Larkspur-Corte Madera School District
Providing interim funding for voter-approved facility improvements
Background & Opportunity
Larkspur-Corte Madera School District, located in Marin County, serves approximately 1,100 students through two elementary schools and one middle school in the communities of Larkspur and Corte Madera.
In June 2026, District voters approved a $44.0 million general obligation bond measure to finance the acquisition, construction, modernization and equipping of school sites and facilities. The District needed approximately $10.0 million to begin facility projects before issuing long-term bonds under the authorization.
On September 1, 2026, Baird’s California K-12 Public Finance group served as sole managing underwriter for the District’s $9,999,474 2026 General Obligation Bond Anticipation Notes. The BANs carried an AA+ rating with a stable outlook from S&P.
Solution & Implementation
The BANs were structured as zero-coupon capital appreciation notes maturing on September 1, 2030. Rather than paying interest on a current basis, the notes accrete in value through maturity. The financing also included a non-standard stepped premium call provision, allowing the District to redeem the BANs beginning September 1, 2028, at 102% of their accreted value, with the redemption price declining to 101% beginning September 1, 2029.
To support investor understanding of the structure and the District’s financing plan, Baird conducted an in-depth pre-marketing process ahead of pricing. The underwriting team engaged key accounts to answer questions about the purpose of the BANs, the District’s future general obligation bonding capacity and the rationale for the stepped call provision.
Despite the zero-coupon format and non-standard call provision, the order book reached 3.1x the amount offered, with participation from major institutional buyers, high-grade bond funds and California-focused investors. Investor demand allowed the financing team to reduce yields from initial pricing levels, resulting in a final yield of 3.27%
Results & Impact
The financing provided approximately $10.0 million for the acquisition, construction, modernization and equipping of District sites and facilities, allowing the District to begin advancing projects while continuing to implement its broader capital improvement program.
