OFFICIAL STATEMENT DATED AUGUST 4, 2010 NEW ISSUE

Transcription

OFFICIAL STATEMENT
DATED AUGUST 4, 2010
NEW ISSUE - Book-Entry-Only
RATINGS: Fitch - "AAA"
Moody's - "Aaa"
S&P - AA+
(See "OTHER PERTINENT INFORMATION Bond Ratings" herein)
In the opinion of Bond Counsel (defined below), assuming continuing compliance by the County (defined below) after the date of initial delivery
of the Tax-Exempt Obligations (defined below) with certain covenants described in the Tax-Exempt Orders (hereinafter defined) and subject to
the matters described herein under “TAX MATTERS” herein, interest on the Tax-Exempt Obligations for federal income tax purposes under
existing under statutes, regulations, published rulings, and court decisions (1) will be excludable from the gross income of the owners thereof for
federal income tax purposes under section 103 of the Internal Revenue Code of 1986, as amended (the "Code") to the date of initial delivery of
the Tax-Exempt Obligations and (2) will not be included in computing the alternative minimum taxable income of the owners thereof. See “TAX
MATTERS herein.
Interest on the Taxable Bonds (defined below) is not excludable from gross income under section 103 of the Code for federal income tax
purposes. See “FEDERAL TAX TREATMENT OF TAXABLE CERTIFICATES” herein.
BEXAR COUNTY, TEXAS
$97,455,000
COMBINATION TAX AND REVENUE
CERTIFICATES OF OBLIGATION,
SERIES 2010A
$30,325,000
TAXABLE SERIES 2010B
(DIRECT SUBSIDY – BUILD AMERICA BONDS)
Dated: July 15, 2010
$24,020,000
LIMITED TAX
GENERAL OBLIGATION
BONDS, SERIES 2010
Due: June 15, in each of the years stated in pages -ii-, -iii-, and -iv- herein
Bexar County, Texas (the “County”) is issuing its $97,455,000 Combination Tax and Revenue Certificates of Obligation, Series 2010A (the
“Tax-Exempt Certificates” and, together with the hereinafter-defined Bonds, the “Tax-Exempt Obligations”), its $30,325,000 Combination Tax
and Revenue Certificates of Obligation, Taxable Series 2010B (Direct Subsidy - Build America Bonds) (the “Taxable Certificates” and, together
with the Tax-Exempt Certificates, the “Certificates”), and its $24,020,000 Limited Tax General Obligation Bonds, Series 2010” (the “Bonds” and,
together with the Certificates, the “Obligations”). The Certificates are issued under and in conformity with the Constitution and laws of the State
of Texas (the “State), including Subchapter C of Chapter 271, as amended, Texas Local Government Code (the Certificate of Obligation Act of
1971), and Chapter 1371 and Subchapter E of Chapter 1473, as amended, Texas Government Code, and pursuant to separate orders adopted
on July 13, 2010 by the Commissioners Court (the “Court”) of the County. The Bonds are issued pursuant to the general laws of the State of
Texas, particularly Chapters 1371 and 1473, Texas Government Code, as amended, and pursuant to a separate order adopted on July 13, 2010
by the Court.
In the respective authorizing orders, and in accordance with Chapter 1371, as amended, Texas Government Code, the Court has delegated to
certain designated officials of the County the authority to establish the final terms of, as well as to effectuate the sale of the Obligations and to
execute respective approval certificates relating to each series of Obligations evidencing such final terms of sale. These approval certificates
were executed by the County’s Executive Director, Planning & Resource Management/Budget Officer/Chief Investment Officer on August 4,
2010.
The Obligations are issuable only as fully registered obligations in denominations of $5,000 or any integral multiple thereof. Interest on the
Obligations will accrue from the date of their initial delivery to the initial purchasers thereof named below (the “Underwriters”), will be payable
semiannually on June 15 and December 15 of each year commencing December 15, 2010, and will be calculated on the basis of a 360-day year
consisting of twelve 30-day months. The Obligations are initially registered solely in the name Cede & Co., as registered owner and nominee for
The Depository Trust Company, New York, New York (“DTC”) acting as securities depository for the Obligations, until DTC resigns or is
discharged. The Obligations initially will be available to purchasers in book-entry form only. So long as Cede & Co. is the registered owner of
the Obligations, as nominee for DTC, the Paying Agent/Registrar, initially, Wells Fargo Bank, National Association, Austin, Texas, will pay the
principal of and interest on the Obligations to Cede & Co., which will, in turn, remit such amounts to DTC participants for subsequent
disbursement to the beneficial owners of the Obligations. (See “BOOK-ENTRY-ONLY SYSTEM” herein.)
The Certificates are payable from an annual ad valorem tax levied against all taxable property located in the County, within the limitations
prescribed by law, and, additionally, from a subordinate lien on and pledge of certain net revenues derived from the operation of the
County's parking facilities (referred to herein as the "Pledged Revenues") on a parity with certain currently outstanding obligations and any
Additional Parity Obligations (defined herein) hereafter issued by the County. The Bonds are payable from an annual ad valorem tax
levied against all taxable property located in the County, within the limitations prescribed by law. (See "THE OBLIGATIONS - Authority for
Issuance" and "THE OBLIGATIONS - Security for Payment" herein.)
In addition to the Obligations, the County sold its $36,915,000 Limited Tax Refunding Bonds, Series 2010 (the “Refunding Bonds”) on June 18,
2010 pursuant to a separate order adopted by the Court on June 8, 2010. The Refunding Bonds were delivered on July 22, 2010. This Official
Statement only describes the Obligations and does not provide any disclosure relating to the Refunding Bonds.
SEE MATURITY SCHEDULES, PRINCIPAL AMOUNTS, INTEREST RATES, INITIAL YIELDS,
CUSIP NUMBERS AND REDEMPTION PROVISONS ON PAGES -ii-, -iii-, AND -iv- HEREOF
The Obligations are offered for delivery, when, as, and if issued, and received by the Underwriters subject to the approving opinion of the
Attorney General of the State of Texas and the approval of certain legal matters by Fulbright & Jaworski L.L.P, San Antonio, Texas, Bond
Counsel. (See “APPENDIX D - Forms of Bond Counsel’s Opinions” herein.) Certain legal matters will be passed upon for the Underwriters by
Escamilla, Poneck & Cruz, LLP, San Antonio, Texas and Manuel G. Escobar, Jr., Attorney at Law, San Antonio, Texas, co-counsel for the
Underwriters. (See "LEGAL MATTERS" herein.) The Obligations are expected to be available for initial delivery through the services of DTC
on or about August 19, 2010.
LOOP CAPITAL MARKETS
CABRERA CAPITAL MARKET, INC.
SIEBERT BRANDFORD SHANK & CO., L.L.C.
ESTRADA HINOJOSA & COMPANY, INC.
WELLS FARGO SECURITIES
MATURITY SCHEDULE, PRINCIPAL AMOUNTS, INTEREST RATES,
INITIAL YIELDS, CUSIP NUMBERS AND REDEMPTION PROVISONS
BEXAR COUNTY, TEXAS
CUSIP NO. PREFIX: 088281(1)
$97,455,000
CERTIFICATES OF OBLIGATION, SERIES 2010A
$75,765,000 Tax-Exempt Serial Certificates
Maturity
6/15
Principal
Amount ($)
Interest
Rate (%)
Initial
Yield (%)
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
2,860,000
2,125,000
2,190,000
2,300,000
2,415,000
2,535,000
2,595,000
2,720,000
2,860,000
3,000,000
3,150,000
3,310,000
3,475,000
3,650,000
3,830,000
4,020,000
4,225,000
4,435,000
4,655,000
4,890,000
5,135,000
5,390,000
3.000
3.000
5.000
5.000
5.000
2.250
5.000
5.000
5.000
5.000
5.000
5.000
5.000
5.000
5.000
5.000
5.000
5.000
5.000
5.000
5.000
5.000
0.390
0.450
0.740
0.990
1.470
1.870
2.170
2.410
2.610
2.810(2)
2.980(2)
3.120(2)
3.260(2)
3.390(2)
3.500(2)
3.620(2)
3.730(2)
3.830(2)
3.900(2)
3.980(2)
4.060(2)
4.130(2)
CUSIP
No. Suffix(1)
CW8
CX6
CY4
CZ1
DA5
DB3
DC1
DD9
DE7
DF4
DG2
DH0
DJ6
DK3
DL1
DM9
DN7
DP2
DQ0
DR8
DS6
DT4
(Interest to accrue from the date of initial delivery to the Underwriters)
$21,690,000 Tax-Exempt Term Certificates
$11,555,000 4.125% Term Certificates Due June 15, 2034 - Priced to Yield 4.350% - CUSIP No. Suffix DV9(1)
$10,135,000 5.000% Term Certificates Due June 15, 2036 - Priced to Yield 4.250%(2) - CUSIP No. Suffix DX5(1)
The County reserves the right to redeem the Tax-Exempt Certificates maturing on and after June 15, 2020, in whole or in
part, in the principal amount of $5,000 or any integral multiple thereof, on June 15, 2019 or any date thereafter, at the
redemption price of par plus accrued interest. The Tax-Exempt Certificates maturing on June 15 in the years 2034 and
2036 (the "Term Tax-Exempt Certificates") are subject to mandatory sinking fund redemption. (See "THE OBLIGATONS Redemption Provisions of the Tax-Exempt Obligations" herein.)
____________
(1)
.(2)
CUSIP numbers are included solely for the convenience of the owners of the Tax-Exempt Certificates. CUSIP is a registered trademark of
the American Bankers Association. CUSIP data herein is provided by CUSIP Global Services, managed by Standard & Poor’s Financial
Services LLC on behalf of The American Bankers Association. None of the County, the Co-Financial Advisors, nor the Underwriters, either
individually or collectively, shall be responsible for the selection or correctness of the CUSIP numbers set forth herein.
Yield calculated based on the assumption that the Tax-Exempt Certificates denoted and sold at a premium will be redeemed on June 15,
2019, the first optional call date for the Tax-Exempt Certificates, at a redemption price of par, plus accrued interest to the redemption date.
-ii-
BEXAR COUNTY, TEXAS
(1)
CUSIP NO. PREFIX: 088281
$30,325,000
CERTIFICATES OF OBLIGATION, TAXABLE SERIES 2010B
(DIRECT SUBSIDY - BUILD AMERICA BONDS)
Term Taxable Certificates
$30,325,000 5.755% Term Certificates Due June 15, 2040 - Priced to Yield 5.755% - CUSIP No. Suffix CV0(1)
The County reserves the right to redeem the Taxable Certificates prior to stated maturity in the amounts, at the times, and
at the prices described herein. (See "THE OBLIGATIONS - Redemption Provisions of the Taxable Certificates" herein.)
____________
(1)
CUSIP numbers are included solely for the convenience of the owners of the Taxable Certificates. CUSIP is a registered trademark
of the American Bankers Association. CUSIP data herein is provided by CUSIP Global Services, managed by Standard & Poor’s
Financial Services LLC on behalf of The American Bankers Association. None of the County, the Co-Financial Advisors, nor the
Underwriters, either individually or collectively, shall be responsible for the selection or correctness of the CUSIP numbers set forth
herein.
-iii-
BEXAR COUNTY, TEXAS
CUSIP NO. PREFIX: 088281(1)
$24,020,000
LIMITED TAX GENERAL OBLIGATION BONDS
SERIES 2010
Maturity
6/15
Principal (2)
Amount ($)
Interest
Rate (%)
Initial
Yield (%)
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
615,000
465,000
475,000
490,000
505,000
515,000
535,000
555,000
575,000
600,000
625,000
650,000
675,000
705,000
730,000
760,000
790,000
3.000
2.000
3.000
3.000
2.500
3.250
4.000
4.000
4.000
4.000
4.000
4.000
4.000
4.000
4.000
4.000
4.000
0.390
0.450
0.740
0.990
1.470
1.870
2.170
2.410
2.610
2.830(2)
3.030(2)
3.200(2)
3.370 (2)
3.520 (2)
3.650(2)
3.750 (2)
3.850 (2)
CUSIP
(1)
No. Suffix
DY3
DZ0
EA4
EB2
EC0
ED8
EE6
EF3
EG1
EH9
EJ5
EK2
EL0
EM8
EN6
EP1
EQ9
$21,690,000 Term Bonds
(1)
$2,565,000 4.000% Term Bonds Due June 15, 2030 - Priced to Yield 4.120% - CUSIP No. Suffix ET3
$3,935,000 4.125% Term Bonds Due June 15, 2034 - Priced to Yield 4.350% - CUSIP No. Suffix EX4(1)
$7,255,000 4.250% Term Bonds Due June 15, 2040 - Priced to Yield 4.400% - CUSIP No. Suffix FD7(1)
(Interest to accrue from the Dated Date)
The County reserves the right to redeem the Bonds maturing on and after June 15, 2020, in whole or in part, in the
principal amount of $5,000 or any integral multiple thereof, on June 15, 2019 or any date thereafter, at the redemption
price of par plus accrued interest. The Term Bonds maturing on June 15 in the years 2030, 2034, and 2040 (the "Term
Bonds") are subject to mandatory sinking fund redemption. ( (See "THE OBLIGATIONS - Redemption Provisions of the
Tax-Exempt Obligations" herein.)
____________
(1)
(2)
CUSIP numbers are included solely for the convenience of the owners of the Bonds. CUSIP is a registered trademark of the
American Bankers Association. CUSIP data herein is provided by CUSIP Global Services, managed by Standard & Poor’s
Financial Services LLC on behalf of The American Bankers Association. None of the County, the Co-Financial Advisors, nor the
Underwriters, either individually or collectively, shall be responsible for the selection or correctness of the CUSIP numbers set forth
herein.
Yield calculated based on the assumption that the Bonds denoted and sold at a premium will be redeemed on June 15, 2019, the
first optional call date for the Bonds, at a redemption price of par, plus accrued interest to the redemption date.
-iv-
BEXAR COUNTY, TEXAS
COMMISSIONERS COURT
Position
Length of
Service
Term
Expires
Occupation
County Judge
Commissioner, Precinct 1
9 years
6 years
27 years
1 year
11 years
2014
2012
2014
2012
2010
Businessman/Attorney
Public Official
Businessman
Businessman
Attorney
Name
Nelson W. Wolff
Sergio "Chico" Rodriguez
Paul Elizondo
Kevin A. Wolff
Tommy Adkisson
COUNTY OFFICIALS
Name
Position
Years
Served
Sylvia S. Romo
Margaret G. Montemayor
Susan D. Reed
Gerard C. Rickhoff
Amadeo Ortiz
County Tax Assessor/Collector
District Clerk
Criminal District Attorney
County Clerk
Sheriff
13
7
11
13
2
APPOINTED OFFICIALS
Years
Served
Name
Position
David L. Smith
Executive Director, Planning & Resource
Management/Budget Officer/Chief Investment Officer
County Auditor
Purchasing Agent
Susan T. Yeatts, C.P.A.
Daniel R. Garza
6
1st
1st
COMMISSIONERS COURT EMPLOYEES
Name
Joe Aceves
Catherine Maras
Aurora Sanchez
Position
Director, Infrastructure Services
Chief Information Officer
Director, Community Resources
Years
Served
4
1st
3
CONSULTANTS AND ADVISORS
SAMCO Capital Markets, Inc.
San Antonio, Texas
Co-Financial Advisors
M. E. Allison & Co., Inc.
San Antonio, Texas
Fulbright & Jaworski L.L.P.
San Antonio, Texas
Bond Counsel
Garza/Gonzalez & Associates
San Antonio, Texas
Certified Public Accountants
-v-
For additional information regarding the County, please contact:
Mr. David L. Smith
Executive Director, Planning & Resource
Management/Budget Officer/Chief Investment Officer
Bexar County
410 S. Main, Suite 208
San Antonio, Texas 78204
(210) 335-2405 - Telephone
(210) 335-2683 - Facsimile
Ms. Susan T. Yeatts, C.P.A.
County Auditor
Bexar County
212 Stumberg
Suite 100
(210) 335-2434 - Telephone
(210) 335-2996 - Facsimile
Mr. Duane L. Westerman
SAMCO Capital Markets, Inc.
8700 Crownhill Boulevard, Suite 601
(210) 832-9760 - Telephone
(210) 832-9794 - Facsimile
[email protected]
Mr. Mark A. Seal
M. E. Allison & Co., Inc.
950 E. Basse Road, 2nd Floor
(210) 930-4000 - Telephone
(210) 930-4001 - Facsimile
[email protected]
[The remainder of this page intentionally left blank]
-vi-
USE OF INFORMATION IN OFFICIAL STATEMENT
No dealer, broker, salesman, or other person has been authorized by the County to give any information or to make any
representation with respect to the Obligations, other than as contained in this Official Statement, and if given or made,
such other information or representations must not be relied upon as having been authorized by either of the foregoing.
This Official Statement does not constitute an offer to sell or a solicitation of an offer to buy, nor shall there be any sale of
the Obligations by any person, in any jurisdiction in which it is unlawful for such person to make such offer, solicitation, or
sale. The information set forth herein has been obtained from sources which are believed to be reliable but is not
guaranteed as to accuracy or completeness and is not to be construed as a representation by the Underwriters.
The information and expressions of opinion herein are subject to change without notice, and neither the delivery of this
Official Statement nor any sale made hereunder shall under any circumstances create any implication that there has been
no change in the information or opinions set forth herein after the date of this Official Statement The information and
expressions of opinion herein are subject to change without notice, and neither the delivery of this Official Statement nor
any sale made hereunder will under any circumstances create any implication that there has been no change in the
information or opinions set forth herein after the date of this Official Statement. See “CONTINUING DISCLOSURE” for a
description of the County’s undertaking to provide certain information on a continuing basis.
The Underwriters have provided the following sentence for inclusion in this Official Statement. The Underwriters have
reviewed the information in this Official Statement in accordance with, and as part of their responsibilities to investors
under the federal securities laws as applied to the facts and circumstances of this transaction, but the Underwriters do not
guarantee the accuracy or completeness of such information.
THE OBLIGATIONS ARE EXEMPT FROM REGISTRATION WITH THE UNITED STATES SECURITIES AND
EXCHANGE COMMISSION AND CONSEQUENTLY HAVE NOT BEEN REGISTERED THEREWITH. THE
REGISTRATION, QUALIFICATION, OR EXEMPTION OF THE OBLIGATIONS IN ACCORDANCE WITH APPLICABLE
SECURITIES LAW PROVISIONS OF THE JURISDICTIONS IN WHICH THESE OBLIGATIONS HAVE BEEN
REGISTERED, QUALIFIED, OR EXEMPTED SHOULD NOT BE REGARDED AS A RECOMMENDATION FOR THE
PURCHASE THEREOF.
IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT TRANSACTIONS
WHICH STABILIZE THE MARKET PRICE OF THIS ISSUE AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE
PREVAIL IN THE OPEN MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.
None of the County, the Co-Financial Advisors, nor the Underwriters make any representation or warranty with respect to
the information contained in this Official Statement regarding The Depository Trust Company or its “BOOK-ENTRY ONLY
SYSTEM.”
The agreements of the County and others related to the Obligations are contained solely in the contracts described herein.
Neither this Official Statement, nor any other statement made in connection with the offer or sale of the Obligations, is to
be construed as constituting an agreement with the purchasers of the Obligations. INVESTORS SHOULD READ THE
ENTIRE OFFICIAL STATEMENT, INCLUDING ALL APPENDICES ATTACHED HERETO, TO OBTAIN INFORMATION
ESSENTIAL TO MAKING AN INFORMED INVESTMENT DECISION WITH RESPECT TO THE OBLIGATIONS.
-vii-
TABLE OF CONTENTS
COVER PAGE.......................................................................
i
STATED MATURITY SCHEDULES.................................... ii-iv
COMMISSIONERS COURT.................................................
v
COUNTY OFFICIALS ..........................................................
v
APPOINTED OFFICIALS ....................................................
v
COMMISSIONERS COURT EMPLOYEES .......................
v
CONSULTANTS AND ADVISORS .....................................
v
USE OF INFORMATION IN OFFICIAL STATEMENT ...... vii
TABLE OF CONTENTS ....................................................... viii
INTRODUCTION...................................................................
1
THE OBLIGATIONS
Authority for Issuance .....................................................
1
General Description ........................................................
1
Security for Payment .....................................................
2
Refundable Tax Credits ................................................
2
Payment Record ...........................................................
3
Legality ..........................................................................
3
Delivery ..........................................................................
3
Use of Proceeds ............................................................
3
Future Issues .................................................................
4
Redemption Provisions of the Tax-Exempt
Obligations ...............................................................
4
Redemption Provisions of the Taxable
Certificates ...............................................................
5
Selection of Obligations for Redemption ....................
6
Notice of Redemption ..................................................
6
Defeasance ...................................................................
7
Amendments .................................................................
7
Default and Remedies ..................................................
7
SOURCES AND USES OF FUNDS
FOR THE TAX-EXEMPT CERTIFICATES .................
8
FOR THE TAXABLE CERTIFICATES ........................
8
FOR THE BONDS ........................................................
9
REGISTRATION, TRANSFER, AND EXCHANGE
Paying Agent Registrar .................................................
9
Successor Paying Agent/Registrar ...............................
9
Record Date ..................................................................
9
Special Record Date for Interest Payment ...................
9
Registration, Transferability and Exchange .................. 10
Limitation on Transferability of
Obligations Called for Redemption ........................ 10
Replacement Obligations .............................................. 10
BOOK-ENTRY-ONLY SYSTEM .......................................... 10
AD VALOREM TAX PROCEDURES
Ad Valorem Taxation ...................................................... 12
Taxable Property, Exemptions and
Agriculture Exclusions ................................................
Tax Rate and Funded Debt Limitations .................................
PROPERTY TAXES
Property Tax Code and County-Wide
Appraisal District .............................................................
Tax Abatement Reinvestment Zone/
Tax Phase-in Agreements .........................................
Exemptions From Taxes ................................................
County and Taxpayer Remedies ...................................
Levy and Collection of Taxes ........................................
Tax Liens ........................................................................
The Effect of the Financial Institutions Act of 1989
on Tax Collections of the County ...............................
INVESTMENT POLICIES
Investments .........................................................................
Legal Investments ................................................................
Investment Policies ..............................................................
Additional Provisions ............................................................
Current Investments ......................................................
LEGAL MATTERS .................................................................
NO-LITIGATION .....................................................................
TAX MATTERS
Tax-Exemption .......................................................................
FEDERAL INCOME TAX TREATMENT
OF TAXABLE CERTIFICATES .....................................
CONTINUING DISCLOSURE OF INFORMATION
Annual Reports ....................................................................
Material Event Notices ........................................................
Availability of Information from MSRB ................................
Limitations and Amendments .............................................
Compliance with Prior Undertakings ..................................
OTHER PERTINENT INFORMATION
Authenticity of Financial Data and Other Information ........
Registration and Qualification of Obligations for Sale ........
Legal Investments and Eligibility to
Secure Public Funds in Texas ........................................
Bond Ratings ........................................................................
Co-Financial Advisors .........................................................
Underwriting ........................................................................
Financial Statements ..........................................................
Use of Information in the Official Statement ......................
Forward Looking Statements ..............................................
GASB Implications for the County ......................................
Certification of the Official Statement .................................
Authorization of the Official Statement ...............................
SELECTED FINANCIAL INFORMATION OF THE COUNTY..............................................................................................
GENERAL INFORMATION REGARDING THE COUNTY...................................................................................................
BEXAR COUNTY, TEXAS ANNUAL FINANCIAL REPORT ...............................................................................................
FORMS OF OPINIONS OF BOND COUNSEL ....................................................................................................................
14
15
16
16
16
17
17
17
17
18
19
19
19
20
20
21
23
24
24
24
25
25
25
25
25
26
26
26
27
27
27
27
27
APPENDIX A
APPENDIX B
APPENDIX C
APPENDIX D
The cover page, subsequent pages hereof, and appendices attached hereto, are part of this Official Statement.
-viii-
12
13
OFFICIAL STATEMENT
Relating to
BEXAR COUNTY, TEXAS
$97,455,000
COMBINATION TAX AND
REVENUE
SERIES 2010A
$30,325,000
TAXABLE SERIES 2010B
(DIRECT SUBSIDY – BUILD AMERICA BONDS)
$24,020,000
LIMITED TAX
GENERAL OBLIGATION
BONDS, SERIES 2010
INTRODUCTION
This Official Statement of Bexar County, Texas (the “County”) is provided to furnish certain information in connection with
the sale of the County's $97,455,000 Combination Tax and Revenue Certificates of Obligation, Series 2010A (the “TaxExempt Certificates” and, together with the hereinafter-defined Bonds, the “Tax-Exempt Obligations”), its $30,325,000
Combination Tax and Revenue Certificates of Obligations, Taxable Series 2010B (Direct Subsidy - Build America Bonds)
(the “Taxable Certificates” and, together with the Tax-Exempt Certificates, the “Certificates”), and its $24,020,000 Limited
Tax General Obligation Bonds, Series 2010” (the “Bonds” and, together with the Certificates, the “Obligations”).
In addition to the Obligations, the County has sold its $36,915,000 Limited Tax Refunding Bonds, Series 2010 (the
“Refunding Bonds”) on June 18, 2010 pursuant to a separate order adopted by the Court on June 8, 2010. The Refunding
Bonds were delivered on July 22, 2010. This Official Statement only describes the Obligations and does not provide any
disclosure relating to the Refunding Bonds.
This Official Statement contains descriptions of the Obligations and certain other information about the County and its
finances. All descriptions of documents contained herein are only summaries and are qualified in their entirety by
reference to each such document. Copies of such documents may be obtained from the County at the Bexar County
Courthouse, 100 Dolorosa, Room 101, San Antonio, Texas 78205 and, during the offering period, from the County's CoFinancial Advisors, SAMCO Capital Markets, Inc., 8700 Crownhill Blvd., Suite 601, San Antonio, Texas 78209, and M. E.
Allison & Co., Inc., 950 E. Basse Road, 2nd Floor, San Antonio, Texas 78209, by electronic mail or upon payment of
reasonable copying, mailing, and handling charges.
This Official Statement speaks only as to its date, and the information contained herein is subject to change. A copy of the
Final Official Statement pertaining to the Obligations will be filed with the Municipal Securities Rulemaking Board through its
Electronic Municipal Markets Access (EMMA) system. See “CONTINUING DISCLOSURE OF INFORMATION” herein for a
description of the County’s undertaking to provide certain information on a continuing basis. Capitalized terms used, but not
defined herein, shall have the meanings ascribed thereto in each of the respective Orders (defined below).
THE OBLIGATIONS
Authority for Issuance
The Bonds…The Bonds are issued under and in conformity with the Constitution and laws of the State of Texas (the
“State”), including Chapters 1473 and 1371, Texas Government Code, as amended, and pursuant to the provisions of an
order of the Commissioners Court of the County (the “Court”) adopted on July 13, 2010 (the "Bond Order" and, collectively
with the hereinafter-defined Tax-Exempt Certificates Order and the Taxable Certificates Order, the "Orders").
The Certificates…The Certificates are issued under and in conformity with the Constitution and laws of the State,
including Subchapter C of Chapter 271, as amended, Texas Local Government Code (the Certificate of Obligation Act of
1971), and Chapter 1371 and Subchapter E of Chapter 1473, as amended, Texas Government Code, and pursuant to
respective orders (the “Tax-Exempt Certificates Order” and the Taxable Certificates Order”) adopted on July 13, 2010 by
the Court.
Delegated Sale Authority…In each of the respective Orders, and as permitted by Chapter 1371, as amended, Texas
Government Code (“Chapter 1371”), the Court has delegated to certain designated officials of the County the authority to
establish the final terms of, as well as to effectuate the sale of, the Obligations and to execute respective approval
certificates relating to each series of Obligations evidencing such final terms of sale (each an “Approval Certificate” and,
together, the “Approval Certificates”). The Approval Certificates were executed by the County’s Executive Director,
Planning & Resource Management/Budget Officer/Chief Investment Officer on August 4, 2010.
General Description
The Obligations will be dated July 15, 2010 (the "Dated Date") and issued only in fully registered form and in principal
denominations of $5,000 or any integral multiple thereof. The Obligations bear interest from their date of initial delivery to
the Underwriters at the stated interest rates indicated on pages ii, iii and iv, as applicable, hereof. Interest on the
Obligations will be calculated on the basis of a 360-day year of twelve 30-day months payable on December 15, 2010, and
each June 15 and December 15 thereafter, until the earlier of stated maturity or prior redemption.
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Interest on the Obligations is payable to the registered owners appearing on the bond registration books of the Paying
Agent/Registrar on the Record Date (identified below) and such interest shall be paid by the Paying Agent/Registrar (i) by
check sent by United States mail, first class, postage prepaid, to the address of the registered owner recorded in the bond
register or (ii) by such other method, acceptable to the Paying Agent/Registrar, requested by, and at the risk and expense
of, the registered owner. The principal of the Obligations is payable at stated maturity or prior redemption, upon their
presentation and surrender to the Paying Agent/Registrar.
Initially the Obligations will be registered and delivered only to Cede & Co., the nominee of The Depository Trust Company
("DTC") pursuant to the Book-Entry-Only System described herein. No physical delivery of the Obligations will be made to
the owners thereof. Notwithstanding the foregoing, as long as the Obligations are held in the Book-Entry-Only System,
principal of, premium, if any, and interest on the Obligations will be payable by the Paying Agent/Registrar to Cede & Co.,
which will make distribution of the amounts so paid to the participating members of DTC for subsequent payment to the
beneficial owners of the Obligations. (See "BOOK-ENTRY-ONLY SYSTEM" herein.)
Security for Payment
The Certificates…The Certificates will be payable from the proceeds of an annual ad valorem tax levied, within the
limitations prescribed by law, upon all taxable property within the County. The Certificates are payable from the County's
$0.80 tax rate authorized by Article IX, Section 9 of the Texas Constitution (see "AD VALOREM TAX INFORMATION –
Tax Rate and Funded Debt Limitations" herein) and are additionally payable from a subordinate lien on and pledge of
certain Pledged Revenues (defined herein) derived from the operation of the County's parking facilities on a parity with
certain currently outstanding obligations and any Additional Parity Obligations hereafter issued by the County.
The lien on and pledge of the Pledged Revenues securing, in part, the payment of the Certificates will be on a parity with
the lien thereof securing, in part, the payment of the County's currently outstanding Obligations Similarly Secured. The
County also reserves the right to issue, for any lawful purpose, at any time in one or more installments, bonds, certificates
of obligation, and other obligations of any kind payable, in whole or in part, from the Pledged Revenues, as Prior Lien
Bonds and Additional Revenue Obligations, such liens being prior and superior to the lien on and pledge of the Pledged
Revenues securing payment of the Certificates or the currently outstanding Obligations Similarly Secured or any Additional
Parity Obligations hereafter issued by the County.
The term "Pledged Revenues," as defined in the Tax-Exempt Certificates Order and Taxable Certificates Order, means a
portion of the Net Revenues of the County's parking facilities securing the payment of the currently outstanding Obligations
Similarly Secured or any Additional Parity Obligations hereafter issued by the County. The amount of Pledged Revenues
appropriated during any fiscal year and set aside in the annual budget for the payment of principal of or interest on each
series of the currently outstanding Obligations Similarly Secured and the Certificates will be determined within the sole
discretion of the Court; provided, however, that in no event may the Court in the exercise of its discretion appropriate less
than $1,000, or such lesser amount remaining and available after the payment of all Maintenance and Operation
Expenses, of such Net Revenues for the payment of the principal of or interest on each issue of the currently outstanding
Obligations Similarly Secured, the Certificates, or any Additional Parity Obligations.
The County has transferred approximately $150,000 in each of the five prior fiscal years for the payment of debt service
requirements on the Obligations Similarly Secured; however, the holders of the Certificates should not anticipate that the
County will transfer an amount in excess of $1,000 in each fiscal year for the payment of principal of and interest on the
Certificates. Accordingly, the County intends that ad valorem taxes will be the primary source for the repayment of the debt
service requirements on the Certificates.
The Bonds…The Bonds constitute direct obligations of the County payable from the levy and collection of a direct and
continuing ad valorem tax, within the limits prescribed by law, on all taxable property within the County, as provided in the
Order. See “AD VALOREM TAX PROCEDURES – Tax Rate and Funded Debt Limitations” herein.
Refundable Tax Credits
The Taxable Certificates qualify for and will be designated as “build America bonds” under and pursuant to the authority
provided for in the federal American Recovery and Reinvestment Act of 2009, effective February 17, 2009 (“Stimulus Act”),
and in accordance with guidance released from time to time by the Internal Revenue Service. In connection with the
issuance of the Taxable Certificates, and as permitted in the Stimulus Act, the County has elected an option (which
election is irrevocable pursuant to the provisions of the Stimulus Act) to treat the Taxable Certificates as “qualified bonds”
under section 54AA(g) of the Code, permitting it to receive directly from the United States Department of the Treasury
(“Department of the Treasury”) a subsidy payment equal to 35% of the taxable interest it pays on the Taxable Certificates
to the holders thereof (“Tax Credit”). See “FEDERAL INCOME TAX TREATMENT OF TAXABLE CERTIFICATES” herein
for a description of the effects upon the holders thereof of the County’s designation of the Taxable Certificates as taxable
Build America Bonds and its election to directly receive the Tax Credit relating thereto.
In the IRS Form 8038-CP to be filed with the Internal Revenue Service notifying the Department of the Treasury of its
designation and election with respect to the Taxable Certificates described above, the County has provided for the Tax
Credit to be delivered from the Department of the Treasury directly to the Paying Agent/Registrar, for further deposit and
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allocation to a special interest and sinking subaccount created on the books and records of the Paying Agent/Registrar
relating solely to the Taxable Certificates. The agreement between the County and the Paying Agent/Registrar relating to
the Taxable Certificates provides that the amount held in this special interest and sinking subaccount shall be used to
reduce the amount of the regularly scheduled debt service payments on the Taxable Certificates that the County is
required to make under the Taxable Certificate Order by remitting the same to the Paying Agent/Registrar.
The Tax Credit is a general revenue of the County and is not directly pledged to the payment of the Taxable Certificates;
however, the County anticipates that the entirety of any Tax Credit received, as a result of the direct deposit from the
Department of the Treasury to the Paying Agent/Registrar for further deposit to the limited purpose debt service
subaccount described above, will be available to off-set the scheduled debt service payment requirements attributable
solely to the Taxable Certificates.
The County’s continued receipt of the Tax Credit is subject to various requirements under federal tax law. No assurance
are provided that the County will receive the Tax Credit. The Tax Credit will only be paid by the Department of the
Treasury if the Taxable Certificates remain qualified in accordance with the provisions of the Code as provided above. For
the Taxable Certificates to be, and remain, qualified as “build America bond” and as “qualified bonds” for which the Tax
Credit will be received, the County must comply with certain covenants relating to the use and investment of proceeds
thereof, the use of property financed therewith, making timely and proper filings with the Internal Revenue Service, and
satisfying certain other requirements of the Code. Failure on the part of the County to comply with the conditions imposed
by the Code and future guidance to be provided by the Department of the Treasury and the Internal Revenue Service, may
cause the County to fail to receive the Tax Credit for the remaining term of the Taxable Certificates and it could subject the
County to a claim for refund of previously received Tax Credits. Moreover, the Tax Credit is subject to automatic offset
against certain amounts that may, for unrelated reasons, be owed by the County to the United States of America or an
agency thereof. In addition, see “THE OBLIGATIONS – Redemption of the Taxable Certificates” herein for more
information concerning optional redemption of the Taxable Certificates upon the occurrence of an Extraordinary Event.
Payment Record
The County has never defaulted on the payment of its bonded indebtedness.
Legality
The Obligations are offered for delivery when issued and received by the Underwriters subject to the approval of certain
legal matters by Fulbright & Jaworski L.L.P., San Antonio, Texas, and the approving opinion of the Attorney General of
the State of Texas. The applicable legal opinion of Bond Counsel will be printed on or attached to the appropriate series
Obligations. Forms of the legal opinions of Bond Counsel appear in APPENDIX D.
Delivery
When issued; anticipated on or about August 19, 2010.
Use of Proceeds
Proceeds from the sale of the Certificates are being used by the County for the purposes of (1) constructing, renovating,
improving, and equipping the Bexar County Courthouse, Bexar County Jail, Bexar County Adult Detention Facilities, Bexar
County Juvenile Detention Facilities, Bexar County Annex, Bexar County Mental Health Facilities, Central Magistration,
Adult Detention Center (including land acquisition and renovation, construction, and equipment of facilities), Cadena
Reeves Justice Center, Juvenile Justice Academy Project, Justice of the Peace/Constable Facilities, Bexar County Justice
Center and other Bexar County-owned justice facilities, Bexar County Justice Center Expansion Project, Vista Verde
Facilities, Bullis Park Facilities, Haven for Hope, and Bexar County Adult Probation Center; (2) the purchase of computer
hardware and software and other technology and audio visual equipment information technology system upgrades and
improvements, and the payment of professional fees relating thereto, including the Countywide Integrated Justice System,
Financial Management System, County Human Resource Information System, the County Forensic Science Center
Network Systems, County-wide computer and network upgrades, and the Juvenile Justice Information System; (3) energy
upgrades to existing County facilities; (4) constructing, renovating, equipping, improving, and equipping County park
facilities and the purchase of park vehicles; (5) purchase of vehicles for various County departments; (6) constructing and
equipping a new parking facility at Flores Street; (7) constructing and equipping a new parking facility at the Bexar County
Adult Probation Facility; (8) purchase and installation of energy conservation equipment for County facilities; (9)
constructing and equipping a new justice of the peace and constable facility in Justice of the Peace No. 1, Precinct No. 3;
(10) constructing and equipping a new firing range for the Bexar County Sheriff’s Department to be located in Precinct No.
1; (11) purchase of patrol vehicles and other vehicles for the Bexar County Sheriff’s Department; (12) constructing,
renovating, repairing, and improving County roads (including utilities relocation); (13) constructing various park and/or
recreational facility improvements outside the banks of the San Antonio River; and (14) the payment of professional
services related to the construction, design, project management, and financing of the aforementioned projects.
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Proceeds from the sale of the Bonds are being used by the County for the purposes of (i) purchasing, constructing,
reconstructing, improving or equipping a building or buildings, purchasing technology, and the purchase and improvement
of the necessary sites therefor that will be utilized for housing county jail facilities, including adult probation facilities and
juvenile probation facilities; (ii) purchasing, acquiring, constructing, improving or equipping County park facilities, including
cultural, educational, historical documents preservation, and museum facilities, including the Hertzberg Museum/Library;
(iii) purchasing, acquiring, constructing, improving or equipping, or provide by other means, including a lease or a lease
with an option to purchase, facilities located within the territorial limits of the City of San Antonio, Texas, and the purchase
and improvement of the necessary sites therefor, for County offices or for the conducting of other public business,
including an emergency operations center and senior citizens multipurpose facilities; and (iv) paying the costs associated
with the issuance of the Bonds.
Future Issues
The County does not anticipate the issuance of any additional general obligation debt in 2010.
Redemption Provisions of the Tax-Exempt Obligations
Optional Redemption of the Tax-Exempt Obligations…The Tax-Exempt Obligations, being the Bonds and the TaxExempt Certificates, stated to mature on and after June 15, 2020 are subject to optional redemption, in whole or in part,
in principal amounts of $5,000 or any integral multiple thereof (and if less than all within a stated maturity by lot, selected
by the Paying Agent/Registrar), on June 15, 2019 or on any date thereafter, at a price of par plus accrued interest to the
date fixed for redemption.
Mandatory Redemption of the Tax-Exempt Certificates … The Tax-Exempt Certificates maturing on June 15 in each
of the years 2034 and 2036 (the "Tax-Exempt Term Certificates") are subject to mandatory redemption in part prior to
maturity at the price of par plus accrued interest to the mandatory redemption date on June 15 in each of the years and
in the principal amounts as follows:
Tax-Exempt Term Certificates
Maturing June 15, 2034
Redemption
Principal
Date
Amount ($)
2033
2034*
Tax-Exempt Term Certificates
Redemption
Principal
Date
Amount( $)
$5,660,000
5,895,000
2035
2036*
$6,135,000
4,000,000
____________
* Stated Maturity.
Mandatory Redemption of the Bonds…The Bonds maturing on June 15 in each of the years 2030, 2034, and 2040
(the "Term Bonds" and, together with the Tax-Exempt Term Certificates, the "Tax-Exempt Term Obligations") are subject
to mandatory redemption in part prior to maturity at the price of par plus accrued interest to the mandatory redemption
date on June 15 in each of the years and in the principal amounts as follows:
Term Bonds
Redemption
Principal
Date
Amount ($)
2028
2029
2030*
$820,000
855,000
890,000
Term Bonds
Redemption
Principal
Date
Amount ($)
2031
2032
2033
2034*
925,000
965,000
1,000,000
1,045,000
Term Bonds
Redemption
Principal
Date
Amount ($)
2035
2036
2037
2038
2039
2040*
1,085,000
1,135,000
1,180,000
1,230,000
1,285,000
1,340,000
____________
* Stated Maturity.
Mandatory Redemption Procedures for the Tax-Exempt Term Obligations…Approximately forty-five (45) days prior
to each mandatory redemption date that the Term Obligations are to be mandatorily redeemed, the Paying
Agent/Registrar shall select by lot the numbers of the Term Obligations within the applicable Stated Maturity to be
redeemed on the next following June 15 from money set aside for that purpose in the Tax-Exempt Certificate Fund and
Bond Fund, respectively, each maintained for the payment of the respective Tax-Exempt Term Obligations. Any TaxExempt Term Obligations not selected for prior redemption shall be paid on the date of their Stated Maturity.
The principal amount of the Tax-Exempt Term Obligation for a Stated Maturity required to be redeemed pursuant to the
operation of such mandatory redemption provisions may be reduced, at the option of the County, by the principal amount
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of the Tax-Exempt Term Obligation of like Stated Maturity which, at least fifty (50) days prior to the mandatory
redemption date (1) shall have been acquired by the County and delivered to the Paying Agent/Registrar for cancellation,
(2) shall have been purchased and canceled by the Paying Agent/Registrar at the request of the County, or (iii) shall
have been redeemed pursuant to the optional redemption provisions and not theretofore credited against a mandatory
redemption requirement.
Redemption Provisions of the Taxable Certificates
Optional Redemption at Par…The Taxable Certificates stated to mature on and after June 15, 2020 are subject to
optional redemption, in whole or in part in principal amounts of $5,000 or any integral multiple thereof (and if less than all
within a stated maturity by lot, selected by the Paying Agent/Registrar), on June 15, 2019 or on any date thereafter, at a
price of par plus accrued interest to the date fixed for redemption.
Optional Redemption at the Make-Whole Redemption Price…The Taxable Certificates are also subject to redemption
prior to Stated Maturity, at the option of the County, on any date from the Closing Date through June 14, 2019, as a whole
or in part, in principal amounts of $5,000 or any integral multiple thereof (and if in part, selected at random and by lot by
the Paying Agent/Registrar), at the Make-Whole Redemption Price.
Optional Redemption at the Extraordinary Redemption Price…The Taxable Certificates are subject to redemption
prior to Stated Maturity, at the option of the County and upon the occurrence of an Extraordinary Event, on any date from
the Closing Date through June 14, 2019, as a whole or in part, in principal amounts of $5,000 or any integral multiple
thereof (and if in part, selected at random and by lot by the Paying Agent/Registrar) at the Extraordinary Redemption
Price.
Mandatory Redemption of the Taxable Certificates…The Taxable Certificates maturing on June 15 in the year 2040
(the "Taxable Term Certificates") are subject to mandatory redemption in part prior to maturity at the price of par plus
accrued interest to the mandatory redemption date on June 15 in each of the years and in the principal amounts as
follows:
Taxable Term Certificates
Redemption
Principal
Date
Amount ($)
2036
2037
2038
2039
2040*
2,350,000
6,635,000
6,885,000
7,060,000
7,395,000
____________
* Stated Maturity.
Approximately forty-five (45) days prior to each mandatory redemption date that the Taxable Term Certificates are to be
mandatorily redeemed, the Paying Agent/Registrar shall select by lot the numbers of the Taxable Term Certificates within
the applicable Stated Maturity to be redeemed on the next following June 15 from money set aside for that purpose in the
Taxable Certificates Fund maintained for the payment of the Taxable Term Certificates Any Taxable Term Certificates
not selected for prior redemption shall be paid on the date of their Stated Maturity.
The principal amount of the Taxable Term Certificates for a Stated Maturity required to be redeemed pursuant to the
operation of such mandatory redemption provisions may be reduced, at the option of the County, by the principal amount
of the Taxable Term Certificates of like Stated Maturity which, at least fifty (50) days prior to the mandatory redemption
date (1) shall have been acquired by the County and delivered to the Paying Agent/Registrar for cancellation, (2) shall
have been purchased and canceled by the Paying Agent/Registrar at the request of the County, or (iii) shall have been
redeemed pursuant to the optional redemption provisions and not theretofore credited against a mandatory redemption
requirement.
Defined Terms … The following defined terms are used in the redemption provisions provided above:
"Extraordinary Event" means the occurrence of a change to Sections 54AA or 6431 of the Code (as such Sections were
added by Section 1531 of the Stimulus Act, pertaining to Build America Bonds) or if there is any guidance published by the
Internal Revenue Service or the United States Treasury with respect to such Sections or any other determination by the
Internal Revenue Service or the United States Treasury, which determination is not the result of an act or omission by the
County to satisfy the requirements to receive the 35% Tax Credit from the United States Treasury, pursuant to which the
County's 35% Tax Credit from the United States Treasury is reduced or eliminated.
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"Extraordinary Redemption Price" means an amount equal to the greater of (i) the issue price of the Taxable Certificates
set forth in the Taxable Certificates Order (but not less than 100%) of the principal amount of the Taxable Certificates to be
redeemed or (ii) the sum of the present value of the remaining scheduled payments of principal and interest on the
Taxable Certificates to be redeemed to the maturity date of such Taxable Certificates, not including any portion of those
payments of interest accrued and unpaid as of the date on which the Taxable Obligations are to be redeemed, discounted
to the date on which the Taxable Certificates are to be redeemed on a semi-annual basis, assuming a 360-day year
containing twelve 30-day months, at the Treasury Rate plus one hundred (100) basis points, plus accrued interest on the
Taxable Certificates to be redeemed to the redemption date.
“Make-Whole Redemption Price” means an amount equal to the greater of (i) the issue price of the applicable series of
Taxable Certificates set forth in the applicable Taxable Certificate Order (but not less than 100%) of the principal amount
of such series of Taxable Certificates to be redeemed or (ii) the sum of the present value of the remaining scheduled
payments of principal and interest on the Taxable Certificates to be redeemed to the maturity date of such Taxable
Certificates, not including any portion of those payments of interest accrued and unpaid as of the date on which the
Taxable Certificates are to be redeemed, discounted to the date on which the Taxable Certificates are to be redeemed on
a semi-annual basis, assuming a 360-day year containing twelve 30-day months, at the Treasury Rate plus fifty (50) basis
points, plus accrued interest on the Taxable Certificates to be redeemed to the redemption date.
“Treasury Rate” means, with respect to any redemption date for a particular Taxable Certificate, the yield to maturity as of
such redemption date of United States Treasury securities with a constant maturity (as compiled and published in the most
recent Federal Reserve Statistical Release H.15 (519) that has become publicly available at least two business days prior
to the redemption date (excluding inflation indexed securities) (or, if such Statistical Release is no longer published, any
publicly available source of similar market data)) most nearly equal to the period from the redemption date to the maturity
date of the Taxable Certificate to be redeemed; provided, however, that if the period from the redemption date to such
maturity date is less than one year, the weekly average yield on actually traded United States Treasury securities adjusted
to a constant maturity of one year will be used.
Selection of Obligations for Redemption
The years of maturity of the Obligations called for redemption shall be selected by the County. If less than all of the
Obligations are redeemed within a stated maturity at any time, the Obligations to be redeemed shall be selected by the
Paying Agent/Registrar at random and by lot or other customary method in multiples of $5,000 within any stated maturity.
Notice of Redemption
Not less than 30 days prior to a redemption date for the Obligations, the County must cause a notice of redemption to be
sent by United States mail, first class, postage prepaid, to each such registered owner of an Obligation to be redeemed,
in whole or in part, at the address of the registered owner appearing on the registration books of the Paying
Agent/Registrar at the close of business on the business day next preceding the date of mailing such notice. ANY
NOTICE OF REDEMPTION SO MAILED WILL BE CONCLUSIVELY PRESUMED TO HAVE BEEN DULY GIVEN
IRRESPECTIVE OF WHETHER RECEIVED BY THE HOLDER. If an Obligation is subject by its terms to prior
redemption and has been called for redemption and notice of redemption thereof has been given as herein above
provided, such Obligation (or the principal amount thereof to be redeemed) will become due and payable and interest
thereon will cease to accrue from and after the redemption date thereof, provided moneys sufficient for the payment of
such Obligation (or of the principal amount thereof to be redeemed) at the then applicable redemption price are held for
the purpose of such payment by the Paying Agent/Registrar.
All notices of redemption shall (i) specify the date of redemption for the Obligations, (ii) identify the Obligations to be
redeemed and, in the case of a portion of the principal amount to be redeemed, the principal amount thereof to be
redeemed, (iii) state the redemption price, (iv) state the Obligations, or the portion of the principal amount thereof to be
redeemed, shall become due and payable on the redemption date specified, and the interest thereon, or on the portion of
the principal amount thereof to be redeemed, shall cease to accrue from and after the redemption date, and (v) specify
that payment of the redemption price for the Obligations, or the principal amount thereof to be redeemed, shall be made at
the designated corporate trust office of the Paying Agent/Registrar only upon presentation and surrender thereof by the
registered owner. If an Obligation is subject by its terms to redemption and has been called for redemption and notice of
redemption thereof has been duly given or waived as provided in the Tax-Exempt Certificates Order, Taxable Certificates
Order, or Bond Order, respectively, such Obligation (or the principal amount thereof to be redeemed) so called for
redemption shall become due and payable, and on the redemption date designated in such notice, interest on said
Obligation (or the principal amount thereof to be redeemed) called for redemption shall cease to accrue and such
Obligation shall not be deemed to be Outstanding.
The Paying Agent/Registrar and the County, so long as a Book-Entry-Only System is used for the Obligations will send
any notice of redemption, notice of proposed amendment to the Order or other notices with respect to the Obligations
only to DTC. Any failure by DTC to advise any DTC participant, or of any DTC participant or indirect participant to notify
the beneficial owners, will not affect the validity of the redemption of the Obligations called for redemption or any other
action premised or any such notice. Redemption of portions of the Obligations by the County will reduce the outstanding
principal amount of such Obligations held by DTC. In such event, DTC may implement, through its Book-Entry-Only
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System, a redemption of such Obligations held for the account of DTC participants in accordance with the rules or other
agreements with DTC participants and then DTC participants and indirect participants may implement a redemption of
such Obligations for the beneficial owners. Any such selection of Obligations to be redeemed will not be governed by the
Order and will not be conducted by the County or the Paying Agent/Registrar. None of the County, the Paying
Agent/Registrar, nor the Underwriters will have any responsibility to DTC participants, indirect participants or the persons
for whom DTC participants act as nominees, with respect to the payments of the Obligations or the providing of notice to
DTC participants, indirect participants, or beneficial owners of the selection of portions of the Obligations for redemption.
(See “BOOK-ENTRY-ONLY SYSTEM” herein.)
Defeasance
Any Obligation will be deemed paid and shall no longer be considered to be outstanding within the meaning of the Orders
when payment of the principal of and interest on such Obligation to its stated maturity or redemption date will have been
made or will have been provided by depositing with the Paying Agent/Registrar, or an authorized escrow agent, (1) cash in
an amount sufficient to make such payment, (2) Government Obligations certified by an independent public accounting
firm of national reputation to be of such maturities and interest payment dates and bear such interest as will, without
further investment or reinvestment of either the principal amount thereof or the interest earnings therefrom, be sufficient to
make such payment, or (3) a combination of money and Government Obligations together so certified sufficient to make
such payment; provided, however, that no certification by an independent accounting firm of the sufficiency of deposits
shall be required in connection with a gross defeasance of Obligations.
The term "Government Obligations" means (i) direct noncallable obligations of the United States of America, including
obligations the principal of and interest on which are unconditionally guaranteed by the United States of America, (ii)
noncallable obligations of an agency or instrumentality of the United States, including obligations unconditionally
guaranteed or insured by the agency or instrumentality and on the date of their acquisition or purchase by the County are
rated as to investment quality by a nationally recognized investment rating firm not less than "AAA" or its equivalent and
(iii) noncallable obligations of a state or an agency or a county, municipality, or other political subdivision of a state that
have been refunded and on the date of their acquisition or purchase by the County are rated as to investment quality by
a nationally recognized investment rating firm not less than "AAA" or its equivalent.
Upon such deposit as described above, such Obligations shall no longer be regarded to be outstanding or unpaid. After
firm banking and financial arrangements for the discharge and final payment of the Obligations have been made as
described above, all rights of the County to initiate proceedings to call the Obligations for redemption or take any other
action amending the terms of the Obligations are extinguished; provided, however, that, in addition to the County’s
continuing obligation to fund, from lawfully available funds, any shortfall in amounts held in trust for the defeasance of the
Taxable Certificates as described above, which continuing obligation is memorialized in the Taxable Certificates Order, the
County’s right to redeem Obligations defeased to stated maturity is not extinguished if the County has reserved the option,
to be exercised at the time of the defeasance of the Obligations, to call for redemption at an earlier date those Obligations
which have been defeased to their maturity date, if the County (i) in the proceedings providing for the firm banking and
financial arrangements, expressly reserves the right to call the Obligations for redemption, (ii) gives notice of the
reservation of that right to the owners of the Obligations immediately following the making of the firm banking and financial
arrangements, and (iii) directs that notice of the reservation be included in any redemption notices that it authorizes.
Amendments
The County may amend the Orders without the consent of or notice to any registered owner in any manner not detrimental
to the interests of the registered owners, including the curing of any ambiguity, inconsistency, or formal defect or omission
therein and, with respect to the Taxable Certificates, the provisions of the applicable Taxable Certificates Order may be
amended at any time to ensure that Taxable Certificates continues to qualify as “build America bonds” and “qualified
bonds”, pursuant to the provisions of the Taxable Certificates Order and the tax credit agreement (as defined and
described in the Taxable Certificates Order). In addition, the County may, with the written consent of the owners of a
majority in aggregate principal amount of the Obligations then outstanding, amend, add to, or rescind any of the provisions
of the Orders; except that, without the consent of all of the registered owners of the Obligations then outstanding, no such
amendment, addition, or rescission may (1) change the date specified as the date on which the principal of, or any
installment of interest on any Obligation is due and payable, reduce the principal amount thereof, the redemption price
therefor, or the rate of interest thereon, or in any other way modify the terms of payment of the principal of, or interest on
the Obligations, (2) give any preference to any Obligation over any other Obligation, or (3) reduce the percentage of the
aggregate principal amount of Obligations required to be held for consent to any amendment, addition, or waiver.
Default and Remedies
If the County defaults in the payment of principal, interest, or redemption price on the Obligations when due, or if it fails to
make payments into any fund or funds created in the Orders, or defaults in the observation or performance of any other
covenants, conditions, or obligations set forth in the Orders, the registered owners may seek a writ of mandamus to
compel County officials to carry out their legally imposed duties with respect to the Obligations, if there is no other
available remedy at law to compel performance of the Obligations or Orders and the County’s obligations are not uncertain
or disputed. The issuance of a writ of mandamus is controlled by equitable principles, so rests with the discretion of the
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court, but may not be arbitrarily refused. There is no acceleration of maturity of the Obligations in the event of default and,
consequently, the remedy of mandamus may have to be relied upon from year to year. The Orders do not provide for the
appointment of a trustee to represent the interest of the bondholders upon any failure of the County to perform in
accordance with the terms of the Orders, or upon any other condition and accordingly all legal actions to enforce such
remedies would have to be undertaken at the initiative of, and be financed by, the registered owners. Texas counties are
generally immune from suits for money damages for breach of contracts under the doctrine of sovereign immunity. On
June 30, 2006, the Texas Supreme Court ruled in Tooke v. City of Mexia, 197 S.W.3d 325 (Tex. 2006) that a waiver of
sovereign immunity in a contractual dispute must be provided for by statute in “clear and unambiguous” language.
Chapter 1371, which pertains to the issuance of public securities by issuers such as the County, permits the County to
waive sovereign immunity in the proceedings authorizing the issuance of the Obligations. Notwithstanding its reliance
upon the provisions of Chapter 1371 in connection with its issuance of the Obligations (as further described in “THE
OBLIGATIONS – Authority for Issuance” herein), the County has not waived the defense of sovereign immunity with
respect thereto. Because it is unclear whether the Texas legislature has effectively waived the County’s sovereign
immunity from a suit for money damages, beyond Chapter 1371, bondholders may not be able to bring such a suit against
the County for breach of the Obligations or the Orders covenants. Even if a judgment against the County could be
obtained, it could not be enforced by direct levy and execution against the County’s property. Further, the registered
owners cannot themselves foreclose on property within the County or sell property within the County to enforce the tax lien
on taxable property to pay the principal of and interest on the Obligations. Furthermore, the County is eligible to seek relief
from its creditors under Chapter 9 of the U.S. Bankruptcy Code (“Chapter 9”). Although Chapter 9 provides for the
recognition of a security interest represented by a specifically pledged source of revenues, the pledge of ad valorem taxes
in support of a general obligation of a bankrupt entity is not specifically recognized as a security interest under Chapter 9.
Chapter 9 also includes an automatic stay provision that would prohibit, without Bankruptcy Court approval, the
prosecution of any other legal action by creditors or bondholders of an entity which has sought protection under Chapter 9.
Therefore, should the County avail itself of Chapter 9 protection from creditors, the ability to enforce would be subject to
the approval of the Bankruptcy Court (which could require that the action be heard in Bankruptcy Court instead of other
federal or state court); and the Bankruptcy Code provides for broad discretionary powers of a Bankruptcy Court in
administering any proceeding brought before it. Each opinion of Bond Counsel will note that all opinions relative to the
enforceability of the Orders and the Obligations are qualified with respect to the customary rights of debtors relative to their
creditors and general principles of equity which permit the exercise of judicial discretion.
SOURCES AND USES OF FUNDS FOR THE TAX-EXEMPT CERTIFICATES
Sources of Funds:
Principal Amount of the Tax-Exempt Certificates
Net Original Issue Premium
Total Sources of Funds
$ 97,455,000.00
8,340,378.20
$105,795,378.20
Uses of Funds:
Deposit to Construction Fund
Underwriters’ Discount
Costs of Issuance
Contingency
$105,000,000.00
529,385.00
263,000.00
2,993.20
Total Uses of Funds
$105,795,378.20
SOURCES AND USES OF FUNDS FOR THE TAXABLE CERTIFICATES
Sources of Funds:
Principal Amount of the Taxable Certificates
$30,325,000.00
$30,325,000.00
Uses of Funds:
Costs of Issuance
$30,000,000.00
166,787.50
158,212.50
Total Uses of Funds
$30,325,000.00
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SOURCES AND USES OF FUNDS FOR THE BONDS
Sources of Funds:
Principal Amount of the Bonds
Net Original Issue Premium
$24,020,000.00
230,863.90
$24,250,863.90
Uses of Funds:
Costs of Issuance
Contingency
Total Uses of Funds
$24,000,000.00
132,690.00
115,000.00
3,173.90
$24,250,863.90
REGISTRATION, TRANSFER, AND EXCHANGE
Paying Agent/Registrar
The initial Paying Agent/Registrar is Wells Fargo Bank, National Association, Austin, Texas. The Obligations will be issued
in fully registered form in multiples of $5,000 for any one stated maturity. Principal of and semiannual interest on the
Obligations will be paid by the Paying Agent/Registrar. If the Obligations are not held in the Book-Entry-Only System,
interest on the Obligations will be paid by check or draft mailed on each interest payment date by the Paying
Agent/Registrar to the registered owner at the last known address as it appears on the Paying Agent/Registrar's books on
the Record Date (see “REGISTRATION, TRANSFER, AND EXCHANGE - Record Date” herein) or by such other method,
acceptable to the Paying Agent/Registrar, requested by and at the risk and expense of the registered owner, and principal of
the Obligations will be paid to the registered owner at stated maturity or earlier redemption upon presentation to the Paying
Agent/Registrar. If the date for the payment of the principal of or interest on the Obligations shall be a Saturday, Sunday, a
legal holiday or a day when banking institutions in the city where the Paying Agent/ Registrar is located are authorized to
close, then the date for such payment shall be the next succeeding day which is not such a day, and payment on such date
shall have the same force and effect as if made on the date payment was due.
Successor Paying Agent/Registrar
The County covenants that until the Obligations are paid it will at all times maintain and provide a paying agent/registrar.
In each Order, the County retains the right to replace the Paying Agent/Registrar. If the Paying Agent/Registrar is
replaced by the County, the new Paying Agent/Registrar must accept the previous Paying Agent/Registrar's records and
act in the same capacity as the previous Paying Agent/Registrar. Any successor Paying Agent/Registrar selected by the
County must be a bank, trust company, financial institution or other entity duly qualified and legally authorized to serve
and perform the duties of Paying Agent/Registrar for the Obligations. Upon any change in the Paying Agent/Registrar for
the Obligations, the County will promptly cause a notice thereof to be sent to each registered owner of the Obligations by
United States mail, first class, postage prepaid, which notice shall give the address of the new Paying Agent/Registrar.
Record Date
The record date ("Record Date") for determining the registered owner entitled to the receipt of payment of interest on a
Obligation is the last business day of the month next preceding each interest payment date.
If the date for the payment of the principal of or interest on the Obligations is a Saturday, a Sunday, a legal holiday or a
day on which banking institutions in the city where the corporate trust office of the Paying Agent/Registrar is located are
authorized by law or executive order to close, then the date for such payment is the next succeeding day which is not
such a day and payment on such date will have the same force and effect as if made on the original date payment was
due.
Special Record Date for Interest Payment
In the event of a non-payment of interest on a scheduled payment date, and for 30 days thereafter, a new record date for
such interest payment (a "Special Record Date") will be established by the Paying Agent/Registrar, if and when funds for
the payment of such interest have been received. Notice of the Special Record Date and of the scheduled payment date
of the past due interest (which shall be 15 days after the Special Record Date) shall be sent at least five (5) business
days prior to the Special Record Date by United States mail, first class, postage prepaid, to the address of each
registered owner of an Obligation appearing on the books of the Paying Agent/Registrar at the close of business on the
last business day next preceding the date of mailing of such notice.
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Registration, Transferability and Exchange
In the event the Book-Entry-Only System is be discontinued, printed obligations will be issued to the registered owners of
the Obligations and thereafter the Obligations may be transferred, registered, and assigned on the registration books of the
Paying Agent/Registrar only upon presentation and surrender thereof to the Paying Agent/Registrar, and such registration
and transfer will be without expense or service charge to the registered owner, except for any tax or other governmental
charges required to be paid with respect to such registration and transfer. An Obligation may be assigned by the execution
of an assignment form on the Obligation or by other instrument of transfer and assignment acceptable to the Paying
Agent/Registrar. A new Obligation or Obligations will be delivered by the Paying Agent/Registrar in lieu of the Obligations
being transferred or exchanged at the designated office of the Paying Agent/Registrar, or sent by United States registered
mail to the new registered owner at the registered owner's request, risk and expense. New Obligations issued in an
exchange or transfer of Obligations will be delivered to the registered owner or assignee of the registered owner in not more
than three business days after the receipt of the Obligations to be canceled in the exchange or transfer and the written
instrument of transfer or request for exchange duly executed by the registered owner or his duly authorized agent, in form
satisfactory to the Paying Agent/Registrar. New Obligations registered and delivered in an exchange or transfer will be in
denominations of $5,000 for any one stated maturity or any integral multiple thereof and for a like aggregate principal
amount and at the same maturity or maturities as the Obligations surrendered for exchange or transfer. Neither the County
nor the Paying Agent/Registrar will be required to transfer or exchange any Obligations (i) during a period beginning at
the close of business on any Record Date and ending with the next interest payment date or (ii) with respect to any
Obligations or any portion thereof called for redemption prior to maturity, within 45 days prior to its redemption date.
(See “BOOK-ENTRY-ONLY SYSTEM” herein for a description of the system to be utilized initially in regard to ownership
and transferability of the Obligations.)
Limitation on Transferability of Obligations Called for Redemption
Neither the County nor the Paying Agent/Registrar will be required to issue, transfer or exchange any Obligation called for
redemption, in whole or in part, within 45 days of the date fixed for redemption; provided, however, such limitation on
transferability will not be applicable to an exchange by the registered owner of the unredeemed principal balance of a
Obligation called for redemption in part.
Replacement Obligations
If any Obligation is mutilated, destroyed, stolen or lost, a new Obligation of like kind and in the same amount as the
Obligation so mutilated, destroyed, stolen or lost will be issued. In the case of a mutilated Obligation, such new
Obligation will be delivered only upon surrender and cancellation of such mutilated Obligation. In the case of any
Obligation issued in lieu of and in substitution for a Obligation which has been destroyed, stolen, or lost, such new
Obligation will be delivered only (a) upon filing with the County and the Paying Agent/Registrar evidence satisfactory to
establish to the County and the Paying Agent/Registrar that such Obligation has been destroyed, stolen or lost and proof
of the ownership thereof, and (b) upon furnishing the County and the Paying Agent/Registrar with Obligation or indemnity
satisfactory to them. The person requesting the authentication and delivery of a new Obligation must comply with such
other reasonable regulations as the Paying Agent/Registrar may prescribe and pay such expenses as the Paying
Agent/Registrar may incur in connection therewith.
BOOK-ENTRY-ONLY SYSTEM
The following describes how ownership of the Obligations is to be transferred and how the principal of, premium, if any,
and interest on the Obligations are to be paid to and credited by DTC while the Obligations are registered in its nominee
name. The information in this section concerning DTC and the Book-Entry-Only System has been provided by DTC for
use in disclosure documents such as this Official Statement. The County, the Co-Financial Advisors and the
Underwriters believe the source of such information to be reliable, but take no responsibility for the accuracy or
completeness thereof.
The County cannot and does not give any assurance that (1) DTC will distribute payments of debt service on the
Obligations, or redemption or other notices, to DTC Participants, (2) DTC Participants or others will distribute debt
service payments paid to DTC or its nominee (as the registered owner of the Obligations), or redemption or other
notices, to the Beneficial Owners, or that they will do so on a timely basis, or (3) DTC will serve and act in the manner
described in this Official Statement. The current rules applicable to DTC are on file with the United States Securities and
Exchange Commission, and the current procedures of DTC to be followed in dealing with DTC Participants are on file
with DTC.
The Depository Trust Company ("DTC"), New York, New York, will act as securities depository for the Obligations. The
Obligations will be issued as fully registered securities registered in the name of Cede & Co. (DTC’s partnership
nominee) or such other name as may be requested by an authorized representative of DTC. One fully-registered
security certificate will be issued for each maturity of the Obligations, each in the aggregate principal amount of such
maturity, and will be deposited with DTC.
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DTC, the world’s largest depository, is a limited-purpose trust company organized under the New York Banking Law, a
"banking organization" within the meaning of the New York Banking Law, a member of the Federal Reserve System, a
"clearing corporation" within the meaning of the New York Uniform Commercial Code, and a "clearing agency"
registered pursuant to the provisions of Section 17A of the Securities Exchange Act of 1934. DTC holds and provides
asset servicing for over 3.5 million issues of U.S. and non-U.S. equity issues, corporate and municipal debt issues, and
money market instruments from over 100 countries that DTC’s participants ("Direct Participants") deposit with DTC.
DTC also facilitates the post-trade settlement among Direct Participants of sales and other securities transactions in
deposited securities, through electronic computerized book-entry transfers and pledges between Direct Participants’
accounts. This eliminates the need for physical movement of securities certificates. Direct Participants include both U.S.
and non-U.S. securities brokers and dealers, banks, trust companies, clearing corporations, and certain other
organizations. DTC is a wholly-owned subsidiary of The Depository Trust & Clearing Corporation ("DTCC"). DTCC is
the holding company for DTC, National Securities Clearing Corporation, and Fixed Income Clearing Corporation, all of
which are registered clearing agencies. DTCC is owned by the users of its regulated subsidiaries. Access to the DTC
system is also available to others such as both U.S. and non-U.S. securities brokers and dealers, banks, trust
companies, and clearing corporations that clear through or maintain a custodial relationship with a Direct Participant,
either directly or indirectly ("Indirect Participants"). DTC has Standard & Poor’s highest rating: AAA. The DTC Rules
applicable to its Participants are on file with the United States Securities and Exchange Commission. More information
about DTC can be found at www.dtcc.com and www.dtc.org.
Purchases of Obligations under the DTC system must be made by or through Direct Participants, which will receive a
credit for the Obligations on DTC’s records. The ownership interest of each actual purchaser of each Obligation
("Beneficial Owner") is in turn to be recorded on the Direct and Indirect Participants’ records. Beneficial Owners will not
receive written confirmation from DTC of their purchase. Beneficial Owners are, however, expected to receive written
confirmations providing details of the transaction, as well as periodic statements of their holdings, from the Direct or
Indirect Participant through which the Beneficial Owner entered into the transaction. Transfers of ownership interests in
the Obligations are to be accomplished by entries made on the books of Direct and Indirect Participants acting on behalf
of Beneficial Owners. Beneficial Owners will not receive certificates representing their ownership interests in Obligations,
except in the event that use of the book-entry-only system for the Obligations is discontinued.
To facilitate subsequent transfers, all Obligations deposited by Direct Participants with DTC are registered in the name of
DTC’s partnership nominee, Cede & Co., or such other name as may be requested by an authorized representative of
DTC. The deposit of Obligations with DTC and their registration in the name of Cede & Co. or such other DTC nominee
do not effect any change in beneficial ownership. DTC has no knowledge of the actual Beneficial Owners of the
Obligations; DTC’s records reflect only the identity of the Direct Participants to whose accounts such Obligations are
credited, which may or may not be the Beneficial Owners. The Direct and Indirect Participants will remain responsible for
keeping account of their holdings on behalf of their customers.
Conveyance of notices and other communications by DTC to Direct Participants, by Direct Participants to Indirect
Participants, and by Direct Participants and Indirect Participants to Beneficial Owners will be governed by arrangements
among them, subject to any statutory or regulatory requirements as may be in effect from time to time. Beneficial Owners
of Obligations may wish to take certain steps to augment the transmission to them of notices of significant events with
respect to the Obligations, such as redemptions, defaults, and proposed amendments to the Obligation documents. For
example, Beneficial Owners of Obligations may wish to ascertain that the nominee holding the Obligations for their
benefit has agreed to obtain and transmit notices to Beneficial Owners. In the alternative, Beneficial Owners may wish to
provide their names and addresses to the registrar and request that copies of notices be provided directly to them.
Redemption notices shall be sent to DTC. If less than all of the Obligations within an issue are being redeemed, DTC’s
practice is to determine by lot the amount of the interest of each Direct Participant in such issue to be redeemed.
Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote with respect to Obligations unless
authorized by a Direct Participant in accordance with DTC’s Procedures. Under its usual procedures, DTC mails an
Omnibus Proxy to the County as soon as possible after the record date. The Omnibus Proxy assigns Cede & Co.’s
consenting or voting rights to those Direct Participants to whose accounts Securities are credited on the record date
(identified in a listing attached to the Omnibus Proxy).
Redemption proceeds and principal and interest payments on the Obligations will be made to Cede & Co., or such other
nominee as may be requested by an authorized representative of DTC. DTC’s practice is to credit Direct Participants’
accounts upon DTC’s receipt of funds and corresponding detail information from the County or the Paying
Agent/Registrar, on payable date in accordance with their respective holdings shown on DTC’s records. Payments by
Participants to Beneficial Owners will be governed by standing instructions and customary practices, as is the case with
securities held for the accounts of customers in bearer form or registered in "street name," and will be the responsibility
of such Participant and not of DTC [nor its nominee], the Paying Agent/Registrar, or the County, subject to any statutory
or regulatory requirements as may be in effect from time to time. Payment of redemption proceeds and principal and
interest payments to Cede & Co. (or such other nominee as may be requested by an authorized representative of DTC)
is the responsibility of the County or the Paying Agent/Registrar. Disbursement of such payments to Direct Participants
will be the responsibility of DTC, and disbursement of such payments to the Beneficial Owners will be the responsibility of
Direct and Indirect Participants.
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DTC may discontinue providing its services as depository with respect to the Obligations at any time by giving
reasonable notice to the County or the Paying Agent/Registrar. Under such circumstances, in the event that a successor
depository is not obtained, Obligation certificates are required to be printed and delivered.
The information in this section concerning DTC and DTC’s book-entry system has been obtained from sources that the
County believes to be reliable, but the County, the Co-Financial Advisors, or the Underwriters take no responsibility for
the accuracy thereof.
Use of Certain Terms in Other Sections of This Official Statement
In reading this Official Statement it should be understood that while the Obligations are in the Book-Entry-Only System,
references in other sections of this Official Statement to registered owners should be read to include the person for
which the Participant acquires an interest in the Obligations, but (i) all rights of ownership must be exercised through
DTC and the Book-Entry-Only System, and (ii) except as described above, notices that are to be given to registered
owners under the Orders will be given only to DTC.
Effect of Termination of Book-Entry-Only System
In the event that the Book-Entry-Only System is discontinued by DTC or the use of the Book-Entry-Only System is
discontinued by the County, printed certificates will be issued to the respective holders and the Obligations will be
subject to transfer, exchange and registration provisions as set forth in the Orders and summarized under the caption
“REGISTRATION, TRANSFER AND EXCHANGE” above.
AD VALOREM TAX PROCEDURES
Ad Valorem Taxation
The Obligations are payable primarily from an annual ad valorem tax levied, within the limitations prescribed by law, on
all taxable property within the County. Reference is hereby made to the Vernon’s Texas Codes Annotated, Tax Code
(the “Property Tax Code”) for identification of property subject to taxation, property exempt or which may be exempted
from taxation, the appraisal of property for taxation purposes, and the procedures and limitations applicable to the levy
and collection of ad valorem taxes. Among other provisions, the Property Tax Code contains the following provisions
with respect to the assessment of property and the levy and collection of ad valorem taxes:
(1) a single appraisal district in each county to appraise property for taxation purposes for all taxing units located wholly
or partly within the county;
(2) excluding agricultural and open-space land, which may be taxed on the basis of productive capacity, all property is
to be appraised on the basis of 100% of its market value and the assessment of property on the basis of a
percentage of its appraised value is prohibited;
(3) requires an "effective tax rate" and "rollback tax rate" to be annually calculated and publicized and necessitates the
holding of two public hearings when the tax rate proposed to be adopted exceeds the lower of the rollback tax rate or
the effective tax rate; if the adopted tax rate exceeds the rollback tax rate, a referendum election may be required to
be held on limiting the tax rate for the County for the current year to the rollback tax rate; and
(4) the value of property is generally assessed for purposes of taxation on January 1 of each year and taxes levied each
year generally become due and payable on October 1 and become delinquent on February 1 of the following year in
which the taxes are imposed.
Taxable Property, Exemptions and Agricultural Exclusions
All real property located in the taxing unit and certain personal property is taxable property unless exempt by law. With
certain exceptions, intangible personal property is not taxable property. Excluding agricultural and open-space land, which
may be taxed on the basis of productive capacity, all property is to be appraised on the basis of 100% of its market value.
In determining the market value of property, different methods of appraisal may be used, including the cost method of
appraisal, the income method of appraisal and market data comparison method of appraisal, and the method considered
most appropriate by the chief appraiser is to be used. The value placed upon property within the Appraisal District is
subject to review by an Appraisal Review Board, consisting of three members appointed by the Board of Directors of the
Appraisal District. Effective January 1, 2010, State law requires the appraised value of a residence homestead to be
based solely on the property's value as a residence homestead, regardless of whether residential use is considered to be
the highest and best use of the property. The Appraisal District is required to review the value of property within the
Appraisal District at least every three years. The County may require annual review at its own expense, and is entitled to
challenge the determination of appraised value of property within the County by petition filed with the Appraisal Review
Board. State law further limits the appraised value of a residence homestead for a tax year to an amount not to exceed
the lesser of (1) the market value of the property or (2) the sum of (a) 10% of the appraised value of the property for the
last year in which the property was appraised for taxation times the number of years since the property was last appraised,
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plus (b) the appraised value of the property for the last year in which the property was appraised plus (c) the market value
of all new improvements to the property.
Principal categories of exempt property include: (1) property owned and used for public purposes by the State or its
political subdivisions; (2) property exempt by federal law; (3) family supplies, household goods and personal effects not
held or used in the production of income; (4) certain property owned by charitable organizations, youth development
associations, and religious organizations; (5) certain properties used for school purposes; (6) solar and wind-powered
energy devices; (7) farm products, livestock, and poultry in the hands of the producer, and family supplies for home and
farm use; (8) implements of husbandry used in the production of farm and ranch products; (9) personally owned
automobiles (unless affirmatively provided to be taxed by taxing entity); (10) property owned by disabled veterans or by
the surviving spouse and surviving minor children of disabled veterans is exempt from taxation in amounts ranging from
$5,000 to $12,000 depending on the disability rating of the veteran; and (11) other miscellaneous exceptions.
At an election held on September 13, 2003, the voters of the State approved a constitutional amendment authorizing
counties, cities, towns or junior college districts to establish an ad valorem “tax freeze” on residence homesteads of the
disabled and persons sixty-five years of age or older. This “tax freeze” can be implemented by official action of a
governing body, or pursuant to an election called by the governing body upon receipt of a petition signed by 15% of
registered voters of the municipality. The County implemented this “tax freeze” on May 11, 2005.
Non-business personal property, such as automobiles or light trucks, are exempt from ad valorem taxation unless the
governing body of a political subdivision elects to tax this property. Boats owned as non-business property are exempt
from ad valorem taxation.
Article VIII, Section 1-j of the Texas Constitution exempts from taxation goods, wares, merchandise, other tangible
personal property and ores (other than oil, natural gas and other petroleum products) acquired or imported for
assembling, storing, manufacturing, processing or fabricating purposes while such property is being detained in the
State, and such property is to be forwarded outside the State within 175 days after the date of its acquisition or
importation. Notwithstanding such exemption, counties, school districts, junior college districts and cities may tax such
tangible personal property provided official action to tax is taken before April 1, 1990. The official action to tax such
property can subsequently be rescinded and, if rescinded, such property will thereafter be exempt from taxation.
In addition, effective for tax years 2008 and thereafter, Article VIII, Section 1-n of the Texas Constitution provides for an
exemption from taxation for "goods-in-transit", which are defined as personal property acquired or imported into the State
and transported to another location inside or outside the State within 175 days of the date the property was acquired or
imported into the State. The exemption excludes oil, natural gas, petroleum products, aircraft and special inventory,
including motor vehicle, vessel and out-board motor, heavy equipment and manufactured housing inventory. After
holding a public hearing, a taxing unit may take action by January 1 of the year preceding a tax year to tax goods-intransit during the following tax year. A taxpayer may obtain only a freeport exemption or a goods-in-transit exemption for
items of personal property. The County took official action on November 20, 2007 to continue its taxation of goods in
transit.
Additionally, a percentage of the value of the residence homestead of a person may be exempt from taxation at the
option of the governing body of the taxing entity, such exemption not to exceed 20% each year. Furthermore, not less
than $3,000 of the market value of the residence homestead of a person 65 years of age or older and certain disabled
persons may be exempt from taxation, if such exemption is allowed by the governing body of the taxing entity or imposed
by referendum election.
Tax Rate and Funded Debt Limitations
The County must annually calculate and publicize its “effective tax rate” and “rollback tax rate.” By the later of September
30 or the 60th day after the County receives the certified appraisal roll the Commissioners Court must adopt a tax rate per
$100 taxable value for the current year. Failure to adopt a tax rate by such required date will result in the tax rate for the
taxing unit for the tax year to be the lower of the effective tax rate calculated for that tax year or the tax rate adopted by
the taxing unit for the preceding tax year. Furthermore, the Commissioners Court may not adopt a tax rate that exceeds
the lower of the rollback rate or of the effective tax rate until it has held two public hearings on the proposed increase
following notice to the taxpayers and otherwise complied with the Property Tax Code. The tax rate consists of two
components: (1) a rate for funding of operations, and (2) a rate for debt service. If the adopted tax rate exceeds the
rollback tax rate, the qualified voters of the County, by petition, may require that an election be held to determine whether
or not to reduce the tax rate adopted for the current year to the rollback tax rate.
“Effective tax rate” means the rate that will produce last year’s total tax levy (adjusted) from this year’s total taxable values
(adjusted). “Adjusted” means lost values are not included in the calculation of last year’s taxes and new values are not
included in this year’s taxable values.
“Rollback tax rate" means the rate that will produce last year’s maintenance and operation tax levy (adjusted) from this
year’s values (adjusted) multiplied by 1.08 plus a rate that will produce this year’s debt service from this year’s values
(adjusted) divided by the anticipated tax collection rate.
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Reference is made to the Property Tax Code for definitive requirements for the levy and collection of ad valorem taxes and
the calculation of the various defined tax rates.
The Property Tax Code provides certain cities and counties in the State the option of assessing a maximum one-half
percent (1/2%) sales tax on retail sales of taxable items for the purpose of reducing its ad valorem taxes if approved by a
majority of the voters in a local option election. If the additional tax is approved and levied, the ad valorem property tax levy
must be reduced by the amount of the estimated sales tax revenues to be generated in the current year. Further, the
Property Tax Code provides certain cities the option of assessing a maximum one-half percent (1/2%) sales tax on retail
sales of taxable items for economic development purposes if approved by a majority of the voters in a local option election.
House Bill 3613, enacted by the 81st Texas Legislature during its Regular Session, added Section 11.131 to the Texas Tax
Code. This law, effective January 1, 2009, states that a disabled veteran who receives from the United States Department
of Veterans Affairs or its successor 100% disability compensation due to a service-connected disability and a rating of
100% disabled or of individual unemployability is entitled to an exemption from taxation of the total appraised value of the
veteran's residence homestead. To date, the 2,394 County residents qualify for this exemption, with an estimated loss of
taxable assessed value upon which the County’s limited tax supporting the Obligations is levied of $332,590,537.
Limited Tax Funded Debt Payable From Proceeds of $0.80 Constitutional Tax Rate: Article VIII, Section 9 of the
Texas Constitution imposes a limit of $0.80 per $100 assessed valuation for all purposes of the County's General Fund,
Permanent Improvement Fund, Road and Bridge Fund and Jury Fund, including debt service of bonds, warrants, tax
notes and certificates of obligation issued against such funds. By administrative policy, the Attorney General of Texas will
permit allocation of $0.40 of the constitutional $0.80 tax rate for the payment of the debt service requirements on the
County's indebtedness payable from such tax. Taxes subject to this limitation are the primary source for the currently
outstanding limited tax bonds, tax notes, and certificates of obligation. (See "OBLIGATIONS OUTSTANDING" and
"AUTHORIZED BUT UNISSUED TAX BONDS" in APPENDIX A.) The Obligations are payable from such limited tax
indebtedness.
The Obligations described herein are being issued pursuant to applicable law and the Orders. There are no specific
limitations as to the amount of such debt under this authority; however, the Obligations are primarily payable from the
$0.80 constitutional tax rate.
Limited tax obligations of counties issued pursuant to authority granted under Section 1301.003, Texas Government
Code, as amended, does limit the amount of such debt issued for those certain purposes as follows:
Courthouse
Jail
Courthouse and Jail
Road and Bridge
2% of Assessed Valuation
1 1/2% of Assessed Valuation
Unlimited Tax Road Bonds: Article III, Section 52, Texas Constitution, authorizes the County to levy a separate
unlimited tax to pay debt service on County road bonds if approved by a majority of the voters of the County at an
election. Unlimited tax road bonds may not be issued in an amount greater than 25% of the County's assessed valuation
of real estate. (See "OBLIGATIONS OUTSTANDING" and "AUTHORIZED BUT UNISSUED TAX BONDS" in APPENDIX
A.)
Road Maintenance: As authorized by statute (Section 256.052, as amended, Texas Transportation Code) the County
may levy up to $0.15 per $100 assessed valuation, no part of which may be used for debt service.
Farm-to-Market and/or Flood Control: As authorized by statute (Section 256.054, as amended, Texas Transportation
Code, Article VIII, Section 1-8, Vernon’s Texas Civil Statutes), the County may levy up to $0.30 per $100 assessed
valuation after exemption of homesteads up to $3,000; no allocation prescribed by statute between debt service and
maintenance. All or part may be used for either purpose. These levies provide additional funds for road and flood control
purposes that might otherwise be paid from taxes subject to the $0.80 tax limitation. The County held an election on April
17, 1951 which approved the levy of a (i) $0.15 tax per $100 valuation for Farm-to-Market and Lateral Roads and (ii) $0.15
tax per $100 valuation for flood control purposes (the “Flood Control Tax”). The Obligations are not payable from either of
these taxes; however, the other certificates of obligation issued by the County concurrently with the Obligations are
primarily payable from a lien on and pledge of the Flood Control Tax. (See "THE OBLIGATIONS - Concurrent Issues" and
“OBLIGATIONS OUTSTANDING” in APPENDIX A.)
PROPERTY TAXES
Property Tax Code and County-Wide Appraisal District
The appraisal district created for the County (the "Bexar Appraisal District" or the "Appraisal District") is responsible for
the appraisal of all taxable property and the equalization of appraised values of property of all taxing units in the
Appraisal District, including the County. The Appraisal District is governed by a Board of Directors elected by the
governing bodies of certain taxing units in the Appraisal District. The Board of Directors has appointed a Chief Appraiser
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to act as Chief Administrator of the Appraisal District. Appraisal districts have a minimum of 5 directors and may have up
to 13 directors. The Bexar Appraisal District presently has 6 directors.
The Property Tax Code: (1) requires that all taxing units assess taxable property at 100% of its appraised value, subject
to the limitations hereafter described; (2) allows the valuation of certain eligible farm, ranch, and timberlands on a
"productive capacity" basis; (3) requires that the appraised values, subject to the limitations hereafter described of real
property within an appraisal district be reviewed at least every three years; (4) provides for notices of any increases in
appraised values to property owners before meetings of an appraisal review board; (5) grants rights of administrative and
judicial appeal for taxpayers challenging property valuations established by an appraisal district or a county; (6) requires
taxing jurisdictions to hold two public hearings and publish newspaper advertisements before adopting a tax rate that
exceeds the rollback tax or the effective tax rate, whichever is lower in accordance with the Property Tax Code; and
(7) permits taxpayers by referendum in the event the tax rate exceeds the rollback tax rate to reduce the tax rate to the
rollback tax rate. State law further limits the appraised value of a residence homestead for a tax year to an amount not to
exceed the lesser of (1) the market value of the property or (2) the sum of (a) 10% of the appraised value of the property
for the last year in which the property was appraised for taxation times the number of years since the property was last
appraised, plus (b) the appraised value of the property for the last year in which the property was appraised plus (c) the
market value of all new improvements to the property.
The Texas Constitution permits local governments the option of granting all individuals a homestead exemption of up to
20% of market value, with a minimum exemption of $5,000. The Commissioners Court has never granted such
exemption and it cannot be predicted whether the Commissioners Court will exercise any of its options thereunder in
future years.
Tax Abatement Reinvestment Zone/Tax Phase-In Agreements
Texas statutes permit the creation of tax abatement reinvestment zones to attract new commercial investment, to expand
existing facilities, and to contribute to retaining or expanding primary employment within areas of economic development
interests. The designation of a zone should contribute to the County's economic development and guidelines and criteria
for governing tax phase-in agreements must be adopted at the discretion of Commissioners Court. Once a reinvestment
zone has been designated, the County may offer a tax phase-in agreement to owners or lessees of taxable property
within the reinvestment zone on a case-by-case basis. Areas designated as an enterprise zone under the Texas
Enterprise Zone Act also constitute designation as a reinvestment zone. Tax phase-in agreements are contracts
between the County and an owner or lessee of property wherein the owner or lessee makes an amount of new capital
investment and jobs and the County abates all or a portion of ad valorem taxes under its authority on the new eligible real
and personal property improvements within a reinvestment zone for a specific period of time. Tax phase-in agreements
may abate up to 100% on real and/or personal property improvement values for up to 10 years.
Since 1985, the County has executed a number of tax phase-in agreements to grow and diversify its economy, to attract
new industry and commercial enterprises, and to encourage the retention and development of existing businesses. As
evidenced by the following companies, such agreements result in major stimulus to the County’s marketplace: ACLP
University Park SA, L.P./Clarke American Check, Inc.; AHS Family Real Estate, Ltd./Bates Container, Inc.; Ark Recycling
Texas/LLC Toyota Tsusho America, Inc.; Avanzar Interior Technologies, Ltd.; BDS Properties Inc./Ultramar Diamond
Shamrock Corp./Valero Energy; Boeing Aerospace Operations, Inc.; The Capital Group Companies, Inc.; Caterpillar,
Inc., CEDRA Clinical Research, LLC; Chase Bankcard Services, Inc./JP Morgan Chase Bank; Coilplus Texas,
Incorporated; Curtis-Maruyasu America, Inc.; DPT Laboratories, Ltd./Brooks Development Authority; Futaba Industrial
Texas Corp.; GMI Recycling Texas, LLC/Toyota Tsusho America, Inc.; HEB Grocery Co. LP; HEI San Antonio Hotel LP
(Adams Mark); HERO Assemblers, LP/Toyota Tsusho America, Inc.; HERO Logistics, LP/Toyota Tsusho America, Inc.;
Higuchi International Corp.; Kautex, Inc./Toyota Tsusho America, Inc.; KLN Steel Products Company, LLC; Lancer Corp.;
LCWW Partners (Westin La Cantera Resort); Lowe’s Home Centers, Inc.; Mann Road, Inc., dba International Bank of
Commerce; McCarley Investment Co., Inc.; Metalsa Light Truck, Inc.; Metokote Corp./Toyota Tsusho America, Inc.;
Microsoft Corp.; Millennium Steel of Texas, LP/Toyota Tsusho America, Inc.; Reyes Automotive Group, LLC; ReyesAmtex Automotive, LLC; Richter’s Bakery of San Antonio, Inc.; Security Capital Industrial Trust (Gaylord Container
Corporation); Silver Rio Ltd. Partnership (Westin Riverwalk Hotel); Takata Seat Belts, Inc.; Takumi Stamping Texas, Inc.;
Tenneco Automotive Services Texas, Inc./Toyota Tsusho America, Inc.; Tindall Corp.; Toyoda Gosei Texas, LLC; Toyota
Motor Manufacturing Texas; Toyotetsu Texas, Inc.; Vistana, Ltd.; Vutex, Inc.; Wachovia/World Savings and Loan
Association; York International Corp.; and Zachry Construction Corp..
Under the revised and adopted Tax Phase-in Guidelines, for 10-year term abatements the County is focused on the
revitalization of areas located within Loop 410, South of U.S. Highway 90, or located within boundaries of I-35 Highway to
the North, I-10 Highway to the South, the County’s jurisdictional line to the East, and Loop 410 to the West (includes
areas near Windsor Park Mall and Walzem Road in Districts 2 and 10), and projects located within commercial areas of
the Medical Center, the boundaries of the San Antonio International Airport, or the Texas Research Park Foundation.
Areas eligible for 6-year terms are outside of Loop 410 and also North of U.S. Highway 90 (to the extent not defined as a
10-year term area). Areas not eligible for tax abatement are projects located in whole or in part over the Edwards Aquifer
Recharge Zone or new or existing projects that may have a potentially negative impact on military missions. In addition,
the County may offer tax abatement proposals to the following targeted industries predicated on a project's proposed
levels of capital investment and job creation: agribusiness; aviation/aerospace; biotechnology; creative services;
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environmental technology (also known as clean technology or green technology); finance; information technology and
security; logistics and distribution; manufacturing; telecommunications; corporate and regional headquarters; or
Downtown urban significant projects, including but not limited to mixed-use, and multi-family rental only housing projects.
The County does not offer to abate flood control taxes or taxes levied on behalf of the University Health System.
Exemptions from Taxes
The Texas Constitution and the Property Tax Code grant various exemptions from taxation, if properly claimed, including
exemptions for public property, residence homestead, tangible personal property not producing income, farm products
and implements of farming or ranching, cemeteries, property owned and used exclusively by certain charitable
organizations, and, at the option of the taxing jurisdiction, freeport goods. The County has elected to tax freeport goods.
In addition, Texas law authorizes counties, cities, or junior college districts to take official action to establish a permanent
limitation on the total amount of ad valorem taxes that may be imposed by such governmental entity on the residence
homestead of a disabled individual or an individual 65 years of age or older under Texas Constitution, article VIII, Section
1-b(h). Under the legislation, the surviving spouse of an individual who qualified for the limitation on ad valorem taxes,
would be entitled to the limitation if the surviving spouse is 55 years of age or older when the individual dies and the
residence homestead of the qualifying individual is, and remains, the residence homestead of the surviving spouse. If an
individual who qualified for the limitation makes improvements to the residence homestead, the governmental entity
granting the limitation may increase the amount of taxes on the homestead in the first year the value of the homestead is
increased on the appraisal roll because of the enhanced value of the improvements. The legislation required the
adoption of a constitutional amendment by the voters of the State of Texas authorizing the governing body of a county,
city or junior college district to place such a limitation on ad valorem tax increases on the residence homestead of a
disabled individual or individual 65 years of age or older which voters adopted on September 13, 2003. By Order
approved by the Commissioners Court on May 11, 2005, the Commissioners Court adopted the ad valorem tax limitation
on the residence homestead of individuals who are under a disability for purposes of payment of disability insurance
benefits under Federal Old-Age, Survivors, and Disability Insurance, or its successor, and individuals 65 years of age or
older as permitted under the Texas Constitution, article VIII, 1-b(h) and Property Tax Code, Section 11.261. Adoption of
the tax limitation by Commissioners Court set 2005 as the base year for those individuals who qualify for the stated ad
valorem tax limitation and the qualified individuals realized tax freeze benefits beginning January 1, 2006 for tax year
2006. Once established, the governing body of the taxing unit may not repeal or rescind the tax limitation. The County
studied the effects of implementing such an ad valorem tax freeze for resident homeowners that qualify as disabled
individuals and/or individuals 65 years of age or older and was unable to determine the exact extent to which such a tax
freeze would negatively impact the County’s future tax revenues. A number of other studies have been undertaken to
measure the extent of the impact of a tax freeze and these studies have concluded that such a tax freeze would cause a
decrease in the rate of growth of future ad valorem tax revenues to the County.
County and Taxpayer Remedies
Under certain circumstances, taxpayers and taxing units, including the County, may appeal orders of the Appraisal
Review Board by filing a notice of appeal with that Board and a petition for review in district court. In such event, the
property value in question may be determined by the courts or by a jury, if requested by any party. Additionally, taxing
units may bring suit against the Appraisal District to compel compliance with the Property Tax Code.
The Property Tax Code establishes procedures for providing notice and the opportunity for a hearing for taxpayers in the
event of certain proposed tax increases and provides for taxpayer referenda which could result in the repeal of certain tax
increases. The Property Tax Code also establishes a procedure for notice to property owners of reappraisals reflecting
increased property value, appraisals which are higher than renditions, and appraisals of property not previously on an
appraisal roll.
Levy and Collection of Taxes
The County is responsible for the collection of its taxes, but it may assign such functions to another governmental entity.
As earlier described, by the later of September 30th or 60 days after the certified appraisal roll is delivered to the taxing
unit, the rate of taxation is set by the Commissioners Court based upon the valuation of property within the County as of
January 1. Ad valorem taxes are due on receipt of a tax bill and payable from October 1 of the year in which levied until
January 31 of the following year without interest or penalty. Split payments are allowed with the first half due by
November 30 and the second half of the taxes due by June 30. Unless the split payment option is exercised by the
taxpayer, taxes become delinquent after January 31 of the following year. On February 1, the unpaid taxes have a
penalty and interest charge of 7%. Taxes delinquent from March 1 through June 30 have an additional penalty and
interest charge of 2% per month, for a total penalty and interest charge of 18%. Taxes delinquent on July 1 have a total
penalty and interest charge of 18%. Unpaid taxes after July 31 accrue an additional interest charge of 1% per month
until paid. State law allows employment of outside legal counsel to collect delinquent taxes. When this is done, the
County may, upon giving proper notice, impose an additional penalty up to 20% to the taxes, penalty, and interest
delinquent as of July 1. The County has elected this option and presently uses outside legal counsel to collect delinquent
taxes.
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Tax Liens
Taxes levied by the County are a personal obligation of the owner of the property. On January 1 of each year, a tax lien
attaches to property to secure the payment of all taxes, penalties, and interest ultimately imposed for the year on the
property. The lien exists in favor of each taxing unit, including the County, having power to tax the property. The tax lien
on real property has priority over the claim of most creditors and other holders of liens on the property encumbered by
the tax lien, whether or not the debt or lien existed before the attachment of the tax lien. Personal property under certain
circumstances is subject to seizure and sale for the payment of delinquent taxes, penalty, and interest. At any time after
taxes on property become delinquent, the County may file suit to foreclose the lien securing payment of the tax, to
enforce personal liability for the tax, or both. In filing a suit to foreclose a tax lien on real property, the County may join
other taxing units that have claims for delinquent taxes against all or part of the same property. The ability of the County
to collect delinquent taxes by foreclosure may be adversely affected by the amount of taxes owed to other taxing units,
adverse market conditions, taxpayer redemption rights, or bankruptcy proceedings which restrain the collection of a
taxpayer's debt. Also, provisions of the Property Tax Code require the abatement of any foreclosure or collection suit for
delinquent taxes against any individual who is 65 years of age or older, owns and occupies as a residential homestead
the property on which the taxes are delinquent, and requests the abatement in writing at the appropriate time.
The Effect of the Financial Institutions Act of 1989 on Tax Collections of the County
The "Financial Institutions Reform, Recovery and Enforcement Act of 1989" ("FIRREA"), enacted on August 9, 1989,
contains certain provisions which affect the time for protesting property valuations, the fixing of tax liens, and the
collection of penalties and interest on delinquent taxes on real property owned by the Federal Deposit Insurance
Corporation ("FDIC") and the Resolution Trust Corporation ("RTC") when the FDIC/RTC is acting as the conservator or
receiver of an insolvent financial institution.
Under FIRREA real property held by the FDIC/RTC is still subject to ad valorem taxation, but such act states (i) that no
real property of the FDIC/RTC shall be subject to foreclosure or sale without the consent of the FDIC/RTC and no
involuntary liens shall attach to such property, (ii) the FDIC or RTC shall not be liable for any penalties or fines, including
those arising from the failure to pay any real or personal property tax when due, and (iii) notwithstanding failure of a
person to challenge an appraisal in accordance with state law, such value shall be determined as of the period for which
such tax is imposed.
There has been little judicial determination of the validity of the provisions of FIRREA or how they are to be construed
and reconciled with respect to conflicting state laws. However, certain federal court decisions have held that the
FDIC/RTC is not liable for statutory penalties and interest authorized by State property tax law, and that although a lien
for taxes may exist against real property, such lien may not be foreclosed without the consent of the FDIC/RTC, and no
liens for penalties, fines, interest, attorneys fees, costs of abstract and research fees exist against the real property for
the failure of the FDIC/RTC or a prior property owner to pay ad valorem taxes when due. It is also not known whether
the FDIC/RTC will attempt to claim the FIRREA exemptions as to the time for contesting valuations and tax assessments
made prior to and after the enactment of FIRREA. Accordingly, to the extent that the FIRREA provisions are valid and
applicable to any property in the County, and to the extent that the FDIC/RTC attempts to enforce the same, these
provisions may affect the timeliness of collection of taxes on property, if any, owned by the FDIC/RTC in the County, and
may prevent the collection of penalties and interest on such taxes.
INVESTMENT POLICIES
Investments
The County invests its funds in investments authorized by Texas law in accordance with investment policies approved by
the Commissioners Court of the County. Both State law and the County’s investment policies are subject to change.
Legal Investments
Texas law permits the County to invest in (1) obligations, including letters of credit, of the United States or its agencies
and instrumentalities, (2) direct obligations of the State or its agencies and instrumentalities, (3) collateralized mortgage
obligations directly issued by a federal agency or instrumentality of the United States, the underlying security for which is
guaranteed by an agency or instrumentality of the United States, (4) other obligations, the principal and interest of which
are unconditionally guaranteed or insured by, or backed by the full faith and credit of the State or the United States or
their respective agencies and instrumentalities, (5) obligations of states, agencies, counties, cities, and other political
subdivisions of any state rated as to investment quality by a nationally recognized investment rating firm not less than "A"
or its equivalent, (6) (a) certificates of deposit and share certificates issued by a depository institution that has its main
office or branch office in the State, that are guaranteed or insured by the Federal Deposit Insurance Corporation or the
National Credit Union Share Insurance Fund or their respective successors, or are secured as to principal by obligations
described in clauses (1) through (5) or in any other manner and amount provided by law for County deposits, and in
addition (b) the County is authorized, subject to certain conditions, to invest in certificates of deposit with a depository
institution that has its main office or branch office in the State and that participates in the Obligation of Deposit Account
Registry Service network ("CDARS") and as further provided by Texas law, (7) fully collateralized repurchase
agreements that have a defined termination date, are fully secured by obligations described in clause (1) and require the
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security being purchased by the County to be pledged to the County, held in the County’s name and deposited at the
time the investment is made with the County or with a third party selected and approved by the County, and are placed
through a primary government securities dealer or a financial institution doing business in the State, (8) bankers’
acceptances with the remaining term of 270 days or less from the date of issuance, if the short-term obligations of the
accepting bank or its parent are rated at least "A-1" or "P-1" or the equivalent by at least one nationally recognized credit
rating agency, (9) commercial paper with the remaining term of 270 days or less from the date of issuance that is rated at
least "A-1" or "P-1" or the equivalent by at least (a) two nationally recognized credit rating agencies or (b) one nationally
recognized credit rating agency if the paper is fully secured by an irrevocable letter of credit issued by a U.S. or state
bank, (10) no-load money market mutual funds registered with and regulated by the United States Securities and
Exchange Commission that have a dollar weighted average portfolio maturity of 90 days or less and include in their
investment objectives the maintenance of a stable net asset value of $1 for each share, (11) no-load mutual fund
registered with the United States Securities and Exchange Commission that: have an average weighted maturity of less
than two years; invest exclusively in obligations described in the preceding clauses, and are continuously rated as to
investment quality by at least one nationally recognized investment rating firm of not less than “AAA” or its equivalent,
and (12) public funds investment pools that have an advisory board which includes participants in the pool and are
continuously rated as to investment quality by at least one nationally recognized investment rating firm of not less than
“AAA” or its equivalent or no lower than investment grade with a weighted average maturity no greater than 90 days.
Texas law also permits the County to invest bond proceeds in a guaranteed investment contract subject to the limitations
set forth in Chapter 2256, as amended, Texas Government Code.
Entities such as the County may enter into securities lending programs if (i) the securities loaned under the program are
100% collateralized including accrued income, a loan made under the program allows for termination at any time and a
loan made under the program is either secured by (a) obligations that are described in clauses (1) through (5) above, (b)
pledged irrevocable letters of credit issued by a state or national bank that is continuously rated by a nationally
recognized investment rating firm at not less than "A" or its equivalent or (c) cash invested in obligations described in
clauses (1) through (5) above, clause (9) above and clauses (10) and (11) above, or an authorized investment pool; (ii)
securities held as collateral under a loan are pledged to such investing entity or a third party designated by such
investing entity; (iii) a loan made under the program is placed through either a primary government securities dealer or a
financial institution doing business in the State; and (iv) the agreement to lend securities has a term of one year or less.
The County may invest in such obligations directly or through government investment pools that invest solely in such
obligations provided that the pool are rated no lower than “AAA” or “AAA-m” or an equivalent by at least one nationally
recognized rating service. The County is specifically prohibited from investing in: (1) obligations whose payment
represents the coupon payments on the outstanding principal balance of the underlying mortgage-backed security
collateral and pays no principal; (2) obligations whose payment represents the principal stream of cash flow from the
underlying mortgage-backed security and bears no interest; (3) collateralized mortgage obligations that have a stated
final maturity of greater than 10 years; and (4) collateralized mortgage obligations the interest rate of which is determined
by an index that adjusts opposite to the changes in a market index.
Under Texas law, the County may contract with an investment management firm registered under the Investment
Advisers Act of 1940 (15 U.S.C. Section 80b-1 et seq.) or registered with the State Securities Board to provide for the
investment and management of its public funds or other funds under its control for a term up to two years, but the County
retains ultimate responsibility as fiduciary of its assets. In order to renew or extend such a contract, the County must do
so by order, ordinance or resolution. The County distributed a request for proposal to contract with an investment
management firm to provide such services and entered into a contract on July 13, 2006.
Investment Policies
Under Texas law, the County is required to invest its funds under written investment policies that primarily emphasize
safety of principal and liquidity; that address investment diversification, yield, maturity, and the quality and capability of
investment management; and that includes a list of authorized investments for County funds, maximum allowable stated
maturity of any individual investment owned by the County and the maximum average dollar-weighted maturity allowed
for pooled fund groups. All County funds must be invested consistent with a formally adopted “Investment Strategy
Statement” that specifically addresses each fund’s investment. Each Investment Strategy Statement will describe its
objectives concerning:
(1) suitability of investment type, (2) preservation and safety of principal, (3) liquidity,
(4) marketability of each investment, (5) diversification of the portfolio, and (6) yield.
Under Texas law, County investments must be made “with judgment and care, under prevailing circumstances, that a
person of prudence, discretion, and intelligence would exercise in the management of the person’s own affairs, not for
speculation, but for investment, considering the probable safety of capital and the probable income to be derived”. At
least quarterly the investment officers of the County must submit an investment report detailing: (1) the investment
position of the County, (2) that all investment officers jointly prepared and signed the report, (3) the beginning market
value, any additions and changes to market value and the ending value of each pooled fund group, (4) the book value
and market value of each separately listed asset at the beginning and end of the reporting period, (5) the maturity date of
each separately invested asset, (6) the account or fund or pooled fund group for which each individual investment was
acquired, and (7) the compliance of the investment portfolio as it relates to: (a) adopted investment strategy statements
and (b) State law. No person may invest County funds without express written authority from the Commissioners Court.
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Additional Provisions
Under Texas law, the County is additionally required to: (1) annually review its adopted policies and strategies; (2) adopt
a rule, order, ordinance or resolution stating that it has reviewed its investment policy and investment strategies and
records any changes made to either its investment policy or investment strategy in the respective rule, order, ordinance
or resolution; (3) require any investment officers with personal business relationships or relatives with firms seeking to
sell securities to the entity to disclose the relationship and file a statement with the Texas Ethics Commission and the
Commissioners Court; (4) require the qualified representative of firms offering to engage in an investment transaction
with the County to: (a) receive and review the County’s investment policy, (b) acknowledge that reasonable controls and
procedures have been implemented to preclude investment transactions conducted between the County and the
business organization that are not authorized by the County’s investment policy (except to the extent that this
authorization is dependent on an analysis of the makeup of the County’s entire portfolio or requires an interpretation of
subjective investment standards), and (c) deliver a written statement in a form acceptable to the County and the business
organization attesting to these requirements; (5) perform an annual audit of the management controls on investments
and adherence to the County’s investment policy; (6) provide specific investment training for the Treasurer, Chief
Financial Officer and investment officers; (7) restrict reverse repurchase agreements to not more than 90 days and
restrict the investment of reverse repurchase agreement funds to no greater than the term of the reverse purchase
agreement; (8) restrict the investment in non-money market mutual funds in the aggregate to no more than 15% of the
County’s monthly average fund balance, excluding bond proceeds and reserves and other funds held for debt service;
(9) require local government investment pools to conform to the new disclosure, rating, net asset value, yield calculation,
and advisory board requirements; and (10) at least annually review, revise, and adopt a list of qualified brokers that are
authorized to engage in investment transactions with the County.
(1)
Current Investments
The investments of the County as of June 30, 2010 are as follows:
Book
Balance
Fair Market
Value
Percent
$ 19,190,368
396,172,750
140,338,466
25,000,000
64,500,000
$645,201,584
$ 19,190,368
396,317,214
140,338,466
25,000,000
64,500,000
$645,346,048
2.97%
61.41%
21.75%
3.87%
10.00%
100.00%
Type of Investment
Money Market (Sweep Account)
U.S. Government Securities
Local Government Investment Pools
Fully Collateralized Certificates of Deposit
Municipal Commercial Paper
Total
____________
Source: Bexar County Quarterly Investment Report for the quarter ended June 30, 2010.
(1)
Unaudited.
As of such date, the fair value of such investments (as determined by the County by reference to published quotations,
dealer bids, and comparable information) was approximately 100% of their book balance. No funds of the County are
invested in derivative securities, i.e., securities whose rate of return is determined by reference to some other instrument,
index, or commodity.
LEGAL MATTERS
The County will furnish the Underwriters with a complete transcript of proceedings incident to the authorization and
issuance of the Obligations, including the unqualified approving legal opinions of the Attorney General of the State to the
effect that the Initial Obligations are valid and legally binding obligations of the County, and based upon examination of
such transcript of proceedings, the approval of certain legal matters by Bond Counsel, to the effect that the Obligations,
issued in compliance with the provisions of the applicable Order, are valid and legally binding obligations of the County
and, subject to the qualifications set forth herein under "TAX MATTERS," the interest on the Tax-Exempt Obligations will
be excludable from gross income for federal income tax purposes under existing statutes, published rulings, regulations,
and court decisions. Though it represents the Co-Financial Advisors and the Underwriters from time to time in matters
unrelated to the Obligations, Bond Counsel has been engaged by and only represents the County in connection with the
issuance of the Obligations. Bond Counsel was not requested to participate, and did not take part, in the preparation of
the Official Statement, and such firm has not assumed any responsibility with respect thereto or undertaken independently
to verify any of the information contained therein, except that, in its capacity as Bond Counsel, such firm has reviewed the
information under the caption "THE OBLIGATIONS" (except for the information under the subcaptions "Payment Record,"
“Delivery,” “Use of Proceeds,” and "Default and Remedies" as to which no opinion is expressed), "REGISTRATION,
TRANSFER AND EXCHANGE," "LEGAL MATTERS" (except for the last two sentences of the first paragraph thereof, as
to which no opinion is expressed), "TAX MATTERS," "FEDERAL INCOME TAX TREATMENT OF TAXABLE
CERTIFICATES," "CONTINUING DISCLOSURE OF INFORMATION" (except for the information under the subcaption
"Compliance with Prior Undertakings," as to which no opinion is expressed) and "OTHER PERTINENT INFORMATION Legal Investments and Eligibility to Secure Public Funds in Texas" in the Official Statement, and such firm is of the opinion
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that the information relating to the Obligations and the legal issues contained under such captions and subcaptions is an
accurate and fair description of the laws and legal issues addressed therein and, with respect to the Obligations, such
information conforms to the provisions of the Orders. The customary closing papers, including a certificate to the effect
that no litigation of any nature has been filed or is then pending to restrain the issuance and delivery of the Obligations or
which would affect the provision made for their payment or security, or in any manner questioning the validity of the
Obligations will also be furnished. The legal fees to be paid Bond Counsel for services rendered in connection with the
issuance of Obligations are contingent on the sale and delivery of the Obligations. The legal opinion of Bond Counsel will
accompany the Obligations deposited with DTC or will be printed on the definitive Obligations in the event of the
discontinuance of the Book-Entry-Only System. Certain matters will be passed upon for the Underwriters by Escamilla,
Poneck & Cruz, LLP, San Antonio, Texas and Manuel G. Escobar, Jr., Attorney at Law, San Antonio, Texas, as counderwriters counsel. The fees of Escamilla, Poneck & Cruz, LLP and Manuel G. Escobar, Jr., Attorney at Law, are
contingent upon the sale and delivery of the Obligations.
The various legal opinions to be delivered concurrently with the delivery of the Obligations express the professional
judgment of the attorneys rendering the opinions as to the legal issues explicitly addressed therein. In rendering a legal
opinion, the attorney does not become an insurer or guarantor of the expression of professional judgment, of the
transaction opined upon, or of the future performance of the parties to the transaction. Nor does the rendering of an
opinion guarantee the outcome of any legal dispute that may arise out of the transaction.
NO-LITIGATION
On the date of delivery of the Obligations to the Underwriters, the County will execute and deliver to the Underwriters a
certificate to the effect that no litigation of any nature has been filed or is pending, as of that date, to restrain or enjoin the
issuance or delivery of the Obligations or which would adversely affect the provisions made for their payment or security,
or in any manner questioning the validity of the Obligations.
In the opinion of certain officials of the County, the County is not a party to any litigation or other proceedings pending or,
to its knowledge, threatened, in any court, agency or other administrative body (either state or federal) which, if decided
adversely to the County, would have a material adverse effect on the financial statements of the County.
TAX MATTERS
Tax Exemption
The delivery of the Tax-Exempt Obligations is subject to an opinion of Fulbright & Jaworski L.L.P., Bond Counsel to the
County (“Bond Counsel”), to the effect that interest on the Tax-Exempt Obligations for federal income tax purposes under
existing statutes, regulations, published rulings and court decisions (1) will be excludable from the gross income, as
defined in section 61 of the Internal Revenue Code of 1986, as amended (the “Code”) to the date of initial delivery of the
Tax-Exempt Obligations, and (2) will not be included in computing the alternative minimum taxable income of the owners
thereof. The statute, regulations, rulings and court decisions on which such opinion will be based are subject to change.
Forms of Bond Counsel’s legal opinions relating to the Tax-Exempt Obligations appear in APPENDIX D attached hereto.
In rendering the foregoing opinions, Bond Counsel will rely upon representations and certifications of the County pertaining
to the use, expenditure and investment of the proceeds of the Tax-Exempt Obligations and will assume continuing
compliance with the provisions of the Tax-Exempt Certificates Order and the Bond Order by the County subsequent to the
issuance of the Obligations. The Tax-Exempt Certificates Order and the Bond Order contain covenants by the County with
respect to, among other matters, the use of the proceeds of the Tax-Exempt Obligations and the facilities financed
therewith by persons other than state or local governmental units, the manner in which the proceeds of the Tax-Exempt
Obligations are to be invested and the reporting of certain information to the United States Treasury. Failure to comply with
any of these covenants may cause interest on the Tax-Exempt Obligations to be includable in the gross income of the
owner thereof for federal income taxes from the date of the issuance of the Tax-Exempt Obligations.
Except as described above, Bond Counsel will express no other opinion with respect to any other federal, state or local tax
consequences under present law, or proposed legislation, resulting from the receipt or accrual of interest on, or the
acquisition or disposition of, the Tax-Exempt Obligations.
Bond Counsel’s opinion is not a guarantee of a result, but represents its legal judgment based upon its review of existing
statutes, published rulings and court decisions and the representations and covenants of the County described above. No
ruling has been sought from the Internal Revenue Service (the “Service”) with respect to the matters addressed in the
opinion of Bond Counsel, and Bond Counsel’s opinion referenced above is not binding on the Service. The Service has an
on going program of auditing the tax-exempt status of the interest on municipal obligations. If an audit of the Tax-Exempt
Obligations is commenced, under current procedures the Service is likely to treat the County as the “taxpayer,” and the
Owners would have no right to participate in the audit process. In responding to or defending an audit of the tax-exempt
status of the interest on the Tax-Exempt Obligations, the County may have different or conflicting interests from the
Owners. Public awareness of any future audit of the Tax-Exempt Obligations could adversely affect the value and liquidity
of the Tax-Exempt Obligations during the pendency of the audit, regardless of its ultimate outcome.
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Ancillary Tax Consequences…Prospective purchasers of the Tax-Exempt Obligations should be aware that the
ownership of tax-exempt obligations such as the Tax-Exempt Obligations may result in collateral federal tax
consequences to, among others, financial institutions, property and casualty insurance companies, life insurance
companies, certain foreign corporations doing business in the United States, S corporations with subchapter C earnings
and profits, owners of an interest in a financial asset securitization investment trust ("FASIT"), individual recipients of
Social Security or Railroad Retirement benefits, individuals otherwise qualifying for the earned income tax credit and
taxpayers who may be deemed to have incurred or continued indebtedness to purchase or carry, or who have paid or
incurred certain expenses allocable to, tax-exempt obligations. Prospective purchasers should consult their own tax
advisors as to the applicability of these consequences to their particular circumstances.
Tax Accounting Treatment of Discount Tax-Exempt Obligations…The initial public offering price to be paid for certain
Tax-Exempt Obligations may be less than the amount payable on such Tax-Exempt Obligations at maturity (the “Discount
Tax-Exempt Obligations”). An amount equal to the difference between the initial public offering price of a Discount TaxExempt Obligations (assuming that a substantial amount of the Discount Tax-Exempt Obligations of that maturity are sold
to the public at such price) and the amount payable at maturity constitutes original issue discount to the initial purchaser of
such Discount Tax-Exempt Obligations. A portion of such original issue discount, allocable to the holding period of a
Discount Tax-Exempt Obligation by the initial purchaser, will be treated as interest for federal income tax purposes,
excludable from gross income on the same terms and conditions as those for other interest on the Tax-Exempt Obligations.
Such interest is considered to be accrued actuarially in accordance with the constant interest method over the life of a
Discount Tax-Exempt Obligation, taking into account the semiannual compounding of accrued interest, at the yield to
maturity on such Discount Tax-Exempt Obligation and generally will be allocated to an initial purchaser in a different
amount from the amount of the payment denominated as interest actually received by the initial purchaser during this
taxable year.
However, such accrued interest may be required to be taken into account in determining the amount of the branch profits
tax applicable to certain foreign corporations doing business in the United States, even though there will not be a
corresponding cash payment. In addition, the accrual of such interest may result in certain other collateral federal income
tax consequences to, among others, financial institutions, property and casualty insurance companies, life insurance
companies, S corporations with subchapter C earnings and profits, owners of an interest in a FASIT, individual recipients of
Social Security or Railroad Retirement benefits, individuals otherwise qualifying for the earned income tax credit, and
taxpayers who may be deemed to have incurred or continued indebtedness to purchase or carry, or who have paid or
incurred certain expenses allocable to, tax-exempt obligations.
In the event of the sale or other taxable disposition of a Discount Tax-Exempt Obligation prior to maturity, the amount
realized by such owner in excess of the basis of such Discount Tax-Exempt Obligation in the hands of such owner
(adjusted upward by the portion of the original issue discount allocable to the period for which such Discount Tax-Exempt
Obligation was held) is includable in gross income.
Owners of Discount Tax-Exempt Obligations should consult with their own tax advisors with respect to the determination for
federal income tax purposes of accrued interest upon disposition of Discount Tax-Exempt Obligations and with respect to
the state and local tax consequences of owning Discount Tax-Exempt Obligations. It is possible that, under applicable
provisions governing determination of state and local income taxes, accrued interest on the Discount Tax-Exempt
Obligations may be deemed to be received in the year of accrual even though there will not be a corresponding cash
payment.
Tax Accounting Treatment of Premium Tax-Exempt Obligations...The initial public offering price to be paid for certain
Tax-Exempt Obligations may be greater than the stated redemption price on such Tax-Exempt Obligations at maturity (the
“Premium Tax-Exempt Obligations”). An amount equal to the difference between the initial public offering price of a
Premium Tax-Exempt Obligation (assuming that a substantial amount of the Premium Tax-Exempt Obligations of that
maturity are sold to the public at such price) and its stated redemption price at maturity constitutes premium to the initial
purchaser of such Premium Tax-Exempt Obligations. The basis for federal income tax purposes of a Premium Tax-Exempt
Obligations in the hands of such initial purchaser must be reduced each year by the amortizable certificate premium,
although no federal income tax deduction is allowed as a result of such reduction in basis for amortizable bond premium
with respect to the Premium Tax-Exempt Obligations. Such reduction in basis will increase the amount of any gain (or
decrease the amount of any loss) to be recognized for federal income tax purposes upon a sale or other taxable disposition
of a Premium Tax-Exempt Obligation. The amount of premium which is amortizable each year by an initial purchaser is
determined by using such purchaser’s yield to maturity.
Purchasers of the Premium Tax-Exempt Obligations should consult with their own tax advisors with respect to the
determination of amortizable certificate premium on Premium Tax-Exempt Obligations for federal income tax purposes
and with respect to the state and local tax consequences of owning and disposing of Premium Tax-Exempt Obligations.
FEDERAL INCOME TAX TREATMENT OF TAXABLE CERTIFICATES
General…The following is a general summary of certain United States federal income tax consequences of the purchase
and ownership of the Taxable Certificates. The discussion is based upon laws, Treasury Regulations, rulings and
decisions now in effect, all of which are subject to change (possibly, with retroactive effect) or possibly differing
interpretations. No assurances can be given that future changes in the law will not alter the conclusions reached herein.
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The discussion below does not purport to deal with United States federal income tax consequences applicable to all
categories of investors. Further, this summary does not discuss all aspects of United States federal income taxation that
may be relevant to a particular investor in the Taxable Certificates in light of the investor’s particular personal investment
circumstances or to certain types of investors subject to special treatment under United States federal income tax laws
(including insurance companies, tax exempt organizations, financial institutions, broker-dealers, and persons who have
hedged the risk of owning the Taxable Certificates). The summary is therefore limited to certain issues relating to initial
investors who will hold the Taxable Certificates as “capital assets” within the meaning of section 1221 of the Code, and
acquire such Taxable Certificates for investment and not as a dealer or for resale. This summary addresses certain federal
income tax consequences applicable to beneficial owners of the Taxable Certificates who are United States persons within
the meaning of section 7701(a)(30) of the Code (“United States persons”) and, except as discussed below, does not
address any consequences to persons other than United States persons.
Prospective investors should note that no rulings have been or will be sought from the IRS with respect to any of the
United States federal income tax consequences discussed below, and no assurance can be given that the IRS will not
take contrary positions.
INVESTORS SHOULD CONSULT THEIR OWN TAX ADVISORS IN DETERMINING THE FEDERAL, STATE, LOCAL,
FOREIGN AND ANY OTHER TAX CONSEQUENCES TO THEM FROM THE PURCHASE, OWNERSHIP AND
DISPOSITION OF THE TAXABLE CERTIFICATES.
Internal Revenue Service Circular 230 Notice...You should be aware that:
(i)
the discussion with respect to United States federal tax matters in this Official Statement was not
intended or written to be used, and cannot be used, by any taxpayer for the purpose of avoiding
penalties that may be imposed on the taxpayer;
(ii)
such discussion was written to support the promotion or marketing (within the meaning of IRS Circular
230) of the transactions or matters addressed by such discussion; and
(iii)
each taxpayer should seek advice based on his or her particular circumstances from an independent tax
advisor.
This notice is given solely for purposes of ensuring compliance with IRS Circular 230.
Stated Interest on the Taxable Certificates…The stated interest on the Taxable Certificates will be included in the gross
income, as defined in section 61 of the Code, of the beneficial owners thereof and be subject to U.S. federal income
taxation when paid or accrued, depending on the tax accounting method applicable to the beneficial owners thereof.
Original Issue Discount...If a substantial amount of the Taxable Certificates of any stated maturity is purchased at
original issuance for a purchase price (the “Issue Price”) that is less than their face amount by more than one quarter of
one percent times the number of complete years to maturity, the Taxable Certificates of any stated maturity will be treated
as being issued with “original issue discount.” The amount of the original issue discount will equal the excess of the
principal amount payable on such Taxable Certificates at maturity over their Issue Price, and the amount of the original
issue discount on such Taxable Certificates will be amortized over the life of Taxable Certificates using the “constant yield
method” provided in the Treasury Regulations. As the original issue discount accrues under the constant yield method, the
beneficial owners of such Taxable Certificates, regardless of their regular method of accounting, will be required to include
such accrued amount in their gross income as interest. This can result in taxable income to the beneficial owners of the
Taxable Certificates that exceeds actual cash distributions to the beneficial owners in a taxable year.
The amount of any original issue discount that accrues on the Taxable Certificates each year will be reported annually to
the IRS and to the beneficial owners. The portion of the original issue discount included in each beneficial owner’s gross
income while the beneficial owner holds the Taxable Certificates will increase the adjusted tax basis of the Taxable
Certificates in the hands of such beneficial owner.
Disposition of Taxable Certificates and Market Discount…A beneficial owner of Taxable Certificates will generally
recognize gain or loss on the redemption, sale or exchange of the Taxable Certificates equal to the difference between the
redemption or sales price (exclusive of the amount paid for accrued interest) and the beneficial owner’s adjusted tax basis
in the Taxable Certificates. Generally, the beneficial owner’s adjusted tax basis in the Taxable Certificates will be the
beneficial owner’s initial cost, increased by any original issue discount previously included in the beneficial owner’s income
to the date of disposition. Any gain or loss generally will be capital gain or loss and will be long-term or short-term,
depending on the beneficial owner’s holding period for the Taxable Certificates.
Under current law, a purchaser of Taxable Certificates who did not purchase the Taxable Certificates in the initial public
offering (a “subsequent purchaser”) generally will be required, on the disposition of the Taxable Certificates, to recognize
as ordinary income a portion of the gain, if any, to the extent of the accrued “market discount.” In general, market discount
is the amount by which the price paid for the Taxable Certificates by a subsequent purchaser is less than the principal
amount payable at maturity (or, in the case of Taxable Certificates issued with original issue discount, the sum of the Issue
Price and the amount of original issue discount previously accrued on the Taxable Certificates), except that market
discount is considered to be zero if it is less than one quarter of one percent of the principal amount times the number of
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complete remaining years to maturity. The Code also limits the deductibility of interest incurred by a subsequent purchaser
on funds borrowed to acquire Taxable Certificates with market discount. As an alternative to the inclusion of market
discount in income upon disposition, a subsequent purchaser may elect to include market discount in income currently as
it accrues on all market discount instruments acquired by the subsequent purchaser in that taxable year or thereafter, in
which case the interest deferral rule will not apply. The recharacterization of gain as ordinary income on a subsequent
disposition of Taxable Certificates could have a material effect on the market value of the Taxable Certificates.
Backup Withholding...Under section 3406 of the Code, a beneficial owner of the Taxable Certificates who is a United
States person, as defined in the Code and referenced above, may, under certain circumstances, be subject to “backup
withholding” of current or accrued interest on the Taxable Certificates or with respect to proceeds received from a
disposition of the Taxable Certificates. This withholding applies if such beneficial owner of Taxable Certificates: (i) fails to
furnish to the payor such beneficial owner’s social security number or other taxpayer identification number (“TIN”); (ii)
furnishes the payor an incorrect TIN; (iii) fails to report properly interest, dividends, or other “reportable payments” as
defined in the Code; or (iv) under certain circumstances, fails to provide the payor with a certified statement, signed under
penalty of perjury, that the TIN provided to the payor is correct and that such beneficial owner is not subject to backup
withholding.
Backup withholding will not apply, however, with respect to payments made to certain beneficial owners of the Taxable
Certificates. Beneficial owners of the Taxable Certificates should consult their own tax advisors regarding their qualification
for exemption from backup withholding and the procedures for obtaining such exemption.
Withholding on Payments to Nonresident Alien Individuals and Foreign Corporations…Under sections 1441 and
1442 of the Code, nonresident alien individuals and foreign corporations are generally subject to withholding at the current
rate of 30% (subject to change) on periodic income items arising from sources within the United States, provided such
income is not effectively connected with the conduct of a United States trade or business. Assuming the interest income of
such a beneficial owner of the Taxable Certificates is not treated as effectively connected income within the meaning of
section 864 of the Code, such interest will be subject to 30% withholding, or any lower rate specified in an income tax
treaty, unless such income is treated as portfolio interest. Interest will be treated as portfolio interest if: (i) the beneficial
owner provides a statement to the payor certifying, under penalties of perjury, that such beneficial owner is not a United
States person and providing the name and address of such beneficial owner; (ii) such interest is treated as not effectively
connected with the beneficial owner’s United States trade or business; (iii) interest payments are not made to a person
within a foreign country which the IRS has included on a list of countries having provisions inadequate to prevent United
States tax evasion; (iv) interest payable with respect to the Taxable Certificates is not deemed contingent interest within
the meaning of the portfolio debt provision; (v) such beneficial owner is not a controlled foreign corporation, within the
meaning of section 957 of the Code; and (vi) such beneficial owner is not a bank receiving interest on the Taxable
Certificates pursuant to a loan agreement entered into in the ordinary course of the bank’s trade or business.
Assuming payments on the Taxable Certificates are treated as portfolio interest within the meaning of sections 871 and
881 of the Code, then no withholding under section 1441 and 1442 of the Code and no backup withholding under section
3406 of the Code is required with respect to beneficial owners or intermediaries who have furnished Form W-8 BEN, Form
W-8 EXP or Form W-8 IMY, as applicable, provided the payor does not have actual knowledge or reason to know that
such person is a United States person.
Reporting of Interest Payments…Subject to certain exceptions, interest payments made to beneficial owners with
respect to the Taxable Certificates will be reported to the IRS. Such information will be filed each year with the IRS on
Form 1099 which will reflect the name, address, and TIN of the beneficial owner. A copy of Form 1099 will be sent to each
beneficial owner of a Taxable Certificate for U.S. federal income tax purposes.
CONTINUING DISCLOSURE OF INFORMATION
In each of the respective Orders, the County has made the following agreement for the benefit of the holders and
Beneficial Owners of each series of the Obligations. The County is required to observe the agreement for so long as it
remains obligated to advance funds to pay the Obligations. Under the agreement, the County will be obligated to provide
timely notice of specified material events, to the Municipal Securities Rulemaking Board ("MSRB"). This information will
be available to the public free of charge via the MSRB's Electronic Municipal Market Access ("EMMA") system at
www.emma.msrb.org as described below under "Availability of Information from the "MSRB."
Annual Reports
Under Texas law, including, but not limited to, Chapter 115, as amended, Texas Local Government Code, the County
must keep its fiscal records in accordance with generally accepted accounting principles, must have its financial accounts
and records audited by a certified or permitted public accountant and must maintain each audit report with the County
Auditor. The County’s fiscal records and audit reports are available for public inspection during the regular business
hours of the County Auditor. Additionally, upon the filing of these financial statements and the annual audit, these
documents are subject to the Texas Open Records Act, as amended, Texas Government Code, Chapter 552.
Thereafter, any person may obtain copies of these documents upon submission of a written request to the County
Auditor at the Bexar County Auditor, 212 Stumberg, Suite 100, San Antonio, Texas 78204, and upon paying the
reasonable copying, handling, and delivery charges for providing this information.
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The County will provide certain updated financial information and operating data to the MSRB annually. The information
to be updated with respect to the County includes all quantitative financial information and operating data of the general
type included in this Official Statement. The information is of the general type included in APPENDIX A, exclusive of the
table reflecting "Consolidated Overlapping Gross Funded Debt Payable from Ad Valorem Taxes," and in APPENDIX C.
The County will update and provide this information within six months after the end of each fiscal year ending in or after
2009. The County will provide the updated information to the MSRB.
The County may provide updated information in full text or may incorporate by reference certain other publicly available
documents, as permitted by SEC Rule 15c2-12 (the "Rule"). The updated information will include audited financial
statements, if the County commissions an audit and it is completed by the required time. If audited financial statements
are not available by the required time, the County will provide unaudited financial statements by the required time, and
will provide audited financial statements when and if the audit report becomes available. Any such financial statements
will be prepared in accordance with the accounting principles described in APPENDIX C or such other accounting
principals as the County may be required to employ from time to time pursuant to state law or regulation.
The County’s current fiscal year end is September 30. Accordingly, it must provide updated information by the last day of
March in each year, unless the County changes its fiscal year. If the County changes its fiscal year, it will notify the
MSRB.
Material Event Notices
In the Orders, the County has agreed, for the benefit of the holders and Beneficial Owners of each series of the
Obligations, to provide timely notices of certain events to the MSRB. The County is required to observe such agreement
for so long as it remains obligated to advance funds to pay the Obligations. The County will provide notice of any of the
following events with respect to the Obligations, if such event is material to a decision to purchase or sell Obligations: (1)
principal and interest payment delinquencies; (2) non-payment related defaults; (3) unscheduled draws on debt service
reserves reflecting financial difficulties; (4) unscheduled draws on credit enhancements reflecting financial difficulties;
(5) substitution of credit or liquidity providers, or their failure to perform; (6) adverse tax opinions or events affecting the
federal tax treatment of the interest on the Obligations; (7) modifications to rights of holders of the Obligations; (8)
Obligation calls; (9) defeasances; (10) release, substitution, or sale of property securing repayment of the Obligations; and
(11) rating changes. Neither the Obligations nor the Orders makes any provision for debt service reserves, credit
enhancement, or liquidity enhancement. In addition, the County will provide timely notice of any failure by the County to
provide information, data, or financial statements in accordance with its agreement described above under “Annual
Reports.” The MSRB has made this information available to the public without charge and investors are able to access
continuing disclosure information with the MSRB at www.emma.msrb.org.
Availability of Information from MSRB
Effective July 1, 2009 (the "EMMA Effective Date"), the SEC implemented amendments to the Rule which approved the
establishment by the MSRB of EMMA, which is now the sole successor to the national municipal securities information
repositories with respect to filings made in connection with undertakings made under the Rule after the EMMA Effective
Date. Commencing with the EMMA Effective Date, all information and documentation filing required to be made by the
County in accordance with its undertaking made for the Obligations will be made with the MSRB in electronic format in
accordance with MSRB guidelines. Access to such filings will be provided, without charge to the general public, by the
MSRB.
With respect to debt of the County issued prior to the EMMA Effective Date, the County remains obligated to make annual
required filings, as well as notices of material events, under its continuing disclosure obligations relating to those debt
obligations (which includes a continuing obligation to make such filings with the Texas state information repository (the
“SID”)). Prior to the EMMA Effective Date, the Municipal Advisory Council of Texas (the “MAC”) had been designated by
the State and approved by the SEC staff as a qualified SID. Subsequent to the EMMA Effective Date, the MAC has
entered into a Subscription Agreement with the MSRB pursuant to which the MSRB makes available to the MAC, in
electronic format, all Texas-issuer continuing disclosure documents and related information posted to EMMA’s website
simultaneously with such posting. Until the County receives notice of a change in this contractual agreement between the
MAC and EMMA or of a failure of either party to perform as specified thereunder, the County has determined, in reliance
on guidance from the MAC, that making its continuing disclosure filings solely with the MSRB will satisfy its obligations to
make filings with the SID pursuant to its continuing disclosure agreements entered into prior to the EMMA Effective Date.
Limitations and Amendments
The County has agreed to update information and to provide notices of material events only as described above and
subject to the exemption contained in the Rule. The County has not agreed to provide other information that may be
relevant or material to a complete presentation of its financial results of operations, condition, or prospects or agreed to
update any information that is provided, except as described above. The County makes no representation or warranty
concerning such information or concerning its usefulness to a decision to invest in or sell Obligations at any future date.
The County disclaims any contractual or tort liability for damages resulting in whole or in part from any breach of its
continuing disclosure agreement or from any statement made pursuant to its agreement, although holders and Beneficial
Owners of Obligations may seek a writ of mandamus to compel the County to comply with its agreement.
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This continuing disclosure agreement may be amended by the County from time to time to adapt to changed circumstances
that arise from a change in legal requirements, a change in law, or a change in the identity, nature, status, or type of operations
of the County, but only if (1) the provisions, as so amended, would have permitted a purchaser to purchase or sell Obligations
in the primary offering of the Obligations in compliance with the Rule, taking into account any amendments or interpretations of
the Rule since such offering as well as such changed circumstances and (2) either (a) the registered owners of a majority in
aggregate principal amount (or any greater amount required by any other provision of the Orders that authorizes such an
amendment) of the outstanding Obligations consent to such amendment or (b) a person that is unaffiliated with the County
(such as nationally recognized bond counsel) determined that such amendment will not materially impair the interest of the
registered owners and Beneficial Owners of the Obligations. The County may also amend or repeal the provisions of this
continuing disclosure agreement if the SEC amends or repeals the applicable provision of the Rule or a court of final jurisdiction
enters judgment that such provisions of the Rule are invalid, but only if and to the extent that the provisions of this sentence
would not prevent a purchaser from lawfully purchasing or selling Obligations in the primary offering of the Obligations. If the
County amends its agreement, it must include with the next financial information and operating data provided in accordance
with its agreement described above under “Annual Reports” an explanation, in narrative form, of the reasons for the
amendment and of the impact of any change in the type of information and data provided.
Compliance with Prior Undertakings
During the past five years, the County has complied in all material respects with continuing disclosure agreements made
by it in accordance with the Rule. On March 31, 2010, the County made its timely annual filing which included the audited
financial statements for the period ended September 30, 2009. Due to the recalibration of municipal credit ratings that
both Fitch and Moody’s have recently completed, the County received upgraded ratings on its indebtedness from both
Moody’s (on April 23, 2010) and Fitch (on April 30, 2010) (see “OTHER PERTINENT INFORMATION – Bond Ratings”
herein). On June 4, 2010, the County filed notice of this material event with the MSRB through EMMA.
OTHER PERTINENT INFORMATION
Authenticity of Financial Data and Other Information
The financial data and other information contained herein have been obtained from the County’s records, audited financial
statements and other sources that are believed to be reliable. There is no guarantee that any of the assumptions or
estimates contained herein will be realized. All of the summaries of the statutes, documents and resolutions contained in
this Official Statement are made subject to all of the provisions of such statutes, documents and resolutions. These
summaries do not purport to be complete statements of such provisions and reference is made to such documents for
further information. Reference is made to original documents in all respects.
Registration and Qualification of Obligations for Sale
The sale of the Obligations has not been registered under the federal Securities Act of 1933, as amended, in reliance
upon the exemption provided thereunder by Section 3(a)(2); and the Obligations have not been qualified under the
Securities Act of Texas in reliance upon various exemptions contained therein; nor have the Obligations been qualified
under the securities act of any other jurisdiction. The County assumes no responsibility for qualification of the Obligations
under the securities laws of any jurisdiction in which the Obligations may be sold, assigned, pledged, hypothecated or
otherwise transferred. This disclaimer of responsibility for qualification for sale or other disposition of the Obligations shall
not be construed as an interpretation of any kind with regard to the availability of any exemption from securities
registration provisions.
Legal Investments and Eligibility to Secure Public Funds in Texas
Section 1201.041 of the Public Securities Procedures Act (Chapter 1201, Texas Government Code, and Section 271.052,
as amended, Texas Local Government Code) provides that the Obligations are negotiable instruments governed by
Chapter 8, Texas Business and Commerce Code, and are legal and authorized investments for insurance companies,
fiduciaries, and trustees, and for the sinking funds of municipalities or other political subdivisions or public agencies of the
State of Texas. With respect to investment in the Obligations by municipalities or other political subdivisions or public
agencies of the State of Texas, the Public Funds Investment Act, Chapter 2256, Texas Government Code, requires that
the Obligations be assigned a rating of at least "A" or its equivalent as to investment quality by a national rating agency.
(See "OTHER PERTINENT INFORMATION - Bond Ratings" herein.) In addition, various provisions of the Texas Finance
Code provide that, subject to a prudent investor standard, the Obligations are legal investments for state banks, savings
banks, trust companies with at least $1 million of capital, and savings and loan associations. The Obligations are eligible
to secure deposits of any public funds of the State, its agencies, and its political subdivisions, and are legal security for
those deposits to the extent of their market value.
Bond Ratings
Fitch Ratings ("Fitch"), Moody's Investors Service, Inc. (“Moody's”) and Standard and Poor's Ratings Services, a Standard
& Poor's Financial Services LLC business (“S&P”) have assigned their municipal bond ratings of “AAA,” "Aaa," and "AA+,"
respectively, to the Obligations.
-25-
The County’s underlying, unenhanced ratings on the Obligations reflect recent upgrades received by the County on its
indebtedness due to the recalibration of municipal credit ratings that both Fitch and Moody’s have recently completed.
Moody’s released its recalibrated ratings on April 23, 2010 and Fitch released its recalibrated ratings on April 30, 2010.
See “CONTINUING DISCLOSURE OF INFORMATION – Compliance with Prior Undertakings” herein.
The ratings reflect only the views of Fitch, Moody's and S&P at the time the ratings are given, and the County makes no
representations as to the appropriateness thereof. There is no assurance that any rating will continue for any given
period of time, or that a rating will not be revised downward or withdrawn entirely if, in the judgment of Fitch, Moody's or
S&P, circumstances so warrant. Any such downward revision or withdrawal of a rating may have an adverse effect on
the market price of the Obligations.
SAMCO Capital Markets, Inc. and M. E. Allison & Co., Inc. (the “Co-Financial Advisors") are employed as the Co-Financial
Advisors to the County in connection with the issuance of the Obligations. The Co-Financial Advisor’s fee for services
rendered with respect to the sale of the Obligations is contingent upon the issuance and delivery of the Obligations. The
Co-Financial Advisors, in their capacity as Co-Financial Advisors, have relied on the opinion of Bond Counsel and have not
verified and do not assume any responsibility for the information, covenants, and representations contained in any of the
bond documentation with respect to the federal income tax status of the Obligations.
In the normal course of business, the Co-Financial Advisors may also from time to time sell investment securities to the
County for the investment of bond proceeds or other funds of the County upon the request of the County.
The Co-Financial Advisors have provided the following sentence for inclusion in this Official Statement. The Co-Financial
Advisors have reviewed the information in this Official Statement in accordance with, and as part of, their responsibilities to
the County and, as applicable, to investors under the federal securities laws as applied to the facts and circumstances of
this transaction, but the Co-Financial Advisors do not guarantee the accuracy or completeness of such information.
Underwriting
The Underwriters have agreed, subject to certain conditions, to purchase the Tax-Exempt Certificates from the County at
a price equal to the initial offering prices to the public, as shown on page ii, hereof, less an underwriting discount of
$529,385.00, and no accrued interest on the Tax-Exempt Certificates. The Underwriters have agreed, subject to certain
conditions, to purchase the Taxable Certificates from the County at a price equal to the initial offering prices to the public,
as shown on page iii hereof, less an underwriting discount of $166,787.50, and no accrued interest on the Taxable
Certificates. The Underwriters have agreed, subject to certain conditions, to purchase the Bonds from the County at a
price equal to the initial offering prices to the public, as shown on page iv, hereof, less an underwriting discount of
$132,690.00, and no accrued interest on the Bonds. The Underwriters’ obligation is subject to certain conditions
precedent. The Underwriters will be obligated to purchase all of the Obligations if any Obligations are purchased. The
Obligations may be offered and sold to certain dealers and others at prices lower than such public offering price, and
such public prices may be changed from time to time, by the Underwriters.
Wells Fargo Securities is the trade name for certain capital markets and investment banking services of Wells Fargo &
Company and its subsidiaries, including Wells Fargo Bank, National Association. Wells Fargo Bank, National
Association is serving as both an Underwriter and the Paying Agent/Registrar for the Obligations.
Effective as of September 30, 2008, MSRB rules require underwriter participation with the Depository Trust and Clearing
Corporation’s (“DTCC”) New Issue Information Dissemination System (“NIIDS”). The rule change consists of an
amendment of Rule G-8, Books and Records, Rule G-9, Preservation of Records, and Rule G-34, CUSIP Numbers and
New Issue Requirements. The rule change is designed to improve new issue trade reporting by accelerating the timing for
CUSIP number assignment, and, with the exception of new issues of short-term instruments with less than nine months in
effective maturity, requiring underwriters to: (1) submit certain information about a new issue of municipal securities to
NIIDS within set timeframes and (2) set and disseminate a “Time of First Execution” that allows time for market
participants to access necessary information in preparation for trade reporting prior to beginning trade executions in the
issue.
The Underwriters have provided the following sentence for inclusion in this Official Statement. The Underwriters have
reviewed the information in this Official Statement in accordance with their responsibilities to investors under the federal
securities laws as applied to the facts and circumstances of this transaction, but the Underwriters do not guarantee the
accuracy or completeness of such information.
Financial Statements
APPENDIX C to this Official Statement contains the County’s annual financial report for the fiscal year ended September
30, 2009. These financial statements have been audited by Garza/Gonzalez & Associates, San Antonio, Texas,
independent certified public accountants, as stated in their reports included with such financial statements in APPENDIX
C.
-26-
No person has been authorized to give any information or to make any representations other than those contained in this
Official Statement, and if given or made, such other information or representations must not be relied upon as having
been authorized by the County. This Official Statement does not constitute an offer to sell or solicitation of an offer to
buy in any state in which such offer or solicitation is not authorized or in which the person making such offer or
solicitation is not qualified to do so or to any person to whom it is unlawful to make such offer or solicitation.
Forward Looking Statements
The statements contained in this Official Statement, and in any other information provided by the County, that are not
purely historical, are forward-looking statements, including statements regarding the County’s expectations, hopes,
intentions, or strategies regarding the future. Readers should not place undue reliance on forward-looking statements. All
forward looking statements included in this Official Statement are based on information available to the County on the
date hereof, and the County assumes no obligation to update any such forward-looking statements. It is important to note
that the County’s actual results could differ materially from those in such forward-looking statements.
The forward-looking statements herein are necessarily based on various assumptions and estimates and are inherently
subject to various risks and uncertainties, including risks and uncertainties relating to the possible invalidity of the
underlying assumptions and estimates and possible changes or developments in social, economic, business, industry,
market, legal and regulatory circumstances and conditions and actions taken or omitted to be taken by third parties,
including customers, suppliers, business partners and competitors, and legislative, judicial and other governmental
authorities and officials. Assumptions related to the foregoing involve judgments with respect to, among other things,
future economic, competitive, and market conditions and future business decisions, all of which are difficult or impossible
to predict accurately and many of which are beyond the control of the County. Any of such assumptions could be
inaccurate and, therefore, there can be no assurance that the forward-looking statements included in this Official
Statement would prove to be accurate.
GASB Implications for the County
In June 1999, the Governmental Accounting Standards Board issued statement No. 34, “Basic Financial Statements and
Management’s Discussion and Analysis for State and Local Governments” (“GASB 34”), which established new financial
reporting requirements for state and local governments throughout the United States. The County has complied with
GASB No. 34 effective with the September 30, 2002 financial statements. GASB 34 enhances the clarity and usefulness
of the general-purpose external financial reports of state and local governmental entities to the citizenry, investors,
creditors, and legislative and oversight bodies by creating new information and restructuring much of the information that
governments have presented in the past to provide a more comprehensive demonstration of their annual financial
performance. Examples of the changes that have been initiated due to GASB 34 include requiring governments to (i)
report information about their most important funds, including their general fund, individually as opposed to reporting fund
information in the aggregate by fund type, (ii) report the government’s original annual budget in additional to revised
versions created throughout the year to provide for a more accurate measure of budgetary compliance and the
government’s ability to estimate and manage its general resources, (iii) provide government-wide financial statements
prepared using the accrual method of accounting, which measures both current and long term assets and liabilities, and
(iv) provide management’s discussion and analysis of the government’s financial manager giving readers an objective
analysis of the government’s financial performance for the year.
Governments with total annual revenues (excluding extraordinary items) of $100 million or more must apply GASB 34 in
the preparation of their annual reports for periods beginning after June 15, 2001. As such, the County’s annual financial
reports beginning with fiscal year ending September 30, 2002 reflect the changes required by GASB 34.
Certification of the Official Statement
At the time of payment for and delivery of the Obligations, the Underwriters will be furnished a certificate, executed by
proper officers, acting in their official capacity, to the effect that to the best of their knowledge and belief: (a) the description
and statements of or pertaining to the County contained in its Official Statement, and any addenda, supplement or
amendment thereto, on the date of such Official Statement, and on the date of the initial delivery of the Obligations, were
and are true and correct in all material respects; (b) insofar as the County and its affairs, including its financial affairs, are
concerned, such Official Statement did not and does not contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements therein, in the light of circumstances under
which they are made, not misleading; (c) insofar as the description and statements, including financial data, of or pertaining
to entities, other than the County, and their activities contained in such Official Statement are concerned, such statements
and data have been obtained from sources which the County believes to be reliable and that the County has no reason to
believe that they are untrue in any material respect; and (d) there has been no material adverse change in the financial
condition of the County since September 30, 2009, the date of the last audited financial statements of the County.
Authorization of the Official Statement
No person has been authorized to give any information or to make any representations other than those contained in this
Official Statement, and if given or made, such other information or representations must not be relied upon as having
been authorized by the County.
-27-
This Official Statement has been approved by the Commissioners Court of the County for distribution in accordance with
provisions of the United States Securities and Exchange Commission’s Rule codified at 17 C.F.R. Section 240.15c-12, as
amended.
BEXAR COUNTY, TEXAS
/s/
ATTEST:
/s/
Gerard C. Rickhoff
County Clerk and Ex-Officio Clerk
of the Commissioners Court
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Nelson W. Wolff
County Judge
APPENDIX A
SELECTED FINANCIAL INFORMATION OF THE COUNTY
(this page intentionally left blank)
GENERAL OBLIGATION DEBT
2009 Appraised Valuation of County @ 100% .......................................................................................
Less Local Exemptions(1) .......................................................................................................................
2009 Taxable Assessed Valuation .........................................................................................................
$108,437,413,370
9,867,565,863
$ 98,569,847,507
____________
Source: Comptroller of Public Accounts 2009 County Report of Property Value.
(1)
A detailed listing of the Local Exemption is provided in "EXEMPTIONS AND REDUCTIONS TO APPRAISED VALUES" herein.
County’s Funded Debt Payable from Ad Valorem Taxes (as of 6-15-2010)
Total Funded Debt Outstanding .............................................................................................................
Ratio Total Funded Debt to 2009 Taxable Assessed Valuation ..............................................................
$879,840,000 *
0.89%
____________
* Includes the Obligations.
2000 U.S. Census Population - 1,392,931; 2009 Estimated Population - 1,622,899
Per Capita 2009 Taxable Assessed Valuation - $60,736.90
Per Capita Total General Purpose Funded Debt - $542.14
Area - 1,248 Square Miles - 798,720 Acres
Total General Purpose Funded Debt Per Acre - $1,101.56
OBLIGATIONS OUTSTANDING
(As of July 15, 2010)
(a) (b)
Limited Tax Debt:
Combination Tax and Revenue Certificates of Obligation, Series 2002
Limited Tax General Obligation Refunding Bonds, Series 2004
Limited Tax Bonds, Series 2004
Combination Tax and Revenue Certificates of Obligation, Series 2004-A
Pass-Through Revenue and Limited Tax Bonds, Series 2007
Pass-Through Revenue and Limited Tax Bonds, Series 2008
Limited Tax Refunding Bonds, Series 2009
Public Property Finance Contractual Obligations, Series 2009
Combination Tax and Revenue Certificates of Obligation, Series 2009 A & B
Limited Tax Refunding Bonds, Series 2010
Limited Tax General Obligation Bonds, Series 2010 (the "Bonds")
Combination Tax and Revenue Certificates of Obligation,
Series 2010A (the "Tax-Exempt Certificates")
Combination Tax and Revenue Certificates of Obligation Taxable Series 2010B
(Direct Subsidy - Build America Bonds) (the “Taxable Certificates”)
Total Limited Tax Debt
(b)
Unlimited Tax Debt:
Unlimited Tax Road Bonds, Series 2004
Total Unlimited Tax Debt
Flood Control Tax Debt:
Combination Flood Control Tax and Revenue Certificates of Obligation, Series 2002
Combination Flood Control Tax and Revenue Certificates of Obligation, Series 2009 A& B
Total Flood Control Debt
Total Outstanding Debt
$
7,280,000.00
7,610,000.00
10,170,000.00
7,520,000.00
17,770,000.00
21,355,000.00
2,195,000.00
20,950,000.00
19,855,000.00
51,150,000.00
29,170,000.00
10,690,000.00
3,960,000.00
149,065,000.00
36,915,000.00
24,020,000.00
97,455,000.00
30,325,000.00
$547,455,000.00
5,445,000.00
17,855,000.00
14,265,000.00
37,565,000.00
2,570,000.00
3,220,000.00
67,885,000.00
66,835,000.00
154,310,000.00
294,820,000.00
$879,840,000.00
____________
(a)
See “AD VALOREM TAX PROCEDURES - Limited Tax Funded Debt Payable from Proceeds of $0.80 Constitutional Tax Rate” in
the Official Statement.
(b)
As of July 1, 2010. Excludes debt payable from a flood control tax which is included as "Flood Control Tax Debt." (See “AD
VALOREM TAX PROCEDURES - Tax Rate and Funded Debt Limitations" in the Official Statement.)
A-1
OTHER DEBT
The County has authorized its General Obligation Commercial Paper Notes, Series A in the maximum principal amount
of $100,000,000. The purpose of the Commercial Paper Program is to provide funds for the interim financing of a portion
of the costs of capital improvements in the County. Scheduled maturities of the short-term borrowings under the
Commercial Paper Program must mature within 270 days and cannot extend beyond September 20, 2012, which is the
current stated expiration date of the Revolving Credit Agreement executed between the County and Dexia Credit Local,
acting through its New York Branch. J. P. Morgan Securities, Inc. serves as the dealer for the Commercial Paper
Program and Deutsche Bank Trust Company Americas, New York, New York, serves as the Issuing and Paying Agent.
As of May 31, 2010, the County has issued $39,384,000 in principal amount of these commercial paper notes that have
been refunded by its issue of Limited Tax Refunding Bonds, Series 2010 (the "Refunding Bonds"), which closed on July
22, 2010.
At an election held on May 10, 2008 (the "2008 Election"), the County’s qualified voters authorized the County to continue
its levy and collection of the Venue Tax, which the County began collecting on January 1, 2000 as authorized at an
election of its qualified voters held on November 2, 1999, and to pledge the revenues therefrom for the repayment of, and
as security for, one or more series of bonds to finance various venue projects authorized by Chapter 334, as amended,
Texas Local Government Code. The Commissioners Court ordered the continuation of its collection of the Venue Taxes
on May 27, 2008. On September 30, 2008, the County refunded the Original Venue Bonds, and issued two series of new
money venue project bonds to provide construction proceeds for the completion of venue projects approved at the 2008
Election, all of which obligations are secured by and payable from (in whole or in part) the Venue Taxes. On December
17, 2009, the County issued two additional series of bonds. The purpose of these bonds is for financing the costs of Motor
Vehicle Rental Tax Venue Projects, to pay the costs of their issuance, and to fund the Tax-Exempt Combined Venue Tax
Bonds Reserve. These six series of bonds that have been issued represent the only outstanding County indebtedness
secured by and payable from the Venue Taxes; however, the County anticipates issuing multiple series of such bonds
over the next five years to provide additional proceeds for the completion of the projects authorized at the 2008 election,
which includes the proposed issuance of two series of new money venue project revenue bonds to be issued prior to
September 30, 2010. As of June 15, 2010, the County had $153,940,000 in combined venue project debt outstanding.
____________
Source: The County's audited financial statements and information provided by the County Auditor.
AD VALOREM TAX RATIOS
The following table sets forth the ratio of the County's indebtedness outstanding payable from ad valorem taxes to
assessed value and indebtedness outstanding per capita.
Fiscal
Year
Ended
9/30
Assessed
(a)
Value
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
$39,836,862,150
41,870,592,752
45,407,904,531
49,789,196,016
52,734,890,581
57,047,025,482
60,273,124,001
65,437,180,648
74,916,971,550
86,921,985,819
97,312,377,954
98,569,847,507
Net
Indebtedness
Outstanding
$139,577,751
141,455,298
128,096,591
133,262,031
121,442,194
120,114,211
145,642,187
132,304,822
234,361,842
349,497,513
665,979,115
(b)
784,857,224
Net
Indebtedness
Outstanding
To Assessed Value
Estimated
Population
0.35%
0.34%
0.28%
0.27%
0.23%
0.21%
0.24%
0.20%
0.31%
0.40%
0.68%
0.80%
1,432,700
1,462,500
1,488,600
1,512,800
1,536,600
1,560,500
1,584,600
1,609,500
1,609,500
1,618,918
1,622,899
1,641,170
_____________
(a) Assessed values are net of exemptions. The basis of assessment is 100% of appraised value.
(b) Includes the Obligations, less County cash and investments as of May 27, 2010.
A-2
Net
Indebtedness
Outstanding
Per Capita
$97.42
96.72
86.05
88.09
79.03
76.97
91.94
82.20
169.75
215.88
410.36
478.23
ADDITIONAL DEBT
On November 4, 2003, the voters of the County approved a bond referendum authorizing $99,246,000 in new debt for a
variety of projects. After the issuance of the Bonds and the Refunding Bonds (as described below), the County will have
exhausted the voted authority. (See “SELECTED FINANCIAL INFORMATION OF THE COUNTY - Authorized but
Unissued Tax Bonds” herein.)
The County may issue certificates of obligation, personal property finance contractual obligations, tax notes and
commercial paper notes payable from ad valorem taxes without voter approval. See "OTHER DEBT ISSUES" herein.
AUTHORIZED BUT UNISSUED TAX BONDS
The County has the following authorized but unissued bonds payable from the $0.80 Tax Limitation:
Purpose
Detention Facilities
Detention Facilities
Parks & Comm. Facilities
Public Safety
e
Date
Authorized
Original
Amount
Authorized
Amount
Previously
Issued
11-2-93
11-4-03
11-4-03
11-4-03
$79,000,000
47,990,000
5,925,000
4,750,000
$66,999,113
8,112,500
975,000
312,500
Amount
Being
Issued
$
-017,430,371
2,889,218
3,680,411
Unissued
Balance
$12,000,887
22,447,129
2,060,782
757,0889
(1)
(2)
(2)
(2)
The County has not previously held a bond election to authorize debt payable from the Flood Control Tax (hereinafter
defined).
The County has no authorized but unissued bonds payable from its unlimited tax for County road projects.
____________
(1)
(2)
The Commissioners Court does not contemplate the issuance of these bonds.
With the issuance of the Bonds and the Refunding Bonds, the Commissioners Court does not contemplate the issuance of the
remainder of this voted authority. The Refunding Bonds proceeds were utilized to refund the County's Commercial Paper Notes
that were utilized to construct the public improvements represented by the unissued balance of this voted authority
[the remainder of this page intentionally left blank]
A-3
DEBT SERVICE REQUIREMENTS - LIMITED TAX INDEBTEDNESS*
The following table sets forth the annual debt service requirements on the County's limited tax indebtedness (See
"SELECTED FINANCIAL INFORMATION OF THE COUNTY - Authorized But Unissued Tax Bonds" herein.)
Less:
Direct
Subsidy(1)
Total
Limited Tax
Debt Service
Fiscal Year
Ending 9/30
Principal
Interest
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
2038
2039
2040
$ 20,860,000.00
25,815,000.00
25,845,000.00
25,755,000.00
22,300,000.00
19,665,000.00
19,000,000.00
18,080,000.00
18,925,000.00
21,815,000.00
20,575,000.00
20,560,000.00
15,575,000.00
17,375,000.00
16,065,000.00
16,845,000.00
14,225,000.00
14,915,000.00
14,865,000.00
13,345,000.00
13,990,000.00
14,680,000.00
15,400,000.00
16,150,000.00
16,900,000.00
17,675,000.00
19,035,000.00
20,070,000.00
21,125,000.00
22,150,000.00
8,735,000.00
$ 16,975,847.66
25,371,621.01
25,714,933.14
24,665,216.14
23,574,916.64
22,590,934.64
21,719,429.64
20,913,361.14
20,066,238.64
19,186,580.88
18,184,109.88
17,164,666.38
16,143,134.88
15,355,059.88
14,504,866.14
13,722,053.64
12,901,078.64
12,212,003.64
11,496,247.38
10,771,334.88
10,131,809.88
9,441,209.88
8,720,953.62
7,965,359.88
7,222,409.88
6,438,134.86
5,562,522.36
4,413,508.36
3,169,252.70
1,858,443.16
482,532.26
$
(919,854.82)
(1,676,513.61)
(1,785,104.06)
(1,785,104.06)
(1,785,104.06)
(1,785,104.06)
(1,785,104.06)
(1,785,104.06)
(1,785,104.06)
(1,785,104.06)
(1,785,104.06)
(1,785,104.06)
(1,785,104.06)
(1,785,104.06)
(1,785,104.06)
(1,785,104.06)
(1,785,104.06)
(1,785,104.06)
(1,785,104.06)
(1,785,104.06)
(1,785,104.06)
(1,785,104.06)
(1,785,104.06)
(1,785,104.06)
(1,785,104.06)
(1,785,104.06)
(1,785,104.06)
(1,469,832.28)
(1,051,895.30)
(611,408.20)
(148,953.78)
$ 36,915,992.84
49,510,107.40
49,774,829.08
48,635,112.08
44,089,812.58
40,470,830.58
38,934,325.58
37,208,257.08
37,206,134.58
39,216,476.82
36,974,005.82
35,939,562.32
29,933,030.82
30,944,955.82
28,784,762.08
28,781,949.58
25,340,974.58
25,341,899.58
24,576,143.32
22,331,230.82
22,336,705.82
22,336,105.82
22,335,849.56
22,330,255.82
22,337,305.82
22,328,030.80
22,812,418.30
23,013,676.08
23,242,357.40
23,397,034.96
9,068,578.48
$568,315,000.00
$428,639,771.71
$(50,506,059.49)
$946,448,712.22
____________
*
Includes the Obligations.
(1)
The Taxable Certificates and the Bexar County, Texas Combination Tax and Revenue Certificates of Obligation, Taxable Series
2009B (Direct Subsidy – Build America Bonds) (the “Taxable Non-Flood Obligations”) were designated as “Build America Bonds”
under and pursuant to the authority provided for in the federal American Recovery and Reinvestment Act of 2009 (effective February
17, 2009) and are permitted to receive directly from the United States Treasury a refundable tax credit equal to 35% of the taxable
interest the County pays on the Taxable Non-Flood Obligations to the holders thereof (the “Subsidy Payment”). Failure on the part of
the County to comply with the conditions imposed by the Internal Revenue Code, and future guidance to be provided by the United
States Treasury and the Internal Revenue Service, may cause the County to fail to receive the Subsidy Payment for the Taxable
Non-Flood Obligations. Moreover, Subsidy Payments are subject to automatic offsets against certain amounts that may, for unrelated
reasons, be owed by the County to an agency of the United States of America.
TAX ADEQUACY - LIMITED TAX DEBT
Estimated Proceeds from $0.045267 Limited Tax Using 2009 Taxable
Assessed Valuation of $98,569,847,507 at 95% Collected ........................................................................
$42,388,632
Estimated Other Sources (includes funds transferred from the Advanced Transportation District) .................
8,800,000
Total Estimated Available Funds for 2010/2011 Debt Service ........................................................................
$51,188,632
2010/2011 Estimated Limited Tax Debt Service Requirement ........................................................................
$49,510,107 *
____________
* Includes the Obligations.
A-4
DEBT SERVICE REQUIREMENTS - UNLIMITED TAX INDEBTEDNESS*
The following table sets forth the annual debt service requirements on the County's unlimited tax indebtedness.
Fiscal Year
End 9/30
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
Principal
Interest
Total
Unlimited
Tax Debt
Debt Service
$ 1,510,000.00
1,575,000.00
1,650,000.00
1,715,000.00
1,785,000.00
1,855,000.00
1,945,000.00
2,025,000.00
2,125,000.00
2,220,000.00
2,325,000.00
2,430,000.00
2,535,000.00
2,660,000.00
2,230,000.00
2,340,000.00
2,450,000.00
2,570,000.00
1,130,000.00
$ 1,786,703.76
1,724,153.76
1,658,263.76
1,588,488.76
1,518,433.76
1,442,143.76
1,360,291.26
1,273,628.76
1,176,478.76
1,080,056.26
978,473.76
871,092.51
761,611.26
644,611.26
518,231.26
411,431.26
298,125.00
179,487.50
53,675.00
$ 3,296,703.76
3,299,153.76
3,308,263.76
3,303,488.76
3,303,433.76
3,297,143.76
3,305,291.26
3,298,628.76
3,301,478.76
3,300,056.26
3,303,473.76
3,301,092.51
3,296,611.26
3,304,611.26
2,748,231.26
2,751,431.26
2,748,125.00
2,749,487.50
1,183,675.00
$39,075,000.00
$19,325,381.41
$58,400,381.41
____________
*
In practice, the County has not levied a tax for its unlimited tax bonds. The County currently is covering the debt service for these
unlimited tax bonds from other lawfully available funds.
TAX ADEQUACY - UNLIMITED TAX BONDS
Estimated Proceeds from $0.00352 Unlimited Tax Using 2009 Taxable
$3,299,154
Estimated Other Sources ................................................................................................................................
20,000
Total Estimated Available Funds for Unlimited Tax Debt Service ...................................................................
$3,319,154
2010/2011 Estimated Unlimited Tax Debt Service Requirement ....................................................................
$3,299,154 *
____________
*
In practice, the County has not levied a tax for its unlimited tax bonds. The County currently is covering the debt service for these
unlimited tax bonds from other lawfully available funds.
A-5
DEBT SERVICE REQUIREMENTS - FLOOD CONTROL TAX INDEBTEDNESS
The following table sets forth the annual debt service requirements on the County's flood control indebtedness.
Less:
Direct
Subsidy(1)
Total
Flood Control
Debt Service
Fiscal Year
Ending 9/30
Principal
Interest
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
2038
2039
$ 2,915,000.00
3,035,000.00
3,150,000.00
3,295,000.00
3,435,000.00
3,605,000.00
4,055,000.00
3,745,000.00
3,920,000.00
6,090,000.00
6,355,000.00
6,660,000.00
6,995,000.00
8,360,000.00
8,455,000.00
8,885,000.00
9,345,000.00
9,825,000.00
11,320,000.00
13,895,000.00
14,590,000.00
15,320,000.00
16,070,000.00
16,855,000.00
17,675,000.00
18,550,000.00
19,610,000.00
20,710,000.00
17,210,000.00
13,805,000.00
$ 13,631,276.44
15,352,718.60
15,228,883.60
15,086,833.60
14,951,723.60
14,782,768.60
14,606,368.60
14,408,718.60
14,235,043.60
14,069,083.60
13,799,958.60
13,488,077.36
13,158,821.10
12,800,483.60
12,373,118.60
11,939,193.60
11,483,181.10
11,003,543.60
10,505,531.10
9,932,418.60
9,237,093.60
8,506,943.60
7,759,856.10
6,976,218.60
6,154,143.60
5,279,118.60
4,360,756.10
3,201,784.60
1,976,798.20
914,995.40
$
(919,854.82)
(1,174,282.76)
(1,174,282.76)
(1,174,282.76)
(1,174,282.76)
(1,174,282.76)
(1,174,282.76)
(1,174,282.76)
(1,174,282.76)
(1,174,282.76)
(1,174,282.76)
(1,174,282.76)
(1,174,282.76)
(1,174,282.76)
(1,174,282.76)
(1,174,282.76)
(1,174,282.76)
(1,174,282.76)
(1,174,282.76)
(1,174,282.76)
(1,174,282.76)
(1,174,282.76)
(1,174,282.76)
(1,174,282.76)
(1,174,282.76)
(1,174,282.76)
(1,174,282.76)
(906,345.86)
(622,054.36)
(320,248.38)
$ 15,626,421.62
17,213,435.84
17,204,600.84
17,207,550.84
17,212,440.84
17,213,485.84
17,487,085.84
16,979,435.84
16,980,760.84
18,984,800.84
18,980,675.84
18,973,794.60
18,979,538.34
19,986,200.84
19,653,835.84
19,649,910.84
19,653,898.34
19,654,260.84
20,651,248.34
22,653,135.84
22,652,810.84
22,652,660.84
22,655,573.34
22,656,935.84
22,654,860.84
22,654,835.84
22,796,473.34
23,005,438.74
18,564,743.84
14,399,747.02
$297,735,000.00
$321,205,454.50
$(33,299,855.18)
$585,640,599.32
____________
(1)
The Bexar County, Texas Combination Flood Control Tax and Revenue Certificates of Obligation, Taxable Series 2009B (Direct
Subsidy – Build America Bonds) (the “Taxable Flood Obligations”) were designated as “Build America Bonds” under and pursuant to
the authority provided for in the federal American Recovery and Reinvestment Act of 2009 (effective February 17, 2009) and are
"qualified bonds" under section 6431 of the Code, permitting the County to receive directly from the United States Treasury a
refundable tax credit equal to 35% of the taxable interest it pays on the Taxable Flood Obligations to the holders thereof (the “Subsidy
Payment”). Failure on the part of the County to comply with the conditions imposed by the Internal Revenue Code, and future guidance
to be provided by the United States Treasury and the Internal Revenue Service, may cause the County to fail to receive the Subsidy
Payment for the Taxable Flood Obligations. Moreover, Subsidy Payments are subject to automatic offsets against certain amounts that
may, for unrelated reasons, be owed by the County to an agency of the United States of America.
TAX ADEQUACY - FLOOD CONTROL TAX OBLIGATIONS
Estimated Proceeds from $0.01709 Flood Control Tax Using 2009 Taxable
$16,000,000
Estimated Other Sources ................................................................................................................................
1,225,000
Total Estimated Available Funds for Flood Control Tax Debt Service .............................................................
$17,225,000
2010/2011 Estimated Flood Control Tax Debt Service Requirement ..............................................................
$17,213,436
A-6
AD VALOREM TAX RATES
The following table shows the County's ad valorem tax rates per $100 of assessed value for each of the tax years 2005
through 2009:
Purpose
2009
2008
2007
2006
2005
General Fund
Limited Tax Debt Service
Equipment Obligations
$0.250920
0.045267
0.00
$0.250920
0.038479
0.00
$0.265594
0.029510
0.00
$0.286301
0.027846
0.00
$0.287407
0.031064
0.00
Total Limited Tax Rate
Unlimited Tax Rate (1)
$0.296187
0.00
$0.289399
0.00
$0.295104
0.00
$0.314147
0.00
$0.318471
0.00
Sub-Total
Farm to Market Special Tax
Flood Control Special Tax (2)
$0.296187
0.00
0.030676
$0.289399
0.00
0.037467
$0.295104
0.00
0.031762
$0.314147
0.00
0.012719
$0.318471
0.00
0.012719
Total Tax Rate
$0.326866
$0.326866
$0.326866
$0.326866
$0.331190
___________
(1)
(2)
The County has historically utilized other lawfully available funds, including the Farm-to-Market and Lateral Road Tax discussed
above to pay the debt service requirements on the County's unlimited tax road bonds.
The County has previously entered into a contract, as amended, with the San Antonio River Authority (“SARA”) pursuant to Section
411.003, as amended, Texas Local Government Code, for the accomplishment of plans and programs for flood control and soil
conservation, pursuant to which the County agreed to annually assess and levy a portion of the Flood Control Tax at the rates and
amounts set forth in the contract sufficient to meet the obligations of the County under the contract with SARA. In addition, a portion
of the Flood Control Tax is utilized to pay the debt service requirements on the Flood Control Certificates.
PROPERTY TAX LEVIES AND COLLECTIONS
(Unaudited)
County Tax Rate - General and Debt
Collected Within the
Fiscal Year of the Levy
Fiscal
(1)
Year
Taxes Levied
for
(2)
Fiscal Year
Subsequent
(3)
Collections
Total Collections to Date
Amount
Percent
of Levy
Taxes from
Prior Year
Levy
Amount
Percent of
Current
L
Receivable
Outstanding
Taxes from
(4)
Prior Years
2000
$142,444,278
$139,401,003
97.9%
$1,875,176
$141,276,179
99.2%
$10,174,483
2001
153,348,375
150,869,686
97.7%
3,022,102
153,891,788
99.7%
10,873,624
2002
159,860,934
156,028,658
97.6%
3,376,904
159,405,562
99.7%
11,264,054
2003
167,857,501
163,685,935
97.5%
3,659,885
167,345,821
99.7%
11,498,246
2004
182,983,382
179,297,078
98.0%
3,090,416
182,387,494
99.7%
12,058,064
2005
191,334,814
187,860,871
98.2%
2,823,028
190,683,899
99.7%
11,616,455
2006
207,309,014
203,851,097
98.3%
2,708,288
206,559,385
99.6%
11,880,379
2007
232,729,932
229,355,021
98.5%
2,360,160
231,715,181
99.6%
11,142,226
253,356,250
249,567,648
98.5%
2,064,062
251,631,710
99.3%
11,415,483
275,433,604
270,493,314
98.2%
1,752,429
270,493,314
98.2%
12,359,490
2008
2009
(5)
(6)
____________
Source: Bexar County Tax Assessor-Collector TC-168 Reports.
(1)
Figures for Fiscal Year 2000-2001 totals are estimated. TC-168 Reports were not available.
(2)
Taxes Levied can increase or decrease based on the number of tax cases settled during the fiscal years. Figures for fiscal years
2000-2001 tax cases were not included.
(3)
Subsequent collections consist of prior tax year collections during the fiscal year. Figures for fiscal years 2000-2001 are estimated.
(4)
Outstanding taxes from prior years consist of all delinquent taxes from tax year 2008 - 1988 for the County, and tax year 2008 - 1988
for the flood.
(5)
Total tax rate the County assesses is split between flood and general and debt. While the total tax rate for FY 2008 remained
unchanged, the portion allocated to flood was significantly increased.
(6)
Amount of taxes from prior year levy as of June 30, 2010.
A-7
County Tax Rate - Flood and Debt
Collected Within the
Fiscal Year of the Levy
Taxes Levied
for
Fiscal Year (2)
Amount
Fiscal
Year(1)
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
(5)
$ 8,011,667
8,689,519
8,451,822
8,967,649
7,633,579
8,040,185
8,691,424
9,837,333
26,805,988
34,968,389
$ 7,840,542
8,494,424
8,247,838
8,741,687
7,480,196
7,888,282
8,538,987
9,685,804
26,407,917
34,354,457
Percent
of Levy
Subsequent
Collections(3)
Taxes
Prior
Levy
97.9%
97.8%
97.6%
97.5%
98.0%
98.1%
98.2%
98.5%
98.5%
98.2%
$ 98,293
168,083
177,990
195,582
124,556
119,860
114,917
101,173
223,031
225,279
Total Collections to Date
Amount
(6)
Percent of
Current
$ 7,938,835
8,662,507
8,425,829
8,937,268
7,604,753
8,008,142
8,653,904
9,786,978
26,630,948
34,354,457
99.1%
99.7%
99.7%
99.7%
99.6%
996%
99.6%
99.5%
99.3%
98.2%
Receivable
Outstanding
Taxes from
Prior Years(4)
$ 524,250
583,511
603,968
622,131
607,588
586,621
588,853
560,731
827,131
1,100.234
____________
Source: Bexar County Tax Assessor-Collector TC-168 Reports.
(1)
Figures for Fiscal Year 2000-2001 totals are estimated. TC-168 Reports were not available.
(2)
Taxes Levied can increase or decrease based on the number of tax cases settled during the fiscal years. Figures for fiscal years
2000-2001 tax cases were not included.
(3)
Subsequent collections consist of prior tax year collections during the fiscal year. Figures for fiscal years 2000-2001 are estimated.
(4)
Outstanding taxes from prior years consist of all delinquent taxes from tax year 2008 - 1988 for the County, and tax year 2008 - 1988
for the flood.
(5)
Total tax rate the County assesses is split between flood and general and debt. While the total tax rate for FY 2008 remained
unchanged, the portion allocated to flood was significantly increased.
(6)
Amount of taxes from prior year levy as of June 30, 2010.
TAXPAYERS BY CLASSIFICATION
Property Valuations by Category
Classification
Real Estate:
Single Family Residential
Multi-Family Residential
Vacant - Platted Lots/Tracts
Acreage (Land Only)
Farm & Ranch
Commercial & Industrial
Oil, Gas & Other Mineral Res.
Personal:
Utilities
Commercial
Industrial
Mobile Homes
Residential Inventory
Special Inventory
Total Valuation
Less Exemptions & Exclusions
Net Taxable
Assessed Valuation
2009
Assessed
Valuation
Percent
Of Total
2008
Assessed
Valuation
Percent
Of Total
2007
Assessed
Valuation
Percent
Of Total
$ 61,668,472,119
6,528,581,942
2,192,622,474
3,801,861,354
329,625,731
22,341,075,205
7,060,714
56.87%
6.02%
2.02%
3.51%
0.30%
20.60%
0.01%
$ 61,470,072,666
6,415,000,884
2,252,352,783
3,997,999,406
342,964,999
21,198,041,669
7,324,448
57.24%
5.97%
2.09%
3.72%
0.32%
19.73%
0.01%
$56,854,414,951
5,623,822,904
1,937,526,723
3,235,596,866
348,898,132
17,979,504,712
5,802,968
58.74%
5.81%
2.00%
3.34%
0.36%
18.58%
0.01%
684,497,899
7,713,126,321
1,995,759,970
278,635,629
538,479,532
357,614,480
$108,437,413,370
9,867,565,863
0.63%
7.11%
1.84%
0.26%
0.50%
0.33%
704,619,973
7,579,896,162
2,158,497,750
281,277,235
586,413,692
405,040,630
$107,399,502,297
10,087,124,343
0.66%
7.06%
2.01%
0.26%
0.55%
0.38%
763,879,638
6,707,350,704
2,118,386,320
298,168,089
537,826,000
371,943,130
$96,783,121,137
9,571,280,243
0.79%
6.93%
2.19%
0.31%
0.56%
0.38%
100.00%
$ 98,569,847,507
$ 97,312,377,954
100.00%
$87,211,840,894
_____________
Source: Comptroller of Public Accounts - Property Tax Assistance Division - County Reports of Property Value.
A-8
100.00%
EXEMPTIONS AND REDUCTIONS TO APPRAISED VALUES
65 and Over Exemptions
on Homestead (a)
Veterans Exemption
Freeport Loss
Productivity Loss
Abatement Loss
Solar
Other
Value Lost to 10% Cap
Fiscal Year ending September 30
2007
2006
2009
2008
$4,426,863,084
635,168,562
585,674,228
2,545,401,123
1,133,917,332
15,742,308
87,397,460
437,401,766
$ 4,404,017,548
278,264,885
564,810,967
2,517,811,598
1,125,785,384
38,306,758
119,137,003
1,038,990,200
$ 9,867,565,863
$10,087,124,343
$4,234,076,55
9
266,111,027
2005
536,783,733
1,996,236,944
966,338,860
11,754,892
108,845,266
1,451,132,962
$4,104,719,699
255,929,296
399,287,480
1,481,159,905
339,635,304
15,930,706
75,506,813
941,717,633
$3,864,326,984
293,427,384
343,086,810
1,108,039,348
331,649,050
1,796,347,097
345,932,958
$9,571,280,243
$7,613,886,836
$8,082,809,631
____________
(a)
The County currently offers an exemption of $50,000 to property owners that qualify as disabled persons and/or persons 65 years of
age or older. The County has studied the effects to the property tax base and tax revenues of raising that exemption to levels between
$60,000 and $100,000. The exact extent to which such an increase in the current exemption would negatively impact the County’s
future tax revenues is unknown. A number of studies, however, have been undertaken to measure the extent of the impact of an
increase in the current exemption, and these studies have concluded that such an increase in the current exemption would cause a
decrease in the rate of growth of future tax revenues to the County.
Source: Comptroller of Public Accounts - County Reports of Property Value.
TEN LARGEST TAXPAYERS AND THEIR VALUATIONS
The following table lists the ten taxpayers with the largest assessed values in the County as of September 30, 2009:
Percent
of Total
Taxable Value
Taxpayer
Type of Business
Market Value
H.E. Butt Grocery Company
Methodist Healthcare System SA
AT&T
Wal-Mart Stores, Inc.
Baptist Hospital Sys (VHS San Antonio Partners LP)
USAA
La Cantera Retail LTD Partnership
Frost National Bank
Frankel Family Trust
SA Real Estate LLLP
Retail
Medical
Services
Retail
Medical
Finance/Insurance
Real Estate
Services
Real Estate
Real Estate
$ 926,841,969
459,806,611
408,854,755
392,639,185
375,476,876
343,756,700
263,640,000
209,948,288
199,812,310
171,986,360
0.96%
0.48%
0.42%
0.41%
0.39%
0.36%
0.27%
0.22%
0.21%
0.18%
$3,752,763,054
3.89%
Total
_____________________
Source: Bexar Appraisal District.
A-9
CONSOLIDATED OVERLAPPING GROSS FUNDED DEBT PAYABLE FROM AD VALOREM TAXES
Expenditures of the various taxing bodies within the territory of the County are paid out of ad valorem taxes levied by
these taxing bodies on properties within the County. These political taxing bodies are independent of the County and may
incur borrowings to finance their expenditures. The following statement of direct and estimated overlapping ad valorem
tax debt was developed from information contained in "Texas Municipal Reports" published by the Municipal Advisory
Council of Texas. Except for the amounts relating to the County, the County has not independently verified the accuracy
or completeness of such information, and no person should rely upon such information as being accurate or complete.
Furthermore, certain of the entities listed below may have issued additional debt since the date stated in the table, and
such entities may have programs requiring the issuance of substantial amounts of additional debt, the amount of which
cannot be determined. The following table reflects the County’s estimated share of overlapping gross debt of these
various taxing bodies:
Taxing Body
Alamo CCD
City of Alamo Heights
Alamo Heights ISD
City of Balcones Heights
Bexar County Hospital District
Bexar Co. WC&ID #10
Bexar Co. WC&ID #18
Boerne ISD
Cibolo Creek Municipal Authority
Cibolo Canyons Special Imp. District
Comal ISD
City of Converse
East Central ISD
Edgewood ISD
City of Elmendorf
City of Fair Oaks Ranch
Floresville ISD
City of Grey Forest
Harlandale ISD
City of Helotes
City of Hill Country Village
Town of Hollywood Park
Judson ISD
City of Kirby
Lackland ISD
City of Leon Valley
City of Live Oak
City of Lytle
Medina Valley ISD
North East ISD
Northside ISD
City of Olmos Park
Randolph Field ISD
City of St. Hedwig
San Antonio ISD
San Antonio MUD #1
San Antonio RA
City of San Antonio
City of Schertz
Schertz- Cibolo- University City ISD
City of Selma
City of Shavano Park
Somerset ISD
City of Somerset
Tax Debt
Outstanding
As of 5/01/2010
Estimated Overlapping
Percent
Tax Debt
$ 411,718,778
6,865,000
66,748,702
1,229,000
551,910,000
-0-0114,175,499
-022,520,000
536,942,806
3,770,000
90,994,996
101,350,000
-02,485,000
80,154,984
405,000
214,597,183
9,950,000
1,275,000
-0398,516,646
3,325,000
-03,370,000
18,270,000
1,035,000
62,786,518
1,255,012,166
1,534,795,000
4,625,000
-0980,000
464,587,560
1,165,000
42,015,000
1,089,420,000
59,165,000
282,285,514
12,215,000
6,082,665
25,579,991
125,000
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
26.71%
100.00%
100.00%
14.93%
100.00%
100.00%
100.00%
100.00%
67.97%
0.12%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
1.37%
27.12%
100.00%
99.55%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
3.32%
10.47%
71.68%
100.00%
75.21%
100.00%
(Table continued on next page)
A-10
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
$ 411,718,778
6,865,000
66,748,702
1,229,000
551,910,000
-0-030,496,276
-022,520,000
80,165,561
3,770,000
90,994,996
101,350,000
-01,689,055
96,186
405,000
214,597,183
9,950,000
1,275,000
-0398,516,646
3,325,000
-03,370,000
18,270,000
14,179
17,027,704
1,255,012,166
1,534,795,000
4,625,000
-0980,000
464,587,560
1,165,000
42,015,000
1,089,420,000
1,964,278
29,555,293
8,755,712
6,082,665
19,239,711
125,000
Consolidated Overlapping Gross Funded Debt Payable From Ad Valorem Taxes (continued from page A-9)
Taxing Body
Tax Debt
Outstanding
As of 5/01/2010
South San Antonio ISD
Southside ISD
Southwest ISD
City of Terrell Hills
City of University City
City of Windcrest
$141,472,061
63,390,000
132,169,999
3,235,000
11,635,000
2,155,000
Estimated Overlapping
Percent
Tax Debt
(a)
100.00%
100.00%
100.00%
100.00%
100.00%
100.00%
$ 141,472,061
63,390,000
132,169,999
3,235,000
11,635,000
2,155,000
6,841,776,134
100.00%
879,840,000
Total Overlapping
Bexar County
879,840,000
(b)
Total Direct & Overlapping
$7,721,616,134
_______________
(a) Certain bonds issued by Texas Independent School Districts are eligible for payment from the State of Texas “Instructional
Facilities Allotments” and from “Existing Debt Allotments.” These bonds, while obligations of the district, are payable in whole or in
part from district allocations of state funds. Such funding may vary between districts and from year to year depending upon the
state’s contributions.
(b) Includes the the Obligations.
NOTE: All outstanding capital appreciation bonds are shown at the original issue amount.
[The remainder of this page intentionally left blank]
A-11
CURRENT DEBT SERVICE REQUIREMENTS
The following table sets forth the annual debt service requirements on all of the County's outstanding general obligation
indebtedness, including the Obligations but excluding the unlimited tax debt.
Fiscal Year
Ending 9/30
Principal
Interest
Less:
Direct
Subsidy(1)
Total
General Obligation
Debt Service
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
2038
2939
2040
$ 23,775,000.00
28,850,000.00
28,995,000.00
29,050,000.00
25,735,000.00
23,270,000.00
23,055,000.00
21,825,000.00
22,845,000.00
27,905,000.00
26,930,000.00
27,220,000.00
22,570,000.00
25,735,000.00
24,520,000.00
25,730,000.00
23,570,000.00
24,740,000.00
26,185,000.00
27,240,000.00
28,580,000.00
30,000,000.00
31,470,000.00
33,005,000.00
34,575,000.00
36,225,000.00
38,645,000.00
40,780,000.00
38,335,000.00
35,955,000.00
8,735,000.00
$ 30,607,124.10
40,724,339.61
40,943,816.74
39,752,049.74
38,526,640.24
37,373,703.24
36,325,798.24
35,322,079.74
34,301,282.24
33,255,664.48
31,984,068.48
30,652,743.74
29,301,955.98
28,155,543.48
26,877,984.74
25,661,247.24
24,384,259.74
23,215,547.24
22,001,778.48
20,703,753.48
19,368,903.48
17,948,153.48
16,480,809.72
14,941,578.48
13,376,553.48
11,717,253.46
9,923,278.46
7,615,292.96
5,146,050.90
2,773,438.56
482,532.26
$ (1,839,709.64)
(2,850,796.37)
(2,959,386.82)
(2,959,386.82)
(2,959,386.82)
(2,959,386.82)
(2,959,386.82)
(2,959,386.82)
(2,959,386.82)
(2,959,386.82)
(2,959,386.82)
(2,959,386.82)
(2,959,386.82)
(2,959,386.82)
(2,959,386.82)
(2,959,386.82)
(2,959,386.82)
(2,959,386.82)
(2,959,386.82)
(2,959,386.82)
(2,959,386.82)
(2,959,386.82)
(2,959,386.82)
(2,959,386.82)
(2,959,386.82)
(2,959,386.82)
(2,959,386.82)
(2,376,178.14)
(1,673,949.66)
(931,656.58)
(148,953.78)
$
$866,050,000.00
$749,845,226.21
$(83,805,914.67)
$1,532,089,311.54
52,542,414.46
66,723,543.24
66,979,429.92
65,842,662.92
61,302,253.42
57,684,316.42
56,421,411.42
54,187,692.92
54,186,895.42
58,201,277.66
55,954,681.66
54,913,356.92
48,912,569.16
50,931,156.66
48,438,597.92
48,431,860.42
44,994,872.92
44,996,160.42
45,227,391.66
44,984,366.66
44,989,516.66
44,988,766.66
44,991,422.90
44,987,191.66
44,992,166.66
44,982,866.64
45,608,891.64
46,019,114.82
41,807,101.24
37,796,781.98
9,068,578.48
____________
(1)
The Taxable Certificates, the Taxable Non-Flood Obligations, and the Taxable Flood Obligations were designated as “Build America
Bonds” under and pursuant to the authority provided for in the federal American Recovery and Reinvestment Act of 2009 (effective
February 17, 2009) and as “qualified bonds” under section 6431 of the Code, permitting the County to receive directly from the United
States Treasury a refundable tax credit equal to 35% of the taxable interest the County pays on the Taxable Non-Flood Obligations to
the holders thereof (the “Subsidy Payment”). Failure on the part of the County to comply with the conditions imposed by the Internal
Revenue Code, and future guidance to be provided by the United States Treasury and the Internal Revenue Service, may cause the
County to fail to receive the Subsidy Payment for the Taxable Non-Flood Obligations. Moreover, Subsidy Payments are subject to
automatic offsets against certain amounts that may, for unrelated reasons, be owed by the County to an agency of the United States of
America.
THE COUNTY
Creation and Location
The County was created in 1836 and organized in 1837 as one of the original counties of the Republic of Texas and is
now the third most populous of the 254 counties in the State of Texas. The County is located in south central Texas and
is a component of the San Antonio Metropolitan Statistical Area, the nation's thirtieth largest Metropolitan Statistical Area
and the third largest in Texas in 2000. The 2000 population of the County was 1,392,931. (See Appendix B for more
information concerning the County.)
A-12
The principal city within the County is San Antonio, the county seat. The economy is based on manufacturing,
agriculture, mineral production, medical facilities, military activities, and tourism.
Administration of the County
Those officials having responsibility for the financial administration of the County are the County Judge and four County
Commissioners (the "Commissioners Court"), the County Tax Assessor Collector and the County Clerk (all of whom are
elected officials), the County Auditor (who is appointed by the District Judges), and the Budget Officer (who is an
employee of Commissioners Court). See page v for the names of the current office holders.
The Commissioners Court is the governing body of the County. It has certain powers expressly granted by the Texas
Constitution and by the Legislature and powers necessarily implied from such grants. Among other things, it approves
the budget, determines the tax rates, approves contracts in the name of the County, determines whether indebtedness
should be authorized and issued, and appoints certain County officials.
The County Judge is the presiding official of the Commissioners Court and is elected for a four-year term by the voters of
the County. Each Commissioner represents one of the four precincts into which the County is divided. Each of the four
Commissioners is elected by the voters of his precinct for a four-year term.
The Tax Assessor Collector is responsible for collecting ad valorem taxes, collecting certain State and County fees and
other taxes.
The County Clerk's duties include Treasurer responsibilities as related to depositing money received by the County in the
depository selected by the Commissioners Court and cosigning all of the County's checks. In addition, the County Clerk
is the Clerk of the Commissioners Court and civil, criminal, and probate courts. The County Clerk is also the recorder of
the County and issues and records, marriage licenses, assumed business names, and records military discharges, cattle
brands, uniform commercial code filings and deeds.
The County Auditor is the chief financial officer of the County and is responsible for substantially all County finance and
accounting control functions. The responsibilities include those of auditing, accounting system design, financial planning,
financial relations, payroll and is charged statutorily with strict enforcement of the law governing county finances. The
County Auditor is appointed for a two-year term by, and is accountable to, the 24 State District Judges of whose courts
are located in the County.
The County Budget Officer is appointed by the Commissioners Court and is responsible for preparing the County’s
annual budget. These responsibilities also include those of Chief Investment Officer, debt issuance planning and health
insurance administration. In addition, the County Budget Officer develops the long range financial forecast and
completes special studies and cost/benefit analyses of various issues that have a fiscal impact on the County.
Employees
The following table shows the number and employment category of the County's employees on September 30, years
2003 through 2009.
General Government
Judicial
Public Safety
Education & Recreation
Public Works
Health & Public Welfare
Total
2009
2008
2007
2006
2005
2004
2003
807
921
2,579
73
272
59
4,711
803
902
2,515
69
277
68
4,634
767
904
2,387
62
270
50
4,440
753
863
2,467
67
269
40
4,459
739
844
2,384
67
265
54
4,353
692
843
2,331
66
254
50
4,236
685
828
2,325
69
249
45
4,201
County Services
The County operates a jail and detention system and various parking facilities, constructs and maintains roads, and
provides various levels of civil and criminal courts, a district attorney's office, a county sheriff's department, juvenile
probation and detention, parks, and certain other public health and social welfare services.
The Bexar County Hospital District which uses the assumed name University Health System (the "System"), is a political
subdivision of the State of Texas which owns and operates several health care facilities and is the major teaching facility
for the University of Texas Health Science Center. The Commissioners Court appoints the governing body of the System
and approves the System's annual budget. The financial information contained herein does not include information
concerning the System.
A-13
The financial statements of the County include the Bexar County Housing Finance Corporation, the Bexar County Health
Facilities Development Corporation, and the Bexar County Industrial Development Corporation as blended component
units.
In March, 2005, Commissioners Court recognized the Deputy Sheriff’s Association of Bexar County/International Union
of Police Associations, Local #30 (DSABC/IUPA) as the exclusive bargaining agent for collective bargaining under
Section 174.101 of the Texas Local Government Code. The DSABC/IUPA represents all Sheriff’s Office uniformed
employees in the Detention and Law Enforcement careers and a majority of the senior management. These 1,450
positions represent an annual payroll of $52.3 million.
The purpose of bargaining is to come to an agreement pertaining to wages, hours and conditions of employment and
enter into a contract between the members of the DSABC/IUPA and Bexar County. Negotiations started in October 2005
and continued with agreement reached on all articles July 21, 2006. The contract was ratified by DSABC membership
and approved by both the Sheriff’s Office and Commissioners Court on August 17, 2006.
The Wages and Benefits article includes adoption of a new step pay plan resulting in a first year average base pay
increase of 5.5% for law enforcement deputies and 6.9% for adult detention deputies. A 3.5 percent increase will be
implemented in each of the second and third years of the contract. The total cumulative investment over the three-year
contract period is $26.4 million.
RETIREMENT PROGRAM
Plan Description
The County provides retirement, disability and death benefits for all of its full-time employees through a non-traditional
defined benefit pension plan in the statewide Texas County and District Retirement System (TCDRS). The Board of
Trustees of TCDRS is responsible for the administration of the statewide agent multiple-employer public employee
retirement system which consists of 586 non-traditional defined benefit pension plans. TCDRS, in the aggregate issues
a Comprehensive Annual Financial Report (CAFR) on a calendar year basis. The CAFR is available upon written
request from the TCDRS Board of Trustees at P. O. Box 2034, Austin, Texas 78768-2034.
The plan provisions are adopted and may be amended by the governing body of the County within the options available
in the Texas state statutes governing TCDRS (TCDRS Act). Members can retire at age 60 and above with 8 or more
years of service, with 20 years of service regardless of age, or when the sum of their age and years of service equals 75
or more. Members are vested after 8 years of service but must leave their accumulated deposits in the plan to receive
any employer-financed benefit. Members who withdraw their personal deposits in a lump-sum and who are not eligible to
retire are not entitled to any amounts contributed by their employer.
Benefit amounts are determined by the sum of the employees' deposits to the plan, with interest, and employer-financed
monetary credits. The level of these monetary credits is adopted by the governing body of the employer within the
actuarial constraints imposed by the TCDRS Act, so that the resulting benefits can be expected to be adequately
financed by the employer's commitment to contribute. At retirement, death, or disability, the benefit is calculated by
converting the sum of the employee's accumulated deposits and the employer-financed monetary credits to a monthly
annuity using annuity purchase rates prescribed by the TCDRS Act.
Funding Policy
The County has elected the Annually Determined Contribution Rate (ADCR) plan provisions of the TCDRS Act. The plan
is funded by monthly contributions from both employee members and the employer based on the covered payroll of
employee members. Under the TCDRS Act, the contribution rate of the employer is actuarially determined annually.
The County contributed using the actuarially determined rate of 9.90% of covered payroll for the months of the
accounting year in 2008, and 9.9% of covered payroll for the months of the accounting year in 2009.
The deposit rate payable by all employee members for the calendar year 2009 is the rate of 7% as adopted by the
governing body of the County. The employee deposit rate and the employer contribution rate may be changed by the
governing body of the employer within the options available in the TCDRS Act.
Annual Pension Cost
For the County's accounting year ended September 30, 2009 the annual pension cost for the TCDRS plan for its
employees was $21,164,730 and the actual contributions were $21,164,730.
The annual required contributions were actuarially determined as a percent of the covered payroll of the participating
employees, and were in compliance with the GASB Statement No. 27 parameters based on the actuarial valuations as of
December 31, 2006 and December 31, 2007, the basis for determining the contribution rates for calendar years 2008
and 2009. The December 31, 2008 actuarial valuation is the most recent valuation.
A-14
Actuarial Valuation Information
Actuarial valuation date
Actuarial cost method
Amortization method
Amortization period in years
Asset valuation method
Actuarial assumptions:
Investment return*
Projected salary increases*
Inflation
Cost-of-living adjustments
December 31,2006
Entry age
Level percentage of
payroll, closed
12.3
SAF: 10-yr
Smoothed value ESF:
Fund Value
December 31, 2007
Entry age
Level percentage of
payroll, closed
12.0
SAF: 10-yr
Smoothed value ESF:
Fund Value
December 31, 2008
Entry age
Level percentage of
payroll, closed
20.0
SAF: 10-yr
Smoothed value ESF:
Fund Value
8.0%
5.3%
3.5%
0.0%
8.0%
5.3%
3.5%
0.0%
8.0%
5.3%
3.5%
0.0%
____________
* Includes inflation at the stated rate.
Trend Information
Accounting
Year Ending
Actual Pension
Cost (APC)
Percentage of
APC Contributed
Net Pension
Obligation
September 30, 2007
September 30, 2008
September 30, 2009
$18,247,585
$19,981,983
$21,164,730
100%
100%
100%
$0
$0
$0
Schedule of Funding Progress for the Retirement Plan for the Employees of Bexar County
Actuarial
Valuation
Date**
Actuarial
Value
Assets (a)
Actuarial
Accrued
Liability
(AAL) (b)
12/31/06
12/31/07
12/31/08
493,106,883
533,909,770
532,359,466
544,318,343
586,511,660
632,707,583
Unfunded
AAL
(UAAL)
(b-a)
Funded
Ratio
(a/b)
Annual
Covered
Payroll*(c)
51,211460
52,601,890
100,348,117
90.59%
91.03%
84.14%
174,803,879
189,723,874
205,997,638
UAAL as a
Percentage of
Covered
Payroll
((b-a)/c)
29.30%
27.73%
48.71%
____________
*
**
The annual covered payroll is based on the employee contribution received by TCDRS for the year ending with the valuation date.
Funding information for 12/31/2006 may differ from prior year compliance due to plan changes effective 1/1/2008.
GASB 45 – Reporting Liabilities for Other Post-Employment Benefits (OPEB)
The Governmental Accounting Standards Board has issued Statement No. 45 (“GASB 45”), “Accounting and Financial
Reporting by Employers for Post-employment Benefits Other Than Pensions”. GASB 45 establishes financial reporting
standards for other post employment benefit plans. Currently the County has established a post employment healthcare
plan for full-time regular employees that retire after January 1, 2000. This statement will require the County to accumulate
assets for the payment of post-employment healthcare benefits. In order to comply with Governmental Accounting
Standards Board (GASB) Statement 45, beginning with FY 2007-08, the County started reporting the accrued liability for
Other Post Employment Benefits (OPEB). Although this reporting is not required by law, it is part of Generally Accepted
Accounting Principles (GAAP). Furthermore, bond rating agencies such as Moody’s, Fitch, and Standard & Poor’s, have
stated that GASB 45 compliance will be considered when assigning credit ratings for local governments. In FY 2006-07,
the County retained L&E Actuaries and Consultants to do an actuarial study on the County’s potential OPEB liabilities.
This study showed that as of May 1, 2007, the County’s unfunded actuarial accrued liability (UAAL) was $118,738,300 and
the County’s annual contribution requirement (ARU) was $10,620,736 (assuming a 4.5% investment rate of return). A
second actuarial study was performed for fiscal year ending September 30, 2009 to confirm these initial findings. This
study showed that as of October 1, 2008 the County's unfunded actuarial accrued liability (UAAL) was $129,384,741, and
the County's annual contribution (ARU) was $9,764,752 (assuming a 4% investment rate return). The County has begun
to address this potential liability by contributing annually to the County's Other Post Employment Benefits Fund. The
County has continued to explore cost mitigation strategies and to develop a full funding plan to meet its OPEB liabilities. At
this time the County has not and is not contemplating entering into any contracts that obligate the County to make future
health care benefit payments and no such obligation exists under Texas law as the County, at its sole discretion, may
A-15
reduce, modify, and/or terminate any post-employment healthcare benefit plans with any County employees. It is not the
County’s intention to establish an irrevocable trust for its OPEB liabilities, but rather report this liability as prescribed by
GASB 45 and develop a structured funding mechanism with annual contributions maintained in a dedicated fund, thereby
reducing the County’s OPEB liability over a period of time.
BEXAR COUNTY, TEXAS
STATEMENT OF REVENUES, EXPENDITURES, AND
CHANGES IN GENERAL FUND BALANCE
For the Fiscal Year Ended September 30
2009
2008
REVENUES:
Ad Valorem Taxes
Other Taxes, Licenses, Fees & Permits
Intergovernmental Revenue
Fines and Court Costs
Fees on Motor Vehicles
Other Fees
Detention Board Bills
Commissions from Govt. Units
Revenue from Use of Assets
Net Decrease in Investment Fair Value
Sales Refunds and Miscellaneous
$237,371,527
12,282,471
7,327,046
23,349,658
5,317,888
11,092,240
-3,632,217
13,644,286
-5,237,073
$ 228,787,319
11,388,377
6,327,669
24,709,816
5,281,979
11,089,848
-3,369,191
17,340,769
-4,395,775
$ 213,293,692
9,810,281
5,280,520
25,653,891
5,132,575
13,018,672
-3,646,909
19,518,906
-4,199,003
$188,613,835
8,084,404
5,702,551
21,925,747
5,169,201
13,307,060
667,955
3,334,166
15,196,066
-5,573,009
$170,881,729
6,289,868
10,511,528
19,314,287
4,913,787
8,248,916
786,952
3,495,393
12,714,860
-5,810,431
TOTAL REVENUES
$319,254,406
312,690,743
299,554,449
267,573,994
242,967,751
EXPENDITURES:
General Government
Judicial
Public Safety
Education and Recreation
Public Works
Health and Public Welfare
Capital Expenditures
Debt Service
62,641,999
76,083,494
162,044,672
7,888,400
892,467
6,659,129
387,839
100,171
69,881,291
71,133,334
153,089,321
6,794,790
1,139,642
6,638,246
422,213
3,579,663
58,533,050
63,734,773
140,942,811
6,711,436
900,358
5,638,071
235,447
1,893,227
50,904,335
59,610,351
124,713,571
5,642,199
913,338
4,229,257
34,242
164,229
48,617,954
54,689,066
120,039,552
5,127,360
630,506
3,160,499
256,059
--
TOTAL EXPENDITURES
316,698,171
312,678,500
278,589,173
246,211,522
232,520,996
2,556,235
12,243
20,965,276
21,362,472
10,446,755
564,145
( 3,109,883 )
( 2,545,738 )
868,847
( 3,890,821 )
( 3,021,974 )
Excess (Deficiency) of Revenues
Over Expenditures
2007
2006
2005
OTHER FINANCING SOURCES (USES):
Operating Transfers In
Operating Transfers (Out)
Total Other Financing Sources (Uses)
17,599
(5,428,829 )
(5,411,230 )
107,790
(2,365,799 )
(2,258,009 )
416,490
(16,215,402 )
(15,799,002 )
Net Change in Fund Balance
(2,854,995 )
(2,245,766 )
5,166,274
18,816,734
7,424,781
48,726,754
$ 53,893,028
29,910,020
$ 48,726,754
22,485,239
$ 29,910,020
Beginning Fund Balance (Oct. 1)
Ending Fund Balance (Sept. 30)
51,490,183
$ 48,645,188
(2)
53,735,949
$ 51,490,183
(1)
_______________
Source: County’s Annual Financial Reports
(1)
See Note V in Comprehensive Annual Financial Report for fiscal year ended September 30, 2008 for explanation of restatement of prior
year's fund balance.
(2)
The decrease in the prior year's ending General Fund Balance of the County was primarily attributable to the planned drawdown of the
General Fund, but still leaving a General Fund surplus in excess of the County's internal fiscal policy of ten percent.
A-16
APPENDIX B
GENERAL INFORMATION REGARDING BEXAR COUNTY
This Appendix contains a brief discussion of certain economic and demographic characteristics of the area in which the
County is located. Information in this Appendix has been obtained from the sources noted. They are believed to be
reliable, although no investigation has been made to verify the accuracy of such information. Information concerning the
City of San Antonio, Texas (the “City) and its operations is included in this Appendix solely for general information; the
City is not obligated in any way to support payment of the Obligations.
Creation and Location of Bexar County
The County was organized in 1836 as one of the original counties of the Republic of Texas and is now the fourth most
populous of the 254 counties in the State of Texas. The County is located in south central Texas and is a component of
the San Antonio Metropolitan Statistical Area. The County is one of the nation's largest Metropolitan Statistical Areas
and the third in Texas. According to the United State Economic Development Intelligence System (EDIS), the 2008
population of the County was 1,641,170. The County has an area of approximately 1,248 square miles, and contains 21
other incorporated cities within its boundaries.
The principal city within the County is San Antonio, the county seat. The City covers approximately 430 square miles.
The City was founded in the early eighteenth century and was incorporated by the Republic of Texas in 1837. The City’s
2009 population estimate of 1,645,301 makes it the second largest city in Texas and the seventh largest in the United
States.
The following table provides, at the dates shown, the population of the City, the County, and the Area MSA, which
includes Bexar, Comal, Wilson and Guadalupe Counties.
Calendar
Year (a)
1920
1930
1940
1950
7960
1970
1980
1990
2000
City of
San Antonio
161,399
231,542
253,854
408,442
587,718
654,153
786,023
935,933
1,144,646
Bexar
County
202,096
292,533
338,176
500,460
687,151
830,460
988,870
1,185,394
1,392,931
Area
MSA
238,639
333,442
376,093
542,209
736,066
888,179
1,071,954
1,337,705
1,592,383
____________________
Source: U.S. Census of Population, 1920-2000 as of April 1 of the year shown.
Economic Factors
The County has a diversified economic base which is composed of agribusiness, manufacturing, construction, tourism,
medicine and the military. The County’s proximity to Mexico provides favorable conditions for international business
relations in the areas of agriculture, tourism, manufacturing, wholesale and retail markets. Approximately fifty percent
(50%) of U.S. exports to Mexico and fifty percent (50%) of Mexican exports to the U.S. pass through the City. Trade
between the United States and Mexico was valued at $45.84 billion annually in 1995 and was expected to exceed $98.00
billion in 2007. The increase in trade is largely attributed to the passage of the North American Free Trade Agreement
(NAFTA) in 1993. The City is also the headquarters for the North American Development Bank (NADBank), a bi-national
institution created by NAFTA. The intended purpose of NADBank is to help finance environmental infrastructure within
60 to 100 miles (approximately) of the US/Mexican border. With a lending capacity of $3 billion, NADBank finances
projects including water, wastewater and solid waste programs. Industries in the County range from the manufacturing of
apparel, food products, aircraft, electronics and pharmaceuticals to iron and steel products and oil well equipment. San
Antonio is a major insurance center in the southwest, serving as the headquarters for several insurance companies,
including United Services Automobile Association, the nation's 6th largest private automobile insurer and the 10th largest
homeowner’s insurer.
The medical and bio-medical industry is now the number one economic generator in the County, having an economic
impact of nearly $16.3 billion on the local economy in 2007, maintained a $4.8 billion payroll and employed 116,417
persons. One of every seven City employees works in the health care and bio-medical industry. The key components of
the health care industry are three major military medical centers, the South Texas Medical Center (which includes five
University of Texas health professional schools, nine major hospitals and 80 health-related facilities), the Southwest
Foundation for Biomedical Research, and the Southwest Research Institute.
The military presence in the County continues to be a principal component of the area economy. The active military
installations in the County include Fort Sam Houston and the Air Force Bases of Lackland and Randolph, as well as the
B-1
"privatized" installation of Brooks City-Base. These facilities provide over 72,500 defense-related jobs and an estimated
$5 billion annual direct economic impact. Although the military mission of Kelly Air Force Base concluded in 2001 as a
result of the last round of base closure and realignment process in 1995, the Air Force still retains over 2 million square
feet of lease space at the facility now known as Port San Antonio. The County also is home to Camp Bullis which offers
nearly 28,000 acres of unparalleled training infrastructure to ensure the readiness of military and government agencies.
The demand for training at Camp Bullis is strong, particularly in light of the ongoing global war on terror and its capacity
to support joint military operations and homeland security missions.
San Antonio stands to gain both military and civilian positions with the addition of a satellite campus of the National
Security Agency and additional missions added to existing bases.
In 2005, a fifth round of base closures and realignments over the last 18-years was initiated by the U.S. Department of
Defense. Final recommendations of the 2005 Defense Base Closure and Realignment Commission are recognized to
have profound effects on many communities and the people who bring them to life as well as on the uniformed men and
women embodying our Armed Forces. Recommendations were made to strategically transform the military infrastructure
to meet current and future missions of the United States of America. For the County, key recommendations are the
closure of a Defense Finance and Accounting Service field site and Brooks City-Base, as well as the realignment of
Lackland Air Force Base. Despite the closure of military missions at Brooks City-Base, several of its missions are
recommended to be relocated to Fort Sam Houston and the Air Force Bases of Lackland and Randolph so as to maximize
existing technical synergies and co-locate similar research and development activities. The recommendations also
significantly expand Fort Sam Houston to become the nation's premier military medical training base and the future home
of Army installation management, and management of family support activities and community programs. The County is
supportive of tax phase-in incentives and other economic development programs to extensively market and encourage the
commercial redevelopment of properties previously used by the military at Brooks-City Base and Kelly USA. As a result
of the Base Realignment and Closure Commission, San Antonio will see a net increase of military employment of about
9,700 and an estimated increase in investment of about $2.5 billion by 2011. While many of the military missions are
being relocated from Brooks City-Base, private development is increasing with the continued expansion of Port San
Antonio, the expansions of DPT Laboratories, and the recent announcement by Southeast Baptist Hospital System of
plans to build a hospital at Brooks City-Base.
Agribusiness is still a leading industry in the County. The agricultural industry is not limited to farmers and ranchers, but
includes storage, processing and distribution of farm commodities and products made from them.
The cornerstone of the manufacturing sector is the Toyota Tundra manufacturing facility. In November 2006, the first
Toyota Tundra rolled off the assembly line in the City. Toyota expects to produce 200,000 trucks per year and have a
payroll exceeding $37 million for 2,000 jobs. The facility covers 2,000 acres and represents an investment of $850
billion. The 21 on-site suppliers will employ 2,100 people and represent an additional investment of over $300 million
(Source: Toyota). As the trucks roll off the line, the jobs also spin off, possibly adding 5,300 to 13,000 new jobs to Bexar
County in associated industries (Source: TWC). Union Pacific's new intermodal railroad facility near the Toyota plant will
open in 2008, and the company is investing in infrastructure improvements to railways in and around Bexar County
(Source: Union Pacific).
In July 2008, Toyota announced that the plant would shut down production for 90 days. During this temporary cessation of
the Toyota Tundra production, all 2,000 permanent employees remained at the plant with a focus on training and nonmanufacturing duties. The 21 Toyota suppliers at the site, providing another 2,000 jobs, also remained and retained the
majority of their workforce with expectations that the plant would resume production in November 2008. Production
resumed on November 10, 2008, at which time the plant assumed production responsibilities for all domestic Toyota
Tundras.
Toyota's presence in San Antonio increased in August 2009 when Toyota confirmed it was moving the production of the
Tacoma pickup to its San Antonio facility. The move could add as many as 1,100 new jobs and return the plants on-site
suppliers to full capacity employing hundreds more. The addition of a second vehicle, estimated to be 100,000 Tacoma
pickups yearly, returns the plant to two shifts and means that 80% of Toyota's pickups will be made in San Antonio.
The financial services sector is growing faster in the City than any other metropolitan area at an annual rate of 4.7
percent. The financial industry has become an important component of the Bexar County economy. There are eight
financial institutions headquartered in San Antonio and four regional headquarters located in the city. The financial
industry is the third largest employer with over 50,000 employees, and has the highest employee pay with an average
salary of $52,614, over $18,000 higher than the area average salary (Source: City of San Antonio).
In June 2005, Washington Mutual announced its selection of San Antonio as the location of its new regional operations
center and the purchase of the former MCI San Antonio campus located at 20855 Stone Oak, a three-building campus
with 405,000 square feet of prime office space that can accommodate as many as 2,250 employees, and can be
expanded to accommodate as many as 4,200 employees. In one of the largest job creation announcements in the United
States so far this year, Washington Mutual committed to bringing as many as 4,200 jobs to Texas over the next seven
years with up to 3,000 of those jobs based in San Antonio. \
B-2
In September 2008, the federal Office of Thrift Supervision closed Washington Mutual (“WAMU”), and the Federal Deposit
Insurance Corporation (“FDIC”) then became the receiver of WAMU. FDIC then sold the assets and most of WAMU’s
liabilities to JP Morgan Chase Bank (“Chase”). Both Chase and WAMU have major customer service centers in the City
along with retail banking operations, each employing about 2,000 people. Each of these customer service centers serves a
different set of customers. While there may be some closure and consolidation of WAMU banking operations, the City has
stated that it does not expect WAMU’s customer service center to close nor does the City expect to lose a significant
number of WAMU jobs in the community.
On October 3, 2008, Wells Fargo announced its acquisition of Wachovia, which operates a major customer service center
in the City. Based on available information, it does not appear this back office operation will be affected by this acquisition
and integration of the two major financial institutions. Wachovia currently has a major presence in the City, employing
approximately 3,300 people.
Headquartered in the City, Rackspace Managed Hosting is the fastest growing manage hosting specialist in the world.
The company was founded in San Antonio in 1998 and currently manages more than 22,000 servers in seven data
centers in Europe and the U.S. Rackspace was awarded a $22 million grant from the Texas Enterprise Fund as part of
an incentive package to help Rackspace relocate within Bexar County and create up to 4,000 new jobs. The company is
spending more than $100 million to convert a 1.2 million square foot mall located on a 68 acre-tract and has already
converted over 600,000 square feet of the former mall. Rackspace could increase its local employment from nearly 2,000
to as much as 6,000 over the next 5 years with an annual payroll of approximately $300 million.
In May 2009, Medtronic, Inc. announced San Antonio as its home of its new Diabetes Therapy Management and
Education Center, which is expected to hire nearly 1,400 professionals during a five-year period to staff the new 150,000square-foot facility. Based on analyses made by the San Antonio Economic Development Foundation, when fully staffed,
the new operation is expected to generate more than $750 million in economic benefit for San Antonio and Texas each
year, which includes an investment of more than $23 million in capital improvements.
Also in May 2009, the Air Force selected San Antonio as its preferred location for its new cyber command. Lackland Air
Force Base will be the center for the new unit, known formerly as the 24th Air Force Command. The unit is slated to have
up to a $1 billion budget, create up to 400 military and civilian jobs, and have an annual payroll of $40 million to $45
million once fully funded. The selection further bolsters San Antonio as a military community and strengthens its
economy.
The San Antonio River Improvement Project, an investment by the City, the County, and the U.S. Army Corps of
Engineers with the San Antonio River Authority providing project and technical management, recently completed the
northern portion of its flood control, amenities, ecosystem restoration and recreational improvements to the San Antonio
River. The Museum Reach, as the northern portion is known, extends from the downtown area north to the San Antonio
Museum of Art and the 125-year-old Pearl Brewery building, where shopping, dining, and entertainment venues are
planned. The southern portion, known as the Mission Reach, is already underway and will connect the downtown river
area to the historic missions in the southern part of San Antonio.
The National Security Agency (NSA) has a formidable presence in South Texas employing over two thousand people in
San Antonio. In 2007, the NSA announced the establishment of a new facility at an old Sony microchip plant that is now
known as the Texas Cryptology Center. The 470,000-square-foot facility represents an investment of over $100 million
by the NSA to renovate the old plant which will house a data center geared toward cybersecurity.
The City is one of the top convention cities in the country. The City is proactive in attracting convention business through
its management practices and marketing efforts. The following table shows both overall City performance as well as
convention activity booked and hosted by the City's Convention & Visitors Bureau for the years indicated:
Calendar
(a)
Year
Attendance
Room Nights
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
389,448
419,970
483,452
429,549
491,287
503,601
467,426
455,256
563,164
399,408
696,215
712,189
693,921
613,747
621,640
699,932
736,659
644,431
691,525
660,736
___________
(a)
Figures based on expenditures per Convention delegate party.
B-3
Estimated
Delegate
Expenditures
($ Millions)
350.8
378.3
435.5
387.0
510.5
523.3
485.8
473.1
607.5
474.3
Employment Statistics
The following table indicates the total civilian employment in the County for the period 2005 through 2009.
Civilian Labor Force
Total Employment
Total Unemployment
Unemployment Rate
Texas Unemployment Rate
Annual
2009
Annual
2008
Annual
2007
Annual
2006
Annual
2005
765,017
712,970
52,047
6.8%
7.6%
746,758
711,019
35,746
4.8%
4.9%
732,800
702,203
30,597
4.2%
4.4%
727,670
693,573
30,597
4.7%
4.9%
715,837
679,501
36,336
5.1%
5.4%
_____________
Source: Texas Workforce Commission.
Education
The County encompasses 19 independent school districts, which includes over 400 schools. Enrollment ranges
anywhere from nearly 900 in Lackland ISD to over 91,000 in Northside ISD, the fourth largest independent school district
in Texas. Students attend school districts in which they reside with no busing in effect. In addition, San Antonio has over
150 private and parochial schools at all education levels.
San Antonio has 20 institutions of higher learning offering degrees in all major fields of study, many at the graduate level.
Among universities, the University of Texas at San Antonio (UTSA) has over 28,000 students enrolled and has
represented many first-time college students within their family. In May of 2009, The Texas A&M University San Antonio
became the newest four-year college in San Antonio. Among junior colleges, Alamo Colleges includes five colleges, San
Antonio, Palo Alto, Saint Philips, Northeast Lakeview, and Northwest Vista, totaling over 53,000 students enrolled.
2009 Fifteen Largest Employers
Firm Name
Total
Category
Fort Sam Houston
Lackland AFB/37th Training Wing(1)
H.E.B. Grocery Company
Northside Independent School District
USAA
Randolph Air Force Base
City of San Antonio
Northeast Independent School District
San Antonio Independent School District
Methodist Healthcare System
UT Health Science Center At San Antonio
Baptist Health System
University Health System
Tesoro Corporation
Bexar County
30,793
28,100
20,500
15,925
14,589
10,700
9,000
8,507
7,547
7,154
6,217
6,190
5,322
5,620
4,711
Government
Government
Retail
Services
Finance/Insurance
Government
Government
Services
Services
Medical
Medical
Medical
Medical
Gas and Oil/Retail
Government
Total
180,875
_____________
Source: San Antonio Business Journal Book of Lists 2010, Greater San Antonio Chamber of Commerce and confirmation from
individual corporate human resource offices.
(1)
Includes military personnel and their dependents and civilian personnel.
B-4
Growth Indices (City of San Antonio)
As Of
12/31
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
CPS Energy(a)
Electric
Gas
Customers
Customers
516,679
528,302
586,884
545,605
550,000
563,100
578,300
592,195
604,108
602,313
638,344
639,001
662,131
681,295
700,378
297,654
299,140
327,444
301,491
302,000
303,900
305,800
306,668
310,310
306,845
310,699
310,860
314,785
319,261
321,436
____________
(a)
(b)
Source: CPS Energy.
Source: San Antonio Water System.
B-5
Water
Customers(b)
266,308
269,405
273,276
279,209
282,209
288,803
300,296
293,299
302,880
310,433
317,214
331,476
344,168
348,834
352,059
APPENDIX C
BEXAR COUNTY, TEXAS
ANNUAL FINANCIAL REPORT
For the Year Ended September 30, 2009
APPENDIX D
Forms of Opinions of Bond Counsel
Fulbright & Jaworski l.l.p.
A Registered Limited Liability Partnership
300 Convent Street, Suite 2200
San Antonio, Texas 78205-3792
www.fulbright.com
telephone: (210) 224-5575
facsimile:
(210) 270-7205
FINAL
IN REGARD to the authorization and issuance of the “Bexar County, Texas Combination Tax
and Revenue Certificates of Obligation, Series 2010A” (the Certificates), dated July 15, 2010 in the
aggregate principal amount of $97,455,000, we have reviewed the legality and validity of the issuance
thereof by the Commissioners Court of Bexar County, Texas (the Issuer). The Certificates are issuable in
fully registered form only, in denominations of $5,000 or any integral multiple thereof, and have Stated
Maturities of June 15 in each of the years 2011 through 2032, June 15, 2034, and June 15, 2036, unless
mandatorily or optionally redeemed prior to Stated Maturity in accordance with the terms stated on the
face of the Certificates. Interest on the Certificates accrues from the dates, at the rates, in the manner, and
is payable on the dates, all as provided in the order (the Order) authorizing the issuance of the
Certificates.
WE HAVE SERVED AS BOND COUNSEL for the Issuer solely to pass upon the legality and
validity of the issuance of the Certificates under the laws of the State of Texas and with respect to the
exclusion of the interest on the Certificates from the gross income of the owners thereof for federal
income tax purposes and for no other purpose. We have not been requested to investigate or verify, and
have not independently investigated or verified, any records, data, or other material relating to the
financial condition or capabilities of the Issuer. We have not assumed any responsibility with respect to
the financial condition or capabilities of the Issuer or the disclosure thereof in connection with the sale of
the Certificates. We express no opinion and make no comment with respect to the sufficiency of the
security for or the marketability of the Certificates. Our role in connection with the Issuer’s Official
Statement prepared for use in connection with the sale of the Certificates has been limited as described
therein.
WE HAVE EXAMINED the applicable and pertinent laws of the State of Texas and the United
States of America. In rendering the opinions herein we rely upon (1) original or certified copies of the
proceedings of the Commissioners Court of the Issuer in connection with the issuance of the Certificates,
including the Order; (2) customary certifications and opinions of officials of the Issuer; (3) certificates
executed by officers of the Issuer relating to the expected use and investment of proceeds of the
Certificates and certain other funds of the Issuer, and to certain other facts solely within the knowledge
and control of the Issuer; and (4) such other documentation, including an examination of the Certificate
executed and delivered initially by the Issuer, and such matters of law as we deem relevant to the matters
discussed below. In such examination, we have assumed the authenticity of all documents submitted to
us as originals, the conformity to original copies of all documents submitted to us as certified copies, and
the accuracy of the statements and information contained in such certificates. We express no opinion
concerning any effect on the following opinions which may result from changes in law effected after the
date hereof.
BASED ON OUR EXAMINATION, IT IS OUR OPINION that the Certificates have been duly
authorized and issued in conformity with the laws of the State of Texas now in force and that the
Certificates are valid and legally binding obligations of the Issuer enforceable in accordance with the
terms and conditions described therein, except to the extent that the enforceability thereof may be affected
by bankruptcy, insolvency, reorganization, moratorium, or other similar laws affecting creditors’ rights or
the exercise of judicial discretion in accordance with general principles of equity. The Certificates are
Legal Opinion of Fulbright & Jaworski L.L.P. in connection with the authorization and issuance of
“BEXAR COUNTY, TEXAS COMBINATION TAX AND REVENUE CERTIFICATES OF
OBLIGATION, SERIES 2010A”
payable from the levy of an ad valorem tax, within the limitations prescribed by law, upon all taxable
property in the Issuer and are additionally payable from and equally and ratably secured by a lien on and
pledge of the Pledged Revenues (as defined in the Order) derived from the operation of the Issuer’s
parking facilities, such lien being on a parity with the currently outstanding Obligations Similarly Secured
(as defined in the Order); however, such lien on and pledge of the Pledged Revenues will be subordinate
and inferior to the lien on and pledge of Net Revenues securing payment of any Prior Lien Bonds or
Additional Revenue Obligations hereafter issued by the Issuer. In the Order, the Issuer retains the right to
issue Prior Lien Bonds, Additional Revenue Obligations, and Additional Parity Obligations (all as defined
in the Order) without limitation as to principal amount but subject to any terms, conditions, or restrictions
as may be applicable thereto under law or otherwise.
IT IS FURTHER OUR OPINION THAT, assuming continuing compliance after the date hereof
by the Issuer with the provisions of the Order and in reliance upon the representations and certifications
of the Issuer made in a certificate of even date herewith pertaining to the use, expenditure, and investment
of the proceeds of the Certificates, under existing statutes, regulations, published rulings, and court
decisions (1) interest on the Certificates will be excludable from the gross income, as defined in section
61 of the Internal Revenue Code of 1986, as amended to the date hereof (the Code), of the owners thereof
for federal income tax purposes, pursuant to section 103 of the Code, and (2) interest on the Certificates
will not be included in computing the alternative minimum taxable income of the owners thereof.
WE EXPRESS NO OTHER OPINION with respect to any other federal, state, or local tax
consequences under present law or any proposed legislation resulting from the receipt or accrual of
interest on, or the acquisition or disposition of, the Certificates. Ownership of tax-exempt obligations
such as the Certificates may result in collateral federal tax consequences to, among others, financial
institutions, life insurance companies, property and casualty insurance companies, certain foreign
corporations doing business in the United States, S corporations with subchapter C earnings and profits,
owners of an interest in a financial asset securitization investment trust, individual recipients of Social
Security or Railroad Retirement Benefits, individuals otherwise qualifying for the earned income credit,
and taxpayers who may be deemed to have incurred or continued indebtedness to purchase or carry, or
who have paid or incurred certain expenses allocable to, tax-exempt obligations.
OUR OPINIONS ARE BASED on existing law, which is subject to change. Such opinions are
further based on our knowledge of facts as of the date hereof. We assume no duty to update or
supplement our opinions to reflect any facts or circumstances that may thereafter come to our attention or
to reflect any changes in any law that may thereafter occur or become effective. Moreover, our opinions
are not a guarantee of result and are not binding on the Internal Revenue Service; rather, such opinions
represent our legal judgment based upon our review of existing law that we deem relevant to such
opinions and in reliance upon the representations and covenants referenced above.
www.fulbright.com
telephone: (210) 224-5575
facsimile:
(210) 270-7205
FINAL
IN REGARD to the authorization and issuance of the “Bexar County, Texas Combination Tax
and Revenue Certificates of Obligation, Taxable Series 2010B (Direct Subsidy - Build America Bonds)”
(the Certificates), dated July 15, 2010 in the aggregate principal amount of $30,325,000, we have
reviewed the legality and validity of the issuance thereof by the Commissioners Court of Bexar County,
Texas (the Issuer). The Certificates are issuable in fully registered form only, in denominations of $5,000
or any integral multiple thereof, and have a Stated Maturity of June 15, 2040, unless optionally or
mandatorily redeemed prior to Stated Maturity in accordance with the terms stated on the face of the
Certificates. Interest on the Certificates accrues from the dates, at the rates, in the manner, and is payable
on the dates, all as provided in the order (the Order) authorizing the issuance of the Certificates.
validity of the issuance of the Certificates under the laws of the State of Texas and for no other purpose.
We have not been requested to investigate or verify, and have not independently investigated or verified,
any records, data, or other material relating to the financial condition or capabilities of the Issuer. We
have not assumed any responsibility with respect to the financial condition or capabilities of the Issuer or
the disclosure thereof in connection with the sale of the Certificates. We express no opinion and make no
comment with respect to the sufficiency of the security for or the marketability of the Certificates. Our
role in connection with the Issuer’s Official Statement prepared for use in connection with the sale of the
Certificates has been limited as described therein.
proceedings of the Commissioners Court of the Issuer in connection with the issuance of the Certificates,
including the Order; (2) customary certifications and opinions of officials of the Issuer; and (3) such other
documentation, including an examination of the Certificate executed and delivered initially by the Issuer,
and such matters of law as we deem relevant to the matters discussed below. In such examination, we
have assumed the authenticity of all documents submitted to us as originals, the conformity to original
copies of all documents submitted to us as certified copies, and the accuracy of the statements and
information contained in such certificates. We express no opinion concerning any effect on the following
opinions which may result from changes in law effected after the date hereof.
BASED ON OUR EXAMINATION, IT IS OUR OPINION that the Certificates have been duly
authorized and issued in conformity with the laws of the State of Texas now in force and that the
Certificates are valid and legally binding obligations of the Issuer enforceable in accordance with the
terms and conditions described therein, except to the extent that the enforceability thereof may be affected
by bankruptcy, insolvency, reorganization, moratorium, or other similar laws affecting creditors’ rights or
the exercise of judicial discretion in accordance with general principles of equity. The Certificates are
payable from the levy of an ad valorem tax, within the limitations prescribed by law, upon all taxable
property in the Issuer and are additionally payable from and equally and ratably secured by a lien on and
pledge of the Pledged Revenues (as defined in the Order) derived from the operation of the Issuer’s
parking facilities, such lien being on a parity with the currently outstanding Obligations Similarly Secured
(as defined in the Order); however, such lien on and pledge of the Pledged Revenues will be subordinate
and inferior to the lien on and pledge of Net Revenues securing payment of any Prior Lien Bonds or
“BEXAR COUNTY, TEXAS COMBINATION TAX AND REVENUE CERTIFICATES OF
OBLIGATION, TAXABLE SERIES 2010B (DIRECT SUBSIDY - BUILD AMERICA BONDS)”
Additional Revenue Obligations hereafter issued by the Issuer. In the Order, the Issuer retains the right to
issue Prior Lien Bonds, Additional Revenue Obligations, and Additional Parity Obligations (all as defined
in the Order) without limitation as to principal amount but subject to any terms, conditions, or restrictions
as may be applicable thereto under law or otherwise.
are not a guarantee of result; rather, such opinions represent our legal judgment based upon our review of
existing law that we deem relevant to such opinions and in reliance upon the representations and
covenants referenced above.
www.fulbright.com
telephone: (210) 224-5575
facsimile:
(210) 270-7205
FINAL
IN REGARD to the authorization and issuance of the “Bexar County, Texas Limited Tax General
Obligation Bonds, Series 2010” (the Bonds), dated July 15, 2010 in the aggregate principal amount of
$24,020,000, we have reviewed the legality and validity of the issuance thereof by the Commissioners
Court of Bexar County, Texas (the Issuer). The Bonds are issuable in fully registered form only, in
denominations of $5,000 or any integral multiple thereof, and have Stated Maturities of June 15 in each of
the years 2011 through 2027, June 15, 2030, June 15, 2034, and June 15, 2040, unless optionally or
mandatorily redeemed prior to Stated Maturity in accordance with the terms stated on the face of the
Bonds. Interest on the Bonds accrues from the dates, at the rates, in the manner, and is payable on the
dates, all as provided in the order (the Order) authorizing the issuance of the Bonds.
validity of the issuance of the Bonds under the laws of the State of Texas and with respect to the
exclusion of the interest on the Bonds from the gross income of the owners thereof for federal income tax
purposes and for no other purpose. We have not been requested to investigate or verify, and have not
independently investigated or verified, any records, data, or other material relating to the financial
condition or capabilities of the Issuer. We have not assumed any responsibility with respect to the
financial condition or capabilities of the Issuer or the disclosure thereof in connection with the sale of the
Bonds. We express no opinion and make no comment with respect to the sufficiency of the security for
or the marketability of the Bonds. Our role in connection with the Issuer’s Official Statement prepared
for use in connection with the sale of the Bonds has been limited as described therein.
proceedings of the Commissioners Court of the Issuer in connection with the issuance of the Bonds,
including the Order; (2) customary certifications and opinions of officials of the Issuer; (3) certificates
executed by officers of the Issuer relating to the expected use and investment of proceeds of the Bonds
and certain other funds of the Issuer, and to certain other facts solely within the knowledge and control of
the Issuer; and (4) such other documentation, including an examination of the Certificate executed and
delivered initially by the Issuer, and such matters of law as we deem relevant to the matters discussed
below. In such examination, we have assumed the authenticity of all documents submitted to us as
originals, the conformity to original copies of all documents submitted to us as certified copies, and the
accuracy of the statements and information contained in such certificates. We express no opinion
concerning any effect on the following opinions which may result from changes in law effected after the
date hereof.
BASED ON OUR EXAMINATION, IT IS OUR OPINION that the Bonds have been duly
authorized and issued in conformity with the laws of the State of Texas now in force and that the Bonds
are valid and legally binding obligations of the Issuer enforceable in accordance with the terms and
conditions described therein, except to the extent that the enforceability thereof may be affected by
bankruptcy, insolvency, reorganization, moratorium, or other similar laws affecting creditors’ rights or the
exercise of judicial discretion in accordance with general principles of equity. The Bonds are payable
“BEXAR COUNTY, TEXAS LIMITED TAX GENERAL OBLIGATION BONDS, SERIES 2010”
from the levy of an ad valorem tax, within the limitations prescribed by law, upon all taxable property in
the Issuer.
IT IS FURTHER OUR OPINION THAT, assuming continuing compliance after the date hereof
by the Issuer with the provisions of the Order and in reliance upon the representations and certifications
of the Issuer made in a certificate of even date herewith pertaining to the use, expenditure, and investment
of the proceeds of the Bonds, under existing statutes, regulations, published rulings, and court decisions
(1) interest on the Bonds will be excludable from the gross income, as defined in section 61 of the Internal
Revenue Code of 1986, as amended to the date hereof (the Code), of the owners thereof for federal
income tax purposes, pursuant to section 103 of the Code, and (2) interest on the Bonds will not be
included in computing the alternative minimum taxable income of the owners thereof.
WE EXPRESS NO OTHER OPINION with respect to any other federal, state, or local tax
consequences under present law or any proposed legislation resulting from the receipt or accrual of
interest on, or the acquisition or disposition of, the Bonds. Ownership of tax-exempt obligations such as
the Bonds may result in collateral federal tax consequences to, among others, financial institutions, life
insurance companies, property and casualty insurance companies, certain foreign corporations doing
business in the United States, S corporations with subchapter C earnings and profits, owners of an interest
in a financial asset securitization investment trust, individual recipients of Social Security or Railroad
Retirement Benefits, individuals otherwise qualifying for the earned income credit, and taxpayers who
may be deemed to have incurred or continued indebtedness to purchase or carry, or who have paid or
incurred certain expenses allocable to, tax-exempt obligations.
are not a guarantee of result and are not binding on the Internal Revenue Service; rather, such opinions
represent our legal judgment based upon our review of existing law that we deem relevant to such
opinions and in reliance upon the representations and covenants referenced above.
Co- Financial Advisory Services
Provided By:
and

OFFICIAL STATEMENT DATED AUGUST 4, 2010 NEW ISSUE

Transcription

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