Transaction Details

Pacific Grove Unified School District

---

Baird’s California K-12 Public Finance group served as sole managing underwriter on the $8,700,000 General Obligation Bonds Election of 2020, Series C (the “Bonds”) transaction for Pacific Grove Unified School District (the “District”). The District, located in Monterey County, serves around 1,800 students from grades TK-12 and is comprised of two elementary schools, a middle school, a high school, and a continuation high school. The Bonds are the third series relating to the March 3, 2020, election which authorized the issuance of $30,000,000 principal amount of general obligation bonds to finance the renovation, construction and improvement of school facilities.

On the day of pricing, we faced challenging market conditions in the municipal market with the Municipal Market Data yield curve rising from 5 to 18 basis points. While, as a response to such volatile market conditions, Baird’s underwriting desk had to reprice a portion of the District’s bonds to garner investors’ interest, the adjustments made were not of the same magnitude. Baird did not reprice bonds maturing prior to 2034 and only adjusted the remaining bonds by 1 to 10 basis points to successfully complete the transaction.

Ultimately, despite challenging market conditions, the District’s bond sale (rated AA) outperformed other similarly rated transactions for California school districts that priced in the same week as well as the week prior and, in select overlapping maturities, even priced similar to recent AAA-rated California school district transactions.