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City of San Leandro
<br />Notes to Basic Financial Statements
<br />For the year ended June 30, 2012
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<br />70
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<br />NOTE 7 - LONG-TERM DEBT, Continued
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<br />A. Governmental Activities Long-Term Debt, Continued
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<br />2007 Certificates of Participation
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<br />In 2007, the City issued $23,435,000 principal amount of 2007 Certificates of Participation (2007 COPs). The purpose
<br />of the 2007 COPs was to provide funds to refund the outstanding 1999 Certificates of Participation (Library and Fire
<br />Stations Project) of the City of San Leandro and the San Leandro Public Financing Authority. Interest rates vary from
<br />4.00% to a maximum of 4.375% and are payable semiannually on each May 1 and November 1. Prin cipal payments
<br />are payable annually on November 1. The COPs evidence fractional interest of the owners in lease payment to be
<br />made by the City for use and occupancy of San Leandro Libraries and San Leandro Fire Stations.
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<br />At June 30, 2012, future debt service requirements for the 2007 COP’s are as follows:
<br />
<br />For the Year
<br />Ending
<br />June 30,Principal Interest Total
<br />2013 775,000$ 823,819$ 1,598,819$
<br />2014 805,000 792,219 1,597,219
<br />2015 840,000 759,319 1,599,319
<br />2016 870,000 742,519 1,612,519
<br />2017 910,000 689,519 1,599,519
<br />2018-2022 5,115,000 2,860,203 7,975,203
<br />2023-2027 6,265,000 1,677,409 7,942,409
<br />2028-2030 4,445,000 297,172 4,742,172
<br />Total Debt Service 20,025,000$ 8,642,179$ 28,667,180$
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<br />The proceeds from the 1999 COP refunding issue were placed in irrevocable escrow account overseen by independent
<br />bank fiscal agents. The proceeds are generally invested in U.S Treasury Securities, which together with earned
<br />interest, will provide amounts sufficient for future payment of interest, principal, a nd redemption premium on the
<br />defeased bond in the amount of $27,257,815. The escrow account is not included as assets of the City. The defeased
<br />bonds are excluded from the City’s long-term obligations because the arrangement satisfies requirements of
<br />defeasance.
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