Debt Management Commission - Regular Meeting

All right. We are going to go ahead and call the debt management meeting to order for today, June 4, 2026, at 9 AM. We'll first start with the roll call.

Chair Kirkpatrick? Here. Vice Chair Stewart is absent. Commissioner Becker?

Here.

Councilman Churchill?

Here.

Councilwoman Fielding? Here. Councilwoman Jorgensen is absent. Councilwoman Kelly? Here. Yolanda King? Present. Commissioner Naft is absent. Dan Shaw?

Here.

Emily Stevens?

Okay, we still have a quorum? We should. Is now exiting.

Okay.

Councilman Richard Churchill is now exiting.

What do you mean we have seven? Seven minus Churchill? I thought we had eight to start with. Karen was the last one. One, two, three, four. On the phone we had Kara. Good morning, Karen Dilling. Thank you. He is now joining us. Hello. Hello, just hang tight, don't hang up, because we're trying to make sure we have a quorum, okay? Karen building is now joined. Okay, all right, thanks. That's still, we need Emily, right? We're trying to get Emily to see what's on the call. Yeah, it's your stuff that's on the agenda. Hey, hey. Can you show them a seat, maybe? I try not to even read every month for these reasons. SO I HAVE COUNCILWOMAN CARA KELLY ON THE PHONE, I HAVE COUNCILWOMAN KAREN FIELDING, AND THEN COUNCILMAN CHERCHIO, CORRECT? COUNCILWOMAN FIELDING IS HERE. OKAY. CARA, ARE YOU HERE?

Oh, sorry. I thought it was unmuted. Yes.

There's another number, 229. So I think, whose number is that? Where do you see 229?

Usually, 229 is a city number.

Yeah, OK. And then Churchill, you're on there, right? 325? So we do have a quorum now. All right, we'll first start by opening the public comment. Have any comment by the public? Seeing none on the phone, seeing none in person, I'll go ahead and close the public comment, and I will go to item number one, which is approval of the agenda, and I would entertain a motion.

So moved.

I have a motion by Commissioner Becker, a second by Dan Shaw. Any discussion? Seeing none, all those in favor, please say aye. Aye. Aye. Aye. Aye. Item number two is approval of the minutes. The minutes are from the May 7th, 2026 meeting. Do I have any comments or questions regarding the minutes? Seeing none, I'll entertain a motion for approval. I have a motion by Dan Shaw, a second by Commissioner Becker. Anybody opposed? ALL THOSE IN FAVOR, PLEASE SAY AYE.

AYE. AYE.

AYE. ALL RIGHT. AND THAT MOTION CARRIES. THE NEXT ITEM IS ITEM NUMBER THREE IS TO APPROVE, ADOPT, AND AUTHORIZE THE CHAIR TO SEND A RESOLUTION CONCERNING A PROPOSAL TO ISSUE GENERAL OBLIGATION BONDS FOR THE CLARK COUNTY SCHOOL DISTRICT. SO WE'LL WRITE THE SCHOOL DISTRICT UP.

MORNING. Good morning, commissioners. Justin Dayhoff, Chief Financial Officer from the Clark County School District, here today with Chief McLaughlin and Andy Artusa. Excited and grateful for the opportunity to discuss our upcoming and hopeful issuance. And with that, I'll hand the table over to our financial advisor.

Great, thank you everyone. Andy Artusa, I'm the municipal advisor to the Clark County School District. Before you is a proposal for 600 million in general obligation bonds to be issued by the Clark County School District. You will remember a year ago we were here discussing the same item. We promised we'd come back annually. The district has an ongoing capital improvement plan that goes out through March of 2035. The district spends approximately $54 million a month on construction projects. And so the 600 million that you approved last year, we issued 400 million of that in September of last year. And then the remaining $200 million was issued in March of this year. And so we expect to be in a situation where we'll need bond proceeds again in October of this year. And so the $600 million that we're talking about today will also be bifurcated into two issuances, $400 million in October. And then we anticipate, based on their current spend, another $200 million next June. So it might be coming a little later next year to the commission. On page one, we have a summary of the items that need to be considered by the commission before we're in a situation of approving this particular item. I'll touch on the major items here. The first is that we don't exceed the statutory debt limitation. The debt limitation for the district is 15% of assessed valuation that amounts to about $24.6 billion. The district has about $400 million outstanding, plus the $600 million will leave about $20 billion of capacity. We couldn't afford to issue that much. We don't ever anticipate issuing that much, but we just have to make that finding that we're not exceeding it. The next more important detail is provided in the packet on page 11. And that illustrates the coverage debt repayment of this particular issue along with the other bonds that are also paid from the district's 55.34 cents property tax rate you'll see here 2027 assessed value has been published and then the corresponding growth and property tax revenues associated with just that particular tax rate that the district can only use for debt repayment is listed here for 2027 it's a growth about 5.3 percent You'll see that the district does not rely on any future growth in order to pay for its existing bonds or the proposed bonds. The existing bonds are illustrated here, and you can see that they have a very rapid debt repayment. The district only issues 20-year bonds, level debt service. So in essence, they're essentially retiring about $287 million of debt service every year. adding on this new proposed issuance that we talked about, the bifurcation. This assumes an October issuance of this year and a June issuance of next year, level debt service 20-year term. With all that said, oh, and also we've modeled those at 5%. In the current market, the district can borrow closer to 4% for 20-year money. And just to give you an example, the March issuance, which we issued actually in February but closed in March, was done prior to the war breaking out and interest rates spiking, they borrowed at a 3.64%, so very low cost of capital for the district. But assuming the 5% interest rate on the upcoming proposed issuance, you'll see that their coverage is close to, if not exceeding, two times, which is well above the one times required by the commission. The other thing that's unique to the Clark County School District is illustrated on page 12. When the legislature gave them the ability to continue this particular bond program with the revenue sources, they required a debt service reserve be put in place, and that's to protect the property tax rate to ensure that we never have any issues with that. You'll also note that there is also the abatement law in place. There's a significant amount of abatement that's built up as well. So they have that as a further cushion. But this reserve requirement is unique to the Clark County School District. And the reserve requirement is 25% of next year's debt service or 10% of outstanding PAR. That's a lesser of test. So that particular amount is about $118 million. The district's reserve that they have currently taking out any pay-as-you-go projects. Now, this money is essentially being, the legislation allows them to use it on a pay-as-you-go basis. And some projects don't make sense bonding for because they have a short useful life. And under federal tax law, you need to match the useful life of the asset to the useful life, or to the weighted average life of the bonds. And so things like lighting improvements, turf replacements, playgrounds, security improvements to schools, all of those are being paid with cash and not being bonded for and so that's where we back out that number based on we anticipate spending in this current fiscal year on those types of projects the other thing to keep in mind is the clark county school district unlike other local governments doesn't have the ability to build up large reserves in their operating fund and so the way we build up reserves is on the capital side and that gives the rating agencies comfort as far as their ability to repay the debt and keep them at a very, very high bond rating. They're AA- and A+. And so that high bond rating corresponds to a much lower borrowing cost for them and a low cost of capital for the district overall. And so you'll see that we have well above the reserve requirement required by NRS in this particular fund. And I'll stop there to happily answer any questions.

Okay, does anybody on the phone have any questions? No? Anybody here have any questions? So, you're going to make me ask questions. So, one, we do want notice of when you actually go out to bond so that we have it on file. It's just good record keeping. Yeah, we'll provide a summary on each sale. Two, do you guys have a list of what you're going to spend this money on? I THOUGHT YOU WOULD TALK A LITTLE BIT ABOUT THE AMOUNT THAT YOU'RE SPENDING TODAY ON WHAT IT'S COSTING JUST TO KEEP SOME SCHOOLS OPEN.

Yeah, so on March 4th, we allocated what's called our early action plan. So though it's not exhaustive, the 6M will be used just for this, but the projects that we're currently underway with are a slew of elementary school roof and HVACs. Some of our secondary, middle school, high schools also roof and HVACs. On the large capital side, replacement schools of Cashman Middle School, Gibson Middle School, Las Vegas Academy, Southwest Career Technical Academy, and then probably into our next issuance, but still worthwhile to mention what some of these dollars are up to, Bridger Middle School replacement, Chaparral High School replacement. I usually hear more tears around that one. Keokanudsen, Tomiyasu, Hyde Park, and a new pre-K-8 up in the northeast part of North Las Vegas for our new school location up there.

So that sounds like it's about 70% rehabilitation, right?

It's a good chunk of it, yeah.

Which is good, what we wanted, right? Because the older schools were getting left behind. And none of those schools are on your potential closure list, correct?

Nope. That was a crosswalk we did to make sure we're not spending dollars overnight.

Okay. So if you'll send me a copy of the list that they approved. Yeah. For myself, that would be great. I try to track it. No one else has any questions.

I just have one quick one, hasn't it? You mentioned you have the abatement available to you. How do you make that available to you?

So they would have to have a decline in assessed valuation and a corresponding decline in a property tax bill. Because as you know, we have the 3% cap. And even though it only grows 3%, whatever is above that gets abated. And so they have about $184 million of tax abated. So to the extent there was a large decline like there was during the Great Recession, THE ACTUAL TAX BILLS COULD STILL RISE, AND THAT'S WHAT DID HAPPEN, EVEN THOUGH THE ASSESSED VALUE WENT DOWN, AND IT ACTUALLY HELPED THE DISTRICT DURING THAT TIME TO BE ABLE TO COVER THEIR DEBT SERVICE PAYMENTS. SO JUST AFTER HELL FREEZES OVER, IT'LL HAPPEN. THAT'S CORRECT.

BUT THE BONDING PEOPLE LIKE IT. IT JUST PUTS IT BACK INTO THE LEGISLATURE'S HANDS. I WOULD ENTERTAIN A MOTION FOR APPROVAL BUT THE MOTION SHOULD CAPTURE THAT THIS IS OUTSIDE OF THE PROPERTY TAX CAP. THAT'S HOW WE NORMALLY DO THOSE, RIGHT? I'LL MOVE FOR THAT.

I'LL SECOND THAT.

DON'T WE NORMALLY DO THAT, TO SAY THAT IT DOESN'T FALL IF THERE'S A NEED TO RAISE THE PROPERTY TAX, IT WOULD BE OUTSIDE OF THE CAP? OH, YES. YES, THAT'S CORRECT. EXCEPT FROM A MAIL. RIGHT. SORRY. YES. DID I SAY IT GOOD ENOUGH NOW? YES. OKAY. ALL RIGHT. That's your motion. Are you clear on what the motion is? That this includes anything subject to outside of the property tax abatement should we need to raise property taxes?

I second it.

Okay. I have a motion by Dan Shaw, a second by Yolanda King. Any further discussion? Seeing none, all those in favor, please say aye.

Aye.

Aye. Aye. Aye. Any opposed? And that motion carries.

Thank you all.

Write it down in the history books. That's probably your quickest, but thank you for the briefing. I had a time. THE NEXT ITEM ON THE AGENDA IS TO AUTHORIZE THE CHAIR TO SET A PROPOSAL TO ISSUE CLARK COUNTY, NEVADA, GENERAL OBLIGATION, TRANSPORTATION, IMPROVEMENT BONDS. THESE ARE FOR THE STRIP CORRIDOR. AND PLEASE COME FORWARD.

ANNA DANCHIK, COUNTY COMPTROLLER. THE COUNTY IS SEEKING TO ISSUE THIS DEBT FOR TRANSPORTATION PROJECTS WITHIN THE STRIP RESORT CORRIDOR. THE DEBT SERVICE WILL BE PAID BY PLEDGED REVENUES WITHIN THAT RESORT, ROOM TAX REVENUES WITHIN THE RESORT CORRIDOR, AND THAT WILL ANTICIPATE AN IMPACT ON PROPERTY TAX RATES. WHAT I'D LIKE TO DO IS GO BRIEFLY THROUGH THE PACKET, AND THEN WE HAVE A REPRESENTATIVE FROM CLARK COUNTY PUBLIC WORKS TO ANSWER ANY QUESTIONS ON PROJECTS. PAGE 1 SHOWS THAT THE CRITERIA THAT MUST BE MET PRIOR TO AUTHORIZATION HAS BEEN SATISFIED. ON PAGE 9, WE'RE SHOWING THE CURRENT DEBT THAT'S OUTSTANDING WITH THIS PLEDGED REVENUE, AS WELL AS THIS NEW ISSUE, WHICH WILL BRING IT UP TO ABOUT $344.3 MILLION OF OUTSTANDING DEBT WITH THIS PLEDGED REVENUE. ON PAGE 11 IS THE CALCULATION OF THE DEBTORIAL DEBT CAPACITY. SO EVEN WITH THIS ISSUANCE, AS WELL AS THE NEXT ITEM THAT WE HAVE, THE CAPACITY FOR THE COUNTY IS OVER $14 BILLION. PAGE 12 IS THE DEBT SERVICE OF THE EXISTING BONDS, AS WELL AS THE EXPECTED DEBT SERVICE FOR THIS NEW DEBT. IT WILL BE A 20-YEAR BOND WITHOUT ALL DEBT SERVICE, AND THIS DEBT SERVICE SCHEDULING HAS A 100-BASIS POINT PUSH AND BUILD IN IT. ON PAGE 13 IS THE HISTORICAL DEBT COVERAGE OF THE PLEDGED REVENUE. SO FOR FISCAL 2026, THE COUNTY IS ESTIMATING THAT WE WILL HAVE 2.67 TIMES COVERAGE ON THE EXISTING DEBT. ON THE NEXT PAGE IS THE PRO FORMA COVERAGE TABLE, INCLUDING THESE NEW BONDS, AND IT REFLECTS OVER TWO TIMES COVERAGE UNTIL 2040, AND THEN IT SUBSTANTIALLY INCREASES. ONE THING TO POINT OUT, THIS PRO FORMA, THE PLEDGED REVENUE, ASSUMES NO GROWTH. OVER THE TERMS OF THE BONDS, SO THAT COVERAGE IS INCLUDING AS SOON AS NO GROWTH. SO THIS TAPE FURTHER SUPPORTS THAT WE DON'T ANTICIPATE AN INCREASE IN PROPERTY TAXES, PROPERTY TAX RATES. IF YOU HAVE ANY QUESTIONS ON THE PROJECT.

I THINK YOU SHOULD COME TELL US, KAIZA. THIS IS AN IMPORTANT PIECE ON THE LAST BIGGEST TRIP. GOT TO KEEP IT CLEAN AND FUNCTIONAL.

GOOD MORNING, COMMISSIONER. SO WE HAVE ASSUMED PROJECTS FOR THE TRIP CORRIDOR. AS YOU ARE AWARE, A lot of the pedestrian bridges are about 20 years plus. So we're looking at upgrading all the elevators and escalators on the strip. Each escalator earns about $3 million. So the overall total cost of the upgrades for all the three intersections of Flamingo, Spring Mountain, and Harmon is estimated at about $100 million. We have another proposed pedestrian bridge at Palaccio, which is under design right now. that's estimated in another five minutes. We anticipate doing all of this work in the next two to three years so we're not impacting pedestrian movement up and down the corridor all at once. So those are the projects we have planned for the resort corridor.

And then there will be a capital plan that comes before the county which can include any and all other projects, right, going forward for that? Yes. As we continue to ensure that the

traffic flow works well and the landscaping stays up and so whatever we may need for future events future absolutely we have projects in our five-year plan too and those will be updated once we have more work that we we have cobalt that we plan to resurface paradise road a portion of las vegas boulevard that still needs to be complete between flamingo and spring mountain so those are part of the plan so all of that the county will see those yes

All right, anybody else have any questions? Seeing none, I entertain a motion. I'll move to approve. Hearing Kelly, I'll move to approve. I have a motion by, let me give Carol this one. Councilwoman Kelly, second by Dan Shaw. Any further discussion? Seeing none, all those in favor, please say aye.

Aye.

Opposed? Aye. And that motion carries. THE NEXT ITEM IS TO APPROVE, AUTHORIZE THE CHAIR TO SIGN A RESOLUTION CONCERNING A PROPOSED ISSUE TO QUART COUNTY GENERAL OBLIGATION, TRANSPORTATION IMPROVEMENT BONDS. THIS, I THINK, IS SPECIFIC TO THE BELTWAY, THE COUNTY.

YES, SO THIS DESK IS BEING ISSUED FOR TRANSPORTATION PROJECTS FOR THE BELTWAY. THIS IS A DIFFERENT PLEDGED REVENUE. IT'S THE BELTWAY PLEDGE REVENUE, WHICH IS COMPRISED OF THE 1% SUPPLEMENTAL GOVERNMENTAL SERVICE TAX, A PORTION OF NEW DEVELOPMENT FEES, AS WELL AS THE 1% ROOM TAX OUTSIDE THE RESORT CORRIDOR. SO BRIEFLY ON THE PACKET PAGE ONE, AGAIN, SHOWS THAT WE'VE SATISFIED THE CRITERIA FOR AUTHORIZATION. EXISTING DEBT IS ON PAGE 5. SO WITH THIS NEW DEBT, WE EXPECT TO BE AT $136 MILLION OF OUTSTANDING BONDS WITH THE PLEDGED REVENUES. AND THEN ON PAGE 12 IS THE DEBT SERVICE WE EXPECT. AGAIN, THIS WILL BE A 20-YEAR TERM LEVEL DEBT SERVICE, AND WE'VE BUILT IN A 100-BASIS POINT CUSHION. AND THEN HISTORICAL COVERAGE IS ON PAGE And that's been significant, ranging from 10 to 11 times coverage. So for fiscal year 26, we're estimating 10.73 times coverage. And then the pro forma is on page 13. And again, the pledge revenue assumes no growth. So that coverage will range between about 6.19 and then up to over 13.9 times coverage over the life of the bond. any increase in property tax rates.

Does anybody on the phone have any questions? Anybody here have any questions? So can I just ask this? I just want to refresh my brain. So should the legislature try to make any changes to the intergovernmental services tax? This is off limits because it's already pre-bonded, correct? Yes. I just want to make sure I remember my days on the taxation.

Hey, everybody. For the record, Ryan Henry from Taft Law. Yes, that is correct. The legislature cannot make any changes to law that would repeal this tax because it would impair the outstanding bonds. Any bonded taxes. Yes. All right.

Just got to ask the hard questions. All right. Anybody want to make a motion for approval? I HAVE A MOTION BY YOLANDA, SECOND BY DAN SHAW. ANY DISCUSSION? SEEING NONE, ALL THOSE IN FAVOR, PLEASE SAY AYE. AYE. AYE. OPPOSED? AND THAT MOTION CARRIES. I THINK I WAS LIKE THE LIGHT ON EVERYBODY TODAY FOR SOME REASON. OKAY, THIS IS THE SECOND TIME SET ASIDE FOR PUBLIC COMMENT. ANYBODY HAVE ANY QUESTIONS OR COMMENTS? None on the phone. We are going to close public comment and we are adjourned. Thank you.