Mt. Diablo Unified School District
General Obligation Bond Program
and 2010 Series A & B Summary
October 12, 2010
Bond Program and
Financing Objectives
1
Ultimate Goals of the Bond Program
2

Renovate and Upgrade existing classrooms and school facilities of
the Mt. Diablo USD

“Go Green”, Install Energy Efficient Utility/Solar Systems

Pay off outstanding debt to provide General Fund relief
Specific Financing Objectives
3

Maintain and /or upgrade existing credit ratings and secure
insurance at cost effective rates

Utilize the District’s entire Clean Renewable Energy Bond
(“CREB”) allocation

Maximize construction fund proceeds and minimize interest rate
expense

Pay off outstanding leases to provide general fund relief

Maintain the tax rate as estimated to voters
Ratings and Insurance
4

District staff and finance team met with rating agencies Moody’s and
Standard and Poor’s in San Francisco in August

Moody’s Investor Services assigned the District an “Aa3” rating.
Moody’s cited “the District’s large-sized tax base, above average income
levels of district residents…and modest debt burdens” as part of the
strong ratings rationale.

The District received an affirmed “A+” rating from S&P. In the opinion
of S&P the ratings reflect “Large and diverse property tax base; High
wealth and income indicators, evidenced by extremely strong per capita
market values; and History of good financial performance, although
management expects reserves to decline in the near term.”

District secured an insurance bid from Assured Guaranty,
which allowed the bonds to be sold as “AAA”
Selling the CREBs
The CREB program is a federal subsidy for which the
District qualified that provides for low interest loans
to participating agencies for the implementation of
“clean renewable energy” projects
5

Negotiating with the IRS - Allocation by specific
school site or in the aggregate

47 school district sites to benefit by the CREB program

17 year borrowing to fund solar installation

$59,540,000 in CREBs were sold with a true interest cost of 1.689%,
representing $11,107,099.54 in total interest costs

Benefit to the District are annual utility savings of
approximately $5 million for the first five years followed
by $3 million annually thereafter
Maximizing Proceeds, Minimizing Interest
6

Favorable market conditions at the time of the September 22 pricing
with interest rates near 30-year lows

Underwriting team of Stone and Youngberg, George K. Baum, and
Brandis Tallman began to premarket the bonds to their pool of investors

Due to the strong underlying credit scores, the “AAA” rating, and
competitive structure among underwriters, the District was able to sell
$109,996,475 of bonds for projects at a TIC of 4.392%

The ratio of debt service to principal is 1.94, which means that for every
dollar of principal there is .94 cents of interest

District has approximately $238 million in remaining authorization
Logistics of Negotiated Bond Sales

Bonds are pre-marketed to investors prior to the sale

Retail order period held

Underwriter conducts auction among investors for each maturity of
the bond issue

Final purchase price is awarded based on lowest interest rate orders
submitted by investors
Issuer
Issuer
District
US
Trust
Investors
US
Trust
7
Brandis Tallman
Stone
& Youngberg
Underwriter
Underwriter
Serial
Serial
Bonds
CABSBonds
Term
TermBond
Bond11CABS
Convert.
Eaton
Eaton
Investors
Vance
Vance
Citibank
Citibank
Investors
Trust
Trust
Nuveen
Nuveen
Investors
George K. Baum
Term
Bond
22
Term
BondSerials
Taxable
Putnam
Putnam
Investors
Taxable
Term
Fidelity
Fidelity
Investors
Relief to the General Fund
• Paying off Existing General Fund Obligations will free up much needed
Operating Capital
• Pre-paying the outstanding obligations will save the General Fund over
$1.4 million annually with over $19.4 million through 2025.
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
1998 Certificates of
Participation
Principal
Interest
$240,000
$268,478
255,000
257,438
265,000
245,453
275,000
232,865
285,000
219,665
300,000
205,700
310,000
191,000
330,000
175,500
340,000
159,000
355,000
142,000
370,000
124,250
385,000
105,750
405,000
86,500
420,000
66,250
445,000
45,250
460,000
23,000
TOTAL Annual Payments
8
2006 Lease (Capital One)
Principal
Interest
$329,065
$234,072
344,133
219,004
359,890
203,246
376,370
186,767
393,604
169,533
411,627
151,510
430,475
132,662
450,186
112,951
470,800
92,337
492,358
70,779
514,903
48,234
538,480
24,657
2007 Lease (Bank of America)
Principal
Interest
$204,684
$158,960
213,935
149,708
223,605
140,038
233,712
129,931
244,276
119,367
255,317
108,326
266,858
96,786
278,920
84,724
291,527
72,116
304,704
58,939
318,477
45,167
332,872
30,772
347,917
15,726
Total Annual
Payments
$1,435,257
1,439,217
1,437,232
1,434,645
1,431,445
1,432,480
1,427,780
1,432,280
1,425,780
1,423,780
1,421,030
1,417,530
855,143
486,250
490,250
483,000
$19,473,100
Keeping the District Tax Rates
9
Program Summary
10
Specific Financing Objectives
 Maintain and /or upgrade existing credit ratings and secure

insurance at cost effective rates
 Utilize the District’s entire Clean Renewable Energy Bond

(“CREB”) allocation
 Maximize Construction Fund Proceeds and minimize interest rate

expense
 Pay off leases to provide general fund relief

 Maintain the tax rate as estimated to voters

11
Appendix A
Municipal Market Conditions
and Pricing Comparables
12
Market Statistics
Market Indicators & Forecasts

Crude Oil continues to trade around $81/barrel

Gold currently trading around $1,335/oz
10/7/2010 Q4 '10 Q1 '11
Q2 '11
Current
Forecast Forecast Forecast
0.25
0.25
0.25
0.25
0.38
0.60
0.75
0.92
2.63
2.72
2.85
3.08
3.88
3.80
3.95
4.16
Fed Funds Target
2-Y ear T-note
10 Y ear T-note
30 Y ear Bond
Sou r ce: Bloom ber g

Municipal Market Data General Obligation Yields
AAA (Pure) AAA Insured
AA
A
Baa
2011
0.3
0.58
0.35
0.74
1.97
2015
1.25
1.84
1.41
1.94
3.00
2020
2.49
3.16
2.71
3.26
4.26
2025
2.97
3.67
3.21
3.77
4.68
2030
3.36
4.04
3.57
4.14
4.87
2035
3.66
4.24
3.87
4.34
5.05
2040
3.74
4.32
3.94
4.41
5.12
As of 10/6/2010

Current Rates
Deflation is a going concern
The District Can Expect Average Annual Savings from
Insurance of approximately 10 basis points

30-Day Visible Supply is expected to increase
through the rest of year.

The District timed the issuance of its debt before
supply continued to increase
1-Month LIBOR
Bond Buyer 20- Bond Index GO
Bond Buyer Revenue Bond Index
Bond Buyer One-Y ear Note
0.26
3.84
4.59
0.44
Sou r ce: T h e Bon d Bu y er
Economic Data
Q2 '10
Actual
Real GDP
Consumer Prices
Unemployment
Q4 '10
Q1 '11
Q2 '11
Forecast
Forecast Forecast
1.70
2.30
2.30
2.70
1.77
1.10
1.15
1.60
9.70
9.60
9.50
9.30
Sou r ce: Bloom ber g

Bond Insurance still provides significant interest rate
savings to issuers with credit ratings lower than AA
Historical Tax-Exempt Interest Rates
30-Year “AAA” MMD (1981 - Present)
14.00
12.00
30-Year AAA MMD Curve
(1981- Present)
10.00
29 Year Average
8.00
9/30/2010:
3.7%
High: 12.70%
Low: 3.67%
6.00
4.00
2.00

The 29-Year average “AAA” MMD is 6.27%

Interest Rates are very close to 30 Year Lows
6/1/2009
6/1/2007
6/1/2005
6/1/2003
6/1/2001
6/1/1999
6/1/1997
6/1/1995
6/1/1993
6/1/1991
6/1/1989
6/1/1987
6/1/1985
6/1/1983
6/1/1981
0.00
Municipal Credit Spreads
10 Year Maturities: Credit Spreads to
AAA MMD
400
350
300
250
200
150
100
AA GO to MMD
A GO to MMD
BBB GO to MMD
50
0
 Impact of the Credit Crunch is visible in credit spreads during 2009,
but 2010 has seen increased liquidity in the market, causing spreads to
decline.
Tax-Exempt Bond Market Highlights

Reduced Spreads on A and BBB rated debt allow for improved access to the
tax exempt bond market for lower rated issuers.

Interest Rates remain very Attractive for issuers with A rated debt and above

Mt. Diablo Unified School District 2010 General Obligation Bonds were priced within a
month of the 30-Year Record Low Rate of 3.67%

The flight of Capital to the safety of the US Treasury Market has caused rates
to fall in the Taxable Market

The popularity of the Build America Bond Program continues, with the
market remaining strong for these types of federally subsidized financing
structures, including Qualified School Construction Bonds and Clean
Renewable Energy Bonds.

Anticipated heavy BAB issuance toward the end of the 2010 Calendar year
due to the pending expiration of the program.
Pricing Comparables
Size
Issue
Type
Bond Insurance
Underlying Rating
$12,840,000
Los Banos Unified School District
G.O. Refunding Bonds
Assured Guaranty
A+ (S&P)
$21,025,000
Los Rios Community College Dist
G.O. Refunding Bonds
None
AA- (S&P)
$1,615,000
Greenfield Union School Dist
G.O. Refunding Bonds
Assured Guaranty
A (S&P), A2 (Moody's)
8/1/2020 @ 100
O'Conner & Co Securities
9/15/2010
8/1/2020 @ 100
EJ De La Rosa/Stone & Youngberg
9/14/2010
Not Callable
Piper Jaffray
9/17/2010
Call Features
Senior Manager
Sale Date
Maturity
Coupon
2011
3.000%
2012
2.000%
2013
2.000%
2014
2.000%
2015
3.000%
2016
3.000%
2017
3.000%
2018
3.000%
2019
4.000%
2020
3.000%
2021
4.000%
2022
3.500%
2023
3.750%
2024
3.875%
2025
2026
4.000%
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
2038
2039
2040
Yield to
Spread to
Maturity
MMD
Coupon
0.700%
33.000
2.000%
0.900%
45.000
3.000%
1.250%
64.000
2.000%
1.400%
55.000
3.000%
1.800%
63.000
3.000%
2.150%
68.000
4.000%
2.400%
64.000
4.000%
2.650%
65.000
4.000%
2.950%
74.000
4.000%
3.250%
86.000
4.500%
3.500%
98.000
4.000%
3.750%
111.000
5.000%
3.900%
118.000
5.000%
4.050%
126.000
5.000%
4.000%
4.180%
123.000
5.000%
5.000%
Yield to
Spread to
Maturity
MMD
Coupon
0.400%
3.000
2.000%
0.550%
10.000
2.000%
0.720%
11.000
3.000%
0.960%
11.000
3.000%
1.300%
12.000
3.000%
1.650%
17.000
1.950%
18.000
2.240%
23.000
2.500%
28.000
2.690%
30.000
3.000%
48.000
3.110%
47.000
3.190%
47.000
3.300%
51.000
3.650%
79.000
3.450%
50.000
3.540%
50.000
Yield to
Spread to
Maturity
MMD
0.750%
3.000
1.000%
10.000
1.160%
11.000
1.450%
11.000
1.780%
12.000
Pricing Comparables
Size
Issue
Type
Bond Insurance
Underlying Rating
$8,000,000
Souther Humboldt Joint USD
G.O. Bonds
Assured Guaranty
A+ (S&P)
$2,000,000
Rohnerville School District
G.O. Bonds
Assured Guaranty
A+ (S&P)
$12,415,000
Hope Elementary School District
G.O. Bonds (Capital Apprec. Bonds)
None
AA- (S&P)
$8,990,000
John Swett USD
G.O. Refunding Bonds
Assured Guaranty
A+ (S&P)
$46,160,000
East Side UHSD
G.O. Refunding Bonds
Assured Guaranty
A (S&P)
8/1/2020 @ 100
UBS Financial Services
9/9/2010
8/1/2020 @ 101
Stone & Youngberg
9/14/2010
Not Callable
Stone & Youngberg
9/9/2010
8/1/2020 @ 100
Stone & Youngberg
9/30/2010
8/1/2020 @ 100
Piper Jaffray
9/29/2010
Call Features
Senior Manager
Sale Date
Maturity
Coupon
2011
4.000%
2012
3.000%
2013
3.000%
2014
3.000%
2015
3.000%
2016
3.000%
2017
3.000%
2018
3.000%
2019
4.000%
2020
4.000%
2021
4.000%
2022
4.000%
2023
4.250%
2024
5.000%
2025
5.000%
2026
5.000%
2027
5.000%
2028
5.000%
2029
4.000%
2030
4.000%
2031
4.125%
2032
4.125%
2033
4.250%
2034
4.300%
2035
4.375%
2036
2037
2038
2039
2040
Yield to
Maturity
0.800%
0.900%
1.100%
1.300%
1.700%
2.000%
2.300%
2.500%
2.750%
3.000%
3.150%
3.250%
3.350%
3.430%
3.520%
3.620%
3.720%
3.810%
4.000%
4.070%
4.150%
4.220%
4.300%
4.350%
4.380%
Spread to
MMD
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
Coupon
5.750%
5.750%
5.750%
5.750%
5.750%
5.000%
5.000%
5.000%
5.000%
5.000%
Yield to
Maturity
0.500%
0.800%
1.050%
1.300%
1.650%
2.000%
2.300%
2.550%
2.750%
2.950%
5.000%
3.350%
5.000%
3.550%
5.125%
3.700%
5.125%
3.880%
5.250%
4.080%
5.250%
4.250%
5.250%
4.400%
Spread to
MMD
Coupon
n/a
n/a
n/a
n/a
n/a
52.000
53.000
54.000
53.000
0.000%
56.000
0.000%
0.000%
71.000
0.000%
0.000%
76.000
0.000%
0.000%
75.000
0.000%
0.000%
75.000
0.000%
0.000%
75.000
0.000%
0.000%
75.000
0.000%
0.000%
0.000%
74.000
0.000%
0.000%
0.000%
0.000%
0.000%
0.000%
Yield to
Maturity
3.590%
4.040%
4.420%
4.690%
4.950%
5.120%
5.300%
5.540%
5.630%
5.730%
5.830%
5.930%
6.020%
6.100%
6.180%
6.230%
6.260%
6.280%
6.290%
6.300%
6.310%
6.320%
Spread to
MMD
139.000
164.000
189.000
204.000
222.000
233.000
243.000
259.000
259.000
260.000
260.000
260.000
260.000
260.000
260.000
260.000
260.000
260.000
260.000
260.000
260.000
260.000
Coupon
3.000%
3.000%
4.000%
4.000%
4.000%
4.000%
4.000%
4.000%
4.000%
5.000%
5.000%
5.000%
5.000%
5.000%
5.000%
Yield to
Maturity
0.900%
1.170%
1.440%
1.750%
2.100%
2.400%
2.650%
2.920%
3.120%
3.370%
3.560%
3.640%
3.720%
3.800%
3.880%
Spread to
MMD
43.000
52.000
55.000
58.000
64.000
66.000
66.000
72.000
74.000
84.000
92.000
93.000
93.000
93.000
93.000
Coupon
2.000%
2.000%
3.000%
3.000%
3.000%
3.000%
3.000%
3.000%
4.000%
5.000%
5.000%
5.000%
3.500%
3.625%
3.750%
4.000%
4.000%
Yield to
Spread to
Maturity
MMD
0.650%
28.000
0.950%
50.000
1.170%
54.000
1.440%
58.000
1.750%
61.000
2.060%
64.000
2.360%
66.000
2.620%
67.000
2.840%
68.000
3.070%
73.000
3.220%
73.000
3.340%
73.000
3.770%
108.000
3.850%
108.000
3.930%
108.000
4.060%
113.000
4.150%
114.000
Pricing Comparables
Size
Issue
Type
Bond Insurance
Underlying Rating
$3,985,000
Anderson Valley USD
G.O. Bonds (Bank Qualified)
Assured Guaranty
unknown
$2,200,000
Anderson Valley USD
G.O. Bonds (Bank Qualified) (TAXABLE)
Assured Guaranty
unknown
$238,485
Anderson Valley USD
G.O. Bonds (CABs)
Assured Guaranty
unknown
8/1/2020 @ 100
Stone & Youngberg
9/28/2010
Not Callable
Stone & Youngberg
9/28/2010
Not Callable
Stone & Youngberg
9/28/2010
$50,456,475
$59,540,000
Mt Diablo USD
Mt Diablo USD
G.O. Bonds (Convertible CABs) Series A G.O. Bonds (TAXABLE ) Series B
Assured Guaranty
Assured Guaranty
A+ (S&P)
A+ (S&P)
Call Features
Senior Manager
Sale Date
Maturity
Coupon
2011
2.000%
2012
2013
2014
2015
2016
2017
2018
2019
2020
3.000%
2021
2022
2023
2024
4.000%
2025
4.250%
2026
4.250%
2027
4.000%
2028
4.000%
2029
4.000%
2030
4.250%
2031
2032
2033
2034
2035
4.500%
2036
2037
2038
2039
2040
Yield to
Spread to
Maturity
MMD
Coupon
0.500%
13.000
1.299%
1.726%
2.177%
2.624%
3.024%
3.479%
3.879%
4.305%
4.505%
3.000%
68.000
4.705%
4.905%
5.055%
5.205%
3.800%
105.000
5.305%
3.880%
105.000
5.405%
3.960%
105.000
5.505%
4.050%
105.000
5.605%
4.140%
105.000
4.230%
105.000
4.330%
106.000
Yield to
Maturity
1.299%
1.726%
2.177%
2.624%
3.024%
3.479%
3.879%
4.305%
4.505%
4.705%
4.905%
5.055%
5.205%
5.305%
5.405%
5.505%
5.605%
Spread to
MMD
Coupon
92.900
127.600
155.700
0.000%
178.400
0.000%
188.400
0.000%
205.900
0.000%
217.900
0.000%
236.500
0.000%
236.500
0.000%
238.500
243.500
0.000%
246.500
0.000%
253.500
0.000%
255.500
257.500
259.500
260.500
0.000%
0.000%
4.600%
100.000
Yield to
Maturity
8/1/2025 @ 100
S&Y, George K Baum, B. Tallman
9/23/2010
Spread to
MMD
1.500%
1.850%
2.400%
2.600%
3.000%
3.350%
3.700%
88.000
101.000
126.000
118.000
130.000
141.000
156.000
4.350%
4.600%
4.850%
188.000
201.000
218.000
5.980%
6.060%
Coupon
Yield to
Maturity
Spread to
MMD
0.000%
0.000%
0.000%
0.000%
0.000%
0.000%
0.000%
2.460%
2.900%
3.300%
3.650%
4.000%
4.400%
4.700%
104.000
120.000
137.000
152.000
169.000
195.000
213.000
0.000%
5.100%
229.000
0.000%
5.560%
228.000
0.000%
5.770%
215.000
262.000
262.000
Not Callable
S&Y, George K Baum, B. Tallman
9/23/2010
Coupon
1.244%
Yield to
Spread
Maturity
to MMD
1.244%
87.400
3.009%
3.487%
3.887%
4.348%
4.548%
4.748%
4.948%
5.048%
3.009%
3.487%
3.887%
4.348%
4.548%
4.748%
4.948%
5.048%
186.900
206.700
218.700
241.800
241.800
243.800
249.800
247.800
5.548%
5.548%
255.800