SUPPLEMENTAL SUBJECT: APPROVAL OF THE SALE AND ISSUANCE OF MULTIPLE SERIES OF. TAX ALLOCATION REFUNDING BONDS AND RELATED BOND DOCUMENTS

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1 BOARD AGENDA: 5/16/17 ITEM: 9.2 CITY OF SAN TOSE CAPITAL OF SILICON VALLEY Memorandum TO: SUCCESSOR AGENCY BOARD FROM: Julia H. Cooper SUBJECT: SEE BELOW DATE: May 12, 2017 Approved Date SUPPLEMENTAL SUBJECT: APPROVAL OF THE SALE AND ISSUANCE OF MULTIPLE SERIES OF. TAX ALLOCATION REFUNDING BONDS AND RELATED BOND DOCUMENTS REASON FOR SUPPLEMENTAL This memorandum provides supplemental information to the Memorandum, dated April 26, 2017, related to the approval of a resolution authorizing the sale and issuance of multiple series of tax allocation refunding bonds (the "Series 2017 Bonds") and related bond documents (the "Original Memorandum"). In particular this memorandum provides information relating to the: Recommended financing structure for the Series 2017 Bonds Estimated savings based on market conditions as of May 1, 2017 Estimated sources and uses of funds, including estimated transaction costs and not to exceed underwriters' discount List of City-owned assets to be refinanced on a taxable basis Refunding Policy Objectives Additional Recommendation Additional Recommendation: Approval to extend_for ninety (90) days the close of escrow for the sale of the following properties: 201 South Second Street, 292 Stockton Avenue, and 280 Jackson Street in San Jose due to the complexity of completing the tax analysis of the bond issues that financed the acquisition of these properties.

2 May 12, 2017 Page 2 ANALYSIS The Original Memorandum recommends approving the issuance of the Series 2017 Bonds in multiple series in an aggregate principal amount of not to exceed $1,800,000,000 to refund all of the Former Agency's outstanding tax allocation bonds and the Former Agency's obligations in connection with agreements entered into in connection with the City of San Jose Financing Authority's Revenue Bonds, Series 2001A (4 th & San Fernando Parking Facility Project) and Lease Revenue Bonds, Series 200IF (Convention Center Refunding Project) (collectively, the "Refunded Obligations"). The refunding and restructuring of Refunded Obligations are anticipated to achieve the following benefits: Savings for the Successor Agency in the form of lower aggregate debt service due to lower interest rates in the municipal bond market and the improved credit quality of the Former Agency; Elimination of potential debt service spikes with respect to outstanding variable rate tax allocation bonds; Materially improved debt service coverage and cash flow, which will enable the Successor Agency to repay other non-bond subordinate enforceable obligations on a faster schedule than would have otherwise been attainable and to enable earlier distribution of residual revenues to the taxing entities, including the City; Simplified administration of outstanding obligations through consolidation of 25 series of bonds and other obligations expected to be outstanding at the time of the refunding. These bonds and other obligations were issued under six indentures with three trustee banks and separate housing-set aside and non-housing set-aside tax increment pledges, into two to four series of bonds issued under one indenture with a single trustee bank and a combined tax increment pledge; Greater flexibility in the operation and ownership of certain City assets that were financed in whole or in part through tax exempt bonds of the Former Agency; Ensure compliance with federal tax law. At the time that the Original Memorandum was prepared, certain details of the Series 2017 Bonds were not yet known. In addition, the Successor Agency's municipal advisors, Ross Financial and Public Financial Management, Inc. had not yet finalized their analysis (the "Municipal Advisor Work Product") to demonstrate that the issuance of the Series 2017 Bonds will meet the savings parameters (the "Savings Parameters") and debt service spike refunding test (the "Debt Service Spike Refunding Test") with respect to the Refunded Obligations, as required by the Dissolution Law. This Supplemental Memorandum provides additional detail about the Series 2017 Bonds and shows the Municipal Advisor Work Product on Exhibit A.

3 May 12,2017 Page 3 Description of the Series 2017 Bonds Policy Objectives The Successor Agency has developed the following policy objectives governing the issuance of the Series 2017 Bonds and these Policy Objectives are recommended for approval by the Oversight Board to guide the SARA in the structuring of the Refunding Bonds: Place the Successor Agency into a "sufficiency of funds" situation Create "near term" upfront savings to repay enforceable obligations that have remained unpaid given the Successor Agency's "insufficiency of funds" situation Accelerate the distribution of tax revenues to all taxing entities Simplify the administration of the outstanding bond portfolio Deferral of principal amortization on the refunding bonds only within the constraint of outstanding debt service in later years (no cash flow dis-savings in any year), subject to tax analysis. Create bond refunding structure which optimizes the rating on the Series 2017 Bonds, with a target rating in the "AA" rating category for the Series 2017A Senior Bonds (defined below) and in the "A" category for the Series 2017B Subordinate Bonds (defined below). Redevelopment Property Tax Trust Fund revenue pledge will exclude tax override levies for the County of Santa Clara employees' retirement program ("PERS") and the Santa Clara Valley Water District. Refunding a portion of the tax-exempt bonds on a taxable basis to remove/avoid tax constraints issues for Housing Set-Aside Tax Allocation Bonds, Series 1997E (AMT) and Series 2010A-1 (AMT) City of San Jose Financing Authority Lease Revenue Bonds, Series 200IF (Convention Center) - original series of bonds were issued in 1986 prior to significant changes to tax regulations B Tax allocation bonds associated with several key facilities which if refunded on a taxable basis instead of a tax-exempt basis will better enable the City to manage the use of the facilities (Civic Auditorium, Hammer Theater, and Mexican Heritage Plaza) without the restraints imposed by tax exempt financing Successor Agency property sales so as to remove any restrictions imposed by taxexempt bonds on the use of sale proceeds from the properties sold and to be sold under the Long Range Property Management Plan Financing of the outstanding arbitrage rebate due to the IRS on a taxable basis Additional bond structuring considerations include (but will not be refunded with the proceeds of the refunding bonds): H Payment of past-due County Pass-Through Payments D Payment of unsecured third party obligations (e.g. JCDecaux) Q Repayment of SERAF Loans

4 May 12, 2017 Page 4. Repayment of City advances for bonded debt payments (Convention Center & 4 th Street Garage) n Repayment of City advances for administrative costs Repayment of City Parking Loan Refunding bonds will be eligible for refunding in ten years (2027) at which point bond amortization may be restructured, considering tax increment revenues at that time (which will likely have grown significantly). Structure of the Series 2017 Bonds The Series 2017 Bonds are anticipated to be issued in three series: (a) tax-exempt Series 2017A Bonds (the "Series 2017A Bonds", (b) taxable Series 2017A-T Bonds (the "Series 2017A-T Bonds" and, with the Series 2017A Bonds, the "Series 2017A Senior Bonds") and (c) tax-exempt Series 2017B Bonds (the "Series 2017B Subordinate Bonds"). It is possible that one or more additional series may be issued, as noted below. The Series 2017A Senior Bonds will be secured by a senior lien pledge of tax revenues deposited in the Redevelopment Property Tax Trust Fund ("RPTTF") and the Series 2017B Subordinate Bonds will be secured by a subordinate lien pledge of such tax revenues. Based on current market conditions, the Successor Agency anticipates that the Series 2017 Bonds will be structured as follows: Series Issuance Maturity Dates 2017A $964,340,000 Aug 1, Aug 1, A-T $340,525,000 Aug 1, Aug 1, B $241,990,000 Aug 1, Aug 1, 2029 The principal amount of each of the Series 2017 Bonds is estimated based on interest rates and market conditions as of May 1, 2017, tax revenues generated from the Fiscal Year Assessed Value roll and attaining annual debt service coverage of 2.25x on the Series 2017A Senior Bonds. The final size of each series, the number of series to be issued and the principal amortization will depend on interest rates and market conditions at the time of sale, tax revenues to be generated from Fiscal Year assessed values (which will be known in early July 2017), final rating agency considerations, the availability and cost of bond insurance and reserve account surety bonds and the final tax analysis. The principal amortization on the Refunding Bonds will be fine-tuned accordingly at the time of sale. The following graph shows the resulting debt service (based on market conditions as of May 1, 2017) on the Series 2017 Bonds (green line) as compared with the structure of the Refunded Obligations (blue area):

5 May 12, 2017 Page 5 $ Millions $200 $180 $160 $140 $120 $100 $80 $60 $40 $20 $0 Lower annual payments CO LO co co co O CI (N CZ> o M Assuming an issuance date after August 1, 2017, the Series 2017 Bonds will refund, in full, $1,732,345,000! principal amount of Refunded Obligations. Refunding Analysis The Municipal Advisor Work Product, attached as Exhibit A, was prepared to demonstrate that the issuance of the Refunding Bonds will meet the Savings Parameters and the Debt Service Spike Refunding Test. The Municipal Advisor Work Product shows that Based on the above structure and market conditions as of May 1, 2017, the Series 2017 Bonds are projected to generate total debt service savings of $237,887,625 and net present value savings of $160,362,158, or 9.26% of the Refunded Obligations. The Refunding Bonds will eliminate the potential debt service spikes that might otherwise occur with respect to the five series of Refunded Obligations listed in Exhibit A under "Summary of Bonds to Refund". The principal amount of Refunding Bonds allocable to such Refunded Obligations (Debt Service Spikes) is not accelerated except as provided by the Dissolution Law and the principal amount of the allocable Refunding Bonds does not exceed the amount required to finance the debt service spikes, including customary debt service reserves and related costs of issuance. 1 The Original Memorandum noted that the $1,731,545,000 of Refunded Obligations was scheduled to be outstanding, assuming an issuance date on or after August 1, The correct amount is $1,732,345,000.

6 May 12, 2017 Page 6 The projected debt service savings differ by year in accordance with the refunding objectives and considerations previously discussed: Maturity Dates of Series 2017 Bonds August 1, 2018 through August 1, 2022 August 1,2023 August 1, 2024 through August 1, 2027 August 1, 2028 August 1, 2029 through August 1, 2036 Estimated Annual Savings $36.7 million to $37.2 million $24.3 million $8 million $4.5 million No savings or dis-savings Effect on Current Insufficiency of Funds and Residuals The Successor Agency is currently in an "insufficiency of funds" situation. Tax revenues from the Redevelopment Property Tax Trust Fund ("RPTTF") are not sufficient to pay both debt service on the Refunded Obligations and non-bonded, subordinate enforceable obligations. Unpaid enforceable obligations continue to accrue, with a shortfall of more than $38 million projected in the near term. The following graph shows the Successor Agency's current enforceable obligations, the current insufficiency, and the period over which unpaid enforceable obligations can be repaid based on projected Fiscal Year 2018 distributions from the RPTTF: Cash Flows With Current Debt $ Millions $350 TI Shortfall Repayment of Shortfall Est. FY18 Pledged TI Residuals (N<N<N(N<N<N<N<N<N<N(N(N O (N CO lo CO ~ o CO o CO o CO o CO CO <N <N (N <N ~

7 May 12, 2017 Page 7 The proposed structure is expected to eliminate the Successor Agency's current insufficiency status by Fiscal Year Without further growth in Assessed Value, sufficient tax revenues after debt service should exist to: Repay the County, the City and other third parties by June 2018 Make annual County pass-through and AB 1290 payments Repay HUD Loans, the City SERAF and Parking Loans as scheduled Distribute residual revenues to all taxing entities beginning in Fiscal Year The graph below shows the Successor Agency's cash flows after the issuance of the Series 2017 Bonds (based on market conditions of May 1, 2017): Cash Flows With Proposed Debt Structure $ Millions $350 Est. FY18 Pledged TI OOOsOrHfNcO^LnvOKOOONOT-lCNcO'^LO^O r H H M N M M N M N O J M N c O t O c O C O C O C O c O O O O O O O O O O O O O O O O O O O O ( N M M N ( N ( N M ( N N ( N M M ( N N ( N N ( N ( N N

8 May 12,2017 Page 8 Estimated Sources and Uses The estimated sources and uses of funds for the Series 2017 Bonds, including estimated transaction costs, are as follows based on market conditions as of May 1, 2017: Successor Agency to the Redevelopment Agency of the City of San Jose Tax Allocation Refunding Bonds, Series 2017A, 2017A-T and 2017B Estimated Sources and Uses of Funds 0) Sources: Senior Senior Subordinate Series 2017A Series 2017A-T Series 2017B (Tax-Exempt) (Taxable) (Tax-Exempt) Total Bond Par $964,340,000 $340,525,000 $241,990,000 $1,546,855,000 Net Premium 142,434,813 30,312, ,747,480 Other Funds {2) 26,474,510 23,732,580 50,207,090 Total Sources $1,133,249,323 $364,257,580 $272,302,667 $1,769,809,570 Uses: Refunding Escrow $1,124,800,164 $357,356,489 $269,179,403 $1,751,336,056 Issuance Costs (3) 1,372,002 4,488, ,411 6,204,598 U/W Discount 3,402,785 1,115, ,150 5,286,710 Bond Ins./Surety 3,673,372 1,297,131 2,011,703 6,982,206 Total Uses $1,133,249,323 $364,257,580 $272,302,667 $1,769,809,570 (1) Preliminary; subject to change. Totals may not add due to independent rounding. (2) Consists of ROPS funds on hand and prior debt service reserve funds ( 3 ) Includes rating agency fees, legal and other professional fees, arbitrage rebate, and other costs of issuing the Refunding Bonds. The final sources and uses of the Series 2017 Bonds will depend on interest rates, marketing conditions at the time of sale, assigned ratings and projected tax increment to be generated by the Assessed Value rolls for Fiscal Year It is possible that the Successor Agency may be able to accomplish its refunding goals through the issuance of only two series of Series 2017 Bonds; alternatively, one or more additional series of Series 2017 Bonds may be required. Chanse in Tax Status of Certain Assets Certain of the Refunded Obligations that were issued on a tax-exempt basis will be refunded by taxable bonds currently contemplated to be issued as senior lien Series 2017A-T Bonds. The major assets and affected Refunded Obligations are:

9 May 12, 2017 Page 9 Various low income housing loans - Housing Set-Aside Tax Allocation Bonds, Series 1997E and Housing Set-Aside Tax Allocation Bonds, Series 2010A-1, the interest on which is subject to alternative minimum tax (AMT) Civic Auditorium - a portion of Tax Allocation Bonds, Series 2006B, Series 2007B and Series 2008B Mexican Heritage Plaza - a portion of Tax Allocation Bonds, Series 2004A, Series 2005A and 2006B Hammer Theater - a portion of Tax Allocation Bonds, Series 2004A, Series 2005A and 2006D Convention Center - Successor Agency's obligations under the Second Amended and Restated Reimbursement Agreement in connection with the City of San Jose Financing Authority Lease Revenue Bonds, Series 200IF (Convention Center Refunding Project) The refunding of such obligations on a taxable basis will ensure compliance with Federal tax law restrictions and will provide increased flexibility in the operation of the affected City-owned assets such that these assets can be operated in a manner similar to the way a private sector entity might operate them. The City continues to refine, in conjunction with a review by Bond Counsel, the list of assets that may be beneficial or necessary to refinance on a taxable basis. For example, those portions of the Refunded Obligations that financed the acquisition of properties to be sold pursuant to the Successor Agency's Long Range Property Management Plan also may need to be refinanced on a taxable basis. As staff is still in the process of performing certain tax analysis in connection with the disposition of the sale proceeds of certain Successor Agency properties, staff is requesting that the closing of the sales of for ninety (90) days the close of escrow for the sale of the following properties: 201 South Second Street, 292 Stockton Avenue, and 280 Jackson Street in San Jose. Ratins Agencies In early April, the Successor Agency provided credit updates to Fitch Ratings, Moody's Investors Service and S&P Global Ratings with respect to the Successor Agency's outstanding senior lien tax allocation bonds. At those meetings, the Successor Agency described the significant improvements to the Merged Area Project credit and the goals and approach to the refunding. All three rating agencies upgraded both outstanding ratings, as shown in the table below: Non-Housing Housing From To From To Moody's Baal A2 A2 A1 S&P BBB+ A A AA- Fitch BBB A+ A AA In June, the Successor Agency will meet with the rating agencies to obtain ratings on the Series 2017 Bonds, after which there will be final resolution with respect to such matters as target debt service coverage for the Series 2017A Senior Bonds and reserve fund sizing. Final ratings are

10 May 12, 2017 Page 10 expected in early July, following the release of the Fiscal Assessed Value roll and DOF approval. Sale Parameters Staff recommends that the Series 2017 Bonds be sold within certain parameters as described below. The Resolution sets forth these parameters. Principal Amount: The aggregate not-to-exceed principal amount remains $1,800,000,000, which represents the estimated maximum principal amount needed to refund the outstanding Refunded Obligations and pay for the cost of issuance, reserve fund sureties, bond insurance, if economic, underwriters' discount and the outstanding arbitrage rebate amount due. True Interest Cost: The Series 2017 Bonds are not subject to a specific true interest cost limitation. Rather, the Refunding Bonds must meet the savings parameters required under the Dissolution Act. Underwriters' Discount: The not-to-exceed total compensation to underwriters is 0.55% of the par value of the Series 2017 Bonds. The final compensation to underwriters will be determined prior to the sale of the Series 2017 Bonds. Transaction Costs The transactions costs are estimated at $6.2 million in the aggregate. These costs, which do not include the compensation to the underwriters or the cost of bond insurance/debt service reserve sureties, consist of two components: Traditional costs - These are costs for Bond and Disclosure Counsel, co-financial Advisors, Fiscal Consultant, Verification Agent, Rating Agencies, Official Statement printing, City out of pocket costs associated with rating agency/bond insurer tours, travel and investor presentations and related costs. These are estimated at $2.2 million in the aggregate. These costs will be spread on a pro rata basis among all series of Series 2017 Bonds. Arbitrage rebate compliance - The Successor Agency has an outstanding arbitrage rebate compliance amount owing to the U.S. Treasury associated with certain of the Refunded Obligations. The amount due, which will be finalized prior to the issuance of the Series 2017 Bonds, is currently estimated at $4 million, although the final costs may be as high as $9 million. The taxable Series 2017A-T Bonds will finance this cost.

11 May 12, 2017 Page 11 Financing Schedule The key remaining milestones 2 for the issuance of the Series 2017 Bonds are as follows: May Successor Agency Board consideration Oversight Board consideration Formal DOF Review begins o AB1290 Subordination letters delivered June Rating and bond insurer meetings Successor Agency approves the Preliminary Official Statement Early July Preliminary Fiscal Year Assessment Roll released 45 day AB1290 Subordination process complete Expected DOF approval on the refunding Ratings and insurance commitments received Release POS and distribute to potential investors Late July /August Investor roadshow and pre-marketing Price Refunding Bonds Close Refunding Bonds EVALUATION AND FOLLOW-UP As discussed in the Original Memorandum, the proposed issuance of Refunding Obligations also requires approval of the Oversight Board of the Successor Agency. As part of its approval, the Oversight Board will need to make the following determinations with respect to the Series 2017 Bonds: The Successor Agency is authorized to recover its costs related to the issuance of Series 2017 Bonds from the proceeds of the Series 2017 Bonds; The application of proceeds from the Series 2017 Bonds by the Successor Agency to the refunding and defeasance of all or a portion of the Refunded Obligations, as well as payment of issuance costs, shall be implemented by the Successor Agency upon the sale and delivery of the Series 2017 Bonds without the need for further approvals; and 2 The financing schedule presented in the Original Memorandum contained specific dates, many of which are outside the control of the Successor Agency and subject to change.

12 May 12, 2017 Page 12 The Successor Agency shall be entitled to receive its full Administrative Cost Allowance under the Dissolution Law without any deductions for certain continuing costs related to the Series 2017 Bonds, including trustee's fee, fiscal consultant's fees, arbitrage rebate payments and other continuing costs and, further, if the Successor Agency is unable to complete the issuance of the Series 2017 Bonds, it shall nonetheless be entitled to recover its costs incurred with respect to the Series 2017 Bond proceedings from property tax revenues without reduction in its Administrative Cost Allowance. The Oversight Board approval is scheduled for May 18 and is subject to review and approval by the State Department of Finance. COORDINATION This memorandum was coordinated with the City Attorney's Office. /s/ JULIA H. COOPER Chief Financial Officer Attachment For questions, please contact Derek Hansel, Assistant Director of Finance for the City of San Jose at

13 Exhibit A Successor Agency to the Redevelopment Agency of the City of Sam Jose 2017 Tax Allocation Refunding Bonds, Savings Analysis as of May 1, 2017 (Report of the Municipal Advisors)

14 pfm 50 California Street, Suite 2300 San Francisco, CA ROSS FINANCIAL 1736 Stockton Street, Suite One San Francisco, CA *94133 May 1,2017 Ms. Julia Harper Cooper Chief Financial Officer Successor Agency to the San Jose Redevelopment Agency 200 East Santa Clara Street, 13th Floor San Jose, CA Dear Ms. Cooper As co-municipal Advisors to the Successor Agency to the San Jose Redevelopment Agency, Public Financial Management and Ross Financial offer the following analysis of the Successor Agency's proposed refunding bonds. Section (a)(1) of the Health and Safety Code authorizes the Successor Agency to issue refunding bonds to refund bonds or other obligations of the Successor Agency for the purpose of achieving aggregate debt service savings within the parameters of Section (a)(1). Public Financial Management and Ross Financial have analyzed a refunding of 25 series of the Successor Agency's bonds, totaling $1,732,345,000 in outstanding principal. We estimate that, based on interest rates on May 1, 2017, $237,887,625 in debt service savings and $160,362,158 in present value savings can be generated through an issuance of refunding bonds in today's market. This result is in compliance with the Health and Safety Code Section (a)(1) and suggests a substantial benefit for the Successor Agency and other affected taxing entities. Therefore, we advise moving forward with the process of issuing refunding bonds. Our results are detailed on the following pages. Sincerely, /si Robert Gamble, Managing Director PUBLIC FINANCIAL MANAGEMENT /s/ Peter Ross, Principal ROSS FINANCIAL

15 Summary of Bonds to Refund Total of $1,732,345,000 in principal targeted for refunding. Maturity 1996A Sub. (VRDB) 1996B Sub. (VRDB) 1997E 1997 TAB Housing (AMT) 2001A 1999 TAB Revenue (SJFA) 9/1/2017 2,075,000 7/1/2018 1,500,000 1,500,000 8/1/ , ,000 7,165,000 9/1/2018 2,170,000 7/1/2019 1,500,000 1,500,000 8/1/ , ,000 5,755,000 9/1/2019 2,285,000 7/1/2020 1,700,000 1,700,000 8/1/ , ,000 9/1/2020 2,395,000 7/1/2021 1,900,000 1,900,000 8/1/ , ,000 9/1/2021 2,510,000 7/1/2022 1,900,000 1,900,000 8/1/ , ,000 9/1/2022 2,635,000 7/1/2023 2,000,000 2,000,000 8/1/ , ,000 9/1/2023 2,770,000 7/1/2024 1,600,000 1,600,000 8/1/ , ,000 9/1/2024 2,905,000 7/1/2025 1,600,000 1,600,000 8/1/ ,000 3,260,000 9/1/2025 3,055,000 7/1/2026 1,700,000 1,700,000 8/1/ ,000 3,460,000 9/1/2026 3,205,000 8/1/ ,000 3,670,000 8/1/ ,000 8/1/2029 8/1/2030 8/1/2031 8/1/2032 8/1/2033 8/1/2034 8/1/2035 8/1/2036 Total $15,400,000 $15,400,000 $3,615,000 $14,625,000 $12,920,000 $26,005,000 A-l

16 Maturity 2001F LRB (SJFA) Summary of Bonds to Refund (cont.) 2003 TAB 2003A Sub. (Taxable VRDB) 2003B Sub. (VRDB) 2003J Housing (Taxable) 2003K Housing 2004A TAB 9/1/ ,595,000 7/1/2018 8/1/ ,000 1,675,000 3,020, ,000 31,900,000 9/1/ ,165,000 7/1/2019 8/1/2019 3,600,000 1,765,000 3,165, ,000 15,000,000 9/1/ ,760,000 7/1/2020 8/1/2020 3,185,000 1,845,000 3,330, ,000 9/1/ ,385,000 7/1/2021 8/1/ ,000 1,935,000 3,505, ,000 9/1/ ,045,000 7/1/2022 8/1/ ,000 2,015,000 2,015, ,000 9/1/ ,730,000 7/1/2023 8/1/ ,000 5,000 2,120, ,000 9/1/2023 7/1/2024 8/1/ ,000 2,235, ,000 9/1/2024 7/1/2025 8/1/ ,035, ,000 9/1/2025 7/1/2026 8/1/2026 1,730, ,000 9/1/2026 8/1/ ,185, ,000 8/1/2028 2,865, , ,000 8/1/2029 2,975,000 3,400, ,000 8/1/ ,265,000 3,500,000 8/1/2031 4,115,000 3,700,000 8/1/2032 8,735,000 3,900,000 8/1/ ,100,000 8/1/2034 8/1/2035 8/1/2036 Total $78,680,000 $123,955,000 $9,240,000 $15,000,000 $19,390,000 $4,395,000 $46,900,000 A-2

17 Summary of Bonds to Refund (cont.) Maturity 2005A TAB 2005A Housing 2005B Housing (Taxable) 2006A TAB (Taxable) 2006B TAB 2006C TAB 9/1/2017 7/1/2018 8/1/2018 7,325, ,000 3,125,000 9/1/2018 7/1/2019 8/1/ ,530, ,000 3,290,000 9/1/2019 7/1/2020 8/1/ ,140, ,000 3,495,000 1,800,000 9/1/2020 7/1/2021 8/1/ ,000 1,010,000 3,685,000 5,500,000 9/1/2021 7/1/2022 8/1/ ,000 2,060,000 3,570,000 6,000,000 9/1/2022 7/1/2023 8/1/ ,000 2,165,000 3,750,000 11,995,000 9/1/2023 7/1/2024 8/1/ ,000 2,270,000 3,940,000 74,280,000 9/1/2024 7/1/2025 8/1/2025 6,760,000 6,390,000 51,980,000 9/1/2025 7/1/2026 8/1/2026 7,095,000 6,715,000 3,800,000 53,120,000 9/1/2026 8/1/2027 7,445,000 4,350,000 4,200,000 41,215,000 8/1/2028 7,815,000 8,300,000 1,000,000 42,790,000 8/1/2029 6,725,000 1,000,000 53,380,000 8/1/2030 7,575,000 31,630,000 8/1/2031 7,985,000 9,000,000 32,995,000 8/1/2032 5,140,000 9,500,000 30,045,000 8/1/2033 5,425,000 8/1/2034 4,845,000 21,000,000 8/1/ ,000 17,500,000 8/1/2036 Total $83,360,000 $10,445,000 $89,000,000 $13,300,000 $67,000,000 $423,430,000 A-3

18 Summary of Bonds to Refund (cont.) Maturity 2006D TAB 2007B TAB 2010C 2010A A Housing Grand 2008B TAB Housing TAB (Taxable Total (AMT) VRDB) 9/1/ ,670,000 7/1/2018 3,000,000 8/1/ ,885,000 1,970,000 4,600,000 1,810,000 3,460,000 83,045,000 9/1/ ,335,000 7/1/2019 3,000,000 8/1/ ,205,000 2,050,000 4,730,000 1,905,000 3,665,000 86,935,000 9/1/ ,045,000 7/1/2020 3,400,000 8/1/ ,215,000 3,570,000 5,025,000 2,000,000 3,870,000 91,355,000 9/1/ ,780,000 7/1/2021 3,800,000 8/1/ ,135,000 3,340,000 5,335,000 2,095,000 4,120,000 95,995,000 9/1/ ,555,000 7/1/2022 3,800,000 8/1/ ,330,000 3,290,000 5,670,000 3,180,000 4,365, ,865,000 9/1/ ,365,000 7/1/2023 4,000,000 8/1/ ,725,000 2,710,000 4,235,000 2,065,000 4,125,000 93,305,000 9/1/2023 2,770,000 7/1/2024 3,200,000 8/1/2024 2,830,000 4,505,000 2,165,000 4,365,000 98,060,000 9/1/2024 2,905,000 7/1/2025 3,200,000 8/1/2025 2,960,000 4,660,000 2,280,000 4,630, ,950,000 9/1/2025 3,055,000 7/1/2026 3,400,000 8/1/ ,515,000 6,255,000 2,395,000 4,910, ,040,000 9/1/2026 3,205,000 8/1/ ,360,000 6,700,000 5,245,000 5,210, ,675,000 8/1/ ,240,000 3,965,000 2,350,000 4,205,000 91,185,000 8/1/ ,730,000 4,455,000 4,305,000 4,385,000 96,815,000 8/1/2030 1,525,000 5,500,000 2,225,000 3,745,000 82,965,000 8/1/ ,700,000 5,120,000 2,350,000 3,970,000 86,935,000 8/1/ ,500,000 5,460,000 5,760,000 4,205,000 91,245,000 8/1/2033 9,000,000 2,730,000 1,710,000 2,750,000 55,715,000 8/1/ ,940,000 3,200,000 2,675,000 2,920,000 58,580,000 8/1/ ,970,000 2,600,000 6,305,000 2,725,000 53,795,000 8/1/2036 5,400,000 5,400,000 Total $259,495,000 $191,600,000 $4,600,000 $80,145,000 $52,820,000 $71,625,000 $1,732,345,000 A-4

19 Dollar Savings by Year Date Prior Debt Refunding Debt Dollar Savings per Service Service Year 8/1/ ,321, ,448,955 36,872,833 8/1/ ,125, ,448,607 36,677,118 8/1/ ,373, ,445,515 36,927,907 8/1/ ,641, ,445,086 37,196,379 8/1/ ,476, ,448,131 37,028,552 8/1/ ,757, ,444,143 24,313,601 8/1/ ,731, ,446,140 8,285,611 8/1/ ,515, ,445,352 8,070,351 8/1/ ,421, ,444,754 7,976,837 8/1/ ,960, ,443,757 4,516,506 8/1/ ,869, ,866,789 2,370 8/1/ ,383, ,382, /1/ ,001, ,999,954 1,104 8/1/ ,974, ,972,760 1,589 8/1/ ,055, ,050,208 4,886 8/1/ ,000,959 63,996,586 4,373 8/1/ ,068,454 64,066,581 1,873 8/1/ ,536,422 56,532,901 3,521 8/1/2036 5,629,500 5,628,000 1,500 Total $2,457,844,578 $2,219,956,956 $237,887,625 PV Savings Summary Savings PV Date 8/16/2017 Savings PV Rate 3.75% PV of Savings from Cash Flow 210,564,649 Less: Prior Funds on Hand (50,207,090) Plus: Refunding Funds on Hand 4,599 Net Present Value Savings $160,382,158 A-5