reconvene regular meeting: 7:00 pm - Irvine Unified School District

MCCFD for each Participant is funded with the proceeds of tax and revenue anticipation notes indicated in
such Participant’s Fiscal Year 2010-11 cash flow table in Appendix A hereto.
The cash flows prepared by the Participants reflect the May Revision to the Proposed 2010-11
State Budget Act (defined herein). See “Financial Information Regarding the Participants – State Budget”.
[To be updated.]
Pursuant to Section 42127 of the State Education Code, the Participants must adopt their
respective budgets for the subsequent fiscal year on or before July 1 of such fiscal year. The final State
Budget Act for Fiscal Year 2010-11, which is required to be approved by the Governor by June 30 under
State law, will be subject to future changes or future legislation. The County Department of Education has
advised that it is important for school districts to develop contingency plans that allow for flexibility within
their respective budgets and cash flows. See Appendix A - “The Participants and Cash Flows – Fiscal Year
2010-11 Budget” attached hereto.
The estimates of amounts and timing of receipts and disbursements in the cash flow tables are
based on certain assumptions and should not be construed as statements of fact. The assumptions are based
on present circumstances and currently available information and are believed to be reasonable. The
assumptions may be affected by numerous factors and there can be no assurance that such estimates will
actually be achieved.
Available Sources of Payment and Coverage Factors
Each Participant’s Note, in accordance with California law, is a general obligation of such
Participant, but is payable solely from taxes, income, revenue (including, but not limited to, revenue from
the State and federal governments), cash receipts, and other moneys received for the general fund of the
Participant and provided for and attributable to Fiscal Year 2010-11 and legally available for payment
thereof. Under the Government Code, no obligations, including the Participant’s Note, may be issued
thereunder if the principal thereof and interest thereon exceeds 85 percent of the estimated amount of the
then-uncollected taxes, income, revenue, cash receipts and other moneys which will be available for
payment of such principal and interest. However, each Participant has covenanted that the sum of the
principal amount of the Participant’s Note plus the interest payable thereon, on the date of its issuance, will
not exceed 50 percent of the estimated amounts of such Participant’s then uncollected taxes, income,
revenue (including, but not limited to, revenue from the State and federal governments), cash receipts and
other moneys to be received by such Participant for the general fund of such Participant and provided for
and attributable to Fiscal Year 2010-11, all of which will be legally available to pay principal of and
interest on the Notes.
Each Participant has estimated the total moneys available for payment of its respective Note as
indicated in the table set forth on page C-1 in Appendix C hereto. The principal amount of each Note and
estimated interest thereon is below the 50 percent maximum discussed in the preceding paragraph.
Except for pledged amounts, the unrestricted moneys listed on pages C-1 and C-2 in Appendix C
hereto will be expended during the course of Fiscal Year 2010-11, and no assurance can be given that any
moneys, other than the Pledged Revenues as provided in the Notes and in the Trust Agreement payable
sequentially in the Repayment Months, will be available to pay each Note and the interest thereon.
The tables set forth on pages C-1 and C-2 in Appendix C hereto provide estimated debt service
coverage factors based upon estimated revenues available for debt service as well as estimated amounts in
each respective Participant’s non-general fund accounts that may be borrowed to pay debt service.
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