On June 27, 2019, the District issued its $40,509,000 West Contra Costa Healthcare District (Contra Costa County, California) Refunding Revenue Bonds, Series 2019 (Taxable Converting to Tax-Exempt) (the “2019 Bonds”), pursuant to an Indenture of Trust, dated as of June 1, 2019 (the “Indenture”), to refund, on an advance basis, its then outstanding West Contra Costa Healthcare District Certificates of Participation (2011 Financing Project) (the “2011 COPs”).  
  
Because of limitations under the Internal Revenue Code of 1986, as amended (the “Code”), the 2011 COPs could not be refunded on a tax-exempt basis. Due to this limitation, the 2019 Bonds were issued as taxable bonds that could convert to tax-exempt bonds within 90 days of the optional redemption date of the 2011 COPs. The first date when the conversion to a tax-exempt rate could take place was April 2, 2021. Upon election to convert the bonds to tax-exempt status, the interest rate applicable to the 2019 Bonds decreases from 5.000% to 4.125%.  
  
It is estimated that the taxable converting to tax-exempt structure of the 2019 Bonds will result in approximately $9,600,00 in total savings. To effectuate this structure, it is recommended that the District elect to convert the interest rate with respect to the 2019 Bonds from taxable to tax-exempt.  
  
On March 23, 2021, the Board acknowledged that recommendation of the District’s Finance Committee to approve a resolution to initiate the tax conversion.

If this item is not adopted the interest rate with respect to the 2019 Bonds will not convert from taxable to tax-exempt, resulting in lost savings.