Trustees of the Amador County Unified School District on Thursday adopted a resolution directing defeasance of the district's 2024 certificates of participation, authorizing staff and counsel to place remaining COP proceeds into an irrevocable escrow and to amend the underlying trust and escrow documents to remove the debt from the district's books.

The action, approved unanimously, follows months of analysis by the district's financial advisers and bond counsel and comes as the district reconsiders previously planned construction tied to the COP proceeds. Superintendent Critchfield introduced the item and framed it as a financial necessity, saying continued annual payments of roughly $1.3 million would not be viable for the district's long-term budget.

Shin Green of E Shore Consulting told trustees the COPs were issued in January 2024 as tax-exempt lease-financing to fund consolidation and facility work; proceeds were placed in a project fund and reserve and invested. Because there is now no active construction project tied to those dollars, Green said the district can place the remaining proceeds and reserves into an irrevocable escrow structured to earn fixed returns and make the scheduled payments to investors through an early redemption date of Aug. 1, 2033. "Once the funds are on deposit and validated by a verification agent and counsel," Green said, "the obligation would be satisfied in substance and the COP would no longer be the district's responsibility."

Dan Marruccia of Lozano Smith, serving as bond counsel, described the board's vote as a remedial action under federal tax rules to abandon the original use of proceeds and to reallocate those resources to repay the investors. He said amendments to the trust agreement and an escrow agreement would be executed if the board approved the resolution.

Trustees asked about costs and timing. Director of Fiscal Services Robert Norton explained that at issuance roughly $15 million was placed in the project fund, about $1.3 million in a debt service reserve, and roughly $750,000 was used to capitalize interest for the construction period; issuance and underwriting costs totaled roughly $176,000 and $122,000, respectively. Norton said the district's only out-of-pocket payment to date was a principal payment of $489,691.51 made Aug. 1, 2025. Green said transaction fees for verification, banking and legal work would be modest and largely paid from the COP proceeds; trustees were given cost estimates of several thousand dollars each for a verification agent and escrow agent and low five-figure legal costs as the high-end possibility.

Trustee Ken moved the resolution and Trustee Peter seconded. After discussion the board voted yes: Claire (yes), Peter (yes), Ken (yes), Shane (yes), James (aye) and Board President Kayla Parker (yes).

Officials said they expect to complete the escrow purchase and defeasance in early December, targeting Dec. 2 if market conditions permit; the process requires deposits to escrow within 90 days of the board resolution. Green and Marruccia said that, if completed as planned, the escrow would make semiannual payments on the COPs and the remaining balance would be used to fully redeem the certificates on Aug. 1, 2033, at which point the obligation will be satisfied and removed from district financial reporting.

The board approved the resolution and authorized staff, counsel and the district's financial adviser to take all necessary actions to implement the defeasance within the parameters described.