as of the date of calculation, between the Denominati1onal Amount and its Accreted Value, as these terms are defined below.

Accreted Value means, as of the date of calculation, the calculated value of a Bond upon discountinu its Maturity Value semiannual ly at its Bond Yield to said calcu lation date, assuming that with i n any such semiannual period Accreted Value i ncreases in equal daily amounts to its Accreted Value on its next semi.annual discounting date on the basis of a 360-day year of twelve 30-day months . The semiannual compounding dates for calculating Accreted Value for the Bonds are February 1 and August 1 . Tables of Accreted Values on February 1 and August 1 for the Bonds appear in APPENDIX D herein .

Bond Yield means the yield which discounts the Maturity Value of any Bond to its Denominatiional Amoui nt, as these terms are defined below. Bond Yield is calculated on the basis of a 360-day vear of twelve 30-day months, d iscounted semiannually on February 1 and August 1 . Bond Yields for the Bonds a1ppear in APPENDIX D herein .

2

-� . .i.,,� t11*i>l•""'���"'*-' ____ , ___________ I_I_IIMII ______________ .. _____ I

Capital Appreciation Bond means a bond with zero stated interest rate that accretes in value on the basis of its Bond Yield, compounding semiannually, as described below under "Accreted Value".

Denominational Amount means the initial purchase price of any Bond at which it is purchased by the Underwriter, as hereinafter defined.

Maturity Value means the Accreted Value of any Bond on its maturity date.

Reoffering Price means the price at which a Bond is initially reoffered to the public by the Underwriter.

Reoffering Yield means the yield which discounts the Maturity Value of any Capital Apprnciation Bond to its Reoffering Price. Reoffering Yield is calculated on the, basis of a 360-day year o1' twelve 30-day months discounted semiannually on February 1 and August 1. Reoffering Yields on the Bonds appear on the cover page hereof and in APPENDIX E herein .

Reoffering Yield Accreted Value means, as of the date of calculation, the calculated value of a Bond upon discounting its Maturity Value semiannually at its Reoffering Yield to said calculation date , assuming that within any such semiannual period Reoffering Yield Accreted Value increases in equal daily amounts to its Reoffering Yield Accreted Value on its next semiannual compounding date on the basis of a 360-day year of twelve 30-day months . The semiannual discounting dates for calculating Reoffering Yield Accreted Value for the Bonds are February 1 and August 1 . Tables of REwffering Yield Accreted Values on February 1 and August 1 for the Bond:s appear in APPENDIX E heimin.

Transfer Amount means with respect to any Bond, the Maturity Value.

Tax Matters

In the opinion of Jones Hall Hill & White, A Professional Law Corporation, San Francisco, California, Bond Counsel, subject, however to certain qualifications described herein, under existing law, the interest on the Bonds is excluded from gross income for federal income tax purposes, such interest is not an item of tax preference for purposes of the federal alternative mini mum tax imposed on individuals and corporations, although for the purpose of computing the .alternative minimum tax imposed on certain corporations, such interest is taken into account in determiining certain income and earnings. In the further opinion of Bond Counsel, such interest is exempt from California personal income taxes . See "LEGAL MATTERS - Tax Matters " herein.

Under federal income tax rules currently in effect, gain or loss upo11 sale of the Bonds would bei recognized in part by reference to the Reoffering Yield Accreted Value. S·ee "LEGAL MATTERS -Tax Matters " herein. Tables of Reoffering Yield Accreted Values on February 1 and August 1 for the Bonds appear in APPENDIX D herein.

Bank Qualification

The Bonds are mil "qualified tax-exempt obligations" within the meaning of the Internal Reivenue Code of 1986.

3

Professionals Involved in the Offering

Kelling, Northcross & Nobriga, Inc., Oakland, California , is the District 's financial advisor with respect to the Bonds. Jones Hill Hall & White, A Professional Law Corporation, San Francisco, California, is the District's bond counsel with respect to the Bonds. First Trust of California, National Association , Los Angeles, California, will act as the District 's paying agent, registrar and transfer agent (the "Payin!� Agent") with respect to the Bonds. Kellino, Northcross & Nobriga, Inc. and Jones Hill Hall & White willl receive compensation from the District contingent upon the sale and delivery of the Bonds.

Offering and Delivery of the Bonds

The Bonds will be offered when, as and if issued and received by the Underwriter, subject to approval as to their legality by Bond Counsel. It is anticipated that the Bonds, in book-entry form, wil l be available for delivery through DTC in New Yori<, New York on or about February 6 , 1 997.

Continuing Disclosure

The District has covenanted for the benefit of the holders and beneficial owners of the Bonds to provide certain financial information and operating data relating to the District (the "Annual Report") and to provide notices of the occurrence of certain enumerated events, if material . See " MISCELLANEOUS - Continuing Disclosure" and "APPENDIX C - Form of Continuing Disclosure Certificate"' herein.

Other Information

This Official Statement speaks only as of its date, and the information contained herein is subject to change.

Copies of documents referred to herein and information concerning the Bonds are available from the Business Manager, Cotati-Rohnert Park Unified School District, 1 60 1 East Cotati Avenue, Rohnert Park , California 94928 telephone : (707) 792-47:20. The District may impose a charge for copying, mailing and handling .

No dealer, broker, salesperson or other person has been authorized by the Districts to give any information or to make any representations other than as contained herein and, if given or made, such other information or representations must not be rnlied upon as having been authorized by the District . This Official Statement does not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the Bonds by a person in any jurisdiction in which it is unlawful for such person to make such an offe1r, solicitation or sale .

This Official Statement is not to be construed as a contract with the purchasers of the Bonds. Statements contained in this Official Statement which involve estimates, forecasts or matters of opinion, wlhether or not expressly so described herein, are intended solely as such and are not to be construed as representations of fact . The summaries and references to documents, statutes and constitutional provisions referred to herein do not purport to be comprehensive or definitive, and are qualified in their entireties by reference to each such document , statute and constitutional provision.

The information set forth herein has been obtained from sources which are believed to be reliable , but is not guaranteed as to accuracy or completeness, and is not to be construed as a representation by thei District . The information and expressions of opinions herein are subject to change witlhout notice and neither delivery of this Official Statement nor any sale made hereunder shall, under any circumstances, create any implication that there has been no change in the affairs of the District since the date hereof. This Official Statement is submitted in connection with the sale of the Bonds referred to herein and may not be reproduced or used, in whole or in part , for any other purpose .

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IN CONNECTION WITH THIS OFFERING, THE UNDERWRITER MAY OVERALLOT OR EFFECT TH.L\I\ISACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE BONDS AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME. THE UNDERWRITER MAY OFFER AND SELL THE BONDS TO CERTAIN DEALERS AND DEALER BANKS AND BANKS ACTING AS AGENT AT PRICES LOWER THAN THE PUBLIC OFFERING PRICE STATED ON THE COVER PAGE HEREOF AND SAID PUEILIC OFFERING PRICE MAY BE CHANGED FROM TIME TO TIME BY THE UNDERWRITER.

END OF INTRODUCTION

5

THE BONDS

Authority for lssuanc,e

The Bonds am issued under the provisions of Chapter 2 of Part 1 0 of Division 1 of Title 1 of the Education Code of the State (the "Act") and pursuant to resolutions adopted by the Board of Trustees of the District on January 7, 1 996 and by the Board of Supervisors of the County on .January 2B, 1 996 (collectively the "Resolution").

The District received authorization to issue $85 million of bonds at an election held on June 5, 1 990, by a two-thirds majority of the votes cast by eligible voters (the "Authorization"). The District has previously issued $ 1 2,000,000 Series A Bonds in August, 1 990; $ 1 2,000,000 Series B Bonds in ,t:1,ugust, 1 99 1 ; $ 1 1 ,000,000 Series C Bonds in March, 1 993; $ 1 6,990,000 1 993 General Obligation Refunding Bonds in October, 1 993 (which refunded all the Series A and Series B bonds); $8,000,000 Series D Bonds in August, 1 994; $4,895,000 Series E Current Interest Bonds in May, 1 995; and $3, 1 99,6 '1 8 . 1 5 Series E Capital Appreciation Bonds in May, 1 995 .

Purpose of The Bonds

The Authorization is for the purpose of new school construction, construction of new classrooms and libraries for existing schools, and modernization of existing school facilities .

The net proceeds of the Bonds are expected to be used for improvements to the Mountain Shadows Middle School, the purchase of portable classrooms for the Phoenix High School, the upgrade of portable buildings at the Marguerite Hahn Elementary School, construction of a performing arts center at R:ancho Cotate High School, and general improvements throughout the District .

Estimated Sources and Uses of Funds

Tht� proceeds of the Bonds are expected to be applied as follows:

COTATI-ROHNERT PARK UNIFIED SCHOOL DISTRICT Estimated Sources and Uses of Funds

Sources of Funds

Denommational Amount of Bonds

Total Sources

Use,s of Funds

Estima1ed Project Costs Funded from Proceeds

Estima1ed Costs of Issuance

Total Uses

B 999 095. 1 5 $8 999 095 . 1 5

$8,899,095 . 1 5 1 00,000.00

$8 999 095 . 1 5

Pi Inc ludes estimated fees for rating agency, bond counsel, financial advisor, paying agent, printing and dissemination, and misce l laneous costs of issuance.

Investment of Bond Proceeds

The proceeds from the sale of the Bonds, to the extent of the principal amount thereof, shall be paid to the County Treasurer-Tax Collector to the credit of the Cotati-Rohnert Park Unified School District General Obli{Jation Bonds, Series F Building Fund (the "Building Fund") and shall be kept

6

___ ,. ____ , ___________ -...i•·- 1···

separate and distinct from all other District and County funds. Such proceeds shall be applied solely foir pu rposes described in the Authorization which relate to the acquisition and improvement of real property. The accrued interest and any premium received from the sale of the Bonds shall be paid to the County to the credit of the Cotati-Rohnert Park Unified School District General Obligation Bonds, Series F Interest and Sinking Fund (the· "Debt Service Fund") . Such proceeds shall be applied solely for the payment of principal and interest on the Bonds .

Interest earned on the investment of monies held in the Building Fund shall be retained in the Building Fund. Interest earned on the investment of monies held in the Debt Service Fund shall be retained in the Debt Service Fund and used to pay the principal and interest on the Bonds when due .

Monies in the Building Fund and the Debt Service Fund shall be invested in any one or more investments generally permitted to school districts under the laws of the State including those authorized under Section 53600 et seq . of the Education Code and any other investments specifically authorized in the Resolution . See "THE DISTRICT - Investment of District Funds" herein.

Security and Sources of Payment

The Bonds are general obligations of the District, and the County is empowered and is obligated to annually levy ad valorem taxes, without limitation of rate or amount, for the payment of interest on and principal of the Bonds, upon all property within the District subject to taxation by the District (except certain personal property which is taxable at limited rates) . Such taxes, when collected, will be placed in the Debt Service Fund of the District, which is maintained by the County and which is irrevocably pledged for the payment of principal of and interest on the Bonds when due.

The annual tax levy will be based on the assessed value of taxable property in the District . The reduction of assessed values of taxable property in the District caused by economic factors beyond the District's control, such as economic recession, deflation of land values, a relocation out of the District or financial difficulty or bankruptcy by one or more major property tax payers, or the complete or partial destruction of taxable property due to earthquake, flood or other natural disaster, could cause a reduction in the assessed value within the district and necessitate a corresponding increase in the annual tax levy.

For further information regarding the District's tax base, tax rates, overlapping debt and other matters concerning taxation see "THE DISTRICT" herein.

7

Description of the Bc1nds

The Bonds in the aggregate Denominational Amount of $8, 999,095. 1 5 wil l be dated the date of their dellivery and wi l l accrete in value by semiannual compounding at their respective Bond Yields on each February 1 and August 1 . · Accreted Value is payable only at maturity or upon prior redemption . The Bonds wil l mature on August 1 in each of the years in the principal amounts shown below. Tables of Accreted Values of the Bonds appear in APPENDIX D here in .

Year August l

2003 2004 2005 2006 2007 2008 2009 201 0 201 1 20 1 2 201 3 201 4 201 5 201 6 201 7 201 8 201 9 2020 202 1

TOTAL

Redemptioin

Denominational Amount

$ 37,652.80 77,492 .80 93,200.00

1 93,636.60 231 ,983.50 259,430.60 277,0 1 2 .30 269,036 .25 281 , 1 06 .25 291 ,378.75 300,338 .50 304,222.80 299,7 1 4. 1 0 635,903.70 900,543 .00 862,01 3 .95

1 ,057,699.20 1 ,348,259 .50

1 .278.470.55 $8.999,095 . 1 5

Semiannual Debt Service

Accreted �

�· 42, 347 .20 1 07 ,507 .20 1 !i6, 800.00 1 B6,363.40 H,3,0 1 6 .50 2 1 0,569.40 2 !i7 ,987.70 285,963.75 343,893 .75 403,62 1 .25 469,66 1 .50 535,777 .20 585,285 .90

1 ,374,096.30 2 , 1 49,457.00 2,252,986.05 3,022,300.80 4,301 , 740.50

_Ml 6.529.45 $2 1 .265 904.85

Maturity Value

$ 80,000.00 1 85,000.00 250,000.00 380,000.00 395,000.00 470,000.00 535,000.00 555,000.00 625,000.00 695 ,000.00 770,000.00 840,000.00 885,000.00

2,01 0,000.00 3,050,000.00 3, 1 1 5 ,000.00 4,080,000.00 5,650,000.00 5 695 .000.00

$30 265.000.00

Optional Rediimption. The Bonds maturing on or before August 1 , 2009, are not subject to redemption prior to their stated maturity dates. The Bonds maturing on and after August 1 , 201 0, are subject to redemption prior to their respective stat,ed maturity dates at the option of the District, from any source of available funds, in whole or in part, on any date on or after August 1 , 2009, among such maturity dates as are selected by the District and by lot with in any one maturity i f less than all of the Bonds of one maturity are redeemed , at the following redemption price (expressed as a percentage of the Accret11�d Value as of the date of redemption of the Bonds called for redemption) .

Redemption Price

August 1 , 2009 and thereafter 1 02 %

Notice of Redt1mption. Notice of redemption wil l be given by the Paying Agent at the expense of the District . Such notice will specify: (al that the Bonds or a designated portion thereof are to be redeemed, (bl the numbers and CUSIP numbers of the Bonds to be redeemed, (c) the date of notice and the date of redemption, (d) the place or places where the redemption will be made, and (el descriptive information regarding the Bonds including the dated date, interest rate and maturity date . Such notice of redemption wil l also state that the Bonds, along with the interest accrued to such date and the redemption premium, if any, wil l become dlue and payable on the specified date, and that from and after such date interest with respect to the Bonds will cease to accrue .

8

,·�·-'1"'�1,··----,-------------,---------------..---------1-'l'

_______ , __________ ............ ·-�···· ···

Notice of redemption will be made by registered or otherwise secured mail,. postage prepaid, to (a) the registered owners of the Bonds being redeemed (or, if such owner is a syndicate, to the managing member of such syndicate), (b) a municipal registered securities depository,. and (c) a national information service that disseminates securities redemption notices. Notice of redemption will be at least thirty days, but not more than sixty days, prior to the redemption date. Neither failure to receive such notice nor any defect in the content of such notice will affect the sufficiency of the proceeding for the redemption of the Bonds.

Form, Denomination and Payment

The Bonds will be issued as fully registered bonds, without coupons, and will be in denominations of $5,000 Maturity Value each, or any integral multiple thereof. The Bonds shall bear interest at the rates shown on the cover hereof computed on the basis of a 360-day year of twelve 30-day months. Each bond will accrete in value by semiannual compounding at its respective stated Bond Yield on February 1 and August 1 from the date of delivery, and will be payable in the amount so accreted, as Maturity Value at maturity or Accreted Value upon prior redemption. The difference between the Denominational Amount and Accreted or Maturity Value of a Bond is its Accreted Interest as of the date of such calculation. No separate interest will be paid.

The Bonds, when issued, will be registered initially in the name of Cede & Co. , as nominee of OTC. So long as OTC, or Cede & Co. , as its nominee, is the registered owner of all the Bonds, principal and interest payments on the Bonds will be made directly to OTC, disbursement of such payments to th1:i OTC Participants (defined below) will be the responsibility of OTC, and disbursement of such payments to the Beneficial Owners (defined below) will be the responsibility of the OTC Participants, as more fully described hereinafter. See "THE BONDS - Book-Entry System" and " -- Discontinuation of Book-Entry System; Payment to Beneficial Owners" below.

Bool<··Entry System

The information in this section concerning DTC and DTC 's book-tmtry system has been obtained from sources that the District believes to be reliable, but the District takes no responsibility tor the accuracy thereof. The District cannot and does not give any assurances that DTC, DTC Participants or Indirect Participants will distribute to the Beneficial Owners (t1) payments of interest, pnhcipal or premium, if any, with respect to the Bonds, (b) certificates representing ownership interest in or other confirmation or ownership interest in the Bonds, or (c) redemption or other notices sent to DTC or Cede & Co., its nominee, as the registered owner of the Bonds, or that they will so do on a timely basis or that DTC, DTC Participants or DTC Indirect Participants will act in the manner described in this Official Statement. The current "Rules " applicable to DTC are on file with the Securities and Exchange Commission and the current "Procedures " of DTC to be followf.'d in dealing with DTC Participants are on file with DTC.

DTC will act as securities depository for the Bonds. The Bonds will be issued as fully-registered securities registered initially in the name of Cede & Co. (DTC's partnership nominee). One fully­registered Bond certificate for each maturity will be issued for the Bonds in the aggregate principal amount of each maturity, and will be deposited with OTC.

DTC is a limited-purpose trust company organized under the New York Banking Law, a "banking organization" within the meaning of the New York Banking Law, a member of the Federal Reserve System, a "clearing corporation" within the meaning of the New York Uniform Commercial Code, and a " dearing agency" registered pursuant to the provisions of Section 17 A of the Securities Exchange Act of 1 934 . OTC holds securities that its participants ( " Participants" ) deposit with OTC. OTC also fac:ilitates the settlement among Participants of securities transactions, such af; transfers and pledges, in de1posited securities through electronic computerized book-entry changes in Participants' accounts, thereby eliminating the need for physical movement of securities certificat,es. Direct Participants inc!ud,e securities brokers and dealers, banks, trust companies, clearing corporntions, and certain other

9

organizations. DTC is owned by a number of i ts Direct Part;cipants and by the New York Stock Exchange, Inc., the American Stock Exchange, Inc., and the National Association of Securities Dealers, Inc. Access to the DTC system is also available to others such as securities brokers and dealers, banks, and trust companies that clear through or maintain a custodial relationship with a Direct Participant , either dirnctly or indirectly ( "Indirect Participants"). The Rules applicable to DTC and its Participants are on fil e with the Securities and Exchange Commission.

Purchases of Bonds under the OTC system must be made by or through Direct Participants, which will receive a credit for the Bonds on DTC's records. The ownership interest of each actual purchaser of each Bond ( "Beneficial Owner") is in turn to be recorded on the Direct and Indirect Participants' records. Beneficial Owners wil l not receive written confirmation from OTC of their purchase, but Beneficial Owners are expected to receive written confirmations providing details of the transaction, as wel l as periodic statements of their holdings, from the Direct or Indirect Participant through which the Beneficial Owner entered into the transaction. Transfers of ownership interests in the Bonds are to be accomplished by entries made on the books of Participants acting on behalf of Beneficial Owners. Beneficial Owners will not receive certificates representing their ownership interests in Bonds , except in the event that use of the book-entry system for the Bonds is discontinued.

To facilitate subsequent transfers, all Bonds deposited by Participants with OTC are registered in the name of DTC 's partnership nominee, Cede & Co. The deposit of Bonds with OTC and their registration in the name of Cede & Co . effect no change in beneficial ownership. OTC has no knowledge of the actual Beneficial Owners of the Bonds; DTC's records reflect only the identity of the Direct Participants to whose accounts such Bonds are credited, which may or may not be the Beneficial Owners. The Participants will remain responsible for keeping account of their holdings on behalf of their customers.

Conveyance of notices and other communications by OTC to Direct Participants, by Direct Participants to Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial Owners wii l l be goveirned by arrangements among them, subject to any statutory or regulatory requirements as may be in effect from time to time.

Redemption notices shall be sent to Cede & Co. If less than all of the Bonds within an issue are being redeemed, IDTC' s practice is to determine by lot the amount of the interest of each Direct Participant in such issue to be redeemed.

Neither DTC nor Cede & Co. wil l consent or vote with respect to Bonds . Under its usual procedures , DTC mails an Omnibus Proxy to the District as soon as possible after the record date. The Omnibus Proxy assigns Cede & Co.'s consenting or voting rights to those Direct Participants to whose accounts the Bonds are credited on the record date (identified in a listing attached to the Omnibus Proxy) .

Principal and interest payments on the Bonds will be made to DTC. DTC's practice is to credit Direct Participants' accounts on a payable date in accordance with their respective holdings shown on DTC ' s records unless OTC has reason to believe that it wil l not receive payment on a payable date. Payments by Participants to Beneficial Owners will be governed by standing instructions and customary practices, as is the case with securities held for the accounts of customers in bearer form or registered in "street name, " and will be the responsibility of such Participant and not of OTC, the Paying Agent, the District or the County, subject to any statutory or n�gulatory requirements as may be in effect from time to time. Paymen1t of principal and interest to DTC is the responsibi lity of the County or the Paying Agent, disbursement ,of such payments to Direct Participants shall be the responsibility of OTC, and disbursement of such payments to the Beneficial Owners shall be the responsibi l ity of Direct and Indirect Participants.

OTC may discontinue providing its services as securities depository with respect to the Bonds at any time by giving reasonable notice to the County or the Paying Agent, or the District may decide to discontinue use of the system of book-entry transfers through OTC. Under such circumstances, in

1 0

, _a.0c->••••"-••---------·--------------------------lml!II-----I-"

the event that a successor securities depository is not obtained, Bond certificates are requ ired to be printeid and delivered .

Disc:ontinuation of Book-Entry System; Payment to Beneficial Owners

In the event that the book-entry system described above is no longer used with respect to the Bonds, the fol lowing provisions wil l govern the payment, reg istration, transfer, exchange and replacement of the Bonds.

The principal of the Bonds and any premium upon the redemption thereof pr ior to the maturity wi l l be payable in lawful money of the United States of America upon presentation and surrender of the Bonds at the principal corporate trust office of the Paying Agent. I nterest on the Bonds wil l be paid by th,e Paying Agent by check mailed to the person whose name appears on the reg istration books of the Paying Agent as the registered owner, and to that person's address appeari ng on the registration books as of the close of business on the 1 5th day of the month next preceding an I nterest Payment Date . At the option of the registered owner of at least $ 1 ,000,000 in aggregate principal amount, upon written request given at least three days prior to the applicable I nterest Payment Date, interest wii l l be tra nsmitted by wire transfer to an account designated by such owner.

Any Bond may be exchanged for Bonds of any authorized denomination upon presentation and su rrender at the principal corporate trust office of the Paying Agent, in Los Angeles, California, together wii th a request for exchange signed by the registered owner or by a person l egal ly empowered to do so in a form satisfactory to the Paying Agent. A Bond may be transferred only on the Bond registration books upon presentation and surrender of the Bond at the principal corporate trust office of the Paying A1Jent together with an assignment executed by the registered owner or by a person legal ly empowered to do so in a form satisfactory to the Paying Agent . Upon exchange or transfer, the Paying Agent shal l complete , authenticate and deliver a new Bond or Bonds of any authorized denomination or de1norninations requested by the registered owner or by a person legally empowered to do so , equal in the aggregate to the unmatured principal amount of the Bond surrendered and bearing interest at the same rate and maturing on the same date.

Neither the District, the County nor the Paying Agent wil l be requi red to exchange or transfer any Bond during the period from the sixteenth day of the month next preceding any I nterest Payment Dat,e or date of redemption and ending with the close of business on that Interest Payment Date or dato of redemption.

BOND INSURANCE

The following information has been furnished by Financial Guaranty Insurance Company for use in this Official Statement. The District takes no responsibility for the accuracy thereof. Reference is m.flde to APPENDIX F for a specimen of their Municipal .Bond New Issue Insurance Policy.

Concurrently with the issuance of the Bonds, Financial Guaranty I nsurance Company, doing busiiness in Cal ifornia as FG IC Insurance Company ("Financial Guaranty" ) , wil l issue its Mun icipal Bond N1�w Issue I nsurance Pol icy for the Bonds (the "Policy"} . The Policy unconditionally guarantees the payment of that portion of the pri ncipal (or accreted value in the case of capital appreciation bonds) of and i nterest on the Bonds which has become due for payment, but shall be unpaid by reason of nonpayment by the District. Financial Guaranty wi l l make such payments to State Street Bank and Trust Company, N .A. , or its successor as its agent (the "Fiscal Agent"} , on the later of the date on which such principal (or accreted value in the case of capital appreciation bonds} and i nterest is due or on the business day next following the day on which Financial Guaranty shal l have received tele1Phonic or telegraphic notice, subsequently confirmed in writ ing, or written notice by registered or certified mai l , from an owner of Bonds or the Paying Agent of the nonpayment of such amount by the District. The Fiscal Agent wil l disburse such amount due on any Bond to its owner upon receipt by the

1 1

Fiscal Agent of evidence satisfactory to the Fiscal Agent of the owner's right to receive payment of the principal (or accreted value in the case of capital appreciation bonds) and interest due for payment and evidence, including any appropriate instruments of assignment, that all of such owner's rights to payment o'f such princ:ipal (or accreted value in the case of capital appreciation bonds) and interest shall be vested in Financial Guaranty . The term "nonpayment" in respect of a Bond includes any payment of principal (or accreted value in the case of capital appreciation bonds) or interest made to an owner of a Bond which has been recovered from such owner pursuant to the United States Bankruptcy Code by a trustee in bankruptcy in accordance with a final, nonappealable order of a court having competent jurisdiction .

The Policy is non-cancelable and the premium will be fully paid at the time of delivery of the Bonds. The Policy covers failure to pay principal (or the accreted value in the case of capital appreciation bonds) 01f the Bonds on their respective stated maturity dates, or dates on which the same shall have been duly called for mandatory sinking fund redemption, and not on any other date on which the Bonds may have been accelerated, and covers the failure to pay an installment of interest on the stated date for its payment.

This Official Statement contains a section regarding the ratings assigned to the Bonds and reference should be made to such section for a discussion of such ratings and the basis for their assignment to the Bonds. Reference should be made to the description of the District for a discussion of the ratings, if any, assigned to such entity's outstanding parity debt that is not secured by credit enhancement .

Thi� Policy is not covered by the Property/Casualty Insurance Security Fund specified in Article 76 of the New York Insurance Law.

Financial Guaranty is a wholly-owned subsidiary of FGIC Corporation (the "Corporation"), a Delaware holding company. The Corporation is a subsidiary of General Electric Capital Corporation ("GE Capital"). Neither the Corporation nor GE Capital is obligated to pay the debts of or the claims against Financial Guaranty. Financial Guaranty is a monol1ine financial guaranty insurer domiciled in the State of New York and subject to regulation by the State of New York Insurance Department. As of September 30, 1 9916, the total capital and surplus of Financial Guaranty was approximately $ 1 ,097 ,600, 1 90. Financial Guaranty prepares financial statements on the basis of both statutory accountin�11 principles and generally accepted accounting principles. Copies of such financial statements may be obtained by writing to Financial Guaranty at 1 1 5 Broadway, New York, New York 1 0006, Attention: Communications Department (telephone number: (21 2) 3 1 2-3000) or to the New York State Insurance Department at 1 60 West Broadway, 1 8th Floor, New York, New York 1 00 1 3, Attention: Financial Condition Property/Casualty Bureau (telephone number (21 2) 602-0389) .

CONSTITUTIONAL AND .STATUTORY PROVISIONS

AFFECTING DISTRICT REVENUES AND APPROPRIATIONS

Principal of and interest on the Bonds are payable from the proceeds of an ad valorem tax required to be levied by the Board of Supervisors of the County for the payment thereof. (See 'THE BONDS - Security a.nd Sources of Payment 11 herein.) Articles XII/A and X/1/B of the Constitution, Propositions 62, 98, 1 1 1, 187, and 2 18 and certain other provisions of law discussed below, are included in this section to describe the potential effect of these Constitutional and statutory measures on the ability of the District to levy taxes and spend tax proceeds for operating and other purposes, and it should not be inferred from the inclusion of such materials that these laws impose any limitation on the ability of the District to levy taxes for payment of the Bonds. The tax levied by the County for payment of the Bonds was approved by the District's voters in compliance with the California Constitution and all applicable laws.

·1 2

,,.........,,,i.,.-,4 ............. .-0IHF l ___ l __ i ___________ , _________________ 1111111 ________ �,

Articlle XIIIA

Article XIIIA of the Constitution of the State of California (the "State") limits the amount of ad vc1/orem taxes on real property to 1 % of "full cash value" as determined by the county assessor. Article XIIIA defines "full cash value" fo mean "the county assessor's valuation of real property as shown on the 1 975/76 tax bill under ' full cash value' or, thereafter, the appraised value of real propeirty when purchased, newly constructed, or a change in ownership has occurred after the 1 97 5 assessment, " subject to exemptions in certain circumstances of property transfer o r reconstruction. The "full cash value" is subject to annual adjustment to reflect increases, not to exceed 2% for any ye,ar, or decreases in the consumer price index or comparable local data, or to reflect reductions in propeirty value caused by damage, destruction or other factors.

Article XIIIA requires a vote of two-thirds of those voting in an election in a city, county, special district or other public agency to impose special taxes, and except for ad vaJ'orem taxes described in the next sentence, prohibits the imposition of any additional ad valorem, sales or transaction taxes on real property. Article XIIIA exempts from the 1 % tax limitation any taxes above that level required to pay debt service (a) on any indebtedness approved by the voters prior to July 1 , 1 978, and (bl as the result of an amendment approved by State voters on June 3, 1 986, on ariy bonded indebtedness approved by two-thirds of the votes cast by the voters for the acquisition or improvement of real property on or after July 1 , 1 978. In addition, Article XIIIA requires the approval of two-thirds of all members of the State Legislature to change any State taxes for the purpose of increasing tax revenues, while prohibiting the imposition by the State Legislature of any new ad va/or,<Jm, sales or transaction taxe1s on real property.

Legislation Implementing Article XIIIA

Legislation has been enacted and amended a number of times since 1 978 to implement Article XWA. Under current law, local agencies are no longer permitted to levy directly any property tax (except to pay voter-approved indebtedness) . The 1 % property tax is automatically levied by the county and distributed according to a formula among taxing agencies. The formula apportions the tax roughly in proportion to the relative shares of taxes levied prior to 1 989.

That portion of annual property tax revenues generated by increases in assessed valuations within each tax rate area within a county, subject to redevelopment agencv, if any, claims on tax increment and subject to changes in organization, if any, of affected jurisdictions, is allocated to each jurisdiction within the tax rate area in the same proportion that the total property tax revenue from the ta>e rate area for the prior year was allocated to such jurisdictions.

Beginning in the 1 98 1 /82 fiscal year, assessors in the State no longer record property values on tax rolls at the assessed value of 25 % of market value. All taxable property is now shown at "full cas:h value" on the tax rolls. The tax rate is expressed as $ 1 per $ 1 00 of taxable value.

Unitary Property

AB 454 (Chapter 921 , Statutes of 1 9871 provides that revenues de1rived from most utility property assessed by the State Board of Equalization ( "Unitary Property" ) , commencing with the 1 988/89 fiscal year, are allocated as follows: (a) each jurisdiction will receive up to 1 02% of its prior year State-assessed revenue; and (bl if county-wide revenues generated from Unitary Property are less than the previous year 's revenues or greater than 1 02% of the previous year 's revenues, each jurisdiction will share the burden of the shortfall or the benefit of the excess revenues by a specified formula . This provision applies to all Unitary Property except railroads, whose valuation will continue to be allocated to individual tax rate areas.

The provisions of AB 454 do not constitute an elimination of the asnessment of any State­asse:ssed properties nor a revision of the methods of assessing utilities by the State Board of

1 3

Equal ization . Generally, AB 454 allows valuation growth or decl ine of Un itary Property to be shared by al l jurisd ictions in a county.

Several major State-assessed util ities have challenged the legal ity of property valuation theories and the val ues assessed by the State Board of Equalization, which administers the assessment of publ ic util ities for property taxation purposes. The chal lenge was precipitated by the superior court decision i n A T& T Communications of California, et al. v. State Board of Equalization in which the valuation method used by the State Board of Equal ization to value unitary util ity property was declared il legal and a new method of va luation was imposed , result ing in significantly lower property taxes . Several counties and util ity companies whose unitary property valuations could be affected by the principles announced in the superior court decision signed a settlement agreement i n 1 993. The agreement ' s effective ness, however, is dependent on the fulfi l lment of certai n conditions. If effective, this settlement would have only prospective fiscal impact on uti l ity assessments, which would be phased down gradual ly over the next several years .

Proposition 62

A statutory initiative ("Proposition 62") was adopted by the voters at the November 4, 1 986, general elei:::tion, which requires voter approval for new or higher taxes by local government entities.

The District does not receive tax revemue from any measure adopted in violation of Proposition 62.

Article XI I IB

Article XI I IB oi: the State Constitution, as subsequently amended by Propositions 98 and 1 1 1 , l im its the an nual appropriations of the State and of any city, county, school d istrict, authority or other political subdivision of the State, to the level of appropriations of the particular governmental entity for the prior fiscal year, a:s adjusted for changes in the cost of living and in population, for transfers in the f inancia l responsibi l ity for provid ing services, and for certa in declared emergencies. As amended, Article X l l l ll3 defi nes:

(a l "chan1;1e i n the cost of l iving" with respect to school d istricts to mean the percentage change in California per-capita i ncome from the preced ing year, and

(bl "chan1Je in population" with respect to a school d istrict to mean the percentage change in the average daily attendance of the school d istrict from the preceding fiscal year.

For fiscal yearn beginn ing on or after July 1 , 1 990, the appropriations l imit of each entity of government shall be the appropriations l imit for the 1 986/87 fiscal year adjusted for the changes made from that fiscal year pursuant to the provisions of Article XI I IB, as amended .

The appropriations of an entity of local government subject to Article X I I IB l im itations i nclude the proceeds of taxes levied by or for that entity and the proceeds of certain State subventions to that entity . " Proceeds of taxes" include, but a re not Hmited to , all tax revenues and the proceeds to the entity from (a) regulatory licenses, user charges and user fees ( but only to the extent that these proceeds exceed the reasonable costs in provid ing the regulation, product or service) , and (bl the investment of tax revenues.

Appropriations subject to l imitation do not i nclude (a) refunds of taxes, (b) appropriations for debt servic,e, (c) appropriations required to comply with certa in mandates of the courts or the federal government, (d) appropriations of certain special d istricts, (el appropriations for al l qual ified capital outlay projects as defined by the leg islature, (f) appropriations derived from certain fuel and vehicle taxes and {g) appropriations derived from certa i n taxes on tobacco products .

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........ _,, .. , ................... ----------------------.. --------,----------� ............ , ... ....

Article XIIIB includes a requirement that all revenues received by an entity o:f government other than the State in a fiscal year and in the fiscal year immediately following it in excess of the amount piermitted to be appropriated during that fiscal year and the fiscal year immodiately following it shall b1e re,turned by a revision of tax rates or fee schedules within the next two subsequent fiscal years. If a1 school district receives any proceeds of taxes in excess of its appropriations limit, it may, by resolution of the school district 's governing board, increase its appropriations limit to equal that amount, provided that the State has sufficient excess appropriations limit in that fiscal year.

Article XIIIB also includes a requirement that fifty percent of all revenues received by the State in a fiscal year and in the fiscal year immediately following it in excess of the amount permitted to be appropriated during that fiscal year and the fiscal year immediately following it shal l be transferred and al located to the State School Fund pursuant to Section 8.5 of Article XVI 01f the State Constitution. See '"Pro positions 98 and 1 1 1 " below.

Propositions 98 and 1 1 1

On November 8, 1 988 the voters approved Proposition 98, an initiative constitutional amendment and statute called "The Classroom Instructional Improvement and Accountability Act" ("Proposition 98" ) . In addition to adding certain provisions to the Education Code, Proposition 98 also ameinded Article XIIIB and Section 8 of Article XVI of the State Constitution and added Section 8.5 of Article XVI to the State Constitution, the effects of which are to establish a minimum level of State funding for school districts, to al locate to school districts, within limits, State revenues in excess of th1e State's appropriations limit and to exempt such excess funds from school district appropriations limits ..

On June 5, 1 990, the voters approved Proposition 1 1 1 (Senate Constitutional Amendment No. 1 ) cal led the "Traffic Congestion Relief and Spending Limit Act of 1 990" ("Proposition 1 1 1 ") which furthe,r modified Article XIIIB and Sections 8 and 8.5 of Article XVI of the State Constitution with respect to appropriations limitations and school funding priority and allocation .

Article XIIIB, as amended by both Proposition 98 and Proposition 1 1 1 , hs discussed above under "Article XIIIB ."

The provisions of Sections 8 and 8 .5 of Article XVI, as added 1to and/or amended by Propositions 98 and 1 1 1 , may be summarized as follows :

a) State Funding of Schools !Section 8). Monies to be applied by the State for the support of school districts must be at a level equal to the greater of the following "tests" :

( i ) The amount which, as a percentage of the State general fund ("General Fund") revenues which may be appropriated pursuant to Article Xl 11IB, equals the percentage of General Fund revenues appropriated for school districts in fiscal year 1 986/87;

(ii) The amount actually appropriated to school districts in the prior fiscal year from General Fund proceeds and from allocated local proceeds of taxes (excluding any excess state revenues allocated pursuant to Section 8.5) , adjusted for changes in enrollment and for the change in the cost of living (operative only in a fiscal year in which the percentage growth in California per capita personal income is less than or equal to the percentage growth in per capita General Fund revenues plus one-half of one percent) ;

(iii) The amount actually appropriated to school districts in the prior fiscal year from General Fund proceeds and from allocated local proceeds 01' taxes (excluding any excess State revenues allocated pursuant to Section 8 .5) adjusted for changes in enrol lment and for the change in per capita General Fund revenues, and, in addition,

1 5

an am ount equal to one-half of one percent times the prior year appropriations (excluding any excess State revenues) adjusted for changes in enrollment (operative only in a fiscal year in which the percentage growth in California per capita personal income is greater than the percentage growth in per capita General Fund revenues plus one-half of one percenti.

If the third test is used in any year the difference between the third test and the second test will become a "credit" to schools which will be paid in future years when the General Fund revenue growth exceeds personal income growth.

The State legislature by a two-thirds vote of both houses, with the Governor 's concu1rrence, may suspend for one year the minimum funding provisions for school districts as provided for in Section 8.

b) Allocations to the State School Fund (Section 8.5l. In addition to the amounts applied to school districts under the tests discussed above, the State Controller is directed to allocate available excess State revenues (pursuant to Article XIIIB) to the State School Fund. However, no such allocation is required at any time that the Director of Finance and the Superintendent of Public Instruction mutually determine that current annual expenditures per student equal or exceed the average annual expenditures per student of the 1 0 states with the highest annual expenditures per student and the average class size equals or is less than the average class size of the 1 0 states with the lowest class �.ize.

Such allocations do not constitute appropriations subject to Article XIIIB limitations and are to be made in an equal amount per enrollment.

Proposition 1 87

At the November 1 994 general election, State voters approved Proposition 1 87. Proposition 1 87 makes persons with foreign citizenship who have entered the State illegally ineligible for public social serviices, public health care services (unless an emergency) , and public school educat ion at elementary, secondary , and post-secondary levels. Further, Proposition 1 87 requires every school district to verify the status of every child enrolling for the first time on or after January 1 , 1 995. By January 1 , 1 996, evi,Hy school district is required to have verified the legal status of every student enrolled in the school district as well as the legal status of the student's parents or guardian. If any student, parent, or guardian is not legally in the United States, the school district must report the student to the United States Immigration and Naturalization Service ("INS") and certain other parties. Proposition 1 87 also prohibits a school district from providing education to a student it does not verify as either a United States citizen or a person legally admitted to the U nited States.

Opponents of Proposition 1 87 have filed at least eight lawsuits challenging the constitutionality and validity of the measure. On November 2, 1 995, a United States District Court judge struck down the central provisions of Proposition 1 87 by ruling that parts of Proposition 1 87 conflict with federal power over immigrat ion. The ruling concluded that states may not enact their own schemes to "regulate immigration or devise immigration regulations which run parallel or purport to supplement federal immigration law. " As a consequence of the ruling, students may not be denied public education and may not be asked about their immigration status when enrolling in public schools . Further, the ruling stru c:k down the requirements of Proposition 1 87 that teachers and district employees report information on the immigrant status of students, parents, and guardians. An appeal has been filed. It cannot be predicted what the nature or outcome of such appeal will be or the ultimate fiscal impact of Proposition 1 87.

If ultimately upheld, Proposition 1 87 could have a significant impact on funding for California school districts. For every student that the District excludes under Proposition 1 87 and for every student who does not attend school in the District as a result of Proposit ion 1 87, the District may lose

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a portion of the State revenue it receives based on average daily attendance. lin addition, to the extent that the exclusion of students and the verification and reporting requirements are found to be at odds with various federal laws, the District may lose all or a portion of any federal revenue it receives. Furtlher, the cost of compliance with the verification and reporting requirements may prove significant .

Prop1osition 2 1 8

Under the California Constitution, the power of initiative is reserved to the voters for the purpose of enacting statutes and constitutional amendments. Over the past 113 years, the voters have exierc:ised this power through the adoption of Proposition 13 and similar measures, the most recent of which was approved as Proposition 218 in the general election held on November 5, 1996.

On November 5, 1996, California voters approved Proposition 218 -- Voter Approval for Local Government Taxes - Limitation on Fees, Assessments, and Charges - Initiative Constitutional Ameindment . Proposition 218 added articles XIIIC and XIIID to the California Constitution, imposing certain vote requirements and other limitations on the imposition of new or increased taxes, assessments and property-related fees and charges. Proposition 218 states that all taxes imposed by loc:al governments shall be deemed to be either general taxes or special taxes. Special purpose districts, including school districts, have no power to levy general taxes. No local government may impose, extend or increase any general tax unless and until such tax is submitted to the electorate and approved by a majority vote. No local government may impose, extend or increase any special tax unless and until such tax is submitted to the electorate and approved by a two-thirds vote.

Proposition 218 also provides that no tax, assessment, fee or charge slhall be assessed by any ag1ency upon any parcel of property or upon any person as an incident of property ownership except: ( i ) the ad valorem property tax imposed pursuant to Article XIII and Articlo XIIA of the California Constitution, ( ii) any special tax receiving a two-thirds vote pursuant to the California Constitution, and ( ii i ) assessments, fees and charges for property related services as provided in Proposition 218. Proposition 218 then goes on to add voter requirements for assessments and fees and charges imposed as an incident of property ownership, other than fees and charges for sewer, water, and refuse collection services. In addition, all assessments ad fees and charges imposed a:; an incident of property ownership, including sewer, water, and refuse collection services, are subjected to various additional procedures, such as hearings and stricter and more individualized benefit requirements and findings. The effect of such new provisions will presumably be to increase the difficulty a local agency will have in imposing, increasing or extending such assessments, fees and charges .

Proposition 218 also provides that the initiative power shall not be prohibited or otherwise limited in matters of reducing or repealing any local tax, assessment, fee or charge. This provision is not limited to taxes imposed on or after November 6, 1996, the effective date of Proposition 218, and could result in retroactive repeal or reduction in any existing taxes, assessments, fees and charges, subj(wt to overriding federal constitutional principles relating to the impairments of contracts.

Like its antecedents, Proposition 218 is likely to undergo both judicial and legislative scrutiny beforn its impact on the District and its obligations can be determined. Certain provisions of Proposition 218 may be examined by the courts for their constitutionality under both State and federal constitutional law. The District is not able to predict the outcome of any suc:h examination.

The foregoing discussion of Proposition 218 should not be considered an exhaustive or authoritative treatment of the issues. The District does not expect to be in a position to control the consideration or disposition of these issues and cannot predict the timing or outcome of any judicial or legislative activity in this regard. Interim rulings, final decisions, legislative proposals and legislative enactments may all affect the impact of Proposition 218 on the Bonds as wull as the market for the Bonds. Legislative and court calendar delays and other factors may prolong any uncertainty regarding the offects of Proposition 218.

1 7

Applications of Constitutional and Statutory Provisions

The appl i cation of Proposition 98 and other statutory regu lations has become increasingly d ifficult to predict accurately in recent years . For a d iscussion of how these provisions of Proposition 98 have been applied to school funding see "GENERAL SCHOOL DISTRICT FINANCIAL INFORMATION" herein.

Future lniti1atives

Article X I I IA, Article XI I IB, Proposition 62, Proposition 98, Proposition 1 1 1 , Proposition 1 87 and Proposition 2 1 8 were each adopted as measures that qual ified for the bal lot pursuant to the State's i n itiative process . Frnm time to t ime other in itiative measures could be adopted, further affecting District revenues or the District 's abil ity to expend revenues. The nature and impact of these measures cannot be anticipated by the District .

GENERAL SCHOOL DISTRICT FINANCIAL INFORMATION

Tht:! information in this section concerning the state funding of public education is provided to supplement information regarding the District's finances discussed elsewhere in this Official Statement, and it should not be inferred from the inclusion of this information in this Official Statement that the principal ol or interest on the Bonds is payable from State revenues. The Bonds are payable from the proceeds of an ad valorem tax required to be levied by the County Board of Supervisors in an amount sufficient to make such payments.

State Funding of Edu,cation

As a whole, State school districts receive a significant portion of their funding from State appropriations. As a result, decreases in State revenues can significantly affect appropri ations made by the legislature to school districts.

Aninual State apportionments of basic and equal ization aid to school d istricts for general pu rposes are computed up to a revenue l imit per unit of average dai ly attendance (the "A.D .A . " ) . Generally, these appoirtionments amount to the d i-fference between the school district 's revenue l imit and its property tax al location. The revenue l imit calculations are adjusted annually in accordance with a number of factors designed primari ly to provide cost of l iving increases and to equal ize revenues among all State school d istricts of the same type . SHe "THE DISTRICT - Average Daily Attendance and Revenue Limit" here in .

State Budget

The 1 996/97 State Budget was signed by the Governor on July 1 5, 1 99 6 . Ongoing Proposition 98 fundinfJ for K-1 2 education totals $25 .9 bi l l ion, an increase of $ 2 . 5 bi l l ion, or 1 1 %, from the fundin�11 level included in the 1 995 Budget Act . This large increase includes an al location of $ 1 .2 bil l ion to provide inflation and growth adjustments .. (Specifical ly, the budget includes $800 mi l l ion for a 3 .2 1 % COLA and $400 mil l ion to accommodate a projected 2 . 6 % increase in student population . ) The budget di rects tho remaining $ 1 . 3 bil l ion for other purposes, including new programs and existing categorical! programs . The major programs include $ 7 7 1 mi l l ion for class size reduction and $ 1 78 mi l l ion i n revenue l imit i ncreases. The class size rediuction program is targeted for grades K-3 . To participate,. the district must reduce class size to a maximum of 20 students per teacher.

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_______ , __________ .-.-....... ............ ......

The 1 996/97 State Budget also contains approximately $ 1 . 1 billion in one-time funding for education. The major expenditures for these funds include $387 million in block grants to ind ividual sichool sites and $200 million in block grants to school districts, $200 million for facilities for class size reduction , and $ 1 67 million for a reading initiative .

As of January, 1 997, the 1 997/98 proposed Governor's Budget provides for a $ 1 .677 billion increase in ongoing Proposition 98 funding for K-1 2 education. This increase includes an allocation of $5!3El million for a 2.53% COLA, $530 million -for enrollment growth, and $549 in various Governor's in it1iatives. The major Governor's initiative is $488 million for the expansion of the class size reduction pmgram to include a fourth grade level and to allow for a COLA and higher than projected costs of the program. The 1 997 /98 proposed budget also includes $308 million for revenue limit deficit reduction , $:30EI million for equalization aid, and $ 1 01 million in other one-time funds.

No additional funds were proposed for facilities for the Governor's class size reduction program. However, the Governor and several legislators have proposed a roughly $2 billion statewide school bond to address school 's facilities needs. Without a special election, the earliest such election can take place is June 1 998.

State Lottery

In the November 1 984 general election , the voters of the State approved a constitutional amemdment establishing a State lottery (the "State Lottery"), the net revenues of which are used to supplement money allocated to public education. The amendment stipulated that the funds derived from the State Lottery be used for the education of students and prohibited their use for non­instructional purposes, such as the acquisition of real property, the construction of facilities, or the financi ng of research. School districts receive an amount equal to their total A .D.A. times a per­A.D.A. figure . See "THE DISTRICT - Lottery Income" herein.

Ad Valorem Pro perty Taxation

The District uses the services of the County for the assessment ancl collection of taxes for Dis,tric:t purposes. District property taxes are assessed and collected by the County at the same time and on the same rolls as county, special district , and city property taxes.

The valuation of secured property and a statutory tax l ien is established as of March 1 and is subsequently equalized in August . The result ing secured property tax is payable in two equal installments due November 1 and February 1 , and payments become delinquent on December 1 0 and Apriil 1 0, respectively. The unsecured property tax {payable on personal and leasehold property) is payable in a single i nstallment due on August 31 , and payments become delinquent on October 31 .

State law exempts from taxation $ 7 ,000 of the full cash value of an owner-occupied dwelling, provided that the owner files for such exemption . This exemption does not result in any loss of revenue to local agencies, since the State reimburses local agencies for the value of the exemptions.

As1se,s1sed Valuation

All property is assessed using full cash value as defined by Article XIIIA of the State Const itution . State law provides exemptions from ad va/orem property taxat ion for certain classes of property such as churches, colleges, non-profit hospitals, and charitable instit utions.

Future assessed valuation growth allowed under Article XIIIA {for new construction, certain changes of ownership, 2% per year inflation) will be allocated on the basis of "situs" among the juri:sdlic:tions that serve the tax rate area within which the growth occurs. Local agencies and school districts will share the growth of "base" revenues from the tax rate area . Each year's growth allocation

1 9

becomes part of each agency 's al location in the fol lowing year. The avai labi l ity of revenue from growth in tax bases to such entities may be affected by the establishment of redevelopment agencies which, under certain circumstances, may be entitled to revenues resulting from the increase in certain property values.

For assessment and collection purposes, property is c lassified as either "secured" or " unsecured "' and is l isted accordi ng ly on separate parts of the assessment rol l . The "secured rol l " is that part of the assessment rol l containing State-assessed property and real property having a tax l ien which is sufficient, in the opinion of the assessor, to secure payment of the taxes. Unsecured property comprises al l property not attached to land such as personal property or business property . Boats and airplanes are examples of unsecured property. Unsecured property is assessed on the "unsecured rol l . "

The passage o f A B 454 in 1 987 changed the manner in which unitary and operating nonunitary property is assessed by the State Board of Equal izat ion . The legislation deleted the formula for the al location of assessed value attributed to such property , and imposed a State-mandated local program by requir inn the assignment of the assessed value of al l un itary and operating nonunitary property in each county for each State-assessed taxpayer other than a regulated rai lway company. The legislation establ ished formulas for the computation of appl icable county-wide tax rates for such property and for the al location of property tax revenues attributable to such property among taxing jurisdictions in the county beg inning in fiscal year 1 988/89 . The legislation requires each county to issue to each State­assessed taxpayer, other than a regulated railway company, a single tax bill for all un itary and operating nonunitary property. See "THE DISTRICT - Assessed Valuation" herein .

Tax Levies,, Collections and Delinquencies

A 1 0% penalty attaches to any del inquent payment for secured roll taxes. In addition, property on the secured roll wi1th respect to which taxes are del inquent becomes tax-defau lted . Such property may thereafter be redeemed by payment of the del inquent taxes and the del inquency penalty, plus interest of 1 . 5 % per month to the time of redemption . If taxes are unpaid for a period of five years or more, the property is subject to auction sale by thei County Tax Collector.

I n the case of unsecured property taxes, a 1 0% penalty attaches to del i nquent taxes on property on the unsecured rol l , and interest of 1 . 5 % per month begins to accrue beginning November 1 st of the fiscal year, and a l ien is recorded against the assessee. The taxing authority has four ways of col lecting unsecured personal property taxes : (a) a civil action against the taxpayer; (bl f i l ing a certificate in the office of the County Clerk specifying certain facts in order to obtain a judgment l ien on specific property of the taxpayer; (c) f i l ing a certificate of del inquency for record in the County Recorder 's office in order to obtain a lien on specified property of the taxpayer; and (d) seizure and sale of personal property, improvements or possessory i nterests belonging or assessed to the assessee.

Most counties in the State have adopted the Alternative Method of Distribution of Tax Levies and Collections and of Tax Sale Proceeds (the "Te1eter Plan") , as provided for in Section 4701 et seq. of the State Revenu1a and Taxation Code . Under the Teeter Plan, each participating local agency, i ncluding school districts, levying property taxes in a county receives the amount of uncollected taxes credited to its fund , in the same manner as if the amount credited had been collected . In return, the county receives and retains del inquent payments, penalties and interest as col lected, that would have been due the local agency. However, although a local agency receives the total levy for its property taxes without regard to actual co l lections, funded f rom a reserve established and held by its county for this puirpose, the basic legal l iabi l ity for property tax deficiencies at all t imes remains with the local agency. The Teeter Plan is to remain in effect u nless the county board of supervisors orders its d iscont inua nce or un less, prior to the commencement of any fiscal year of the county, the board of supervisors receives a petition for its discontinuance from two-thirds of the participating revenue districts in the county . No county has ever received a petition from any governing board to discontinue the Teeter Plan . A board of supervisors may, after holding a public hearing on the matter, discontinue the procedures under the Teeter Plan with respect to any tax levying agency in its county . See "THE DISTRICT - Tax Leviies, Collections and Delinquc�ncies" here in .

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Budget Process

School districts are required by provisions of the State Education Cod,e to maintain a balanced biudget each year, in which the sum of expenditures and the ending fund balance cannot exceed the sum of revenues and the carry-over fund balance from the previous year. The State Department of Education imposes a uniform budgeting and accounting format on school d intricts ..

School d istricts must adopt a budget on or before July 1 of each year. The budget must be submitted to the county superintendent within five days of adoption or by Ju ly 1 , whichever occurs f irst . A d istrict may be on either a dua l or single budget cycle . The dua l budget option requires a revised and readopted budget by September 1 that is subject to State mandated standards and criteria . The revised budget must reflect changes in projected income and expenses subsequent to July 1 . The sin{1 lo budget is only readopted if it is disapproved by the county office of education, or as needed .

For both dual and single budgets submitted on July 1 , the county sup13ri ntendent wi l l examine the adopted budget for compliance with the standards and criteria adopted by the State Board of Trustees and identify technical corrections necessary to bring the budget i nto compliance, wi l l determine if the budget a l lows the district to meet its current obl igations and wil l determi ne if the budget is consistent with a f inancial plan that will enable the district to meet its multi-year f inancial commitments. On or before August 1 5, the county superintendent wil l approve or disapprove the adopted budget for each school d istrict. Pursuant to State law, the county superintendent has available various remedies by which to impose and enforce a budget that compl ies with State criteria, depending on the circumstances, if a budget is disapproved .

Subsequent to approval, each county superintendent of schools throut1hout the fiscal year wi l l mon itor each school d istrict pursuant to its adopted budget to determine on an ongoing basis if the distri c:t can meet its current or subsequent year financial obl igations. l'f a cou nty superintendent determines that a d istrict cannot meet its current or subsequent year obl igations, the superintendent wi l l notify the district 's governing board of the determination and the superinttmdent may do either or both of the fol lowing: (al assign a fiscal advisor to enable the district to meet those obl igations or, if a study and recommendations are made and a district fai ls to take approp1'iate action to meet its f inancial obl igations, notify the State Superintendent of Publ ic I nstruction , and then (bl do any or a l l of the fol lowing for the remainder of the fiscal year: ( i ) request additional information regard ing the distr:1ct ' s budget and operations; ( i i ) develop and impose, after also consulting with the district's board, revisiions to the budget that will enable the d istrict to meet its f inancial obl igations; and ( i i i ) stay or rescind any action inconsistent with such revisions. However, the county EiUperintendent may not abro,gate any provision of any collective bargaining agreement that was entered into prior to the date upon which the county superintendent assumed authority.

Ac1r.uunting Practices

The accounting policies of the District conform to general ly accepted accounting principles i n acc:orclance with policies and procedures o f the Cal ifornia School Accounting Manua l . This manual , according to Section 4 1 0 1 0 of the California Education Code, is to be followed by a l l Cal ifornia school d istricts. Revenues are recognized in the period in which they become both mieasurable and avai lable to fina nce expenditures of the current fiscal period. Expenditures are recognized in the period in which the l iabi l ity is incurred.

2 1

THE DISTRICT

General Information

The Cotati-Rohnert Park Unified School District (the "District") is located in Sonoma County (the "County" ) , in the State of Cal ifornia (the "State " ) , approximately 50 miles north of San Francisco . The District was uni f ied in 1 978. The District encompasses a total area of approximately 1 5 .4 square m i les and has an estim ated population of 43,000 . The District provides educational services to the residents of the Cities of Cotati and Rohnert Park and certain unincorporated areas of the County. The District ' s average dai ly attendance for f iscal year 1 995/96 was 7 ,807 and the District 's 1 995/96 general fund budget was approximately $32. 1 mil l ion. The District has a 1 995/96 assessed va luation of approximately $2.6i bi l l ion . The District operates 8 elementary schools, 2 middle schools, 1 high schools, 1 continuation school , and 1 K-8 school . The District 's pupil-teacher ratio is 29: 1 for ki ndergarten, 20: 1 for g rades 1 -3, 30: 1 for grades 4-5, and 26: 1 for grades 6- 1 2.

The District is governed by a Board of Trustees consisting of f ive members. Members are e lected to four-year terms in staggered years . The day-to-day operations a re managed by a board­appointed Superintendent of Schools. Janice Hefson has served in this capacity since the 1 995/96 fiscal year .

Average Daily Attendance and Revenue Limit

The fol lowing is a table summarizing the h istorical and current year estimated average dai ly attendance for the District .

COTATI-ROHNERT PARK UNIFIED SCHOOL DISTRICT Average Daily Attendam:e Second Period

Academic Year

1 992/93 1 993/94 1 994/95 1 995/96 1 996/97(projected)

Average Dai ly Attendance11 1

7,523 7,696 7 ,753 7 ,807 7, 894

12 1 I ncludes K- 1 2, specia l uducation, and continuation students; excludes Adult education and ROP.

Source : The District.

The District 's undeficited annual revenue l imit per A.D .A . was $3,605 (deficited : $3,240) for 1 995/96 and is bud!geted at $3, 751 (deficited : $3, 377) for 1 996/97 . See "GENERAL SCHOOL DISTRICT FINANCIAL INFORMATION - State Funding of Education" here in .

Appropriatiions Limit

Th,13 D istrict had an Article XI I IB appropriations l imit of $27 ,373,294 and had appropri ations subject to the l imit of $27 ,373,294 in 1 995/96 . The District has projected for 1 996/97 an appropriations l imit of $28,279, 1 56 and it estimates it wil l have appropriations subject to the l im it of $28,279, 1 56. See " CONSTITUTIONAL AND STATUTORY PROVISIONS AFFECTING DISTRICT REVENUES AND APPROPRIATIONS - Article XIIIB" here in .

22

,,,,,.... •• ,. ___ 11 ____ ,. ________________________ 1111'1 ___ 111!!!111111111_..,'

, _.,lllll.,l , illl-i�llll •�'lllo-lMllftll.._ti ..... •eillil••_'" ___ _......___. lo,.,,......-,._ ... �-.-.---. .--..-, -----

Lottery Income

The District 's State lottery revenue was $ 1 20 per A.D.A. for 1 995/96 and is projected to be $ 10 0 per A.D.A. for 1 996/97 . See "GENERAL SCHOOL DISTRICT FINANCIAL INFORMATION - State Lo,tte!l'y" herein .

La1bior Relations

Currently the District employs 396 FTE certificated, 1 48 FTE classified employees and 43 management employees. There are 3 formal bargaining units operating in the District which are described in the table below. ------------------------------------------------------��,--------------

RPCEA

SEIU

CSEA

Soiurce1: The District.

Reti1rement Programs

COTATI-ROHNERT PARK UNIFIED SCHOOL DISTRICT Labor Organizations

Number of Employees

4 1 6 76 1 23

�ntract Expiration

June 30, 1 998 June 30, 1 99 8 June 30, 1 998

The District participates in the State of California Teachers Retirement System ( "STRS" ) . This plan covers basically all full-time certificated employees. The contribution to STRS for fiscal year 1 995/96 was $ 1 ,479,262 and in fiscal year 1 996/97 is estimated to be $ '1 ,624,289. In order to receive STRS benefits, an employee must be at least 55 years old and have provided five years of se1rvice to California public schools.

The District also participates in the State of California Public Employees Retirement System ( "PERS" ) . This plan covers all classified personnel who are employed more than four hours per day. The contribution to PERS for fiscal year 1 995/96 was $240,267 and for fiscal year 1 996/97 is projected to be $334,480. In order to receive PERS benofits, an employee must be at least 50 years old and have provided five years of service to California public schools.

Contribution rates to these two retirement systems vary annually depending on changes in actuarial assumptions and other factors, such as changes in benefits. The STRS contribution rates are base1d on State-wide rates set by law. The PERS contribution rates are also State-wide rates and are actuarially determined each year. STRS has a substantial State-wide unfunded liability. Since this liability has not been broken down by each school district, it is impossible to determine the District's share.

23

Assessed Valuation

Thie following table summarizes the historical and current assessed valuation of the District.

COTATI-ROHNERT PARK UNIFIED SCHOOL DISTRICT Assessed Valuations

Fiscal Ye.ar

1 992/93 1 993/94 1 994/9 !:i 1 995/96 1 996/97

! ocal Secured

$2,255 ,328, 1 36 2, 342, 742, 1 96 2,436,658,358 2,498,264,450 2,472,455 ,901

Source : California Municipal Statistics, Inc.

Tax Levies, Collections and Delinquencies

$ 1 ,449,375 1 ,430, 280 1 ,595 ,958

896, 760 935,750

Unsecured

$88,959,071 9 1 ,333,702 82,547,7 1 7 79,269,328 82,200,44 1

$2,345, 736, 582 2,435,506, 1 78 2 ,520,802,033 2 ,578,430,538 2 ,555 ,592 ,092

The following table summarizes the historical tax charges and delinquencies of the District .

1 1 1

Source :

COTATI-ROHNERT PARK UNIFIED SCHOOL DISTRICT Secured Tax Charges and Delinquencies

F.iscal Year

1 99 1 /92 1 992/93 1 993/94 1 994/95 1 99 5/96

Secured Tax Charqe1 1 1

$23, 1 08,648.00 22,040, 1 2 5 .00 22,890,367 .00 23,787,349 .30 24,383, 1 43 .84

All taxes collected by the County within the District.

California Municipal Statistics, Inc.

Amount Delinquent

$ 596, 1 24.00 932,074.00 505,62 1 .00 605,992.21 632,2 1 0.94

% Delinquent June 30

2.58% 4.23 2 . 2 1 2 . 5 5 2 .59

The County has elected to follow the procedures of Section 4 701 -4 7 1 7 of the California Revenue and Taxation Code, also known as the "Teeter Plan" . Under the Teeter plan, the County funds the District its full tax levy allocation, rather than only funding actual collections (levy less delinquencies). In exchange, the County receives the interest and penalties that accrue on delinquent payments, when the late taxes are collected. The Teeter Plan remains in effect unless the County Board orders its discontinuance . See "GENERAL SCHOOL DISTRICT FINANCIAL INFORMATION - Tax Levies, Collections and Delinquencies".

24

�·-··---............... ...................................................................................................... 1 ....

, ...... , _,, ... -......... ----...... ·---------- ·-----·------ -------·-----------.............. ·-·····-

Ta,c !Rates

The following is a table summarizing the historical and current property tax rates levied on behalf of the District to repay debt obligations.

·----------------------------·------------·----------------

Fiscal Year

Boncl Repayment Statn School Building Loan lrotails

COTATI-ROHNERT PARK UNIFIED SCHOOL DISTRICT Five Year Summary of Tax Rates Per $ 1 00 of Assessed Valuation

1 992/93

$0 .0660 Q.QQQQ

$0.0660

$0. '1 087 QJ2QQQ

iQ...:1 087

1 994/95

$0 . 1 272 0.0000

$0. 1 272

Source: County Auditor-Controller's Office.

$0. 1 380 Q.,.QQQQ

$0. 1 3..8.Q

1 996/97

$0. 1 360 .0...0.QOQ

$0. 1360

-------------------------------------------·------·------------------For taxing purposes, the State Board of Equalization has divided the area served by the District

into 43 separate tax rate areas. The largest tax rate area in the District iB Tax Rate Area 7-003 . THA 7-003 has a total 1 996/97 assessed valuation of $752,573,057, approximately 30.13 % of the District' s total assessed valuation . The components of the 1996/97 property tax rate levied in Tax Rate .Area 7-003 are set forth in the following table:

1 1 1

------------------------------------------------·--------------

Co1Jnty-wide Rate 11 1

Cotati-Rohnert Park USD Warm Springs Dam ,·or,�L

COTATI-ROHNERT PARK UNIFIED SCHOOL DISTRICT Tax Rate Components - TRA 7-003

1 996/97 Tax Rates ml!..il.QO of Assessed Value

$ 1 .0000 . 1 360 .0060

$ 1 . 1 420

Maximum rate for purposes other than paying debt service in accordance with Article XmA of the State Constitution.

Source: County Auditor-Controller's Office.

25

Major Taxpayers

The fol lowing table summarizes the major taxpayers in the District in terms of their 1 996/97 secured assessed valuations.

COTATI-ROHNERT PARK UNIFIED SCHOOL DISTRICT Major Taxpayers

1 996/97 blame !.and L� Alill!i!!Hi!i!d Val!..!s!liQn

Hewlett-Packard Company Light Manufacturing 89,987,421 Codding Enterprises Shopping Center 35,844,024 State Farm Mutual Automobile Insurance Co. Office Building 25,380, 235 New York Times Co. Light Manufacturing 24,996,978 John H . Streicker Apartments 20,6 1 0, 6 1 3 RLH Partnership Hotel with Restaurant 1 6,302,350 Jack Yanoff Apartments 1 3, 9 1 2,038 Steven J. Scmpa Apartments 1 3,492,400 Bay Apartment Communities, Inc. Apartments 1 2 , 9 1 5 ,340 Windsong Rohnert Park, Lt d . Apartments 1 2, 3 1 0 ,620 Pine Creek Properties Apartments 1 2,034,03 1 Conam Bay Residential Properties Apartments 8,969,628 Chang Retirement Centers Partners Apartments 8, 1 76, 5 1 8 Sunset Strip Corp . Manufactured Home1 Park 8,000,000 Paul S . & Lynn K . Horwath Vacant Commercial Land 7,330, 794 Century Realty Corp. Light Manufacturing 7,008,02 1 Dorothy Jean Goldstone Manufactured Home Park 6,9 1 6, 7 1 9 Novato Market, Inc. Shopping Center 6,795,081 Transworld Systems, Inc. Office Building 6,766, 6 1 6 Parker Properties, Inc . Light Manufacturing 6.350 000

TOTAL �344.099 427

1 1 1 Total Local Secured Assessed Valuation for 1 996/9 7 $2,472,455,901

Source: Sonoma County Assessor's Office.

26

<z'Q of Total1 1 1

3.64% 1 .45% 1 .03% 1 .01 % 0.83% 0.66% 0.56% 0 .55% 0.52% 0.50% 0.49 % 0.36% 0.33% 0.32% 0.30% 0.28% 0.28% 0.27% 0.27% 0.26%

1 3.92%

""'·-···-------,,---------------·---------------------.. ------1

...... .... ,-.�-·----···---------- ·-----------

Comparative Financial Statements

The following is a table summarizing the District "s historical and current General Fund revenue, expenditures, and fund balances from fiscal year 1992/93 through 1 996/97:

COTATI-ROHNERT PARK UNIFIED SCHOOL DISTRICT General Fund Revenue, Expenditures and Fund Bala11cEis

1 992/93 through 1 996/97

REVENUE: Re,vonue Limit Sources: State Apportionment Local Sources IFede,ral Othm State Othe1r Local Transfers In/Other TOT AL REVENUE

EXPEND ITURES: Salaries:

Certificated Classified

Employee Benefits Books, Supplies, and Equipment Contract Services/Other Expenses Capital Outlay Trainnfers Out/Other TOT AL EXPENDITURES

EXCESS REVENUE OVER (UNDER) EXPENDITURES

FUND BALANCE, JUNE 30

Sources:

Actual 1 992/931 1 1

$ 1 3,9 56,486 9 ,55 7,46 1

761 , 007 4,084, 1 98

726, 330 Q

29,085,482

1 6,279, 1 08 3,325, 740 5 , 1 75 ,830

774,696 2,284,957

1 89,500 493,!;!92

28,523,723

56 1 , 759

�2 1 !;!9,925

Actual 1 993/941 1 1

$ 1 2,059,858 1 2 ,594, 1 68

8 1 8,703 3,973,41 9

704, 1 5 2 __ __Q 30, 1 50,300

1 6,988, 1 65 3,570,058 5 ,41 3,285 1 ,033,842 2,838,655

354,685 4l2lt, 7�!2

30,658.435

(508, 1 35)

� 790

1 1 1 Excerpted from the District's Audited Financial Reports. 121 First Period Interim Report as of October 3 1 , 1 996.

27

Actual Actual ll� .lfillfil�

$ 1 1 ,538,704 * 1 2 , 796,0 1 4 1 3,225 ,429 1 3,006,008

772 ,307 8 1 2,229 4,2 1 5 ,061 5 ,407,543

829,41 1 1 ,548, 6 1 1 Q ��

30,580,9 1 2 33,573,747

1 7,320, 1 69 1 8,269, 1 58 3 ,31 2 ,825 3,41 4,253 4,93 1 ,998 5,066,5 2 1

786,325 1 ,08 1 ,544 2,847,420 3,243, 1 1 8

453,844 725,709 §9Q,345 1..2.a§ 534

30,342 ,926 33,096,837

237,986 476, 9 1 0

� 1 9 1 9 776 : �2,396,686

Budget 1 996/97 121

1 3,459,470 1 3,680,351

1 , 1 92,596 6,536,920

5 1 7,854 0

35,387, 1 9 1

20,22 1 ,41 0 3,820,684 5,953, 1 94 1 ,740,292 3,579,248

6 1 5 ,767 l2Z7,498

36,508,093

( 1 , 1 20,902)

1 275 784

District Debt Structurn

Tax and Revenue Anticipation Notes - In August, 1 996, the District issued $5 ,000,000 in Tax and Revenue Anticipat ion Notes dated August 1 3, 1 996. The notes constitute a general obl igation of the District secured and payable only from general fund revenues received during or al locable to the 1 996/97 fiscal year.

Bonded Debt. The annual principle requirements to amortize general obl igation bonds payable, outstandinn as of June 30, 1 996 are as fol lows:

Year Ended June 30

1 997 1 99 8 1 999 2000 2001

Thereafter Total

Source: 1 996 Audited Financial Statements

$ 1 ,270,000 1 ,3 1 5 ,000 1 ,405,000 1 ,607, 1 79 1 ,728, 1 1 3

45.004,326 $52.329.6 1 8

Capital Leases. The Distri ct has entered into various leases for equipment that have been capital ized and recorded as long-term debt. Future min imum lease payments are as follows:

Year Ended June 30

1 997 1 998 1 999 2000 2001 Total

Less Amount Representing Interest Present Value of Net Minimum Lease Payments

Lease Payment

$23,385 1 8, 777 1 0,002

1 ,933 -1...fil.1 $55, 708

(5.833) $49,875

This District did not receive sublease rental revenues or any contingent rentals for this equipment

Source : 1 996 Audited Financial Statements

Op,erating Let.1ses. The District has entered i nto various operating leases (for land, bui ld ings, and equipment) with lease terms i n excess of one year. The amount of renta l expenditures during the year were 1� 1 1 8 ,572. None of these agreements contain purchase options. All the agreements contain a termination clause providing for cancellation after a specified number of days written notice to lessors but it is un! ikely that the District will cancel any of the agreements prior to the expiration date . Future min imum lease paymie nts under these agreements are as fol lows:

Year Ended June 30

1 997 1 998 1 999 2000 2001 Total

Lease Payment

$ 1 1 8,572 1 1 8, 572 1 1 8,572 1 1 8, 572

8 852 $483, 1 40

This District did not receive sublease rental revenues or any contingent rentals for these properties

Source: 1 996 Audited Financial Statements

28

�····· - , 1

•••••�, -.,-... , .... ,•••••0111,....•-•••---------- ----

StatEtment of Direct and Overlapping Debt

Contained within the District are numerous overlapping local agencies providing public services. Tlhese local agencies have outstanding bonds issued in the form of general obligation, lease revenue and special assessment bonds and outstanding certificates of participation. The following represents the total assessed valuation and the direct and overlapping "bonded" debt of the District as of February 1, 1996, according to California Municipal Statistics, Inc. The District makes no assurance as to the accuracy of the following table, and inquiries concerning the scope and methodology of procedures carried out to complete the information presented should be directod to California Municipal Statistics, Inc.

COTATI-ROHNERT PARK UNIFIED SCHOOL DISTRICT Statement of Direct and Overlapping Debt

.ll!1l6L.97 Assessed Valuation: $2 ,555 ,592,092 (before deduction of redevelopment incremental valuation)

Dl!�ECT AND OVERLAPPING TAX AND ASSESSMENT DEBT:

Sonoma County Water Agency Cota1ti··Rohnert Park Unified School District City 1 !3 1 5 Act Bonds

TOTAL GROSSED DIRECT AND OVERLAPPING TAX AND ASSESSMENT DEBT

OV..E.fil.APPING GENERAL FUND OBLIGATION DEBT:

Sonoma County General Fund Obligations Sonoma County Pension Obligations Sonoma County Office of Education Certificates of Participation City of Rohnert Park General Fund Obligations

TOTAL GROSS OVERLAPPING GENERAL FUND OBLIGATION DEBT Less: Sonoma County Public Works Certificates of participation ( 1 00% self supporting)

City of Rohnert Park Certificates of Participation ( 1 00% self supporting from tax increment revenues)

TOTAL NET OVERLAPPING GENERAL FUND OBLIGATION DEBT

GROSS COMBINED TOTAL DEBT NET COMBINED TOTAL DEBT

!Excludes general obligation bonds to be sold.

7 . 785% 1 00 100

7 .785% 7 . 785 7.785

!38 . 1 04

Debt 211192

$ 2,49 1 5 1 ,059 ,620 11 1

5.780 000 $56,842, 1 1 1

$ 4,641 ,028 7 ,56 1 , 5 7 1

385,747 7.568 724

$20, 1 5 7,070 (523, 1 52)

17.421 5filil $ 1 2, 2 1 2,350

$76,999, 1 8 1 121

$69,054,46 1

( 1 1

(2) !Excludes tax and revenue anticipation notes, revenue, mortgage revenue and tax allocation bonds .and non-bonded capital lease obligations

B.a.ti.OUQ Assessed Valuatjon: Dire,ct Debt ( $ 5 1 ,059,620) . . . . . . . . . . . . . . . . . . . . . . . 2 .00% Tot.al Direct and Overlapping Tax and Assessment Debt . . . . 2 .22% Gross Combined Total Debt . . . . . . . . . . . . . . . . . . . . . . . . 3 .01 % Net Combined Total Debt . . . . . . . . . . . . . . . . . . . . . . . . . 2 .70%

.$.I.�JJ:_ SCHOOL BUILDING AID REPAYABLE AS OF 6/30/95: $83,323

Source : California Municipal Statistics, Inc .

----------------------------------------------------------------------------------The direct debt of the District, including general obligation bonds and state school building loan

obligations, after issuance of the Bonds, will be equal to 2 .35% of the $2. 56 billion 1 995/96 assessed valuation of taxable property within the District.

After issuance of the Bonds, the District "s total amount of general obligation bonds outstanding will be: $60.06 million. The District" s general obligation bonding capacity is limited under State law to

29

an amount equal to 2 . 5 % of the assessed valuation of taxable property within the District, or approximately $ 63 .8B mi l l ion for fiscal year 1 995/96.

Investment of District Funds

In accordance with Education Code Section 4 1 001 , school districts in the State maintain substantia l ly al l operating funds i n the treasuries of the counties i n which the school d istricts are located. Each county is required to invest such funds in accordance with Government Code 53601 , et . seq. In addition , counties have established their own i nvestment policies which are general ly intended to outl ine further l im itations beyond those requ ired by the Government Code.

The fol lowing i nformation provides a general description of the County's i nvestment pol icy, current portfol io holcl ings, and valuation procedures . For the most part, the information has been adapted from material prepared by the Cou nty for use as d isclosure i nformation on securities issues. The information has been obtained from sources which are believed to be reliable but is not guaranteed as to accuracy or completeness, nor has such information been audited by the District nor its financial advisor. Further information may be obta ined from the County Treasurer.

Substanti al ly all operating funds of the District are i nvested in the County's i nvestment pool (the "County Pool") . Upon closing of the Bonds, proceeds of the Bonds wil l be deposited in the County Pool .

The Cou nty Treasurer manages the Cou nty Pool , i n which certain funds of the County and certain funds of other participating entities are i nvested pending disbursement. Amounts held for the Cou nty and school d istricts and special d istricts located within the County constitute 99% of the County Pool. The County Treasurer is ex-officio treasurer of each of these participating entities, which therefore are legally required to deposit their cash receipts and revenues i n the County treasury. Under State law, withdrawals are allowed only to pay for expenses which have become due. The remain ing 1 % of the amounts in the County Pool are not legally required to be maintained in the County Pool and can be withdrawn by the depositors for whom these amounts are held , provided such withdrawal wi l l not adversely affect other Cou nty Pool participants.

Each governing board of school d istrict and special d istricts within the County may al low, by appropriat,1� board resolutions, certain withdrawals of non-operating funds for purposes of i nvesting outside the County Pool . None of the participating entities is currently using this authority. Some d istricts have from time to time authorized the County Treasurer to purchase specified i nvestments for ce rtain d istrict funds to maturity on predetermined future dates when cash would be required for d isbursemi1mts.

The County Pool is accounted for by the Treasurer at book value, which is based on an amortized icost of purchase, includ ing accrued i nterest added to the purchase price of an i nvestment. During the County's '1 995-96 fiscal year, the average balance of the County Pool was $ 599 ,554,290, the h ighest balance (at December 3 1 , 1 996) was $698, 705 ,246, and the lowest balance (at October 3 1 , 1 995) was $ 5 1 5 ,0 1 3 ,206. The i nvestment portfolio is not marked to market, but the market value of the portfol io is calculated and reported quarterly to the Board of Supervisors. The latest quarterly market calculations as of December 3 1 , 1 996, showed the book value of cash and investments as $698, 705 ,246, with a market value of $ 696, 792,067. For the quarter e nded December 3 1 , 1 996, the average daily investment balance of the I nvestment Pool was $61 0,01 7 ,9 1 0, with total earnings, before deducting administration fees, of $8, 1 1 5 , 1 22. The i nterest rate earned before fees was 5 . 377 % . In accordance with the Treasurer's investment pol icy, the next market calculations wi l l be made for March 3 1 , 1 997 in April 1 997 .

30

�·•---•••1• ......... ,. ......................................................................................... 11!1�

--------,--------------··,-······-

The following table summarizes the County' s investment portfolio as of December 31 , 1996 :

Cash ,n Bank Ri�purchase Agreement Treasury Bills/Notes Government Agencies Cc)mrnercial Paper Banl<er Acceptances Corporate Bonds and Notes Negotiable Certificates of Deposit LAIF (State Pool) Mutual Funds Othurn Revorne Repurchase Agreements Tcitalm

Sonoma County Investment Portfolio September 30, '1 996

Amortized Cost/Book Value

$ '1 7,474,680 97,500,000 39, 947, 8 1 1

258, 1 24,462 24, 525,383 24,390,831

1 70,305, 5 96 24,991 ,892 1 8,81 2,407 1 8,054,069

4,5 78, 1 1 5 0

$698. 705.246

( 1 ) This does not include special TRAN investments and deferred compensation.

Source, : Sonoma County Treasurer- Tax Collector

.?Lo of Portfolio

2.50% 1 3.95

5 .72 36.95

3 . 5 1 3.49

24.37 3 .58 2.69 2 .58 0.66

......Q.QQ 1 00.00%

---------------------------------------�-------------,--------------------Total investments in the County Pool at December 31, 1996 consisted of the following:

Step-•Jp issues Not-callable bullet issues Callable bullet issues Straight floating rate instruments lnvms;e floating rate instruments Yield curve notes Total

Sonoma County Pool Investments September 30, 1 996

Amortized Cost/Book Value $ 20,000,000

358, 739,502 1 01 ,298,985 1 46, 1 92,079

20,000,000 35.000.0QQ

$681 230 566

Source: Sonoma County Treasurer-Tax Col lector

31

�ivestments 2 . 94%

52.65 1 4.87 2 1 .46

2 .94

-� 1 00.00%

Of the total investments in the County Pool at December 31 , 1 996, $405,650,341 or 59.41 % of the portfol io consisted of investments maturing in part within 1 2 months. The average life of the portfolio was approximately 1 4 months. Further information on the maturities of investments in the County Pool at December 31 , 1 996 is as follows : ��-------·----------�·------------------------------�,----�-----------------------------------------------------

1 year or less

More than ·1 year, less than 2 years

Moe than 2 years, less than 3 years

Moe than 3 years, less than 4 years

Moe than 4 years, less than 5 years

Total :

Sonoma County Pool Age of Investments December 31 , 1 996

$405,6�i0,341 1 71 , 750,000

60,000,000 1 0, 294,2!50 35.000.000

1§82 694 59 1

Source: Sonoma County Treasurer-Tax Col lector

% of Portfolio

59.41 % 2 5 . 1 6

8 .79 1 . 5 1

-5...U 1 00.00%

Thie County lhas on occasion borrowed funds under reverse repurchase agreements, but currently has no such borrowings outstanding . No portion of the County Pool is leveraged. The County has participated in a securities lending program which is not presently in effect. When purchasing! investments for the County Pool, the County Treasurer generally anticipates holding the investment to maturity.

ECONOMIC PROFILE

lntroductioin

The District is located in the Cities of Cotati and Rohnert Park and certain unincorporated areas of Sonoma County.

Sonoma County, one of California's 27 original counties, is located approximately 40 miles north of San Francisco. Sonoma County is the northernmost of the nine greater San Francisco Bay Area counties. Bordered on the north and east by Mendocino, Lake, and Napa counties and to the west and south by tho Pacific Ocean, Marin County, and San Pablo Bay, Sonoma County encompasses 1 ,598 square miles. Geog raphically, Sonoma County is divided almost equally into mountainous regions, rolling hills, and valley land. Three narrow valleys, sep,; �ated by mountains, run northwest to southeast . Elevations range from sea level to 4,262 feet at Mt. St. Helena, where Sonoma, Napa, and Lake counties converge.

32

H-•·------,----·-------------..... -------------..-----1-;

1li111111•·1 • •••• .. ,1 .... , ........ --. .... j .. __________ ·-------.. ---- --------·------------------.-t- ;-

Population

The following table summarizes population figures for the Cities of Cotati and Rohnert Park and for the County .

CITIES OF COTATI AND ROHNERT PARK AND SONOMA COUNTY Population

� c;w of Cotati

1 960 N/A 1 970 1 ,398 1 980 3,475 1 990 5,724 1 994 6,350 1 995 6,475 1 996 6,500

City of Rohnert Park

N/A 6, 1 33

22,965 34,900 38, 1 50 37,800 38,380

Sonoma ...G.2!.!ill.Y.

1 47,375 204,88 5 299,681 388,22.2 41 3,000 41 6,800 42 1 ,500

Souri:e: The 1 960, 1 970, 1 980, and 1 990 totals are U .S . Census figures. The figures for the years 1 994 and 1 995 are based upon adjusted January 1 estimates provided by the State.

-------------------------------------------------·------------Employment

The following table summarizes historical employment and unemployment in Sonoma County . -------------------------------------------------·-----------SONOMA COUNTY

Civilian Labor Force, Employment and Unemployment Annual Averages

Civilian Labor Force1 1 1

Employment Unemployment Total

Unemployment Rate 121

.1.ruil

1 98,600 1 1 700

2 1 0,300

5 . 5 %

fill

200,800 ] Q,JQQ

2 1 6, 'J OO

7 . 1 %

Notef: i l l 121

Based on place of residence. Based on a March 1 995 benchmark. The unemployment rate is calculated using unrounded data .

Source: California Employment Development Department

33

1 993

207,200 1 :1 QQQ

221 , 700

6 . 5 %

� .1.a9..6.

2 1 3,000 2 1 2 ,900 1 J, 'I QO 1 2 5QO

226 , 'I OO 225 ,400

5 .8% 5 . 5 %

The following table summarizes the historical numbers of workers in Sonoma County by industry.

SONOMA COUNTY Estimated Number of Wage and Salary Workers by Industry

(Amounts In Thousands)

1 989 1 990 llil

Agricultural 5, 200 5,600 5 , 700 Mining & Construction 9 ,400 9 ,800 9, 1 00 Manufacturing 20,600 20,800 1 9, 700 Transportation & Public Utilities 6, 1 00 6, 1 00 6,200 Wholesale Trade 5 ,800 6,600 6,800 Retail Trade 28,900 30, 1 00 30.400 Finance, Insurance & Real Estate 7 , 700 8,400 8,800 Services 30,200 33,400 37.400 Government � 2.1,_1.QQ 24.600

fatal All Industries 1 31.1 oq 144.900 1 4!;! 6QQ

1!l9.2 1 993

5 ,700 5 , 600 8,200 8, 1 00

20,200 20,300 5, 700 5 ,800 6, 700 6 ,300

29,300 29,800 9,700 9,900

37, 1 00 38,400 2.2..1.QQ 24 700

HZ 70Q 1 48.800

Note : Does not include proprietors, self-employed, unpaid volunteers or family workers, domestic workers in households, and persons involved in labor/management trade disputes. Employment reported by place of work. Items may not add to totals due to independent rounding. March 1 99 3 benchmark.

Source : California Employment Development Department

Largest Employers

The following table summarizes the largest employers in Sonoma County.

Employer

Sonoma County Hewlett Packard Company Santa Rosa Junior College Santa Rosa School District Kaiser Permanente Medic:al Center State Farm Insurance Company City of Sanlta Rosa Sonoma State University Sola Optical USA Sonoma County Office of Education State of Ca lifornia Santa Rosa Memorial Hospital North America Mortgage Company Pacific Bell Petaluma Ciity Elem. & H igh School Districts Cotati-Rohnert Park Unified School District Community Hospital (Santa Rosa) Sunrise Industries Pilkington Holding, lnc. Optical Coating Laboratories

SONOMA COUNTY Largest Employers

Product/Service

Government ( County) Electronic Testing Education Education Health Care Insurance Government (City) Education Optic:al Products Mfg. Education Gove1rnment (State) Health Care Financial Services Telecommunications Education Education Health Care Recycling Plastic Manufacturer Film Coating Mfrg .

Sources: "Large Employers Directory 1 995/96," Santa Rosa Chamber of Commerce.

:34

Number of Employees

1 ,000 + 1 ,000 + 1 ,000 + 1 ,000 + 1 ,000 + 1 ,000 + 1 ,000 + 1 ,000 + 1 ,000 + 1 ,000 + 1 ,000 + 1 ,000 + 1 ,000 + 1 ,000 +

500 + 500 + 500 + 500 + 500 + 500 +

__. ......... , .......................................................................................... ""' ............. .......

...... , , .. -·�-.. ··--·--·--··---------------' --------·-----------.............., .... , .... 1,,•-

C:om;truction Activity

The following table summarizes historical building permit valuation for the City of Cotati .

Residential � �

1 99 1 55 1 992 1 6 1 993 47 1 994 1 2 1 995 1 1

11 1 J, iJoes not include alterations and additions. 112], I ncludes all residential building activity.

CITY OF COTATI Building Permit Valuation

($- in Thousands)

Residential Valuation121

$5 , 784 1 ,260 3,235

994 1 ,350

Source: " California Building Permit Activity, " Economic Sciences Corporation.

Non-Residential Total �D. Y.a.l!!a1iQ!l

4 1 4 $6, 1 98 1 ,841 3, 1 0 1 4,973 8,208

785 1 , 779 1 ,303 2,653

The following table summarizes historical building permit valuation for "the City of Rohnert Park.

1 99 1 1 992 1 993 1 994 1 99 5

Residential Unjts' ' 1

239 1 53

3 244 1 96

( 'I ) Does not include alterations and additions. (2) Includes all residential building activity.

ROHNERT PARK Building Permit Valuation

($ in Thousands)

Residential Valuatjon12

�

$25 , 5 1 2 1 5 ,63 1

3 , 1 1 9 1 4,223 1 1 , 787

Source: "Cal ifornia Building Permit Activity, " Economic Sciences Corporation.

Non-Residential Valuation

24.41 9 1 7,076

4.428 4,043

1 1 ,877

Total Valuation

$49,93 1 32,707

7, 547 1 8,266 23,664

---------------------------------------------------------------------------------

35

The fo l lowing table summarizes historical bui ld ing permit valuation for the County .

SONOMA COUNTY Building Permit Valuation

($ in Thousands)

Residential Residential Non-Residential Total Yei;!I �

1 99 1 2 ,202 1 m:12 1 ,976 1 993 1 , 938 1 994 2 , 5 1 1 1 9 95 2 , 1 07

1 1 1 Does not include alterations and additions. 121 I ncludes all residential building activity.

V1:�l.!i!li.!;1n121

$292,348 289, 3�!4 279,569 31 6 ,771 276,225

Source: " California Building Permit Activity, " Economic Sciences Corporation.

Commercial Activity

Valuation �a!uation

$ 1 02,808 $395, 1 5 7 99,5 1 0 388, 844 84,340 363, 91 0 87, 1 43 403, 9 1 4

1 1 2,039 388,264

Tho fol lowing1 table summari zes h istorical taxa ble transactions in the Cities of Cotati and Rohnert Park and the County.

1 99 1 1 992 1 993 1 994 1 995

CITY OF COTATI AND ROHNERT PARK AND SONOMA COUNTY Taxable Transactions

City of Cotati Taxable

Outlets Transactions

2 5 1 237 262 268 281

$ 5 5 , 7 1 4 60,063 58,295 56,458 60, 584

($ in Thousands)

_Qt'l...2f_Rohnert Park �

QJ.it!fJ.1§ Transactions

7 7 1 794 821 834 886

$201 ,41 4 292 ,645 347,874 403,781 424,664

Sonoma County �

Q.u1!.!ils Transactions

1 4.448 1 4,963 1 5,358 1 5, 548 1 6, 1 1 3

$3,65 1 ,536 3,728,692 3,836,452 3,95 1 ,850 4,222,495

Source: State Board of Equalization.

36

�,-....... .............. _____ ,1----·----------··----------------�----1-=

........ . ,,,.·-···-· .. -···---·---------·-----------·-------·----------............ ·i�,,,,�-

Median Household Income

Effective Buying Income (EBI) is defined as personal income less personal income tax and non­tax payments, such as fines, fees or penalties. Median household EBI for the County is shown in the table below. The following table summarizes historical median household EBI for the County .

( 1 ) As of January 1 .

SONOMA COUNTY Median Household Effective Buying Income

1 992 1 993 1 994 1 995 1 99 6121

� County

$37,405 38,279 40,036 4 1 ,600 35,957

(2) Definition has changed. Not comparable to earlier years.

Source : "Survey of Buying Power" , Sales and Marketing Management Magazine.

------------------------------------------------�------�,---------------

LEGAL MATTERS

Tax Matters

In the opinion of Jones Hall Hill & White, A Professional Law Corporation, San Francisco, California, Bond counsel, subject, however to certain qualifications described herein, under existing law, th1e interest on the Bonds is excluded from gross income for federal income tax purposes and such interest is not an item of tax preference for purposes of the federal alternativ1e minimum tax imposed on individuals and corporations, although for the purpose of computing the a lternative minimum tax imposed on certain corporations, such interest is taken into account in determining certain income and earnings.

The difference between the issue price of any maturity of the Bonds and the amount to be paid at maturity of such Bonds constitutes "original issue discount," the accrual of which, to the extent properly allocable to each owner thereof, is treated as interest on the Bonds which is excluded from gross income for federal income tax purposes. For this purpose, the issue price of a particular maturity of the Bonds is the first price at which a substantial amount of such maturity of the Bonds is sold to the public (excluding bond houses, brokers, or similar person or organizations acting in the capacity of undorwriters, placement agents or wholesalers) . The original issue discount with respect to any maturity of the Bonds accrues daily over the term to maturity of such Bonds on the basis of a constant int1Hest rate compounded semiannually (with straight-line interpolations betweon compounding dates) . Thi� accruing original issue discount is added to the adjusted basis of such bonds to determine taxable gain or loss upon disposition (including sale, redemption, or payment on maturity) of such Bonds. Owners of the Bonds should consult their own tax advisors with respect to the tax consequences of ownership of Bonds with original issue discount, including the treatment of purchasers who do not puirch.ase such Bonds in the original offering to the public at the first price at which a substantial amount of such Bonds is sold to the public.

The opinions set forth in the preceding paragraph are subject to the condition that the District comply with all requirements of the Internal Revenue Code of 1986 (the "Code") that must be satisfied

37

su bsequent to the issuance of the Bonds in order that such interest be, or continue to be, excluded from gross income for federal income tax purposes. The District has covenanted to comply with each such requirement . Fai llure to comply with certain o-f such requirements may cause the inclusion of such interest in '!J ross income for federal income tax purposes to be retroactive to the date of issuance of the Bonds.

In t he further opinion of Bond Counsel , interest on the Bonds is exempt from Cal ifornia personal income taxes.

Owners of the Bonds should also be aware that the ownership or disposition of, or the accrual or receipt of interest on , the Bonds may have federal or state tax consequences other than as described above . Bond counsel expresses no opinion regarding any federal or state tax consequences arising with respect to the bonds other than as expressly described above .

The form of Bond Counsel opinion is attached hereto as APPENDIX A.

No Litigation

No l itigation is pending concerning the validity of the Bonds, and a certificate or certificates to that effect wi l l be furnished to the Purchaser at the time of the origina l del ivery of the Bonds. The District is not aware of any l itigation pending or threatened questioning the political existence of the District or contesting the District ' s abi l ity to recei ve ad valorem taxes or to col lect other revenues or contesting the District ' s abi l ity to issue and retire the Bonds.

Legality foll' Investment in California

Under provisions of the California Financial Code, the Bonds are legal investments for commercial ban ks in California to the extent that the Bonds, in the informed opinion of the bank, are prudent for the investment of funds of depositors, and under provisions of the Cal ifornia Government Code, are e l ig ible for security for deposits of public moneys in California.

Legal Opinion

The val id ity o1 the Bonds and certain other legal matters are subject to the approving opinion of Jones Hi l l Hal l & White, Bond Counse l . Bond Counsel undertakes no responsibil ity for the accuracy, completenHss, or fairness of this Official Statement .

MISCELLANEOUS

Rating

Moody's I nvestors Service , which has assigned its municipal bond rating of "Aaa" to the Bonds, has done so with the understanding that, upon delivery of the Bonds, the financial Guaranty Pol icy wil l be issued by Financial Guaranty. Such rating reflects only the views of such organization a nd any desired explanation of the significance of such rating should be obtained from the rating agency at the fol lowing address : Moody's Investors Service , 99 Church Street, New York, New York, 1 0007.

General ly, a rating agency bases its rating on the information and materia ls furnished to it and on investigations, studies and assumptions of its own. There is no assurance such rating wil l continue for any given period of t ime or that such rating wil l not be revised downward or withdrawn entirely by the rat ing agency, if in the judgement of such rating agency, circumstances so warrant . Any such

:38

... -••--•-11 ____ , __________ , ________________ ... ______ I_ '

""''"'""•-•m••·---•••------------------ -------·----------...._--..... -., .•.. ,�-

downward revision or withdrawal of such rating may have an adverse effect on the market price of the Bonds.

U1ndurwriting

Pursuant to the terms of a public bid dated January 30, 1 997, Merril l Lynch & Co . , as Undeirwriter, has agreed to purchase the Bonds from the District at the purchase price of $ 8,999,095. 1 5, and to reoffer the Bonds pursuant to the terms and conditions set forth on the cover pagre of this Official Statement . The Underwriter will be obligated to take and pay for all of the Bonds, if any Bond is purchased.

Cllo:siing Papers

The District wil l furnish to the Underwriter, without charge, concurrently with payment for and dolivBry of the Bonds, the following closing papers, each dated the date of such delivery:

(al The opin ion of Jones Hill Hall & White, San Francisco, California, Bond Counse l , substantially in the form attached as APPENDIX A hereto;

(bl The Certificate of the District certifying that on the basis of the facts, estimates and circumstances in existence on the date of issue, it is not expected that the proceeds of the Bonds will be used in a manner that would cause the Bonds to be arbitrage bonds;

(c) The certificate on behalf of the District certifying that there is no l itigation pending affecting the validity of the Bonds;

(d) The Certificate of an appropriate District official, acting on behalf of the District solely in his or her official and not in his or her personal capacity, certifying that at the time of the sale of the Bonds and at all times subsequent thereto up to and including the time of delivery of the bonds to the in itial purchasers thereof .. to the best knowledge and belief of said Official, the Official Statement of the District pertain ing to said Bonds (excluding the descript ion of the OTC and its book-entry system, information relating to a municipal bond insurance policy and provider, if any, and the description of the County's investment policy, current portfol io holdings, and valuation procedures), did not contain any u ntrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading;

(el The signature certificate of the officials of the County certifyino that said officials have signed the Bonds, whether by facsimile or manual signature, and that they were respectively duly authorized to execute the same; and

(f) The receipt of the Treasurer-Tax Col lector of the County for the purchase price of the Bonds, including i nterest accrued to the date of delivery thereof.

(g) The Continuing Disclosure Certificate of the District in substantially the form shown in APPENDIX C attached hereto .

Continuing Disclosure

The District has covenanted for the benefit of the holders and beneficial owners of the Bonds to provide certain financial information and operating data relating to the District by not later than n ine months following the end of the District 's fiscal year (the "Annual Report"), commencing with the

39

Annual Report for the 1 996/97 Fiscal Year, and to provide notices of the occurrence of certain enumerated events, if material. Currently, the District's Fiscal Year ends on June 30 of each year. The Annual Report will be filed by the District with each Nationally Recognized Municipal Securities Information Repository and with the state information repository, if any. The notices of material events will be filed by the District with the - Municipal Securities Rulemaking Board and with the state information repositorv, if any. The specific nature of the information to be contained in the Annual Report or the notices of material events is set forth below under the caption "APPENDIX C - Form of Continuing DisclosurE! Certificate." These covenants have been made to assist the Underwriter in complying with S.E.C. Rule 1 5c2-1 2(b) (5) . The District has never failed to comply in all material respects with any previous undertakings with regard to said Rule to provide annual reports or notices of material events.

Additional !Information

The purpose of this Official Statement is to supply information to prospective buyers of the Bonds. Quotations from and summaries and explanations of the Bonds, the Resolution providing for issuance of the Bonds, and the documents, statutes and constitutional provisions referenced herein, do not purport to be complete, and reference is made to said documents, statutes constitutional provisions for full and complete statements of their provisions.

All data contained herein has been taken 01r constructed from District , City and County records. Appropriau� District officials, acting in their official capacities, have reviewed this Official Statement and have determined that , as of the date hereof, the information contained herein (excluding the description of the DTC and its book-entry system, information relating to a municipal bond insurance policy and provider, if any, and the description of the County's investment policy, current portfolio holdings, and valuation procedures) is, to the best of their knowledge and belief, true and correct in all material respects and does not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements made herein, in light of the circumstances under which they were made, not misleading . This Official Statement has been reviewed and approved by the District.

COTATI-IROI-INERT PARK UNIFIED SCHOOL DISTRICT

40

.--···-----l·---�----------·---------------------1--"

---··"·--·--"·-·----------- ___ , ----- __________ , ________________ __

APPENDIX A

FORM OF LEGAL OPINION

A- 1

(THIS PAGE INTENTIONALLY LEFT BLANK)

----I·--------------------·---------------............ .,.. ................ · �••....,...•nr�•-•·••

......... . ,, •• ,-.,t� ... , .. -111 ........... ._ .. , • ...._.. ___________ , ____ _ ------·---------...._� .... -, .. -1····

APPENDIX A

FORM OF BOND COUNSEL OPINION

[LETTERHEAD OF JONES HALL HILL & WHITE]

February 13, 1997

Board of Trustees Cotati-Rohnert Park Unified School District 1 601 East Cotati A venue Rohnert Park, California 94928

OPINION: $8,999,095.15 Cotati-Rohnert Park Unified School District (Sonoma County, California) General Obligation Bonds, Series F (Capital Appreciation Bonds)

Mi:1mbers of the Board of Trustees:

We have acted as bond counsel to the Cotati-Rohnert Park Unified School District (the "Dist:rict") in connection with the issuance by the Board of Supervisors of the County of Sonoma (the uBoard") of $8,999,095. 15 Cotati-Rohnert Park Unified School District (Sonoma County, California) General Obligation Bonds, Series F (Capital Appreciation Bonds), dated Febmary 1 3, 1 997 (the "Bonds"), pursuant to Title 1 , Division 1 , Part 1 0, Chapter 2 of the California Education Code, commencing with Section 15100 (the "Act") and a resolution of the Board adopted January 14, 1 997 (the "Resolution"). We have examined the law and such certified proceedings and other papers as we deemed necessary to render this opinion.

As to questions of fact material to our opinion, we have relied upon representations of the Board contained in the Resolution and in the certified proceedings and certifications of public official sand others furnished to us without undertaking to verify the same by independent investigation.

Based upon the foregoing, we are of the opinion, under existing law, as follows:

1 . The District is a duly created and validly existing unified school district with the power to cause the Board to issue the Bonds on its behalf and to perform its obligations under the Resolution and the Bonds.

Board of Trustees Page 2 February B, 1997

2. The Resolµtion has been duly adopted by the Board and constitutes a valid and binding obligation of the District enforceable upon the District.

3 . The Bonds have been duly authorized, executed and delivered by the Board and are valid and binding general obligations of the District, and the Board is required under the Act to levy am ad valorem proprietary tax upon all the property in the District subject to taxation without limitation as to rate or amount, for the payment of principal of and interest on all outstanding bonds of the District, including the Bonds.

4. The interE'st on the Bonds is excluded from gross income for federal income tax purposes and is not an item of tax preference for purposes of the federal alternative minimum tax imposed on individuals and corporations; it should be noted, however, that, for the purpose of computing the alternative minimum tax imposed on corporations (as defined for federal income tax purposes), such interest is taken into account in determining certain income and earnings. The opinion set forth in the preo�ding sentence is subject to the condition that the District comply with all requirements of the· Internal Revenue Code of 1 986 that must be satisfied subsequent to the issuance of the Bonds in order that interest thereon be, or continue to be, excluded from gross income for federal income tax purposes. The District has covenanted to comply with each such requirement. Failure to comply with certain of such requirements may cause the inclusion of interest on the Bonds in gross income for federal income tax purposes to be retroactive to the date of issuance of the Bonds. We express no opinion regarding other federal tax consequences arising with respect to the Bonds.

5 . The interest on the Bonds is exempt from personal income taxation imposed by the State of California.

Thi? rights of the owners of the Bonds and the enforceability of the Bonds and the Resolution may be subject to bankruptcy, insolvency, reorganization, moratorium and other similar laws affecting creditors' rights heretofore or hereafter enacted and may also be subject to the exercise of judicial discretion in appropriate cases.

Respectfully submitted,

A Professional Law Corporation

.,._ .... ___ ,, ____ , _______________ ------------.. -----1-

---·· ···-·-·-···-----·------- ·------- _____ , ________ ......-... ....... , .. , ...

APPENDIX B

EXCERPTS FROM 1 995/96 AUDITED FINANCIAL STATEMENTS

B- 1

(THIS PAGE INTENTIONALLY LEFT BLANK)

GILBERT ACCOUNTANCY CORPORATION Cert1f1ed />ub/Jc Accountant.<

INDEPENDENT AUDITOR'S REPORT ON FINANCIAL STATEMENTS

Board of Education Cotati-Rohnert Park

Unified School District Rohnert Park, California

We have audited the accompanying general purpose financial statements of the Cotati-Rohnert Parle Unified School District as of and for the year ended June 30, 1996, as listed in the table of contents. These general purpose financial statements are the responsibility of the District's management. Our responsibility is to express an opinion on these general purpose financial statements based on our audit.

Except as discussed in the following paragraphs, we conducted our audit in accordance with generally accepted auditing standards and Govemme111 Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of mat.eria1 misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the general purpose financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

The District does not maintain a complete record of the historical cost of its fixed assets. Accordingly, the financial statements do not include the general fixed assets group of accounts, which should be included in order to conform with generally accepted auditing principles. The amount that should be recorded in the general fixed assets account group is not known.

Lack of certain internal control procedures and supporting records limits us to expressing an independent auditor's opinion on recorded transactions of the Student Body Funds.

In our opinion, except for the omission of a statement of general fixed assets and the effect on the fina."!cia! �tateme:1ts, if a."ly, � might have b�n determined to be neeess.ary had cash receipt records of the student body funds been susceptible to satisfactory audit tests, the general purpose financial slatements referred to above present fairly, in all material respects, the financial position of Cotati-Rohnert Park Unified School District at June 30, l 996, and the resuits of its operations in conformity with generally accepted accounting principles.

1760 CREEKSIDE OAKS DRIVE. SUITE 190. SACRAMENTO, CA 95833 • (916) 646-646<1 • FAX (916) 641 -2727

I

I I i I i i I I I I I I I I I

1 1 1 1

Board of :Education Cotati-Rohnert Park

Unified School District Page Two

!n acccrd�rice with Government Auditing Standards,, we have also issued a report daterl October i7, i996 on our consideration ot the Cotati-Rohnert Park Unified School District's internal control structure and a report dated October 17, 1996 on its compliance with laws and regulations.

)j.Jk. J �U#d PM', {!,,,, frl-� GILBERT ACCOUNT ANCY CORPORATION CERTIFIED PUBLIC ACCOUNTANTS

October 17, 1996

2

i l

Cash In County Treasury Cash on Hard and In Banks C8"h In Revolving Fund Accounls Receivable Due From �,er Fundl Sl0<e1 Inventor( - Supplies Slore-s Inventory � Food OU.er Assets Amount Avsllable In Debi Service Fund Amount lo be Provided ID< ReUrernent

ol General l ong-Term Dell!

Tolal Assets

l.!Afilill!fS AND FUND BALANCES.

Uabllrtles Accounts Poyable Deferred R1NenUe Due lo 0111<< Funds Due lo Student Groops Compensat,ed At,sences General Obligation - Payable Slate Schoc� Building Loans Payable Rellremenl Obligations Capita! LeaHe Obligations Other Llabilltles

Total Llabillto,o

Fund Equity: Fund Balance

Total Fund Equity l,l

T clal Llablllt,,o ond Fund Equity

$

Gen@rll

1,656,213 7,949 5,000

1 ,45-4, 1 60 69,790 36,806

56,500

3 288 218

644.<195 242,233

2,804

889,532

2 396 686

2 396 686

Cl<)TATI-ROHNERT PARK UNIFIED SCHOOL DISTRICT

COMBINED BALANCE SHEET ALL FUND TYPES ANO ACCOUNT GROUPS

JUNE 30, 1996

- Govern-I Fund Typn

Specb� -�!!L

499,1328 1 , '104

80,310

B,078

·----

s .��

92,049

67,068

159, 1 1 7

430501

Debi SOfVlce

$ 3,308,871

s 3 308 871 s

132664

132,664

3 176 207

3 1 76 207

Capital Projects

4,383.783 70,563

26,065

----4 480 41 1

698,994

28.763

727.757

3 752 654

3 752 654

Fiduciary Fund Typn

Trust and

Agency

367,303

1 ,864 2,604

371 991

38,318

24 187,616

225,956

1 46 033

1 46 033

3 288 218 s. 589 61 8 3 :IOI! 871 4 480 411 '-�37:,.:.1

.:;.99

;;,;1_

The notes lo •the ftnanclal slalemenls ore an Integral port of this atatemei�.

Account Groue

General Long-Term

Debt

3,1 76,207

50 872 424

54 048 1131

$ 1 59,862 52,329,618

83,322 1 ,425,954

49,875

54,048,631

0

54 048 631

Tolal (Memorandum OnM

1996 �-15-

10,215,798 18,747.272 79,616 1 57.515

5,000 5,000 1 ,536,854 1 ,203,858

98,659 526,192 36,606 :lS,266

8,076 6,387 56,500 115,245

3,176,207 3,3(18,870

50 872 424 52721 1 1 4

66 085 740 $ 76 797719

1 ,473,656 2.571,794 242,233 219,509

98,659 5:!6.192 167,616 1118,957 159,862 11 7,265

52,329,616 53,3114,618 83,322 122,282

1 ,425,954 3(18,947 49,875 2,0:IB,Bn

1 32 664 __ 1 116.844

56,183,659 59,6S3,280

9 902 (181 .....!L!:14 439

9 902 (181 .....!L!:14 439

66 085 7,4() $ 76797 719

- - - - - - - - - - - - - - - - -

.,:..

RE'ffi!\if!; R.....,,ue Umll SourcH

State Apportlonmonl LOC11I Sourcn

Tot•I R.venue Limit

Fedefwil Revenue OtMf Stat• Revenutt Other Loeail Rwenun

Tot1r l{ ..... nues

�[EJ; Cefilficllted S1l1riet Clalulfled 5<11lartes

EmployN I-Boob ind :su� Sonnen and Other Oporwllng E_.Jlturos Capitol Outlay Other Outgo Dlnc1 SUP1...Vlndl- c-Debt Sl9MC• Expendllur.

T.,._1 1!_.JlturN

C:OTATI-ROHNERT PARK UNIFIED SCHOOL DISTRICT

COMBINED STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES AU. GOVERNMENTAL FUND TYPES

s

FOR THE FISCAL YEAR ENDED JUNE 30, 1998

�l_

12,7911.014 1 3 008 1!!_

25.802.022

812,:!29 5,407,!1'13

�'!!.!... 33,570,,tOS

18.2911, 1511 3 .• 14,:!53 5,0l!e,!521 1 .081 ,!I« 3.2.3, 1 1 8

725,109 399,033 (51,092)

32 146 244

Govommomol Fund T>'P"

Spociol Dolll � �

98.872

96,872

333.819 1 1 • 568 s 81.171

__ 791 "311 3 ,2010

1.388.295 3,508,081

52,975 ,10,3111 15,1,,135 510,528 397,0()1

1 1 ,701 133

51 ,092 3 835 o103

� 3 1135 ol03

Capitol

$ 558 283

558,283

203,n5 n.1,111

132,7"8 200.362

7,896.818 12.271

8 523 521

Fklucillry Fund Tvpe

RetlrN -

e 191

8,191

12, 8118

Ex<MI al R- 0- (U-> ExpondN- 1 .,22, 181 (201.11111) (129,322) (7,965,2:le) (118.897)

OTHER FINANCING SOURCES (USES) C)pw.tlng 1 rt.nsferl In 3,342 197,000 718.219 1 1 1.IIOII �1ng r .. n.i.rs0ut (946,!!113) (3.3"42) (76,23"4) OUM, Sour1:;es Other u ... (2"8.282) -----

T ogi •:llhor Financing Soo� (UMI) ��.!.)_ � � � 1 1 1 ,808

Excess al R....,._ and Other 0- (Und<f) E>o....t•- and Other u- •78,810 , •. 981) (132,961) (7,57',535) (7,089)

Fund Boianc-1 - Jli/f 1 _L!.!!..U.!... � 3 308 871 1 1 327 189 153 122

FIM'd Belllnc.s - June lO 2 31111 81'9 ·� $ 3 1 711 207 S 3 752,IISI 146033

Totol (Memorandum Only)

1998 �-12,892,686 s 1 1 ,628,:lSO 13 006 008 _Bill.�

25.898.691 2•.851,719

1 . 195.1148 1 , 1 19,6114 5,603,280 •• 371 ,!571 8 329 •33 �!58

39.027,255 35,820,:3'2

18,322.133 1 7,3811,098 •• 028,389 3,880,3-49 5.423,1143 5,11141808 1 .12,.a20 1 .211.,3,4 3,840,"81 3,360, 181 8.831.028 14.075.247

,11 .,37 ,ss. 109 0

3 1135 403 ----46 020 332 •5 590 �

(8,993,077) (9,789,792)

1 ,028,189 1148,:298 (1,028.189) (148,296)

18,009,180 (249,282) (3,744, 123) ----(2•9,282) �067

(7.2•2.359) 2.•95.275

17 144 4'0 1• &49 IB..

9 902 08 1 ·�2-

Thfl ,v,,t- tr, thtt �ri•nri•I '11111� •'• •n lrrt*Qnll f)llllrt � thl'I !d1tt•mflflt ,, ,11t,.l)'t" J1'8:·----·-11•-----·----------------·-------------····-------·111••••••••��

COTATi�ROHNERT PARK UNiFiEO SCHOOL OiSTRiCT I COTATI-ROHNEF>T PARK UNIFIEO SCHOOL DISTRICT

COM81N!NG STATEMENi or REVENUES, EX?ENUi7URES, AND CHANGES iN fUNO BALANCE COUB!M�� STATE�.-,ENT OF REVENUES, c.X?EniuiTURtS, ANO CHANGES IN FUND BALANCE euoea::T &tJn .a.rTI IAI _ .A l f r;, .... ��R1.1••eU'l"AI r-10.1" "P"Vft£S BUDGET ANO ACTUAL - ALL GOVERNMENTAL FUNO TYPES

FOR THE FISCAL YEAR ENDED JUNE 30. 11196 I FOR THE FISCAL YEAR ENDED JUNE 30, 1996 P e 1 012 1'1 e 2 o1 ;

General Fund S2!'1ial Re...enue Fund& • Uel:JI Servk:e Funds Caertal P� Funds 1/arianCe Vanance I vanance Vanance F•vorable FIIVCJnlble F.....,._ F"""'111,1e

Actual iun,.......,blel B!:!\!ll!! Actual 1unr1vorable) Bud� Actual !UnlavonibleJ Bud51!! Actual (Unlmnb!<

� l �Lmlt -R..,..,... Lmlt Sauranl: Sl8te AJ>panjonn'lonl $ 12,308,079 $ 12,798,014 $ 487,935 s 114,848 $ 96,672 s 1,824 - Apportlonn10nl local SouR>eo 1 3 469 886 1 3 008 008 (463 878) I local Scll'cea

Tcul R.......,.Lmlt 25,717,965 25,802,022 24.057 114,848 1111,872 1 ,824 Total R--... Urnit

F-..i R--... 978,1149 812,229 (166,720) 375.321 383,819 8,298 I F- R-. Other Sia R- 5.552.741 5,407.543 (145,198) 1 1 3,967 11 4,566 599 Olher 5- R- s 0 $ 81,171 $ 81,171 Other local R- 1 4811 772 1 548 61 1 59 839 766 879 791 438 24559 Other local R...,.._ 2 807 904 3 424 910 617 006 $ 541 000 $ 558,283 $�

Total � 33,798,427 33,570,405 (228,022) 1,351,015 1 ,386,295 35.280 Tcul R-.ues 2.807,904 3,506,081 698,177 541.000 558,283 17.2E

EXPl;tltllil!Bl;S I EXPE@ITUBES

Certifated Sal8riH 1 8,$46,994 1 8,269,158 77,836 55,167 52,975 2,212 �--�led - 3,414,511 3,414,253 258 407,733 410,361 (2.628)

' I Cluslfled Suirioo 203.ns 203,775

EfflP'l'/98 8lneflta 5,163.441 5,066,521 96,920 158,370 154,485 1.885 Emploj,oe � 77,531 77,749 (21 --SuppllN 1 ,-493,275 1,081,544 41 1,731 520,087 510,528 11,559 Boolca hi Supplil8 135,219 132,748 2.47 � hi Other Opwldklg - - Other Opontlng

e.-- 3.4n.ses 3,243.118 229.477 <167,160 397,001 70,159 I � 208,503 200,362 8.14 Capllal Odley 995,035 725,709 269,326 12.109 11 ,701 408 CIIPbl Oulr.y 7,931,455 7,896,818 34,6:l Othlr O.., 3117.129 3911,033 (1,904) 3,,468 133 3,335 OthorO.. 1111,983 12,271 84,71: Onct � Colb C51 ,335) C51,(lll2) (243) 48,000 51.IJD2 (3,092) Dncl SupportllndlrKt Com Debl s..ic. � Debi s.,..,. � 0 3 835 403 (3 635 403)

Tcul ElcpenclUN 33 231 645 32 148,£44 1 083401 1 670 1 1 4 1 5882!6 81 838 I T0181 �- 0 3 635 403 (3 635 403) 8 851 466 8 523 521 1 27 �

Eiaa al R_._ Over e- ar R_._ Over

(Unmr) � 5615,782 1 ,422,161 855.379 (3111,099) (201 ,981) 117,118 ' I (Under) � 2.807,904 (129,322) (2.937 ,226) (8.11 0,466) (7 ,965,238) 145,22!

OTHER FINANCING SOURCES (USES) OTHER FINANCING SOURCES (USES) 0ponang T...- 111 3.342 3.342 0 11JT,000 11JT,OOO 0 Oponllng T- In 704,9a5 716,219 1 1 .23-Ope,.ung T- Oul (1148,SQJ) (948,SQJ) 0 I Oponllng T- Ou! 0 (3,342) (3,342) 0 (76,234) (76,23-octw s.i..m. Othlr Sourca Ollw U.. Other U.. (3 635 403) 0 3 1535 403 (223000) (249 282) ('26 28:

Tolll Olher Firw,cing Sourcee (u..) �251) �251) 0 1 1JT OOO 197000 0 Tollil Olher Financing Sources (Uoes) (3 635 403) (3342) 3_,lm,_Ofil_ _ 481 ,� _390,703 (91,28:

e- al R-..- hi Other I Exceu al R-.... - Other so,,,,,.a Over �) So1.n:ea Over (Uncle<) � - Olher U.. (378,469) "715,910 855.379 (122,099) (4,1181) 117,118 �a - other Uses (827,499) (132,e&c) 594,835 (7,828,41!1) (7.574,535) 53.941

Ftn! - - "°1 1 1 9111 776 1 .!!111776 0 435 <482 435 482 0 I Ftnl l!Mncool - "'t 1 3 308 871 3 308 871 0 1 1 327 189 1 1 .327 1 89

Ftn1 - - Juno 30 s 1 541,307 $ 2 396.!!!!. $ 855 379 s 313 383 s 430 501 s 1 17 1 18 Finl -- June 30 s 2.481 372 s 3,1 76,207 s 694 835 s -- �698,708 s �752.1154 s _53.941

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The ncln lo the finoncial -- are an Integral part of thio slalement. 5 The notes lo the linonclal -ements are an integral part of lhi15 otatement 6

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COTATI-ROHNERT PARK UNIFIED SCHOOL DISTRICT

NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS

FOR THE FISCAL YEAR El\TJJED JUNE 30, 1996

SIGNIFICANT ACCOUNTING POLICIES

A. ACCOUNTING POLICIES

B.

C.

The Cotati-Rohnert Park Unified School District (the District) accounts for its financial transactions in accordance with the policies and procedures of the Department of Education 's California School Accounting Manual. The accounting policies of the District conform wiih genernliy accepted accounting principles as prescribed by the Governmental Accounting Standards Board (GASB) and the American Institute of Certified Public Accountants.

REPORTING ENTITY

Cotati-Rohnert Park Unified School District has reviewed criteria to determine whether other entities with activities that benefit the District should be included within its financial reporting entity. The criteria include, but are not limited to, whether the entity exercises oversight responsibility (which includes financial interdependency , selection of governing authority, designation of management, ability to significantly influence operations and accountability for fiscal matters), the scope of public service and a special financing relationship.

The District has determined that no other outside eniiiy meets the above criteria, and therefore, no agency has been included as a component unit in the District's financial statements. in addition, the District is not aware of aJ1y entity that would exercise such oversight responsibility that would result in the District being considered a component unit of that entity.

DESCRIPTION OF FUNDS AND ACCOUNT GROUPS

The accounts of the District are organized on the basis of funds or account groups, each of which is considered to be a separate accounting entity. The operations of each fund are accounted for with a separate set of self-balancing accounts that comprise its assets, liabilities, fund equity, revenues, and expenditures or expenses, as appropriate. District resources are allocated to and accounted for in individual funds based upon the purpose for which they are to be spent and the means by which spending activities are controlled. The District's accounts are organized into three broad categories which in aggregate include six fund types and two account groups as follows:

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COTATI-ROHNERT PARK UNIFIED SCHOOL DISTRICT

NOTES TO GENERAL PURPOSE HNANC!AL STATEMENTS - CONTINUED

FOR THE FISCAL YEAR ENDED JUNE 30, 1996

SIGNIFICANT ACCOUNTING POLICIES (Continued)

C . DESCRiPT10N OF FUNDS AND ACCOUi�'T GROUPS (Con t inued)

Governmental Funds:

The General Fund is the primary operating fund of the District. It is used to account for all financial resources except those required to be accounted for in another fund.

The Special Revenue Funds are used to account for the proceeds of specific revenue sources that are legally restricted to expenditures for specific purposes. The District maintains three special revenue funds:

1 . The Adult Education Fund i s used to account for resources committed to adult education programs maintained by the District.

2 . The Cafeteria Fund i s used to account for revenues received and expenditures made to operate the District' s cafeterias.

3. The Deferred Maintenance Fund is used for the purpose of major repair or replacement of District property.

The Debt Service Funds are used to account for the accumulation of resources for, and the payment of general long-term debt principal , interest and related costs. The District maintains one debt service funds.

The Bond Interest and Redemption Fund is used to account for the accumulation of resources for, and the repayment of, district bonds, interest, and related costs.

The Capital Projects Funds are used to account for the acquisition and/or construction of all major governmental general fixed assets. The District maintains four capital projects funds:

! . The Building Fund i s used to account for the acquisition of major governmental capital facilities and buildings from the sale of bond proceeds.

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COTATI-ROHNERT PAR.JC UNIFIED SCHOOL DISTRICT

NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS - CONTINUED

FOR THE FISCAL YEAR ENDED JUNE 30, 1996

SIGNIFICAI'IT ACCOUNTING POLICIES (Continued)

C. DESCRIPTION OF FUNDS AND ACCOUNT GROUP(S) (Continued)

2 . The Capital Facilities Fund i s used to account for resources received from developer impact fees assessed under provisions of AB2926.

3. The State School Building Lease-Purchase Fund is used to account for state apportionments provided for construction and reconstruction of school facilities. (Education Code Section 1 7700 - 17780)

4 . The Special Reserve Fund is used to account for capital outlay and related expenses.

Fiduciary Funds

Fiduciary funds account for assets held by the District in a trustee capacity or as an agent on behalf of others. Trust funds account for assets held by the District under the terms of a formal trust agreement. The District maintains one expendable trust fund, the Retiree Benefits Fund, which is used to account separately for restricted monies from salary reduction agreements and post­employment benefits.

Agency Funds are used to account for assets of others for which the District acts as an agent. The District maintains student body accounts, the purpose of which is to account for the raising and expending of money to promote the general welfare, morale and educational experience of the student body. The amounts reported for student body funds represent the combined totals of all accounts regarding the various student body clubs and activities of all schools within the District.

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COTATI-ROHN"ERT PARK UNIFIED SCHOOL DISTRICT

NOT"'....S TO GENERAL PURPOSE FINANCiAL STATEMENTS - cm·mNUED

FOR THE FISCAL YEAR El'l'DED JUNE 30, 1996

SIGNIFICANT ACCOUNTING POLICIES (Continued)

C. DESCRIPTION OF FUNDS AND ACCOUNT GROUP(S) (Concluded)

D.

Accounr Group

The accounting and reporting treatment applied to the long-term liabilities associated with a fund are determined by its measurement focus. All governmental funds and expendable trust funds are accounted for on a spending or "financial flow" measurement focus. This means that only current assets and current liabilities are generally included on their balance sheet. Their reported fund balance is considered a measure of "available spendable resources··. Thus, the long-term liabilities associated with governmental funds and expendable trust funds are accounted for in the account groups of the District.

The General Long-Tenn Debt Account Group accounts for long-term liabilities expected to be financed from governmental funds.

BASIS OF ACCOUNTING

Basis of accounting refers to when revenues and expenditures or expenses are recognized in the accounts and reported in the financial statements. Basis of accounting relates to the timing of measurement made, regardless of the measurement focus applied.

Governmental funds are generally accounted for using the modified accrual basis of accounting. Their revenues are recognized in the accounting period in which they become both measurable and available to finance expenditures of the current fiscal period. "Measurable" means the amount of the transaction can be determined and "available" means collectible within the current period or soon enough thereafter to pay liabilities of the current period. Expenditures are recognized in the accounting period in which the liability is incurred (when goods are received or services rendered) except for unmatured interest on general long-term debt which is recognized when due.

Trust and agency fund assets and liabilities are also accounted for on the modified accrual basis.

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COTATI-ROHNERT PARK UNIFIED SCHOOL DISTRICT

NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS - CON-flN-UED

FOR THE FISCAL YEAR ENDED JUNE 30, 1996

SIGNIFICANT ACCOUNTING POLICIES (Continued)

E. BUDGETS AND BUDGETARY ACCOUN!ING

Annual budgets are adopted on a basis consistent with generally accepted accounting principles for all governmental funds.

By state law, the District ' s governing beard must approve a final budget no later than July I . A public hearing must be conducted to receive comments prior to adoption. The District ' s governing board satisfied these requirements.

These budgets are revised by the District ' s governing board and District superintendent during the year to give consideration to unanticipated revenue and expenditures. The final revised budgets are presented in the general purpose financial statements.

F. ENCUMBRANCES

Encumbrance accounting is used in all budgeted funds to reserve portions of applicable appropriations for which commitments have been made. Encumbrances are recorded for purchase orders, contracts, and other commitments when they are written . Encumbrances are liquidated �w·hen the commitments are paid and a.ny outstanding encumbrances at June 30 lapse.

G . INVENTORIES

Inventory is recorded using the purchase method in that the cost is recorded as an expenditure at the time individual inventory items are purchased. Inventory in the general and cafeteria funds is valued at average cost and consists of expendable supplies held for consumption. Reported inventories are equally offset by a fund balance reserve which indicates that these amounts are not "available for appropriation and expenditure" even though they are a component of net current assets.

H. DEFERRED REVENUE

The District received funds for certain programs for which qualifying expenditures have not yet been made resulting in revenue that cannot be recognized until such expenditures are incurred.

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COTATI-ROHNERT PARK UNIFIED SCHOOL DISTRICT

NOTES TO GEf'r-tRAL PURPOSE FH{ANCIAL STATEI\fENTS . cor�LJNUED

FOR THE FISCAL YEAR ENDED JUNE 30, 1996

SIG1''1FICANT ACCOUNTING POLICIES (Concluded)

1 . COfviPENSATED ABSENCES

Accumulated w,paid employee vacation benefits are recognized as liabilities of the District. The liabilities are recognized in the general long-term debt account group.

Accumulated sick leave benefits are not recognized as liabilities of the District. The District ' s policy is to record sick leave as an operating expense in the period taken since such benefits do not vest nor is payment probable; however, unused sick leave is added to the creditable service period for calculation of retirement benefits when the employee retires for STRS and PERS employees hired prior to July I , 1980.

J . FUND BALANCE RESERVES AND DESIGNATIONS

Reservations of the ending fund balance indicate the portions of fund balance not appropriable for expenditure or amounts legally segregated for a specific future use. These amounts are not available for appropriation and expenditure at the balance sheet date. Designations of the ending fund balance indicate tentative plans for financial resource utilization in a future period.

K. PROPERTY TAX

Secured property taxes attach as an enforceable lien on property as of March 1 . Taxes are payable in two installments on November 1 5 and March 15 . Unsecured property taxes are payable in one installment on or before August 3 1 . The District receives the tax revenues for the applicable counties within their boundaries. Each county bills and collects the taxes for the District. Tax revenues are recognized by the District when received.

L. TOTAL COLUMNS AND COMBINED STATEMENTS

Total columns on the Combined Statements are captioned "Memorandum Only" to indicate that they are presented only to facilitate financial analysis. Data in these columns do not present financial position, results of operations, or changes in financial position in conformity with generally accepted accounting principles. Neither is such data comparable to a consolidation. Interfund eliminations have not been made in the aggregation of this data.

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COTATI-ROHNERT PARK UNIFIED SCHOOL DISTRICT

NOTES TO GENERAL PURPOSE FINANCIAL STATE..ME..-,.,.'TS - CONTINUED

FOR THE FISCAL YEAR ENDED JUNE 30, 1996

EXCESS OF EXPENDITURES OVER APPROPRIATIONS

Excesses of expenditures over appropriations by object in individual funds are as follows:

FJlllds.

General: Other Outgo Direct Support

Building Fund: Classified Salaries Employee Benefits Capital Outlay

Special Reserve Fund: Services, Other Operating Expenses

Cafeteria Fund: Classified Salaries Employee Benefits

Deferred Maintenance Fund: Services, Other Operating Expenditures

Retiree Benefits Trust: Employee Benefits

CASH AND n,.,'VESTMENTS

Autbocizc.d Deposits{Iaves1roea1s

Excess Expendiblres

$ 1,904 243

1 218

3,5 18

1 ,800

2,629 l,258

8,970

3,183

In accordance with F.ducation Code Section 41001, the District maintains substantially all of its cash �ith the Sonoma County Treasurer. The county pools U'iese funds w·iui thos.e of other districts in the county and invests the cash. These pooled funds are carried at cost which approximates market value. Any investment losses are proportionately shared by all ftmds in lhe pool. The County may invest in accordance with Section 53601 and 53635 of the California Government Code:

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CO�ATI-ROHNERT ?ARK U�lFIED SCHOOL DiS'fRiCT

NOTES TO GEi'.i"ERAL PURPOSE FINANCIAL STATEME!'.'TS - COJ\'TINUED

FOR TtIE FiSCAL YEAR El'IDED JUNE 30, 1996

CASH AND INVESTMENTS (Concluded)

Authorized Dcposjtsllnvcstrocots (Concluded)

Local agency bonds, notes or warrants within the state United States Treasury instruments Registered state warrants or treasury notes Securities of the U.S. Government, or its agencies Bankers acceptances Commercial paper Certificates of deposit (or time deposits) placed with commercial banks and/or savings and loan companies Repurchase or reverse repurchase agreements Medium term corporate notes Shares of beneficial interest issued by diversified management companies Certificates of participation Obligations with first priority security Collateralized mortgage obligations

Credit Risk Carrying Ammmt and Market Yalne

Investment in pools managed by other governments or in mutual funds are not required to be categorized.

Deposits held in banks are fully insured by the Federal Depository Insurance Corporation or collateralized with securities held by the banks.

Derivative Jovestments

The District did not directly enter into any derivative investments.

The County does not enter into transactions involving derivative investments.

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COTATI-ROHNERT PARK UNIFIED SCHOOL DISTRICT

NOTF.s TO GENERAL PURPOSE FINANCIAL STATEMENTS · CO!','TJI\'UED

FOR THE FISCAL YEAR ENDED JUNE 30, 1996

INTERFUND TRANSACTIONS

lnterfund Receivables/Payables (Due To/Due From)

Individual fund interfund receivable and payable balances at June 30, 1 996, are as follows:

Interfund Interfund Fund Receivahlcs Parah!e�

General Fund $ 69,790 $ 2,804 Building Fund 14,828 1 3,935 Cafeteria Fund 62,94 1 Adult Education Fund 4 , 127 Retiree Benefits Fund 2,804 24 Developer Fees 1 1 ,234 14,828

Total $ 26 fil2 $ 98.659

Interfund receivables and payables are paid and cleared in the subsequent period.

BONDED DEBT

The outstanding bonded debt of Cotati-Rohnert Park Unified School District at June 30, 1996 is:

Amount Redeemed Date of Interest Maturity Of Original Outstanding Current Outstanding

---RalLL ---1alL._ � Juh..l..l2'lj � Jui., 3CL1926.

1973 S.75 1998 s 390,CXXl S 75,CXXl S 15,CXXl S 60,CXXl 1978 S.29 1998 1,885,CXXl 300,CXXl 100,CXXl 200,CXXl 1993 5.00 • 8.00 2018 1 1,CXXl,CXXl 1 1 ,CXXl,<XXl 215,CXXl 10. 785,<XXJ 1993 2.75 - 5.00 2010 26, 990,<XXl 25,915,CXXl 725,00J 25, 190,00J 1994 5.25 • 6.00 2003 4,895,CXXl 4,895.000 0 4.895.CXXl 1994 6.05 • 6.30 2005 3,199,618 3,199,618 0 3,199,618 1994 5.00 - 9.00 2019 8,CXXl,000 J.OOllm ____Q 8. CXXl.!XX)

S 53 384 618 S I 055 000 S 52.329..618

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COTATI-ROHNERT PARK UNIFIED SCHOOL DISTRICT

NOTIS TO GENERAL PURPOSE FINANCIAL STATEMENTS - CONTINUED

FOR THE FISCAL YEAR ENDED JUNE 30, 1 996

BONDED DEBT (Concluded)

l ne annuai pnnctpie requirements to amortize generai obiigaiion bonds payable, outstanding as of June 30, 1996 are as fol lows:

Year Ended lune.JO_

1997 1998 1999 2(XX) 2001

Thereafter

Total

STATE AND PUBLIC SCHOOL BUILDING LOANS

$ 1 ,270,000 1 ,3 15,000 1 ,405,000 1 ,607, 179 1 ,728,1 13

45 QQ4 326

$ 52 329 6]8

The El Colegio facility was constructed from State School Building Loan Funds. The facility is used and maintained exclusively by the Sonoma County Office of Education and they reimburse the District for payments made to the state. The property became the District's property after the final payment in 1995-96.

The State Public School Building Loans are secured by all sites purchased and improved, all equipment purchased, and all buildings constructed, reconstructed , altered , or added to through the expenditures of such funds in accordance with Education Code Section 1 6019.

Annual repayment is determined by the State Controller in accordance with Education Code Section 162 14 .

The District qualified under Section 16 196 of the Education Code which provides for a 50% reduction of the annual loan repayment if more than 50% of the pupils attending facilities built for the use of the physically handicapped are from residences other than the applicant district. Accordingly, the District paid $22,850 to the state, which is half of the required payment of $45,699. Also, the Sonoma County Office of Education reimburses the District for this payment accordingly to their agreement.

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COTATI-ROHNERT PARK UNIFIED SCHOOL DISTRICT

NOTES TO GENERAL PURPOSE FINANCIAL ST A TEMENTS - CONTINUED

FOR THE FISCAL YEAR ENDED JUNE 30, 1 996

STATt; A.ND PUBLIC SCHOOL BUILDING WANS (Concluded)

State school building loans outstanding as of June 30, 1 996 are as follows:

Y�r Interest Balance Interest Repayment

Pisbuaed Rate ! July l 1995 Charrc CuWint Yrar

1976-77 5.6 $ 15,651 $ 877 1976-77 5.5 98, 148 5 ,397 $ 45,699 1977-78 5.S 8,045 443

1977-78 5 . 1 - �"38 _22

Total $ 122 282 $ 6 1J9 $ �5 699

LEASES

A. CAPITAL LEASES

Outstanding

Jun• 30 1996

$ 16,528 57,846

8,488 A60

s _83..122

The District has entered into various leases for equipment that have been capitalized and recorded as long-term debt. Future minimum lease payments are as follows:

Year Ending June 3Q J>avment

1997 $ 23,385 1998 1 8,n7 1999 10,002

2000 1 ,933 2001 _l.611

Total 55,708

Less Amount Representing Interest (5 833)

Present Value of Net Minimum Lease Payments $ __ 49.815

The District did not receive sublease rental revenues or any contingent rentals for this equipment.

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COTATI-ROHNERT PARK U?>.l:FIED SCHOOL DISTRICT

NOTES TO GENERAL PURPOSE FINANCiAL STATEMENTS - CONTINUED

FOR THE FISCAL YEAR ENDED JUNE 30, 1996

LEASES (Concluded)

B. OPERA TING LEASES

The District has entered into various operating leases for (land, buildings, and equipment) with lease terms in excess of one year. The amount of rental expenditures during the year were $ 1 18 ,572. None of these agreements contain purchase options. All the agreements contain a termination clause providing for cancellation after a specified number of days written notice to lessors but it is unlikely that the District will cancel any of the agreements prior to the expiration date. Future minimum lease payments under these agreements are as follows:

Year Ending Lease Juo.e.3Q__ Payment

1997 $ 1 1 8,572 1998 1 18,572 1999 1 18,572 2000 1 18 ,572 2001 g 852

Total $ ___A8.1.__l 4Q

The District did not receive sublease rental revenues or pay any contingent rentals for these properties.

RETIREMENT OBLIGATIONS

A. EARLY RETIREMENT INCENTIVE PROGRAM (ERIP)

The Board of Education has adopted an early retirement incentive program. The District has entered into a contract with certain eligible employees whereby 30 service days per year will be performed <lu!'!ng !he fo!'Jre five j'e8:" period or age 65, whatt:we1 comes first, for a stipulated yearly amount plus employee benefits. This liability is contingent upon the employees performing the required service days per year. During the year, expenditures of $98,450 were recognized under this program. $

Balance at Jun: JO ]'!16

82,350

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COTATI-ROHNERT PARK UNIFIED SCHOOL DISTRICT

NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS - CONTIW.JED

FOR THE FISCAL YEAR ENDED JUNE 30, 1 996

RETIREMENT OBLIGATIONS (Concludro)

B. PUBLIC AGENCY RETIREMENT SYSTEM (PARS)­SUPPLEMENTARY RETIREMENT PLAN

c.

D.

The Board of Education offered an early retirement program in 1995-%. The program was designed by PARS. In order to be eligible, the employee had to be eligible to retire under STRS at June 30, 19%, was a permanent employee as of March 15 , 19%, and had at least ten (10) years of District service. The eligible employee was then able to receive an additional year of salary over an employee selected payment plan. No payments were made during the year.

GOLDEN HANDSHAKE

The Board of Education has annually approved early retirement through the Golden Handshake provision. During the year, expendirures of $69,942 were recognized.

RETIREE H EAL TH BENEFITS

In addition to pension benefits described in Note i4, ihe Districi provides postretirement health care benefits to all employees wt.o retire from t.�e Distric! on or after attairijng age 55

with at least 15 years of service. On June 30, 19%, 40 retirees met these eligibility requirements. Benefits are provided for retirees age fifty-five (55) to sixty-five (65). The District pays up to $145.90 per month for health benefits of retirees on a pay as you go basis. During the year, expendirures of $53,596 were recognized for postretirement health care. The liability at June 30, 19% is based on the estimated lives of participants.

Total Retiree Obligations

Balance at Jure ,n i996

$ 742,302

233,079

36.8..lli

S I 425 954

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COTATI-ROH.SERT PARK UNIFIED SCHOOL DISTRICT

NOTES TO GEl\'ERAL PURPOSE FINANCIAL STATEMENTS - CONTINUED

FOR THE FISCAL YEAR ENDED JUNE 30, 1 996

GENERAL LONG-TERM DEBT - SCHEDULE Of CHANGES

A scheduie of changes m iong-ierm debt for the year ended June 30 . 1996 1s st1l•wn belov. .

Balance Balance July I 1995 Additions Derluc::tiooc.: Juop 30 1996

General Obhgation Bonds $ 53 ,384,6 1 8 s 1 ,055,000 $ 52.329,6 18

State School Building Loans 122,282 s 6,739 45.699 83.322

Capital Leases 2,038,872 221 ,057 2 .2 10.054 49.875

Compensated Absences 1 17.265 42,267 159,862

Retirement Obligations 3fir:i 242 1 :mi 22s 2Zl 968 1.425.9_5_4

Total $ 56 029 984 s l SSl 058 $ 3 493 041 $ 54.048-..fill

FUND BALANCE

Following is a summary of the components of the ending fund balance by fund type at June 30, 1996:

F.ducwy t"�t,mm,a1i111 fund IxRa

Spec di Debi Cap,u.l Tru.t ••.d � Jmi«..... -1'Il!itill- � _JolAL

Reserved Amour.ts s 383,400 s 8,076 s 391 .476

Designated Amounts 1,397.294 S 3 , 176.207 s 207,902 4,781 ,403

Unde1ignated Amount � _m.ill --- � s .J.4MJJ 4.1:Ull2

To<al S 2 396 686 s � s 3 ]76 '91 s 3 m 654 s 146 033 $ 9 902 08)

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COTATI-ROHNERT PARK UNIFIED SCHOOL DISTRICT

NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS - CONTINUED

FOR THE FISCAL YEAR ENDED JUNE 30, 1 996

11. JOINT VENTURE

The Cotati-Rohnert Park Unified School District participates in two joint ventures under a joint powers agreement (IPA) with Schools Excess Liability Fund (SELF) and Redwood Empire Schools' Insurance Group (RESIG) and a trust agreement with the Sonoma County Health and Welfare Benefit Fund (frust). The relationship between the Cotati-Rohnert Park Unified School District and the entities are such that they are not a component unit of the Cotati-Rohnert Park Unified School District for financial reporting purposes.

SELF and RESIG arrange for and provide excess and primary coverage property, liability and workers' compensation insurance for its members up to their respective self-insured retention (SIR). The JPA is governed by a board consisting of a representative from each member district. The board controls the operations of the JPA , including selection of management and approval of operating budgets, independent of any influence by the member districts beyond their representation on the board. Each member district is obligated to pay an amount commensurate with the level of coverage requested and may be subject to assessments and receipt of dividends.

Sonoma County Health and Welfare Benefit Fund - The Trust provides eligible participants with medical, dental, vision and life insurance coverage. The Trust is an agreement between all employees and the Cotati-Rohnert Park Unified School District. The District is required to make contributions to the plan as an employee benefit.

NATURE OF PARTICIPATION

1 .

2.

3.

Workers' Compensation

JPA's (SIR): $ 350,000 Excess Insurance: $ 10,000,000 with SELF

Liability

District Deductible: $ 1 ,000 JPA's SIR: $ 100,000 Excess Insurance: $ 14,000,000 with SELF

Property

District Deductible: $ 3 ,000 JPA's SIR: $ 100,000 Excess Insurance: Replacement coverage with Coregis

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COTATI�ROE�'ERT ?.:.. .. RK U!\:"FIED SCH0GL D1S "i"RICT

NOTES TO GEi'l"ERAL PURPOSE FINANCIAL STATEMENTS - COI\'TINUED

FOR THE FISCAL YEAR ENDED JUNE 30, 1 996

1 1 . JOINT VENTURE (Concluded)

NATURE OF PARTICIPATION (Concluded)

Condensed financial information of the JPA for the year ended June 30, 1 996 is as follows:

Total Assets

Total Liabilities Retained Earnings

Total Revenues Total Expenditures

Net Increase/(Decrease) in Retained Earnings

12. RISK MANAGEMENT

SELF RESIG Trust {Audited} fAnditfdl {Unaudited}

$ l ) ti 478 889 $ 13 751 527 S ----50!L650

$ 74,746,785 $ 1 1 , 160,522 $ 92,000 41 732 104 2 591 005 417 650

$ l! 6 478 889 $ 13 751 527 $ �_.650

$ 1 6,879,761 $ 8, 144,636 $ 2,915,835 JO 243 077 8 232 729 2 958 )66

$ 6 636 684 $ (88 023) $ (42 33])

The District is exposed to various risks of loss related to theft of, damage to, and destruction of assets; errors and omissions; injuries to employees; and natural disasters. During the fiscal year 1996, the District participated in three entities for purposes of pooling of risk. See "Joint Ventures" footnote for nature of participation .

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COTATI-ROHNERT PARK UNIFIED SCHOOL DISTRICT

NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS - co:NTIN"1JED

FOR THE FISCAL YEAR ENDED JUNE 30, 1996

13 . COMMIThfENTS AND CONTINGENCIES

STATE AND FEDERAL ALLOWANCES, AWARDS, AND GRANTS

The District has received state and federal funds for specific purposes that are subject to review and audit by the grantor agencies. Although such audits could generate expenditure disallowances under terms of the grants, it is believed that any required reimbursement will not be material.

14. EMPLOYEE RETIREMENT SYSTEMS

Qualified employees are covered under multiple-employer defined benefit pension plans maintained by agencies of the State of California. Certificated employees are members of the State Teachers' Retirement System, and classified employees are members of the Public Employees' Retirement System.

PJan Description and Provisions

Stare Teachers ' Retirement System (STRS)

All full-time certificated employees participate in STRS, a cost-sharing multiple-employer contributory public employee retirement system. At June 30, 1996, the District employed 394 certificated empioyees wiih a iota! payroll of $ 1 5 ,884,398.

Employees attaining the age of 60 with 5 years of credited California Service (service) are eligible for normal retirement and are entitled to a monthly benefit of 2 percent of their final compensation for each year of service. Final compensation is defined as the average salary eamable for the highest three consecutive years of service. The plan permits early retirement options at age 55 or as early as age 50 with 30 years of service. Disability benefits of up to 90 percent of final compensation are available to members with 5 years of service. A family benefit is available if the deceased member had at least one year of service. After five years of credited service, members become 100 percent vested in retirement benefits earned to date. If a member' s employment is terminated, the accumulated member contributions are refundable. The current rate of interest credited to members' accounts is 6.0 percent per annum.

Benefit provisions for STRS are established by the State Teachers' Retirement Law (Part 13 of the California Education Code, Section 22000 et seq.) .

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NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS - CONTIWLiED

FOR THE FISCAL YEAR ENDED JUNE 30, 1996

1 4 . EMPLOYEE RETIREMENT SYSTEMS (Continued)

Piao Description and Provisions (Continued)

California Public Employees Retirement System (PERS)

All full-time classified employees participate in PERS , an agent multiple-employer contributory public employee retirement system that acts as a common investment a.'1d administrative agent for participating public entities within the State of California. The Cotati-Rohnert Park Unified School District is part of a "cost-sharing" pool within PERS . One actuarial valuation is performed for local miscellaneous employees of those employers participating in the pool, and the same contribution rate applies to each. The assets and l iabilities refer to the pool as a whole. At June 30, 1996, the District employed 2 1 4 classified emplovees with a total payroll of $3, 284,445.

Employees are eligihle for retirement at the age of 60 and are entitled to a monthly benefit of 2 percent of final compensation for each year of service credit. Retirement compensation is reduced if the plan is coordinated with Social Security. Retirement may begin at age 50 with a reduced benefit rate, or after 60 to 63 with an increased rate. The plan also provides death and disability benefits. Retirement benefits fully vest after 5 years of credited service. Upon separation from the District, members' accumulated contributions are refundable with interest credited through the date of sepa.ration.

Benefit provisions for PERS are established by !he Public Employees Retirement Law (Part 3 of the California Government Code, Section 20000 et seq . ) .

Funding Status and Progress of1he Retirement Plans

The "pension benefit obligation" reported below is a standardized disclosure of the present value of pension benefits adjusted for the effects of projected salary increases and any step­rate benefits estimated to be payable in the future as a result of employee service to date. The measure is the actuarial present value of credited projected benefits and is intended to help users assess the retirement plans ' funding status on a going-concern basis, assess progress made in accumulating sufficient assets to pay benefits when due, and make comparisons among retirement systems and employers. The measure is independent of the funding method used to determine contributions to the retirement systems.

The pension benefit obligation for STRS was computed as part of the actuarial valuation performed June 30, 1995. The significant actuarial assumptions used by STRS to compute the June 30, J 995 actuarial valuation are. different from those applied in prior years.

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14.

COTATI-ROHNERT PARK UNIFIED SCHOOL DISTRICT

NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS - CONT!!'s'UED

FOR THE FISCAL YEAR ENDED JUNE 30, 1996

EMPWYEE RETffiEMEl','T SYSTEMS (Continued)

Piao Pescriprjon and Provisions (Continued)

Funding S101us and Progress of 1he Retirement Plans (Concluded)

The assumed Jong-term investment yield is 8.00 percent, and the assumed long-term salary increase assumption for inflation is 5.50 percent. The normal cost rate is 1 6.07 percent of covered payroll and the 1 8 year amortization rate for the unfunded actuarial obligation is 4.53 percent. Member and employer contribution rates are set by law and are not affected by the changed assumptions.

Under current law the pension benefit obligation for STRS is not the responsibility of the District. The State of California makes annual contributions to STRS toward the unfunded obligation. The pension benefit obligation for STRS is included in the financial statements for STRS and the State of California.

PERS uses the Entry Age Normal Actuarial Cost Method which is a projected benefit cost method. That is, it takes into account those benefits that are expected to be earned in the future as well as those already accroed. According to this cost method, the normal cost for an employee is the level amount which would fund the projected benefit if it were paid annually from date of employment until retirement. PERS uses a modification of the Entry Age Cost Method in which the employer's percentage of payroll method to amortize any unfunded actuarial liabilities. The amortization period of the unfunded actuarial liability ends on June 30, 201 1 .

The significant actuarial assumptions used to compute the actuarially determined contribution requirement are the same as those used to compute the pension benefit obligation.

The pension benefit obligation for PERS was computed as part of actuarial valuation performed June 30, 1995. Significant actuarial assumptions used to compute the PERS pension benefit obligation include an actuarial interest rate of 8.5 percent per annum and projected salary increases of 4.5 percent consisting of 4.5 percent for inflation and zero percent for merit and longevity.

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COTATI-ROH�'ERT PARK U1'<1FIED SCHOOL DIS'rRJCT

NU T.ES TO GEi\i"ERAL PURPOSE FINANCIAL STATEMENTS - CONTI!\"JED

FOR THE FISCAL YEAR ENDED JUNE 30, 1996

14. EMPWYEE RETffiEMENT SYSTEMS (Continued)

Plan Pesctiprion and Provisions (Continued)

Funding Stows and Progress of the Rerirement Plans (Concluded)

PERS does not make separate measurements of assets and pension benefit obligations for individual school districts or county offices. The total unfunded pension benefit obligation for local education agencies as a whole, as of June 30, 1995 , is as follows:

Pension Benefit Obligation

Retirees and Beneficiaries Currently Receiving Benefits and Terminated Employees Not Yet Receiving Benefits

Current Employees: Accumulated Employee Contributions Including

Allocated Investment F.amings

Employer-Financed Vested

Employer-Financed Nonvested

Total Pension Benefit Obligation

Net Assets Available for Benefits at Cost (Market Value is $17,314,566,705)

Unfunded Pension Benefit Obligation

l'ERS

$ 7,032,915,534

3,506,097,044

4, 165,61 1 , 650

257 45) 403

14 ,962,075,631

I 6 288 397 653

$ () 326 322 022)

Of the total change in the pension benefit obligation from last year, none resulted from changes in benefit provisions and actuarial assumptions.

Contributions Required and Contributions Made

The District is required by statute to contribute 8.25 percent and 6.979 percent from iuiy i , i995 through December 3 1 , 1995 and 6.599 percent from January I , 1996 through June 30, 1996 of gross salary expenditures to STRS and PERS, respectively. Participants are required to contribute 8 percent and 7 percent of gross salary to STRS and PERS, respectively.

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NOTES TO GENERAL PURPOSE FINANCIAL STATEMENTS CO:-..'TINUED

FOR THE FISCAL YEAR ENDED JUNE 30, 1996

EMPLOYEE RETIREMENT SYSTEMS (Continued)

Plan Description and Provisions (Continued)

Contributions Required and Con:riburions Made (Concluded)

The District contribution information for the year ended June 30, 1996 is as follows:

Employee Employer Contribution, Contribution,

Number of Disui,t's 11 of •• of Emplo)'ec, Tot.al Employee Toe.al Employer Current-Year Percent.age of Percent.ate of

Cootcihu1iOD! Contributions Covrcrd Pnrnll Cov,: a:d Pnroll Covered Ptrroll

STRS 393 s 1 ,4)4,436 s 1 ,479,262 $ 1 7,930,448 8 8.25

PERS 168 s 248,387 $ 240,267 s 3,548.381 7 6.77

The District's contribution represented less than one percent of the total contributions required of all panicipating employers in STRS and PERS, respectively.

The District's employer contributions to STRS met the required contribution rate established by law. Although the actuarially determined contribution rate exceeds the employer rate Set in law, the District has no obligation for the deficit.

The District's employer contributions to PERS met ihe required contribution rate and satisfied the plan's funding requirements as determined by the PERS actuary. The funded contribution included amortization of the unfunded actuarial liability through the year 201 1 . The significant actuarial assumptions used to compute the actuarial I y determined contribution requirement are the same as those used to compute the pension benefit obligation, as previously described.

Trend 1,ifonnarion

Trend information gives an indication of the progress made in accumulating sufficient assets to pay benefits when due. Systemwide ten-year trend information is not yet available.

The three-year employer trend information that is required to be reported in the employer's financial statement is taken from other sections of the current and previous years' disclosure statements.

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15.

COTATI-ROHNERT PARK UNIFIED SCHOOL DISTRICT

NOrc.S TO GENERAL PURPOSE FINANCIAL ST A TEMENTS - cm.:CLlJDED

FOR THE FISCAL YEAR ENDED JUNE 30, 1996

EMPLOYEE RETIREMENT SYSTEMS (Concluded)

Plan Description and Provisions (Concluded)

Trend lriformari()n (Concluded)

Three year trend information is required to be reported for PERS.

Net Assets Available for Benefits as Percentages of the Pension Benefit Obligation

Unfunded Pension Benefit Obligation as Percentages of Annual Covered Payroll

Employer Contributions Made in Accordance with Actuarially Determined Requirements, as Percentages of Annual Covered Payroll

Other Irifonn01ion

..1221.:2.1

108.9%

(30.9)%

3 .82 %

..12.21:24

1 09.7%

(3 1 . 5 )%

7 .0%

10 1 . 2%

(3.7)%

6.66%

Under STRS law, certain early retirement incentives require the employer to pay the present value of the additional benefit which may be paid on either a current or defeITP..d basis. The District has obligations to STRS totaling $ 148,397 for early retirement incentives granted to terminated employees.

ON-BEHALF PAYl\1ENTS MADE BY THE STATE OF CALIFORNIA

The County Office was the recipient of on-behalf payments made by the State of California to the State Teachers' Retirement System (STRS) and to the Public Employees' Retirement S ystem (PERS) for K- 1 2 education. These payments consist of state general fund contributions to STRS in the amount of $ 1 ,2 19,270 (6.8 percent of salaries subject to STRS) and mandated costs for STRS and PERS benefits in the amount of $3,300 (.093 percent of salaries to STRS) and $74,4 1 1 (0.415 percent of salaries to PERS). The County Office has not reported the revenues or expenditures for these payments.

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·-··••i , ,.,_,,i; ..... � ........... ---···----....·--- ------- _____ , ______________ ............ �-.-

APPENDIX C

FORM OF CONTINUING DISCLOSURE CERTIFICATE

(THIS PAGE INTENTIONALLY LEFT BLANK)

,NNlill•- • ••I-.. IJH"'"*'•••H•1t1•-·-···-----·----- , ______ .......... __ _ ______ , __________ ........ _ ... .._.,_ , , .

APPENDIX C

FORM OF CONTINUING DISCLOSURE CERTIFICATE

This Continuing Disclosure Certificate (the "Disclosure Certificate") is executed and delivered by the Cotati-Rohnert Park Unified School District (the "Issuer") in connection with the issuance of $8,999,095. 15 General Obligation Bonds, Series F (Capital Appreciation Bonds) (the "Bonds"). The Bonds are being issued pursuant to a Resolution of the Board of Supervisors of the County of Sonoma adopted January 2.4, 1 997 (the "Resolution"). The Issuer covenants and agrees as follows:

Section 1 . Purpose of the Disclosure Certificate. This Disclosure Certificate is being executed and delivered by the Issuer for the benefit of the holders of the Bonds and in order to assist the Participating Underwriters in complying with S.E .C. Rule l 5c2-12(b)(5).

Section 2. Definitions. In addition to the definitions set forth in the Resolution which apply to any capitalized term used in this Disclosure Certificate unless otherwise defined in this Section, the following capitalized terms shal1 have the following meanings:

"Annual Report" shall mean any Annual Report provided by the Issuer pursuant to, and as described in, Sections 3 and 4 of this Disclosure Certificate.

"Dissemination Agent" shall mean the Issuer, or any successor Dissemination Agent designated in writing by the Issuer and which has filed with the Issuer a written acceptance of such designation.

"Listed Events" shall mean any of the events listed in Section 5(a) of this Disclosure Certificate.

"National Repository" shall mean any Nationally Recognized Municipal Securities Information Repository for purposes of the Rule.

"Participating Underwriter" shall mean any of the original underwriters of the Bonds required to comply with the Rule in connection with offering of the Bonds.

"Repository" shall mean each National Repository and each State Repository.

"Rule" shall mean Rule 15c2-12(b)(5) adopted by the Securities and Exchange Commission under the Securities Exchange Act of 1934, as the same may be amended from time to time.

"State Repository" shall mean any public or private repository or entity designated by the State as a state repository for the purpose of the Rule. As of the date of this Agreement, there is no State Repository.

Section 3. Provision of Annual Reports.

(a) The Issuer shall, or shall cause the Dissemination Agent to, not later than nine months after the end of the Issuer's fiscal year, commencing with the report for the

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1996-1 997 Fiscal year, provide to each Repository an Annual Report which is consistent with the requirements of Section 4 of this Disclosure Certificate. Not later than fifteen (1 5) Business Days prior to said date, the Issuer shall provide the Annual Report to the Dissernination Agent (if other than the Issuer) . The Annual Report may be submitted as a single document or as separate documents comprising a package, and may cross­reference other information as provided in Section 4 of this Disclosure Certificate; provided that 1the audited financial statements of the Issuer may be submitted separately from the balance of the Annual Report, and later than the date required above for the filing of the Annual Report if not available by that date. If the Issuer's fiscal year changes, it shall give notice of such change in the same manner as for a Listed Event under Section S(c).

(b) If the Issuer is unable to provide to the Repositories an Annual Report by the date required in subsection (a), the Issuer shall send a notice to the Municipal Securi lties Rulemaking Board in substantiaHy the form attached as Exhibit A.

(c) The Dissemination Agent shall:

(i) determine each year prior to the date for providing the Annual Report the name and address of each National Repository and each State Repositmy, if any; and (if the Dissemination Agent is other than the Issuer)

(ii) file a report with the Issuer certifying that the Annual Report has been provided pursuant to this Disclosure Certificate, stating the date it was provided and listing all the Repositories to which it was provided.

Section 4.. Content of Annual Report. The Issuer's Annual Report shall contain or incorporate by reference the following:

(a) Audited Financial Statements prepared in accordance with generally accepted accounting principles as promulgated to apply to governmental entities from time to time by the Governmental Accounting Standards Board. If the Issuer's audited financial statements are not available by the time the Annual Report is required to be filed pursuant to Section 3(a), the Annual Report shall contain unaudited financial statements in a format similar to the financial statements contained in the final Official Statement, and the audited financial statements shall be filed in the same manner as the Annual Report when they become available.

(b) the Issuer's adopted Budget.

(c) to the extent not set forth in the Issuer's audited financial statements: (i) information relating to average daily attendance; (ii) information relating ito the Issuer's outstanding debt; (iii) information relating to total assessed valuations of taxable properties within the Issuer's jurisdiction; and (iv) information relating to secured tax charges and delinquencies.

(d ) In addition to any of the information expressly required to be provided under paragraphs (a) through (c) of this Section, the Issuer shall provide such further information, if any, as may be necessary to make the specifically required statements, in the light of the circumstances under which they are made, not misleading.

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,.,, _ , ,.,,. .. _k __ , ___ , __ I ______________ ..,.. __________________ _

, ... .,, •• , ••• -,>IIH·••�llft .. ,i •• lltl•--·-··· .... --...... .. -----_______ , _______________ .. ,_.,. ,,

Any or all of the items listed above may be incorporated by reference from other documents, including official statements of debt issues o.f the Issuier or related public entities, which have been submitted to each of the Repositories or the Securities and Exchange Commission. If the document incorporated by reference is a final official statement, it must be available from the Municipal Securities Rulemaking Board. The Issuer shall clearly identify each such other document so incorporated by reference.

Section 5. Reporting of Significant Events.

(a) Pursuant to the provisions of this Section 5, the Issuer shall give, or cause to be given, notice of the occurrence of any of the following events with respect to the Bonds, if material:

(1) Principal and interest payment delinquencies. (2.) Non-payment related defaults. (.Q.) Unscheduled draws on debt service reserves reflecting

financial difficulties. (i) Unscheduled draws on credit enhancements reflecting

financial difficulties. (fil Substitution of credit or liquidity providers, or their

failure to perform. (§.) Adverse tax opinions or events affecting the tax-exempt

status of the security. (Z) Modifications to rights of security holders. (.8.) Contingent or unscheduled bond calls. (2) Defeasance. (lQ) Release, substitution, or sale o f property securing

repayment of the securities. (11) Rating changes.

(b) Whenever the Issuer obtains knowledge of the occurrence of a Listed E vent, the Issuer shall as soon as possible determine if such event would be material under applicable Federal securities law.

(c) If the Issuer determines that knowledge of the occurrence of a Listed Event would be material under applicable Federal securities law, the Issuer shall promptly file a notice of such occurrence with the Municipal Securities Rulemaking Board and each State Repository. Notwithstanding the foregoinf�, notice of Listed Events described in subsections (a)(S) and (9) need not be given under this subsection any earlier than the notice (if any) of the underlying event is given to holders of affected Bonds pursuant to the Resolution.

Section 6. Termination of Reporting Obligation. The Issuer's obligations under 1this Disclosure Certificate shall terminate upon the legal defeasance, prior redemption or payment in full of all of the Bonds. If such termination occurs prior to the final maturity of the Bonds, the Issuer shall give notice of such termination in the same manner as for a Listed Event under Section 5(c).

Section 7. Dissemination Agent. The Issuer may, from time to time, appoint or engage a Dissemination Agent to assist it in carrying out its oblit�ations under this Disclosure Certificate. and may discharge any such Agent, with or without appointing a successor Dissemination Agent.

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Section 8 . Amendment_ Waiver. Notwithstanding any other provision of this Disclosure Certificate, the Issuer may amend this Disclosure Certificate, and any provision of this Disclosure Certificate may be waived, provided that the following conditions are satisfied:

(a) if the amendment or waiver relates to the provisions of Sections 3(a), 4 or 5(a), it may only be made in connection with a change in circumstances that arises from a change in legal requirements, change in law, or change in the identity, nature, or status of an obligated person with respect to the Bonds, or type of business conducted;

(b) the undertakings herein, as proposed to be amended or waived, would, in the opinion of nationally recognized bond counsel, have complied with the requirements of the Rule at: the time of the primary offering of the Bonds, after taking into account any amendments or Interpretations of the Rule, as well as any change in circumstances; and

(c) the proposed amendment or waiver either (i) is approved by holders of the Bonds in the manner provided in the Indenture for amendments to the Indenture with the consent of holders, or (ii) does not, in the opinion of the Trustee or nationally recognized bond counsel, materially impair the interests of the holders or beneficial owners of the Bonds.

If the annual financial information or operating data to be provided in the Annual Report is amended pursuant to the provisions hereof, the first annual financial infomrntion filed pursuant hereto containing the amended operating data or financial information shall explain, in narrative form, the reasons for the amendment and the impact of the change in the type of operating data or financial information being provided.

If an amendment is made to the undertaking specifying the accounting principles to be followed in preparing financial statements, the annual financial information for the year in which the change is made shall present a comparison between the financial statements or information prepared on the basis of the new accounting principles and those prepared on the basis of the former accounting principles. The comparison shall include a qualitative discussion of the differences in the accounting principles and the impact of the change in the accounting principles on the presentation of the financial infom:1ation, in order to provide information to investors to enable them to evaluate the ability of the Issuer to meet its obligations. To the extent reasonably feasible, the comparison shall be quantitative. A notice of the change in the accounting principles shall be sent to the Repositories in the same manner as for a Listed Event under Section S(c) .

Section 9 . Additional Information. Nothing in this Disclosure Certificate shall be deemed to prevent the Issuer from disseminating any other information, using the means of dissemination set forth in this Disclosure Certificate or any other means of communication, or including any other information in any Annual Report or notice of occurrence of a Listed Event, in addition to that which is required by this Disclosure Certificate. If the Issuer chooses to include any information in any Annual Report or noticE· of occurr,ence of a Listed Event in addition to that which is specifically required by this Disclosure Certificate, the Issuer shall have no obligation under this Disclosure Certificate to update such information or include it in any future Annual Report or notice of occurrence of a Listed Event.

Section llO. Default. In the event of a failure of the Issuer to comply with any provision of this Disclosure Certificate, any holder or beneficial owner of the Bonds may

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. ....... . ,, ... _."'1_ ........... --.....--.---------- ·----------- -------·----------.-.-.�·'1 ... 1, 1 �

take such actions as may be necessary and appropriate, including seeking mandate or specific performance by court order, to cause the Issuer to comply with its obligations under this Disclosure Certificate. A default unde:r this Disclosure Certificate shall not be deemed an Event of Default under the Resolution, and the sole remedy under this Disclosure Certificate in the event of any failure of the Issuer to comply with this Disclosure Certificate shall be an action to compel performance.

Section 1 1 . Duties, Immunities and Liabilities of Dissemination Agent. The Dissemination Agent shall have only such duties as are specifically set forth in this Disclosure Certificate, and the Issuer agrees to indemnify and save the Dissemination Agent, its officers, directors, employees and agents, harmless against any loss, expense and liabilities which it may incur arising out of or in the exercise or performance of its powers and duties hereunder, including the costs and expenses (including attorneys fees) of defending against any claim of liability, but excluding liabilities due to the Dissemination Agent's negligence or willful misconduct. The obligations of the Issuer under this Section shall survive resignation or removal of the Dissemination Agent and payment of the Bonds.

Section 12. Beneficiaries. This Disclosure Certificate shall inure solely to the benefit of the Issuer, the Dissemination Agent, the Participating Underwriters and holders and beneficial owners from time to time of the Bonds, and shall create no rights in any other person or entity.

Date: February 13, 1997

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COTA TI-ROHNERT PARK UNIFIED SCHOOL DISTRICT

By:

EXHlBTI' A

NOTICE OF FAILURE TO FILE ANNUAL REPORT

Name of Issuer:. Cotati-Rohnert Park Unified School District

Name of Bond Issue: General Obligation Bonds, Series F Capital Appreciation Bonds

Date of IssuancE�: ----------

NOTICE IS HEREBY GIVEN that the Issuer has not provided an Annual Report with respect to the above-named Bonds as required by Section 14 of the Resolution adopted by the Board of Trustees of the Issuer on January 7, 1 997. The Issuer anticipates that the Annual Report will be filed by .]

Dated : ______________ ,

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COTATI-ROHNERT PARK UNIFIED SCHOOL DISTRICT

By ______________ _

----- -- - -- --------------·- ·------ ·---·---- ------·--------........................ -

APPENDIX D

BOND YIELD ACCRETED VALUE TABLES

D- 1

(THIS PAGE INTENTIONALLY LEFT BLANK)

�,�1pmr,:llF'!'r'lffflnPill!iiF'ffi ___ lO_.l _____________ l _____________ ..,. _____ lr

I ... , •• ,, , �··-··11p .... , .................. -....... ____ -- -----···- 1 Cotati-Rohnert Park Unified School District

Capital Appreciation Bonds

Bond Yield Accreted Value Tables

Maturity Date 8/1 /03 Maturity Date 8/1 /04 Maturity Date 8/1 /05

Yield 1 2 .000% Yield 1 2 .000% Yield 1 2 .000%

Date Accreted Value Date Accreted Value Date Accreted Value :2/1 3/97 2,353.30 2/1 3/97 2,094.40 2/1 3/97 1 ,864.00

2/1 /97 2,344. 1 5 2/1 /97 2,086.30 2/1/97 1 ,856 .80

8/1 /97 2,484.80 8/1/97 2,2 1 1 .50 8/1 /97 1 ,968 .20

2/1 /98 2,633 .90 2/1/98 2,344 . 1 5 2/1/98 2,086.30

8/1 /98 2,791 .95 8/1 /98 .2,484.80 8/1 /98 2,2 1 1 . 50

2/1 /99 2,959.45 2/1/99 2,633 .90 2/1/99 2,344. 1 5

8/1 /99 3, 1 3 7.05 8/1/99 .2,791 .95 8/1/99 2,484.80

2/1 /00 3,325.25 2/1 /00 2, 959.45 2/1 /00 2,633 .90

8/1 /00 3,524.80 8/1 /00 3, 1 3 7.05 8/1 /00 2 ,791 .95

2/1 /01 3,736.25 2/1 /01 3,325.25 2/1 /0 1 2,959.45

8/1 /0 1 3,960.45 8/1 /01 3,524.80 8/1 /0 1 3 , 1 3 7.05

2/1 /02 4, 1 98.05 2/1/02 3,736 .25 2/1 /02 3,325 .25

8/1/02 4,449.95 8/1/02 3,960.45 8/1 /02 3,524.80

2/1 /03 4, 71 6.95 2/1 /03 4, 1 98.05 2/1 /03 3, 736.25

8/1/03 5,000.00 8/1 /03 4,449.95 8/1 /03 3,960.45

2/1/04 4,71 6.95 2/1 /04 4, 1 98.05

8/1 /04 5,000.00 8/1 /04 4,449.95

2/1 /05 4,71 6 .95

8/1 /05 5,000.00

Cotati-Rohnert Park Unified School District Capital Appreciation Bonds

Bond Yield Accreted Value Tables

Matur i ty Date 8/1 /06 Maturity Date 8/1 /07 Maturity Date 8/1 /08 Yield 7.250% Yield 5 . 1 50% Yield 5.250%

Date Accreted Va l ue Date Accreted Val ue Date Accreted Va lue 2/1 3/9 7 2,547.85 2/1 3/97 2,936.50 2/1 3/97 2,759.90 2/1 /9 ? 2,541 .80 2/1 /97 2,93 1 .55 2/1 /97 2 , 755 . 1 5 8/1 /9 7 2 ,633 .95 8/1 /9 7 3 ,007 .00 8/1 /9 7 2,82 7.45 2/1 /9EI 2 , 729.40 2/1 /98 3,084.45 2/1 /98 2,90 1 . 70 8/1 /9EI 2 ,828 .35 8/1 /98 3, 1 63 .85 8/1 /98 2,977.85 2/1 /99 2,930.90 2/1 /99 3,245 . 3 5 2/1 /99 3,056. 00 8/1 /99 3,03 7. 1 5 8/1 /99 3,328 .90 8/1 /99 3, 1 36 .25 2/1 /00 3 , 1 47.20 2/1 /00 3 ,4 1 4 .65 2/1 /00 3 ,2 1 8 .55

8/1 /00 3,2 6 1 .30 8/1 /00 3,502.55 8/1 /00 3,303.05

2/1 /0 1 3 , 3 79.55 2/1 /0 1 3,592 . 75 2/1 /0 1 3 ,389 .75 8/1 /01 3 ,502.05 8/1 /0 1 3,685.25 8/1 /0 1 3 ,478 . 75

2/1 /02 3,629.00 2/1 /02 3, 780. 1 5 2/1/02 3 , 5 70.05

8/1 /02 3, 760.55 8/1 /02 3,877.50 8/1 /02 3 ,663 .80

2/1 /03 3,896.85 2/1 /03 3,977.35 2/1 /03 3 , 759.95 8/1 /03 4, 038. 1 5 8/1 /03 4,079 .75 8/1 /03 3,858.65

2/1 /04 4, 1 84.50 2/1 /04 4, 1 84.80 2/1 /04 3,959 .95

8/1 /04 4, 336.20 8/1 /04 4,292 .60 8/1 /04 4,063 .90

2/1 /05 4,493 .40 2/1 /05 4,403 . 1 0 2/1 /05 4, 1 70 .55 8/1 /05 4 ,656.25 8/1 /05 4,5 1 6 .50 8/1 /05 4,280.05

2/1 /0b 4, 825 .05 2/1 /06 4,632 .80 2/1 /06 4,392.40

8/1 /06 5,000.00 8/1 /06 4,752 . 1 0 8/1 /06 4, 507. 70

2/1 /07 4,874.45 2/1/07 4,626.05

8/1 /07 5,000.00 8/1 /07 4, 747.45

2/1 /08 4,872 . 1 0

8/1 /08 5,000.00

,.,,....,.lli@',:t,iliflilllllj·•111•·,---1--1----------·----.------------------_..,

1 ... 1111•• 1 ............. .,.�.,,, .. ,•H•i•+-..il-·1·-·-- -- -----... ........ _

Cotati-Rohnert Park Unified School District Capital Appreciation Bonds

Bond Yield Accreted Value Tables

Maturity Date 8/1/09 Maturity Date 8/1 /1 0 Maturity Date 8/1 /1 1

Yield 5 .350% Yield 5 .450% Yield 5 .600%

Date Accreted Val ue Date Accreted Val ue Date Accreted Va lue .. --·· 2/1 3/97 2,588.90 2/1 3/97 2,423 . 75 2/1 3/97 2,248.85

2/1 /9 7 2,584.35 2/1 /97 2,4 1 9.40 2/1 /97 2, 244. 75

8/1 /97 2,653 .45 8/1 /97 2,485 .35 8/1 /97 2 ,307.60

2/1 /98 2 ,724.45 2/1 /98 2,553 .05 2/1 /98 2 ,3 72.20

8/1 /98 2 ,797.30 8/1/98 2,622.65 8/1/98 2,438.60

2/1 /99 2 ,872 . 1 5 2/1 /99 2,694 . 1 0 2/1 /99 2,506.90

8/1/99 2,949.00 8/1 /99 2 ,76 7.50 8/1/99 2 ,577. 1 0

2/1 /00 3,027.85 2/1 /00 2,842 .95 2/1 /00 2,649 .25

8/1 /00 3 , 1 08 .85 8/1 /00 2,920.40 8/1 /00 2 ,723 .45

2/1 /01 3 , 1 92.05 2/1 /01 3,000.00 2/1 /01 2, 799 . 70

8/1 /0 1 3,2 77.40 8/1 /01 3 ,081 . 75 8/1 /0 1 2 ,878. 1 0

2/1 /02 3,365 . 1 0 2/1 /02 3, 1 65 . 70 2/1 /02 2,958.65

8/1 /02 3,455. 1 0 8/1 /02 3,252 .00 8/1 /02 3 ,04 1 .50

2/1 /03 3,547.55 2/1 /03 3,340.60 2/1 /03 3 , 1 26. 70

8/1 /03 3,642 .40 8/1 /03 3,43 1 . 65 8/1 /03 3 ,2 " 14.25

2/1 /04 3 ,739 .85 2/1 /04 3,525 . 1 5 2/1 /04 3, 3 04.25

8/1 /04 3,839.90 8/1 /04 3,62 1 .20 8/1 /04 3 ,396.75

2/1 /05 3 ,942 .60 2/1 /05 3 ,71 9.90 2/1 /05 3 ,49 1 .85

8/1 /05 4,048 . 1 0 8/1 /05 3,82 1 .25 8/1 /05 3,589 .65

2/1 /06 4, 1 56 .35 2/1 /06 3,925.40 2/1/06 3,690 . 1 5

8/1 /06 4,267.55 8/1 /06 4,032 .35 8/1 /06 3 ,793 .45

2/1/07 4, 3 8 1 . 70 2/1 /07 4, 1 42.25 2/1 /07 3,899.70

8/1 /07 4,498.90 8/1/07 4,255 . 1 0 8/1 /0 7 4,008.85

2/1 /08 4,6 1 9.25 2/1 /08 4,3 7 1 .05 2/1 /08 4, 1 2 1 . 1 0

8/1 /08 4,742 .85 8/1 /08 4,490. 1 5 8/1 /08 4,236 .50

2/1/09 4,869.70 2/1 /09 4,6 1 2 .55 2/1 /09 4, 3 55 . 1 5

,8/1 /09 5,000.00 8/1 /09 4, 738.20 8/1 /09 4,477. 1 0

2/1 /1 0 4,867.35 2/1 /1 0 4,602 .45

8/1 /1 0 5,000.00 8/1 /1 0 4, 73 1 .3 0

2/1 /1 1 4,863.80

8/1 /1 1 5,000.00

Cotati-Rohnert Park Unified School District Capital Appreciation Bonds

Bond Yield Accreted Value Tables

Maturity Date :'3/1 /1 2 Maturity Date 8/1 /1 3 Matu rity Date 8/1 /1 4

Y ield 5 . 700% Yield 5.800% Yield 5 .900%

Date Accr,eted Value Date Accreted Value Date Accreted Value 2/1 3/9 7 2, 096.25 2/1 3/97 1 ,950.25 2/1 3/97 1 ,8 1 0.85

2/1 /97 2, 092 .35 2/1 /97 1 ,946.50 2/1/9 7 1 ,807.35

8/1 /97 2, 1 5 1 .95 8/1 /97 2,002 .95 8/1 /97 1 ,860.65

2/1 /9B 2,2 1 3 .30 2/1 /98 2,061 .05 2/1/98 1 ,9 1 5 . 5 5

8/1 /98 2,2 76 .40 8/1 /98 2, 1 20.80 8/1/98 1 ,9 72 .05

2/1 /99 2 ,34 1 .25 2/1 /99 2, 1 82 .30 2/1/99 2,030.25

8/1 /99 2 ,408.00 8/1 /99 2,245.60 8/1/99 2,090. 1 5

2/1 /00 2 ,476.60 2/1 /00 2 ,3 1 0 .75 2/1 /00 2, 1 5 1 .80

8/1 /00 2 ,547.20 8/1 /00 2,3 77. 75 8/1 /00 2 ,2 1 5 .25

2/1 /0 1 2 ,6 1 9.80 2/1 /01 2,446. 70 2/1 /0 1 2 ,280.60

8/1 /0 1 2 ,694.45 8/1 /0 1 2 , 5 1 7.65 8/1 /01 2 ,347.90

2/1 /02 2 , 77 1 .25 2/1 /02 2,590.65 2/1 /02 2,4 1 7. 1 5

8/1 /0'2 2 ,850.25 8/1/02 2,665.80 8/1 /02 2,488.45

2/1 /03 2,93 1 .45 2/1 /03 2 ,743 . 1 0 2/1 /03 2 ,561 .90

8/1 /03 3 ,0 1 5.00 8/1 /03 2,822 .65 8/1 /03 2,63 7.45

2/1 /0LI 3, 1 00.95 2/1 /04 2,904.50 2/1 /04 2 ,7 1 5 .2 5

8/1 /04 3, 1 89 .30 8/1/04 2,988 . 75 8/1 /04 2, 795 .35

2/1 /05 3,280.20 2/1 /05 3,075 .40 2/1 /05 2,877.85

8/1 /05 3 ,373 .70 8/1 /05 3, 1 64.60 8/1 /05 2,962 . 75

2/1 /06 3,469.85 2/1/06 3,256.40 2/1 /06 3,050. 1 5

8/1 /06 3,568 .75 8/1/06 3,350.80 8/1 /06 3, 1 40. 1 0

2/1 /07 3,670.45 2/1 /07 3 ,448 .00 2/1 /07 3, 2 3 2 . 75

8/1 /0 7 3 ,775 .05 8/1 /07 3 ,548.00 8/1 /07 3 ,328 . 1 0

2/1 /08 3 ,882 .65 2/1 /08 3,650.90 2/1 /08 3 ,426.30

8/1 /08 3, 993 .30 8/1/08 3 ,756. 75 8/1 /08 3 ,527.35

2/1 /09 4 , 1 07 . 1 0 2/1 /09 3,865 . 70 2/1 /09 3 ,63 1 .45

8/1 /09 4,224 . 1 5 8/1 /09 3,9 77.80 8/1 /09 3 ,738 .55

2/1 /1 Cl 4,344.55 2/1 /1 0 4,093 . 1 5 2/1 /1 0 3 ,848.85

8/1 /1 Cl 4,468.40 8/1/1 0 4,2 1 1 .85 8/1 /1 0 3, 962.40

2/1 /1 1 4,595 . 75 2/1 /1 1 4,334 .00 2/1 /1 1 4,079.25

8/1 /1 1 4,726 .70 8/1 /1 1 4,459 . 70 8/1 /1 1 4, 1 99.60

2/1 /1 2' 4,861 .40 2/1 /1 2 4,589.05 2/1 /1 2 4,323 .50

8/1 /1 2' 5,000.00 8/1 /1 2 4,722 . 1 0 8/1 /1 2 4,45 1 .05

2/1 /1 3 4,859.05 2/1 /1 3 4,582.35

8/1 /1 3 5,000.00 8/1 /1 3 4, 7 1 7.55

2/1 /1 4 4,856 .70

8/1/1 4 5,000.00

Jl</j;ll,lllisl· .. �l®l,j,--,-------------·----..------------------1�

1,t1t1.i,.,, s ,'IO-••l•H"'�°' .. ,11HH .... ll .. ill-•••----- --·..-...-.. -- ................... , . . . Cotati-Rohnert Park Unified School District

Capital Appreciation Bonds

Bond Yield Accreted Value Tables

Maturity Date 8/1 /1 5 Maturity Date 8/1 /1 6 Maturity Date 8/1 /1 7

Yield 5 .950% Yield 6 .000% Yield 6.050%

Date Accreted Value Date Accreted Value Date Accreted Value ---2/1 3/97 1 ,693 .30 2/1 3/97 1 ,581 .85 2/1 3/97 1 ,476.30

2/1 /97 1 ,690.00 2/1 /97 1 , 578 . 75 2/1 /97 1 ,473 .40

8/1 /97 1 ,740.30 8/1 /97 1 ,626. 1 0 8/1 /97 1 , 5 1 7.95

2/1 /98 1 ,792 .05 2/1 /98 1 ,674.90 2/1 /98 1 , 563.85

8/1 /98 1 ,845 . 3 5 8/1 /98 1 , 725 . 1 5 8/1 /913 1 ,6 1 1 .20

2/1 /99 1 ,900 .25 2/1 /99 1 , 776.90 2/1 /99 1 ,659.90

8/1/99 1 ,956.80 8/1 /99 1 ,830.20 8/1/99 1 , 7 1 0 . 1 5

2/1 /00 2 ,01 5 .00 2/1 /00 1 ,885. 1 0 2/1 /00 1 , 76 1 .85

8/1 /00 2,074.95 8/1 /00 1 ,94 1 .65 8/1/00 1 ,8 1 5 . 1 5

2/1 /0 1 2 , 1 36 .70 2/1 /01 1 ,999.90 2/1 /01 1 ,8 70.05

8/1 /0 1 2,200.25 8/1/01 2,059.90 8/1 10·1 1 ,926.65

2/1 /02 2,265 .70 2/1/02 2, 1 2 1 .70 2/1 /02 1 ,984.90

8/1 /02 2,333. 1 5 8/1/02 2, 1 85.35 8/1 /02 2,044.95

2/1 /03 2,402 .55 2/1 /03 2,250.90 2/1 /03 2, 1 06.85

8/1 /03 2,474.00 8/1 /03 2 ,31 8.45 8/1 /03 2, 1 70.5 5

2/1 /04 2,547.60 2/1 /04 2,388 .00 2/1 /04 2 ,236 .20

8/1 /04 2,623 .40 8/1 /04 2,459.65 8/1 /04 2,303.85

2/1 /05 2 ,701 .45 2/1 /05 2,533.45 2/1/05 2 ,373 .55

8/1 /05 2 ,78 1 .85 8/1 /05 2,609.45 8/1 /05 2,445 .35

2/1 /06 2,864.60 2/1/06 2,68 7. 70 2/1/06 2 ,5 1 9 .35

8/1 /06 2,949.80 8/1 /06 2 ,768.35 8/1 /06 2 ,595 .55

2/1 /07 3,03 7.55 2/1 /07 2,8 5 1 .40 2/1/0? 2 ,674.05

8/1 /07 3, 1 2 7.95 8/1/07 2,936.95 8/1/07 2, 754.95

2/1 /08 3 ,221 .00 2/1/08 3,025 .05 2/1 /08 2,838.30

8/1 /08 3 ,3 1 6.80 8/1 /08 3, 1 1 5 .80 8/1 /08 2,924. 1 5

2/1 /09 3,4 1 5 .50 2/1 /09 3,209.30 2/1 /09 3,01 2 .6 0

8/1 /09 3,5 1 7. 1 0 8/1 /09 3,305.55 8/1 /09 3,1 03 .75

2/1 /1 0 3,62 1 . 75 2/1 /1 0 3,404. 75 2/1 /1 0 3, 1 97.60

8/1 /1 0 3 ,729 .50 8/1 /1 0 3, 506.85 8/1 /1 0 3,294.35

2/1 /1 1 3,840.45 2/1 /1 1 3,61 2 . 1 0 2/1 /1 1 3 ,394.00

8/1 /1 1 3,954 .70 8/1 /1 1 3, 720.45 8/1 /1 1 3,496.70

2/1/1 2 4,072 .35 2/1 /1 2 3,832.05 2/1 /1 2 3,602.45

8/1 /1 2 4, 1 93 .50 8/1 /1 2 3,947.00 8/1 /1 2 3, 7 1 1 .45

2/1 /1 3 4,3 1 8.25 2/1 /1 3 4,065.45 2/1 /1 3 3,82 3 . 70

8/1 /1 3 4,446.75 8/1/1 3 4, 1 87.40 8/1 /1 3 3,939.35

2/1 /1 4 4,5 79.00 2/1/1 4 4,3 1 3 .00 2/1 /1 4 4,058 .55

8/1 /1 4 4, 71 5 .25 8/1 /1 4 4,442.40 8/1 /1 4 4, 1 8 1 . 3 0

2/1/1 5 4,855 .50 2/1 /1 5 4,575 .70 2/1 /1 5 4,307.80

8/1 /1 5 5,000.00 8/1 /1 5 4,71 2 .95 8/1 /1 5 4,438 . 1 0

2/1 /1 6 4,854.3 5 2/1 /1 6 4,572.35

8/1/1 6 5,000.00 8/1 /1 6 4 ,71 0.65

2/1 /1 i' 4,853 . 1 5

8/1 /1 i' 5 ,000.00

Cotati-Rohnert Park Unified School District Capital Appreciation Bonds

Bond Yield Accreted Value Tables

Maturity Date 8/1 /1 8 Matu rity Date 811 /1 9 Maturity Date 8/1/20 Yie ld 6.075% Yield 6 . 1 00% Yield 6.200%

Date Accreted Va l ue Date Accreted Value Date Accreted Va l ue 2/1 3/97 1 ,383 .65 2/1 3/97 1 ,296.20 2/1 3/97 1 , 1 93 . 1 5 2/1 /97' 1 ,380 .90 2/1 /97 1 ,293 .60 2/1 /97 1 , 1 90. 70 8/1 /97' 1 ,422.85 8/1 /97 1 , 333 .05 8/1 /97 1 ,2 27 .60 2/1 /9B 1 ,466.05 2/1 /98 1 ,3 73 . 70 2/1 /98 1 ,265 .65 8/1 /98 1 , 5 1 0.60 8/1 /98 1 ,4 1 5 .60 8/1 /98 1 ,304.90 2/1 /99 1 , 556 .50 2/1 /99 1 ,458.80 2/1 /99 1 ,345 .35 8/1 /99 1 , 603 . 75 8/1 /99 1 ,503 .30 8/1 /99 1 ,387.05 211 100 1 ,652 .50 2/1 /00 1 ,549 . 1 5 2/1 /00 1 ,430.05 8/1 /00 1 , 702 .70 8/1 /00 1 , 596.40 8/1 /00 1 ,474.40 2/1 /0 1 1 , 754.40 2/1 /0 1 1 ,645 . 1 0 2/1 /0 1 1 ,520. 1 0 8/1 /0 1 1 ,807. 70 8/1 /0 1 1 ,695 .25 8/1 /0 1 1 ,567.25 2/1 /02 1 ,862.60 2/1 /02 1 , 746.95 2/1 /02 1 ,6 1 5 .80 8/1 /02 1 ,9 1 9 . 1 5 8/1 /02 1 ,800.25 8/1 /02 1 ,665.90 2/1 /03 1 ,977.45 2/1 /03 1 ,855 . 1 5 2/1 /03 1 , 7 1 7.55 8/1 /03 2,03 7.55 8/1 /03 1 ,9 1 1 . 75 8/1 /03 1 , 770.80 2/1 /04 2,099.45 2/1 /04 1 ,970.05 2/1 /04 1 ,825 . 70 8/1 /04 2, 1 63 .20 8/1 /04 2,030. 1 5 8/1 /04 1 ,882.30 2/1 /05 2, 228 .90 2/1 /05 2,092.05 2/1 /05 1 ,940.65 8/1 /05 2,296 .60 8/1 /05 2, 1 55 .85 8/1 /05 2,000.80 2/1 /06 2 ,366.35 2/1 /06 2,2 2 1 .60 2/1 /06 2,062 .85 8/1 /06 2,438 .25 8/1 /06 2,289.40 8/1 /06 2, 1 26 .80 2/1 /07 2,5 1 2 .30 2/1 /07 2 ,359 .20 2/1 /07 2, 1 92 . 70 8/1 /07 2,588 .60 8/1 /07 2,43 1 . 1 5 8/1 /07 2 ,260 .70 2/1 /08 2,667 .25 2/1 /08 2,505 .30 2/1 /08 2 ,330 .75 8/1 /08 2 ,748 .25 8/1 /08 2 ,58 1 . 70 8/1 /08 2,403 .00 2/1 /09 2,83 1 . 75 2/1 /09 2,660.45 2/1 /09 2 ,477.50 8/1 /09 2 ,9 1 7 .75 8/1 /09 2 ,74 1 .60 8/1 /09 2 , 554.30 2/1 /1 0 3,006.40 2/1 /1 0 2,825.25 2/1 /1 0 2,633 .50 8/1 /1 0 3 ,097 . 70 8/1 /1 0 2,9 1 1 .40 8/1 /1 0 2 ,7 1 5 . 1 5 2/1 /1 1 3, 1 9 1 .80 2/1 /1 1 3,000.20 2/1 /1 1 2 , 799.30 8/1 /1 1 3 ,288 .75 8/1 /1 1 3,09 1 . 70 8/1 /1 1 2,886. 1 0 2/1 /1 2 3, 388.65 2/1 /1 2 3, 1 86.00 2/1 /1 2 2 ,975 .55 8/1 /1 2 3 ,49 1 .60 8/1 /1 2 3 ,283.20 8/1 /1 2 3,067.80 2/1 /1 ] 3, 597.65 2/1 /1 3 3 ,383 .30 2/1 /1 3 3 , 1 62.90 8/1 /1 3 3, 706.95 8/1 /1 3 3,486.50 8/1 /1 3 3 ,260.95 2/1 /1 4 3 ,8 1 9 .50 2/1 / 1 4 3,592 .85 2/1 /1 4 3 ,362 .05 8/1 /1 4 3 ,935 .55 8/1 /1 4 3, 702 .45 8/1 /1 4 3,466.25 2/1 /1 S 4,,055 . 1 0 2/1 /1 5 3,8 1 5 .35 2/1 /1 5 3 ,573 . 75 8/1 /1 S 4,. 1 78 . 25 8/1 /1 5 3,93 1 . 75 8/1 /1 5 3,684.50

2/1 /1 6 4 .. 305.20 2/1 /1 6 4,05 1 .65 2/1 /1 6 3 , 798 .75

8/1 /1 6 4..435 .95 8/1 /1 6 4, 1 75.20 8/1 /1 6 3 ,9 1 6.50

2/1 /1 7 4 ,570 .70 2/1 /1 7 4,302 .55 2/1 /1 7 4,037 .90 8/1 /1 7 4 . 709.50 8/1 /1 7 4,433 .80 8/1 /1 7 4, 1 63 . 1 0 2/1 /1 B 4 ,852 .60 2/1 /1 8 4,569.05 2/1/1 8 4,292 . 1 5 s11 11 a 5,000.00 8/1 /1 8 4, 708.40 8/1 /1 8 4,425 . 20

2/1 /1 9 4,852 .00 2/1 /1 9 4,562 .40 8/1 /1 9 5,000.00 8/1 /1 9 4,703 .80

2/1 /20 4,849.65 8/1 /20 5,000.00

- - ------------ ---- -------,----------�-i--..*•"**'-

Maturity Date Yield

Date 2/1 3/97

2/1/97

8/1/97

2/1 /98

8/1 /98

2/1 /99

8/1/99

2/1 /00

8/1 /00

2/1/01

8/1 /01

2/1/02

8/1 /02

2/1 /03

8/1 /03

2/1 /04

8/1/04

2/1 /05

8/1 /05

2/1/06

8/1/06

2/1/07

,g/1/07

2/1/08

i3/1 /08

2/1 /09

8/1 /09

2/1 /1 0

8/1/1 0

2/1 /1 1

8/1 /1 1

2/1 /1 2

£1/1 /1 2

.:?/1 /1 3

E./ 1 /1 3

2'/1 /1 4

8./1 /1 4

2/1/1 5

8/1 /1 5

2/1/1 6

8/1 /1 6

2/1 /1 7

8/1 /1 7

2/1 /1 8

8/1 /1 8

2/1 /1 9

8/1 /1 9

2/1 /20

8/1 /20

2/1 /2 1

8/1 /2 1

8/1 /2 1

6.200%

Accreted Va l ue 1 , 1 22 .45

1 , 1 20. 1 5

1 , 1 54.90

1 , 1 90. 70

1 ,22 7.60

1 ,265 .65

1 ,304 .90

1 ,345 .35

1 ,38 7.05

1 ,430.05

1 ,4 74 .40

1 ,520. 1 0

1 ,567.25

1 ,6 1 5.80

1 ,665.90

1 , 71 7.55

1 , 770.80

1 ,825.70

1 ,882.30

1 ,940.65

2,000.80

2,062 .85

2, 1 26.80

2, 1 92 .70

2,260.70

2,330. 75

2,403 .00

2,477.50

2,554.30

2,633 .50

2,71 5 . 1 5

2, 799.30

2,886. 1 0

2,975 .55

3,067.80

3, 1 62.90

3,260.95

3,362.05

3,466.25

3,5 73 . 75

3,684.50

3 ,798.75

3 ,91 6 .50

4,03 7.90

4 , 1 63 . 1 0

4,292 . 1 5

4,42 5 .20

4,562 .40

4,703 .80

4,849.65

5,000.00

Cotati-Rohnert Park Unified School District Capital Appreciation Bonds

Bond Yield Accreted Value Tables

(THIS PAGE INTENTIONALLY LEFT BLANK)

!!flM!'•••'91!1 -------·1------------------------..... -------------------,---------"

--·-· · ···-·········---··------------ ---·---- -----,--------� ................

APPENDIX E

REOFFERING YIELD ACCRETED VALUE TABLlES

E- 1

(THIS PAGE INTENTIONALLY LEFT BLANK)

...... H•ll•Nlj·li-lH ....... ._ .... -- ...__ ... _,,,,,_

Cotati-Rohnert Park Unified School District Capital Appreciation Bonds

Reoffering Yield Accreted Value Tables

Maturity Date 8/1/03 Matu rity Date 8/1 /04 Maturity Date 8/1 /05

Yield 4 .800% Yield 4.900% Yield 5 .000%

Date Accreted Value Date Accreted Val ue Date Accreted Value 2/1 3/97 3,679.20 2/1 3/97 3,483.30 2/1 3/97 3,29 1 .35

2/1 /97 3,673 .40 2/1 /97 3,477.65 2/1/97 3,285.95

8/1/97 3 ,76 1 .55 8/1/97 3,562.85 8/1/97 3 ,368. 1 0

2/1 /98 3,85 1 .85 2/1 /98 3,650. 1 5 2/1/98 3,452 .30

8/1/98 3,944.30 8/1 /98 3, 739.60 8/1/98 3,538 .60

2/1 /99 4,038.95 2/1 /99 3,83 1 .20 2/1 /99 3,62 7. 1 0

8/1/99 4, 1 35 .90 8/1 /99 3,925.05 8/1 /99 3 ,7 1 7.75

2/1 /00 4,235. 1 5 2/1 /00 4,02 1 .25 2/1 /00 3 ,8 1 0.70

8/1/00 4,336.80 8/1 /00 4, 1 1 9. 75 8/1 /00 3,905 .95

2/1 /01 4,440.85 2/1 /01 4,220. 70 2/1/01 4,003 . 60

8/1 /0 1 4,547.45 8/1 /01 4,324 . 1 0 8/1/01 4, 1 03 . 70

2/1 /02 4,656.60 2/1 /02 4,430.05 2/1 /02 4,206.30

8/1 /02 4, 768.35 8/1 /02 4,538.60 8/1 /0.2 4,3 1 1 .45

2/1 /03 4,882.80 2/1 /03 4,649.75 2/1/03 4,4 1 9 .25

8/1 /03 5,000.00 8/1 /03 4,763 .70 8/1 /03 4,529 .75

2/1 /04 4,880.40 2/1 /04 4,642.95

8/1/04 5,000.00 8/1 /04 4, 759.05

2/1/05 4,878.00

8/1/05 5,000.00

Cotati-Rohnert Park Unified School District Capital Appreciation Bonds

Reoffering Yield Accreted Value Tables

Maturity Date 8/1 /06 Maturity Date 8/1 /07 Maturity Date 8/1 /08 Yie ld 5 . 1 00% Yield 5 . 1 50% Yield 5 .250%

Date Accreted Va l ue Date Accreted Va l ue Date Accreted Va lue 2/1 3/97' 3, 1 03 .95 2/1 3/97 2,936.50 2/1 3/97 2, 759.90 2/1 /97 3,098 .75 2/1 /97 2 ,93 1 .55 2/1 /97 2 ,755 . 1 5 8/1 /97 3, '1 77.80 8/1 /97 3 ,007.00 8/1 /97 2,82 7.45 2/1 /98 3,258 .80 2/1 /98 3,084.45 2/1 /98 2,901 . 70 8/1 /98 3 ,341 .90 8/1 /98 3, 1 63 .85 8/1 /98 2,977.85 2/1/99 3,42 7. 1 5 2/1 /99 3,245 .35 2/1 /99 3 ,056.00 8/1 /99 3 , 5 1 4 .55 8/1 /99 3,328.90 8/1 /99 3, 1 36 .25 2/1 /00 3,604. 1 5 2/1 /00 3 ,41 4 .65 2/1 /00 3,2 1 8 .55 8/1 /00 3,696.05 8/1 /00 3,502.55 8/1 /00 3 ,303 .05 2/1 /0 1 3,790.30 2/1 /0 1 3 ,592 .75 2/1 /0 1 3 ,3 89 . 75 8/1 /01 3,B86.95 8/1 /0 1 3,685.25 8/1/0 1 3 ,478 . 75 2/1 /02 3,986. 1 0 2/1 /02 3, 780. 1 5 2/1 /02 3 ,570.05 8/1 /02 4,087 .75 8/1 /02 3,B 77.50 8/1 /02 3,663.80 2/1 /03 4, 1 9 1 .95 2/1 /03 3 ,977.35 2/1 /03 3 ,759.95 8/1 /03 4,298.85 8/1 /03 4,079.75 8/1 /03 3,858.65 2/1 /04 4,408 .50 2/1 /04 4, 1 84.80 2/1 /04 3,959.95 8/1 /04 4, 520.90 8/1 /04 4,292 .60 8/1 /04 4,063 .90 2/1 /05 4,636.20 2/1 /05 4,403 . 1 0 2/1 /05 4, 1 70 .55 8/1 /05 4, 754.40 8/1 /05 4,5 1 6 .50 8/1 /05 4,280.05 2/1 /06 4,:3 75 .65 2/1 /06 4,632.80 2/1 /06 4,392 .40 8/1 /06 5 ,000.00 8/1 /06 4,752 . 1 0 8/1 /06 4,507. 70

2/1 /07 4 ,874.45 2/1 /07 4,626 .05 8/1 /07 5,000.00 8/1 /07 4,747.45

2/1 /08 4,8 72 . 1 0 8/1 /08 5,000.00

-····� ..... -... !_ .. ______ -- ..................... _ Cotati-Rohnert Park Unified School District

Capital Appreciation Bonds

Reoffering Yield Accreted Value Tables

Maturity Date 8/1 /09 Matu rity Date 8/1 /1 0 Maturity Date 8/1 /1 1

Yiie ld 5.350% Yield 5.450% Yield 5 .600%

Date Accreted Value Date Accreted Va l ue Date Accreted Value 2/1 3/97 2,588 .90 2/1 3/97 2,423 . 75 2/1 3/97 2,248.85

2/1 /97 2,584.35 2/1 /97 2,4 1 9 .40 2/1 /97 2,244 .75

8/1 /97 2,653 .45 8/1 /97 2,485.35 8/1 /97 2,307.60

2/1 /98 2, 724.45 2/1 /98 2,553.05 2/1 /98 2,372.20

8/1 /98 2,797.30 8/1 /98 2,622 .65 8/1 /98 2,438.60

2/1/99 2,872 . 1 5 2/1 /99 2 ,694 . 1 0 2/1 /99 2,506.90

8/1 /99 2,949.00 8/1/99 2,767.50 8/1 /99 2,5 77. 1 0

2/1 /00 3,02 7.85 2/1 /00 2,842.95 2/1 /00 2,649.25

8/1 /00 3, 1 08 .85 8/1 /00 2,920.40 8/1 /00 2 ,723 .45

2/1 /0 1 3 , 1 92 .05 2/1 /01 3,000.00 2/1 /0 1 2, 799.70

8/1 /0 1 3,277.40 8/1 /01 3,08 1 . 75 8/1/01 2,8 78 . 1 0

2/1 /02 3,365 . 1 0 2/1 /02 3, 1 65 . 70 2/1/0.2 2,958.65

8/1 /02 3,455 . 1 0 8/1 /02 3,252.00 8/1 /0.2 3,04 1 .50

2/1 /03 3,547.55 2/1/03 3,340.60 2/1/03 3, 1 26 .70

8/1 /03 3,642.40 8/1 /03 3,43 1 .65 8/1 /03 3 ,2 1 4 .25

2/1 /04 3 ,739.85 2/1 /04 3,525 . 1 5 2/1 /04 3,304.25

8/1/04 3,839.90 8/1 /04 3,62 1 .20 8/1/04 3,396 .75

2/1 /05 3,942 .60 2/1/05 3 ,7 1 9 .90 2/1 /0'.> 3,49 1 .85

8/1/05 4,048. 1 0 8/1 /05 3,82 1 .25 8/1 /05 3,589.65

2/1 /06 4, 1 56 .35 2/1 /06 3,925.40 2/1 /06 3,690. 1 5

8/1/06 4,267.55 8/1 /06 4,032 .35 8/1 /06 3,793 .45

2/1/0 7 4,38 1 .70 2/1 /07 4,1 42.25 2/1/07 3,899 .70

8/1 /07 4,498 .90 8/1/07 4,255 . 1 0 8/1 /07 4,008.85

2/1 /08 4,6 1 9.25 2/1 /08 4,371 .05 2/1 /08 4,1 2 1 . 1 0

8/1/08 4,742.85 8/1/08 4,490. 1 5 8/1 /08 4,236.50

2/1/09 4,869.70 2/1/09 4,6 1 2 .55 2/1 /09 4,355. 1 5

8/1/09 5,000.00 8/1 /09 4, 738.20 8/1/09 4,477. 1 0

2/1 /1 0 4,867.35 2/1/1 0 4,602.45

8/1 /1 0 5,000.00 8/1 /1 0 4,73 1 .3 0

2/1 /1 1 4,863 .80

8/1 /1 1 5,000.00

Cotati-Rohnert Park Unified School District Capital Appreiciation Bonds

Reoffering Yield Accreteid Value Tables

Maturity Date 8/1 /1 2 Maturity Date 8/1 /1 3 Maturity Date 8/1 /1 4

Yield 5 . 700% Yield 5 .800% Yield 5 .900%

Date Accreted Va l ue Date Accreted Val ue Date Accreted Val ue 2/1 3/97 2,096.25 2/1 3/97 1 ,950.25 2/1 3/9 7 1 , 8 1 0 .85

2/1 /97 2,092 .35 2/1 /97 1 ,946.50 2/1 /97 1 ,807.35

8/1 /97 2, "1 5 1 .95 8/1 /97 2,002 .95 8/1 /97 1 ,860.65

2/1 /98 2,2 1 3 .3 0 2/1 /98 2,06 1 .05 2/1 /98 1 ,9 1 5 .55

8/1 /98 2,27 6 .40 8/1 /98 2, 1 20.80 8/1 /98 1 , 9 72 .05

2/1 /99 2 ,34 1 .25 2/1 /99 2, 1 82 .30 2/1 /99 2,030.25

8/1 /99 2,408.00 8/1 /99 2,245 .60 8/1 /99 2,090. 1 5

2/1 /00 2,476 . 60 2/1 /00 2,3 1 0.75 2/1 /00 2, 1 5 1 .80

8/1 /00 2 ,547.20 8/1 /00 2,3 77. 75 8/1 /00 2,2 1 5 . 2 5

2/1 /0 1 2, 6 1 9 .80 2/1 /01 2 ,446.70 2/1 /0 1 2 ,280.60

8/1 /0 1 2, 694.45 8/1 /01 2 ,5 1 7.65 8/1 /0 1 2,347.90

2/1 /02 2, 771 .25 2/1 /02 2, 590.65 2/1 /02 2 ,4 1 7 . 1 5

8/1 /02 2 ,850.25 8/1 /02 2,665.80 8/1 /02 2,488.45

2/1 /03 2,93 1 .45 2/1 /03 2 ,743 . 1 0 2/1 /03 2 ,561 .90

8/1 /03 3,01 5 .00 8/1 /03 2,822 .65 8/1 /03 2,63 7 .45

2/1 /04 3 , 1 00.95 2/1 /04 2,904.50 2/1 /04 2, 7 1 5 .25 8/1 /04 3, 1 89 .30 8/1 /04 2,988. 75 8/1 /04 2, 795 .35

2/1 /05 3,280.20 2/1 /05 3,075 .40 2/1 /05 2 ,877.85

8/1 /05 3 ,373 . 70 8/1 /05 3, 1 64.60 8/1 /05 2,962.75

2/1 /06 3,469.85 2/1 /06 3,256.40 2/1 /06 3 ,050. 1 5

8/1 /06 3 ,568 . 75 8/1 /06 3,3 50.80 8/1 /06 3, 1 40. 1 0

2/1 /07' 3 ,670.45 2/1 /07 3,448.00 2/1 /07 3,2 3 2 . 75

8/1 /07 3 ,775.05 8/1 /07 3,548 .00 8/1 /07 3,328 . 1 0

2/1 /08 3,882 .65 2/1 /08 3,650.90 2/1 /08 3,426.30

8/1 /08 3 ,993.30 8/1 /08 3 , 756.75 8/1 /08 3 , 5 2 7. 3 5

2/1 /09 4, 1 07. 1 0 2/1 /09 3,865 . 70 2/1 /09 3 ,63 1 .45

8/1 /09 4,224. 1 5 8/1 /09 3,977.80 8/1 /09 3 , 738 .55

2/1 /1 0 4, 344.55 2/1 /1 0 4,093 . 1 5 2/1 /1 0 3,848.85

8/1 /1 0 4, 468 .40 8/1 /1 0 4,2 1 1 .85 8/1 /1 0 3,962.40

2/1 /1 1 4 ,,595 . 75 2/1 /1 1 4, 3 34.00 2/1 /1 1 4,079.25

8/1 /1 1 4,, 726.70 8/1 /1 1 4,459.70 8/1 /1 1 4, 1 99 .60

2/1 /1 2 4,861 .40 2/1 /1 2 4,589.05 2/1 /1 2 4,32 3 .50

8/1 /1 2 5 ,000.00 8/1 /1 2 4,72 2 . 1 0 8/1 /1 2 4,45 1 .05

2/1 /1 3 4,859.05 2/1 /1 3 4, 582 .35

8/1 /1 3 5,000.00 8/1 /1 3 4, 7 1 7 .55

2/1 /1 4 4,856 .70

8/1 / 1 4 5,000.00

-, ... ,. __ ,_,,_ ---�---------... ·----------------------

....... ,,, •• ,-... ! ........ -.............. �- -- ---.... ...... .. , . . ,. ... Cotati-Rohnert Park Unified School District

Capital Appreciation Bonds

Reoffering Yield Accreted Value Tables

Maturity Date 8/1 /1 5 Maturity Date 8/1 /1 6 Maturity Date 8/1 /1 7

Yie ld 5 .950% Yield 6.000% Yield 6.050%

Date Accreted Value Date Accreted Va l ue Date Accreted Value 2/1 3/97 1 ,693 .30 2/1 3/97 1 , 581 .85 2/1 3/97 1 ,476.30

2/1 /97 1 ,690.00 2/1/97 1 ,5 78 .75 2/1 /9 7 1 ,473 .40

8/1 /9 7 1 , 740.30 8/1/97 1 ,626 . 1 0 8/1 /97 1 ,5 1 7.95

2/1 /98 1 , 792.05 2/1 /98 1 ,674.90 2/1 /98 1 ,563.85

8/1 /98 1 ,845.35 8/1 /98 1 ,725 . 1 5 8/1 /98 1 ,61 1 .20

2/1 /99 1 ,900.25 2/1 /99 1 , 776.90 2/1/99 1 ,659 .90

8/1 /99 1 ,956 .80 8/1 /99 1 ,830.20 8/1 /99 1 ,7 1 0 . 1 5

2/1 /00 2 ,0 1 5 .00 2/1 /00 1 ,885 . 1 0 2/1 /00 1 , 76 1 .85

8/1/00 2,074.95 8/1 /00 1 ,94 1 .65 8/1 /00 1 ,8 1 5 . 1 5

2/1 /0 1 2 , 1 36.70 2/1 /0 1 1 ,999.90 2/1/0 1 1 ,8 70.05

8/1 /01 2,200.25 8/1 /0 1 2,059.90 8/1 /01 1 ,926.65

2/1 /02 2,265 . 70 2/1 /02 2, 1 2 1 . 70 2/1 /02 1 ,984.90

8/1 /02 2 ,333 . 1 5 8/1 /02 2, 1 85 .35 8/1/02 2,044.95

2/1 /03 2,402 .55 2/1/03 2,250.90 2/1 /03 2, 1 06.85

8/1 /03 2,474.00 8/1 /03 2,3 1 8.45 8/1 /03 2, 1 70.55

2/1 /04 2 ,547.60 2/1 /04 2,388 .00 2/1 /04 2 ,236 .20

8/1 /04 2,623 .40 8/1 /04 2,459.65 8/1 /04 2,303 .85

2/1 /05 2 ,701 .45 2/1 /05 2 ,533 .45 2/1 /05 2 ,3 73 .55

8/1 /05 2 , 78 1 .85 8/1 /05 2,609.45 8/1 /05 2,445 .35

2/1/06 2 ,864.60 2/1 /06 2,687. 70 2/1 /06 2,5 1 9.35

8/1 /06 2 ,949.80 8/1 /06 2,768.35 8/1 /06 2 ,595 .55

2/1/07 3,03 7 .55 2/1 /07 2,85 1 .40 2/1 /07 2 ,674.05

8/1 /0 7 3, 1 27 .95 8/1 /07 2,936.95 8/1 /07 2, 754.95

2/1 /08 3,2 2 1 .00 2/1 /08 3,025 .05 2/1 /08 2 ,838.30

8/1 /08 3,3 1 6 .80 8/1/08 3 , 1 1 5 .80 8/1 /08 2,924. 1 5

2/1 /09 3,4 1 5 .50 2/1 /09 3 ,209.30 2/1 /09 3,0 1 2 .60

8/1 /09 3,5 1 7 . 1 0 8/1/09 3,305.55 8/1 /09 3 , 1 03 .75

2/1 /1 0 3,62 1 . 75 2/1 /1 0 3,404 . 75 2/1 /1 0 3 , 1 97 .60

8/1 /1 0 3 , 72 9 .50 8/1/1 0 3,506.85 8/1 /1 (} 3 ,2 94.35

2/1 /1 1 3,840.45 2/1 /1 1 3,6 1 2 . 1 0 2/1 /1 11 3 ,394.00

8/1 /1 1 3,954 .70 8/1 /1 1 3, 720.45 8/1 /1 1 3,496 . 70

2/1 /1 2 4,072 .35 2/1 /1 2 3,832.05 2/1/1 2 3,602 .45

8/1 /1 2 4 , 1 93 .50 8/1 /1 2 3 ,947.00 8/1 /1 2 3, 7 1 1 .45

2/1 /1 3 4,3 1 8 .25 2/1 /1 3 4,065 .45 2/1 /1 3 3 ,82 3 . 70

8/1 /1 3 4,446. 75 811 /1 3 4, 1 87.40 8/1 /1 3 3,939.35

2/1 /1 4 4, 5 79.00 2/1 /1 4 4,3 1 3 . 00 2/1 /1 4 4,058 .55

8/1 /1 4 4, 7 1 5 .2 5 8/1 /1 4 4,442 .40 8/1 /1 4 4, 1 8 1 .30

2/1/1 5 4, 855 .50 2/1 /1 5 4,5 75 . 70 2/1 /1 5 4,307.80

8/1 /1 5 5,000.00 8/1 /1 5 4,71 2 .95 8/1/1 5i 4,438. 1 0

2/1 /1 6 4, 854.35 2/1 /1 6 4, 5 72 .3 5

8/1 /1 6 5,000.00 8/1 /1 6 4, 7 1 0 .65

2/1/1 7 4,853 . 1 5

8/1 /1 7 5,000.00

Cotati-Rohnert Park Unified School District Capital Appreciation Bonds

Reoffering Yield Accreted Value Tables

Matu rity Date 8/1 /1 8 Maturity Date 8/1 /1 9 Matu rity Date 8/1 /20

Yield 6.075 % Yield 6. 1 00% Yield 6.200%

Date Accreted Val ue Date Accreted Va lue Date Accreted Val ue 2/1 3/9 ? 1 , 383 .65 2/1 3/97 1 ,296.20 2/1 3/9 7 1 , 1 93 . 1 5

2/1 /9 7 1 ,380.90 2/1 /97 1 ,293 .60 2/1 /9 7 1 , 1 90 .70

8/1 /9 7 1 ,422 .85 8/1 /97 1 ,333 .05 8/1 /97 1 ,2 2 7.60

2/1 /98 1 ,466.05 2/1 /98 1 ,3 73 . 70 2/1 /98 1 ,265 .65

8/1 /98 1 , 5 1 0.60 8/1 /98 1 ,4 1 5 .60 8/1 /98 1 ,304.90

2/1 /99 1 , 556 .50 2/1 /99 1 ,458.80 2/1 /99 1 ,345.35

8/1 /99 1 , 603 .75 8/1 /99 1 ,503 .30 8/1 /99 1 ,387.05

2/1 /00 1 , 652 .50 2/1 /00 1 ,549. 1 5 2/1 /00 1 ,430.05

8/1 /00 1 ,702 . 70 8/1/00 1 , 596.40 8/1 /00 1 ,474.40

2/1 /0 1 1 ,7 54 .40 2/1 /0 1 1 ,645 . 1 0 2/1 /0 1 1 , 520. 1 0

8/1 /0 1 1 ,B07.70 8/1 /0 1 1 ,695.25 8/1 /0 1 1 , 567.25

2/1 /02 1 ,B62 .60 2/1 /02 1 , 746.95 2/1 /02 1 , 6 1 5 .80

8/1 /02 1 ,9 1 9 . 1 5 8/1 /02 1 ,800.25 8/1 /02 1 ,665 .90

2/1 /03 1 ,977 .45 2/1 /03 1 ,855 . 1 5 2/1 /03 1 , 7 1 7 .55

8/1 /03 2,03 7 .55 8/1 /03 1 ,9 1 1 . 75 8/1 /03 1 , 770.80

2/1 /04 2 ,099.45 2/1 /04 1 , 970.05 2/1 /04 1 ,825 . 70

8/1 /04 2, 1 63 .20 8/1 /04 2,030. 1 5 8/1 /04 1 ,882.30

2/1 /05 2,22 8 .90 2/1 /05 2,092.05 2/1 /05 1 ,940.65

8/1 /05 2,296.60 8/1 /05 2, 1 55 .85 8/1 /05 2,000.80

2/1 /06 2 ,366 .35 2/1 /06 2 ,22 1 .60 2/1 /06 2,062.85

8/1 /06 2,438.25 8/1 /06 2 ,289.40 8/1 /06 2, 1 2 6.80

2/1/07 2,S 1 2 .30 2/1 /07 2 ,359 .20 2/1 /07 2 , 1 92 . 70

8/1 /07 2,588.60 8/1 /07 2,43 1 . 1 5 8/1 /07 2 ,260 . 70

2/1/08 2,667.25 2/1 /08 2,505 .30 2/1 /08 2 ,330 .7.5

8/1 /08 2,] 48 .25 8/1 /08 2 ,58 1 . 70 8/1 /08 2,403 .00

2/1 /09 2,133 1 . 75 2/1 /09 2,660.45 2/1 /09 2,477.50

8/1 /09 2 ,9 1 7.75 8/1 /09 2 ,74 1 .60 8/1 /09 2 ,554.30

2/1 /1 0 3 ,006.40 2/1 /1 0 2,825.25 2/1 /1 0 2 ,633 .50

8/1 / 1 0 3,097.70 8/1 /1 0 2,9 1 1 .40 8/1 /1 0 2 ,7 1 5 . 1 5

2/1 /1 1 3, 1 9 1 .80 2/1 /1 1 3 ,000.20 2/1 /1 1 2, 799.30

8/1 /1 1 3 ,288 .75 8/1 /1 1 3 ,09 1 . 70 8/1 /1 1 2 ,886. 1 0

2/1 /1 2 3,388.65 2/1 /1 2 3, 1 86.00 2/1 /1 2 2 ,975 .55

8/1 /1 2 3 ,49 1 .60 8/1/1 2 3 ,283 .20 8/1 /1 2 3 ,067.80

2/1 /1 3 3 ,597.65 2/1 /1 3 3 ,383 .30 2/1 /1 3 3 , 1 62 .90

8/1 /1 3 3 ,706.95 8/1 /1 3 3,486.50 8/1 /1 3 3 ,260.95

2/1 11 4 3 ,8 1 9 .50 2/1 /1 4 3 ,592 .85 2/1 /1 4 3 ,362 .05

8/1 /1 4 3 ,935 .55 8/1 /1 4 3 , 702 .45 8/1 /1 4 3,466 .25

2/1 / 1 5 4,055 . 1 0 2/1 /1 5 3,8 1 5 . 35 2/1 /1 5 3 ,573 . 75

8/1 /1 5 4, 1 78 .25 8/1 /1 5 3,93 1 .75 8/1 /1 5 3,684.50

2/1 /1 6 4, 305.20 2/1 /1 6 4,05 1 .65 2/1 /1 6 3 , 798 .75

8/1 /1 6 4,43 5 .95 8/1 /1 6 4, 1 75.20 8/1 /1 6 3 ,9 1 6.50

2/1 /1 7 4, 5 70 .70 2/1 /1 7 4,302 .55 2/1 /1 7 4,03 7 .90

8/1 /1 7 4,709.50 8/1 /1 7 4,433 .80 8/1 /1 7 4, 1 63 . 1 0

2/1 /1 8 4,852.60 2/1 /1 8 4,569.05 2/1/1 8 4,292 . 1 5

8/1 /1 8 5 , 000.00 8/1/1 8 4,708.40 8/1 /1 8 4,42 5 .20

2/1 /1 9 4, 852.00 2/1 /1 9 4,5 62 .40

8/1 /1 9 5 ,000.00 8/1 /1 9 4,703 .80

2/1 /20 4,849.65

8/1 /20 5,000.00

--···---11----·----------·----------------... -----1_.,.

. ....... �,, .. , ... 1111 .. ,�••1•11ai.-.Wt1-•··--------·----------- ------·---------......... .-w .. .... - •. •

Maturity Date

Yield

Date

2/1 3/97

2/1 /97

8/1/97

2/1 /98

8/1 /98

2/1 /99

8/1/99

2/1/00

8/1 /00

2/1 /01

8/1 /0 1

2/1 /02

8/1 /02

2/1 /03

8/1 /03

2/1 /04

8/1 /04

2/1 /05

8/1 /05

2/1 /06

8/1 /06

2/1 /07

8/1/07

2/1 /08

8/1/08

2/1 /09

8/1 /09

2/1 /1 0

8/1 /1 0

2/1 /1 1

8/1 /1 1

2/1 /1 2

8/1/1 2

2/1 /1 3

8/1 /1 3

2/1 /1 4

8/1 /1 4

2/1 /1 5

,8/1 /1 5

2/1 /1 6

,g/1 /1 6

.2/1 /1 7

:3/1 /1 7

2/1 /1 8

a/1 /1 8

2/1 /1 9

8/1 /1 9

2/1 /20

13/1/20

2/1 /2 1

8/1 /2 1

8/1 /2 1

6.200%

Accreted Value

1 , 1 22 .45

1 , 1 20. 1 5

1 , 1 54 .90

1 , 1 90. 70

1 ,22 7.60

1 ,265.65

1 ,304 .90

1 , 345 .35

1 , 387.05

1 ,430.05

1 ,474.40

1 ,520. 1 0

1 , 567.25

1 ,6 1 5 .80

1 ,665 .90

1 , 7 1 7.55

1 , 770.80

1 ,825 .70

1 ,882.30

1 ,940.65

2,000.80

2,062.85

2, 1 26.80

2, 1 92 . 70

2,260. 70

2,330.75

2 ,403 .00

2,477.50

2,554.30

2,633.50

2 ,7 1 5 . 1 5

2, 799.30

2,886. 1 0

2,975.55

3,067.80

3, 1 62 .90

3,260.95

3,362 .05

3,466.25

3 ,573 . 75

3,684.50

3 ,798. 75

3 ,91 6.50

4,037.90

4, 1 63 . 1 0

4,292 . 1 5

4,425 .20

4,562 .40

4, 703.80

4,849.65

5,000.00

Cotati-Rohnert Park Unified School District Capital Appreciation Bonds

Reoffering Yield Accreted Value Tables

(THIS PAGE INTENTIONALLY LEFT BLANK)

....... ,, ... -, .. ,-.. -----···-------------- _____ , ________ ,.._ ......... ,_ .•... �-

APPENDIX F

SPECIMEN OF BOND INSURANCE POLICY

F- 1

(THIS PAGE INTENTIONALLY LEFT BLANK)

_ ........... -1 ................... ,,-·-··· ..... ,---------- ------·------ ................... .._ _____ , _____________________________ .... __ ......__ _

Financial Guaranty Insurance Company 115 Broadway \"ew York. :\Y 10000 2 1 :2 . 31 2-3000 800 .352-000 1

A GE Capital Company

Municipal Bond New Issue Insurance Policy

Issuer:

Bonds:

Policy Number:

Control Number:

Premium:

Financial Guaranty Insurance Company ··financial Guaranty· · :, . a .\"ew Y in consideration of the payment of the premium and subjec t to the tenns o unconditionally and irrerncahly agrees to pay to State Street 1d Tr successor. as its agent I the ·· Fiscal :\gent"· ,. for the bene · � and interest on the above-described debt obligati 1e · Bon but shal l be unpaid by reason of :\'onpayme1 t he lss

EXH!Brr A

Financial Guarani,· will makr sud e sm I I� <'tpal or i11tn1•st c Financial Guaranty shall

haw rl'Ceived '.\otice will disburse to the Bondholdrr the faee amou ent but is unpaid by rPason of �onpayr Agent. in form rew,onably satisfactory to it. of ( i eive pa · 1ent of the principal or interf'st Dut> for Paymnll and

,/ . s 1ts of assignmi>nt. that all of tilt' Bondholder's right� to ( .. <\� -�>11<vm

d,·� e prill(· al or int rt I DuP for Payment shall thereupon vest in Financial Guaranty. l"pon

lo. ' ., " Fina cial (' · nty shall lwmme the owni>r of tht• Bond. appunenant mupon or right to payr st on such Bond and shall lw fully subroga1rd to all of the Bondholdrr's rights

.....,.,.....--....., he-rru 1e Bondholder's nght to paymrnt thm"Of.

.,..........-. )r ·� Po · . •� 111m-rann·llahl1· f or an� rrason . Thi• premium 01 1 this Polil'y i:; not rt•fundahlP for any n·ason.

� )

1 mg tht' paymrnt of th1· Bondi. prior to t111:�ir maturity. This Poliey does not irnmn• against loss of any

Y prepayment premium which may at an� tinw fw payahlr with respect to any Bond .

>-'"' \s used hen·m. t lu· term · ·Bo11dholdn· · l l l!'ans. as to a p1111ic11lar Bond. t lw prrson otlwr than thr bs1wr

who. at tht• time of '.'lonpayment. is rntitled under the terms uf such Bond to paymen:t thereof. · ·Due for Payment .. mt>ans. when n·frning to the principal of a Bond. the stated maturity date thereof or the date on which the same shall haw bt"t'n duly called for mandatory sinking fund redt>mption and does not rrfer to any earlier datt' on which paym1·111 is due by reason of call for n·demption ( other than by mandatory sinking fund redemption ', . acceleration or other advann·rnent of maturity and me.ans. when reforring to interest on a

FGIC i, a rt'!!i,terrd ,.,·nicr mark 1i-,·d I n F i11aiwial C11aram1· l11;11ra11ce Clllnpam· undrr lic1•1i,;e from ib parent company. FGIC Corporanon.

Form 9000 ,. 10/93 P�r 1 of 2

l 'inaiwia l Cuaran1,· ! 1 1s11 rance ( :ompam 1 13 Bmm h,a, \"ew York. \ Y 10 006 2 1 2 3 1 2 -3000 800 :-l:J:!-000 1

A GE Capital Company

Municipa1l Bond Ne\\' Issue Insurance Policy

i =

Bond. tlw statt'd datt' f or payment of inten·st . · ·!'IJonpayrrwnt . . in n•spP<'t of a Borrd rnPaw; tlw failurt' of thf' lssut'r to hnn· provid1·d sufti!'ient fun<fa to t lw paying agPnt for paynwnt i n fu l l of al l prineipal and intPrest DuP f< ir Paymrnl on such Bond . · ·'.\oti1·p" rrwans IPlqihoni l ' or tt'IPgraphic noti1·t'. suhs1·q1wntly ron firmP<l in writin:!!. or writtPn noticr hv registt'rt'd or 1wti f iPd mail. from a Bondhold,·r or a paying agnH for tht' 10 Financial Guaranty. ··Busirwss Day .. nwans any dm otlwr than a Saturday. Sunday or a da\ ... · --...:,11; · thP Fi -;cal \�1·11 1 is authorizPd by law lo rPmain drnwd.

In ,·rime," \,nereof. Financial Guaranty has caused this Policy to be affixed to be ,,;i;med by its duly authorized officer in fac�irnile to become effectfre d bi, Guaranty by Yirtue of the counter�ignature of its duly authorize

Presidenc

Authorized Representative

pany. :\.A .. acknowledges that it has agreed to perform the duties of Fiscal

FGIC ,. " fl' !!i -l"r�d "'!"\"in• mark 1 1,,·d bv Finan.- ial Cua rant\ ln,11rn111·!' Company undt>r lict>n,t> from ir,; parent rompany. FGIC Corporation.

Form !JO()( ) 10/93\ P�r :2 of :2

.,._ . .,.,. ____ 11-----�----------------.. -------------------119••••••1�

. ....... ..... -. .,, ................ -·-···--------- ·-----·------ ___ , __________ ... ,..., ____ .. ., ....... .

Financial GuaramY ln�uranre Company 115 Broadway

.\ew lork. :\T 1000b

2 1 2 , 3 12 -3000

800'! 352-0001

A GE Capital Company

- ................ .. Endorsement

To Financial Guaranty Insurance Company Insurance Policv

Policy Number: Control Number:

It i� furtlwr understood that tllf' tl'rrn ·· \onpay111Pn1 ·· in rn,p1•1·t of a Bond indw or interest madt> lo a Bondholder h\' or 1 111 ht>half of t lw i!,Stlt'r of sud, Bon such Bondholdn fHt rsuant to tht> l :nitt>d �tatt's Bankniptl"y Codi' by a trns with a final. nonappn1lahl1· ordn of a co11n havin_!! <·om1wtent

'.'JOTHIXG HERE!:\ SHALL BE CONSTRCED TO \�-IN ANY OTHER SECTIO.\ OF THE POLICY. I l-:\

FGIC.

to J xed with it,; corporate

.A."'

�\ !(__---.._ Presi

'--, ) "'-.� Ellec,dve Date,

Y Acknowlt>dged as or the Effl'<'li\·e Datt' wrillt>n abovl':

Authorized Officer

effective and binding upon

Authorized Hepresentative

State Street Bank and Trui,;t Company. :\.A .. as Fiscal Agent

FGIC is a re2istered sen·irP mark used bv Financial Cuarann ln:mrancr C:ompanv under licmse from it; parent mmpany. FCIC Corporation .

Fom1 E-0002 ' 10/9.1 Page l of 1

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