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HUDSON CITY SCHOOL DISTRICT
SUMMIT COUNTY, OHIO

NOTES TO THE BASIC FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED JUNE 30, 2015

NOTE 8 - LONG-TERM OBLIGATIONS - (Continued)

Series 2003 Refunding General Obligation Bonds

On August 19, 2003, the District issued general obligation bonds (Series 2003 School Improvement
Refunding bonds) to advance refund the callable portion of the Series 1993 School Improvement
General Obligation Bonds (principal $7,245,000; interest rate 7.10%). The issuance proceeds were
used to purchase securities which were placed in an irrevocable trust to provide resources for all future
debt service payments on the refunded debt. This refunded debt is considered defeased (in substance)
and accordingly, has been removed from the statement of net position.

The refunding issue is comprised of both current interest bonds par value $6,045,000, and capital
appreciation bonds, par value $1,199,964. The interest rates on the current interest bonds range from
2.0%-4.0%. The capital appreciation bonds matured on December 15, 2011 at an accreted value at
maturity of $2,280,000. The current interest bonds matured on December 15, 2014.

Certificates of Participation, Series 2012 Refunding

The refunding certificates of participation (COPs) were issued on July 10, 2012 in order to advance
refund the previously outstanding COPs issue. The refunding issue consisted of serial COPs, par value
$13,570,000, and term COPs, par value $5,155,000. The refunding COPs range in interest rates from
2.0% - 4.0% and the final maturity date stated in the issue is June 1, 2034.

The issuance proceeds of $18,725,000 were used to purchase securities which were placed in an
irrevocable trust to provide resources for all future debt service payments on the refunded debt. This
refunded debt in considered defeased (in substance) and accordingly has been removed from the
statement of net position. At June 30, 2015, $18,810,000 of this debt was outstanding.

Energy Conservation Bonds

The energy conservation bonds were issued during fiscal year 2010. The proceeds were used to
finance improvements throughout the District for the purpose of reducing future energy costs. These
improvements are not capital in nature and were not added to the District’s capital assets; therefore, the
bonds are not included in the District’s net investment in capital assets. The bonds bear an interest rate
ranging from 2.00% to 4.00% and mature on December 1, 2021. Debt payments will be made from the
general fund from the savings on energy costs resulting from the improvements.

Qualified School Construction Bonds

The qualified school construction bonds were issued during fiscal year 2010. The proceeds were used
to finance various energy improvements throughout the District. The bonds bear an interest rate of
1.69%. Payments on the bonds, which mature on September 15, 2024, are made from the general
fund.

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