Oak Grove School District
Delivering Cost-Effective Financing for Voter-Approved School Improvements
Background
Oak Grove School District (the “District”) is located in the City of San José in Santa Clara County and serves students in transitional kindergarten through eighth grade. The District operates fifteen elementary schools and three intermediate schools, with enrollment of approximately 8,365 students for the 2025–2026 academic year.
In November 2022, voters approved Measure P, authorizing up to $236 million of general obligation bonds to support facility modernization, technology enhancements, safety and security improvements, and other capital needs. The 2022 Election, Series B bonds represent the third issuance under this authorization.
On January 15, 2026, Baird’s California K-12 Public Finance group served as sole managing underwriter for the District’s $71,500,000 General Obligation Bonds, 2022 Election, Series B, rated Aa3 by Moody’s.
Opportunity
In January 2026, the District entered the municipal market to support voter-approved capital projects while benefiting from strong demand for high-quality California school district bonds. Although U.S. Treasury markets softened modestly following the release of initial jobless claims, municipal market performance remained resilient. This favorable environment allowed the District to borrow at attractive interest rates while maintaining flexibility in how the bonds were structured over time.
Solution & Implementation
Baird structured the bonds with a range of repayment dates, including annual maturities from 2027 through 2048 and longer-term bonds maturing in 2051 and 2054, providing investors with multiple options while allowing the District to spread repayment over time.
Building on strong investor interest in comparable California school district transactions earlier in the week, many of which saw interest rate improvements of 5 to 13 basis points, the financing team introduced the bonds at competitive levels. While pricing adjustments were limited in the earlier maturities, longer-term bonds maturing between 2041 and 2054 attracted heightened demand.
As a result, interest rates on these longer-term bonds were lowered by approximately 3 to 12 basis points. Demand for the 2054 bond was particularly strong, with orders reaching about 13x the amount available before pricing adjustments. Even after pricing was revised, the 2054 maturity ultimately closed approximately 4.5x subscribed.
Results & Impact
The successful execution enabled the District to secure attractive borrowing costs while advancing critical facility and technology improvements authorized by voters. Overall, the transaction highlights continued investor appetite for high-quality California school district credits and demonstrates the value of disciplined premarketing, strategic pricing, and active investor engagement.