TO: Board of Supervisors
FROM: Ryan J. Alsop, County Executive Officer
REPORT BY: Thomas C. Zeleny, Chief Deputy County Counsel
SUBJECT: Napa Valley Unified School District General Obligation Bonds
RECOMMENDATION
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Adopt a Resolution authorizing the Napa Valley Unified School District to issue general obligation bonds for School Facilities Improvement Districts No. 1 and No. 2, without further approval of the Board of Supervisors or officers of Napa County.
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BACKGROUND
On May 3, 2022, the Board of Supervisors authorized the Napa Valley Unified School District to create school facilities improvement districts pursuant to Napa County Resolution No. 2022-59. On June 23, 2022, the School District formed School Facilities Improvement District No. 1 (“District No. 1”), generally consisting of School District territory within the City of Napa and nearby unincorporated area of Napa County, and School Facilities Improvement District No. 2 (“District No. 2”), generally consisting of School District territory within the City of American Canyon and nearby unincorporated area of Napa County.
At the General Election held on November 8, 2022, voters approved Measure “A2” authorizing the School District to issue and sell up to $25 million in general obligation bonds for various school improvements in District No. 2. At the General Election held on November 5, 2024, the voters approved Measure “B” authorizing the School District to issue and sell up to $230 million in general obligation bonds for various school improvements in District No. 1.
On March 13, 2025, the Board of Education of the School District adopted Resolution Nos. 25-29 and 25-30 (“District Resolutions”) authorizing the issuance of Election of 2024, Series A Bonds for up to $80 million for District No. 1 and Election of 2022, Series B Bonds for up to $12.5 million for District No. 2. Copies of the adopted District Resolutions are attached. The Board of Supervisors previously approved the issuance and sale of up to $12.5 million in Series A Bonds for District No. 2 pursuant to Resolution No. 2023-54, so this request consists of the remaining amount authorized by the voters in 2022 for District No. 2. This is the first request to issue and sell bonds for District No. 1.
The District Resolutions anticipate that the Board of Supervisors will authorize the School District to issue and sell the bonds on its own behalf, subject to the terms set forth in the District Resolutions. Education Code Section 15140(b) authorizes the Board of Supervisors to take such action by resolution if the School District has not received a qualified or negative certification in its most recent interim financial report. The District Resolutions indicate it has not received such a qualified or negative certification, so the Board of Supervisors may give the School District the authorization it seeks.
The proposed County Resolution includes the standard condition of approval that the County shall not be responsible for any aspect of the sale of these bonds, granting the School District the ability to sell the bonds without County involvement. The Resolution also provides that the County is not responsible if the School District fails to timely provide to the Napa County Auditor-Controller and the Napa County Treasurer-Tax Collector the final debt service schedule for the bonds, reflecting the principal amounts and interest rates of such bonds, in sufficient time to permit the County to establish tax rates and necessary funds or accounts for the bonds. These time deadlines will be established by the Auditor-Controller and Treasurer Tax-Collector. The County will be responsible for the levy and collection of taxes to pay principal of and interest on the bonds, as it does with other school bonds.
FISCAL & STRATEGIC PLAN IMPACT
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Is there a Fiscal Impact? |
No |
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Is it Mandatory or Discretionary? |
Discretionary |
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Discretionary Justification: |
Action is requested by the school district. Allows the school district to issue bonds without further County approval. |
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Consequences if not approved: |
County may need to take a more active role in securing financing for the school district. |
ENVIRONMENTAL IMPACT
ENVIRONMENTAL DETERMINATION: This proposed activity is not subject to CEQA pursuant to CEQA Guidelines section 15060(c)(3) because the activity is not a project pursuant to section 15378, and because it will not result in a direct or reasonably foreseeable indirect physical change in the environment pursuant to section 15060(c)(1).