Garden Grove Unified School District Successfully Sells $120 Million of Tax Exempt Bonds
- Tuesday, October 1, 2013
On Wednesday, September 25, Garden Grove Unified School District sold $119.995 million of tax exempt bonds, the final issuance of the $250 million bond authorized by voters in 2010 as part of Measure A.
As a result of the sale, GGUSD will receive $180 million in matching state allocation to fund the modernization of school sites, most of which have not been renovated in more than 50 years.
Thanks in large part to the district’s fiscal stability and strong ratings of Aa2/AA- by national rating agencies Moody’s Investors Service and Standards & Poor’s, investors responded favorably and the bonds sold within a matter of hours. The increased demand enabled the district to lower the initial interest rate; the bonds were sold at a repayment ratio of 1.996:1. Ratings were based on the district's strong management, healthy reserve levels, large tax base and low overall debt.
The sale comes one week after three members of the Orange County Board of Supervisors - Janet Nguyen, John M.W. Moorlach, and Patricia C. Bates - voted in favor of the sale. The bonds will be fully repaid in 2040, the same year that the District's outstanding bonds sold in 2010 will also be paid off.
With the money from the bond sales, which become available on October 9, and the matching state funds, school facilities will be modernized to ensure a secure and updated infrastructure. The modernization effort will provide long-overdue upgrades to electrical and plumbing. Additionally, aging schools will be updated to ensure Americans with Disabilities Act (ADA) compliance, safety gates and panic hardware will be installed on doors to help keep students safe during an emergency, fire alarm systems will be improved, and the new technology infrastructure will be able support wireless and wired access.