Deal of the Year 2018 — Small Issuer: Jefferson Union High School District

The lack of affordable rental housing for teachers is putting school districts across the country at a competitive disadvantage. Some districts have addressed the challenge by acquiring rental units, which reduces the availability of units on the open market. Others have financed new apartments, which produce income insufficient to meet debt service and expenses without encroaching on their general funds.

Jefferson Union High School District, in San Mateo, California, found a way to avoid those pitfalls. After a random survey found support for a $33 million general obligation bond to build roughly 100 below-market rental housing units, the district put a bond measure on the ballot that 60% of voters approved.

The $5 million Series A Teacher-Staff Housing G.O. Bonds represent the first of two planned financings. It will fund planning, design and site development. A subsequent series will fund construction.

Believed to be the first voter-approved teacher-staff housing G.O. in the nation, the deal makes the district more competitive in attracting highly qualified employees, improves the local economy by increasing the number of employees living in the community, and uses a financial structure that doesn’t put its general fund at risk.