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Levy, Tax and Bond Update

November 25, 2024

Educational Programs & Operation Levies (EP&O)

• Levies are for Learning
• Flexible revenue from local taxpayers to supplement basic education, athletics, and other programs
• Subject to levy lid laws: $3,150 per pupil
• Up to 4 years collection
• Simple Majority 50% +1
• Current EP&O Levy approved through 2028

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Source: EHJR 4204, RCW 84.52.053

Levy and Bond Overview

Capital Projects Levies

• Common uses: technology, safety, security, athletic fields, repair roofs, HVAC, parking, renovations, etc.
• Up to 6 years collection
• Simple Majority 50%+1
• Current Capital Levy approved through 2025
• May be ‘front-funded’ with a non-voted bond to begin projects early

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School Bonds

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• Bonds are for Buildings
• Tax-exempt, receive proceeds up-front
• 20-year term most common
• Super Majority 60%
• 2024 Debt Capacity $361.2 Million
• Last bond was approved in September 1990 ($8.72 Million)

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Source: OSPI 1463-GF, 1463-BI

Levy and Bond Overview

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Property Values and School Taxes

Source: State of Washington, Office of Superintendent of Public Instruction, County Assessor Annual Report, *preliminary

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Source: State of Washington, Office of Superintendent of Public Instruction, County Assessor Annual Report, *preliminary

Property Values and School Taxes

In 2024, Cle Elum-Roslyn SD was ranked 279th out of 287 school districts for tax rate in Washington State.

Voters approved an estimated $1.00 tax rate for calendar year 2024, the actual tax rate today is $0.58

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Source: OSPI 1463-GF, 1463-BI, County Assessor Annual Report and/or Sample Ballot. *voter approved

Property Values and School Taxes

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Source: sos.wa.gov, County Auditor Sample Ballot

Property Values and School Taxes

• Some school districts in Washington State have adjusted strategies to fund capital improvements due to the challenges with the super majority requirements
• Capital Projects Levies require 50% +1 to pass, but have other challenges
• Front funding capital levies with bonds alleviates cash flow shortages, but can create other challenges

Bond and Tax Rate Planning

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Source: County Assessor Annual Report

Assumptions: Scenario 20-23 - AV Growth of 3.5% in 2026 -27, followed by 3% in 2028, 2.5% in 2029-30 and 2% thereafter, two sales, 100 bps cushion in 2027 &150 bps in 2028

Bond and Tax Rate Planning

Two Year Capital Levy

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Source: County Assessor Annual Report

Assumptions: Scenario 24-27 - AV Growth of 3.5% in 2026 -27, followed by 3% in 2028, 2.5% in 2029-30 and 2% thereafter, two sales, 100 bps cushion in 2027 &150 bps in 2028

Bond and Tax Rate Planning

Three Year Capital Levy

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DA DAVIDSON OFFERS:

• Bond and Levy Planning
• Attend and Present at Facility/Community Meetings
• Market and Sell Bonds
• Long Range Capital Financing
• Credit Evaluation and Ratings Presentations
• Continuing Disclosure Compliance
• Annual Debt Service Fund Cash Flows
• Tax Rate Projections
• Budget Support and Notes to the Financials
• Arbitrage Rebate Support
• Monitor Potential Refunding Savings

Neither this material nor any of its contents may be disclosed, sold, or redistributed, electronically or otherwise, without prior written consent of Davidson Companies. The information presented herein is based on public information we believe to be reliable, prevailing market conditions, as well as our views at this point in time. We make no representation or warranty with respect to the accuracy or completeness of this material. Past performance is not necessarily indicative of future results. Davidson Companies does not assume any liability for any loss which may result from the reliance by any person upon such material. We make no representations regarding the legal, tax, regulatory, or accounting implications of entering into a Transaction.

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Required Disclosure Pursuant to MSRB Rule G-23: An underwriter’s primary role will be to purchase as principal, or arrange for the placement of the securities in a commercial arm’s length transaction with the issuer, and may have financial and other interests that differ from those of the issuer. In its capacity as underwriter and not as financial advisor, an underwriter may provide incidental financial advisory services at the issuer’s request, including advice regarding the structure, timing, terms and other similar matters concerning the issuance. However, an underwriter does not assume any financial advisory or fiduciary responsibilities with respect to the issuer.