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Capital Funding 14 December 2009 Sustainability

Capital Funding 14 December 2009 Sustainability. Robert Bennett CFO. Outline. 10 year sustainability profile Importance of setting precedents ESF Funding Strategy - Capital Projects. Age and Floor Area of ESF Schools. Age and Floor Area of ESF Schools. Sustainability. SC/SJS $60M

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Capital Funding 14 December 2009 Sustainability

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  1. Capital Funding 14 December 2009Sustainability Robert Bennett CFO

  2. Outline • 10 year sustainability profile • Importance of setting precedents • ESF Funding Strategy - Capital Projects

  3. Age and Floor Area of ESF Schools

  4. Age and Floor Area of ESF Schools

  5. Sustainability SC/SJS $60M SIS $26M WIS $52M SIS $75M

  6. Gov’t Funding Status • Current Projects (First 10 years) • KJS $420M • ESF could fund, but Gov’t funding imperative • Establish the precedent • KGV $240M • ESF could fund – Gov’t funding level to be tested • IS $600-800++M • ESF cannot fund without strain on resources

  7. ESF Funding - Balanced Approach • Current Funding Options • Cash available for Capital Projects • $150M • Free cash flow ~ $60M per year • Capital Levy (Stakeholder Contribution) • @$25k per student = $300M • Refundable • Years 1 & 7 (6 year collection plan) • Secured Borrowings • $300M approved by Fin Com against Property ESF must demonstrate the ability to fund a share of future sustainability

  8. ESF Funding • Capital Levy • @$25k per student, $10k for 3rd child onward • Generate Cash of $300M over 6 years • Commences Aug 2011 for Years 1 & 7 only • Each new year 1 & Year 7 entrant pays in subsequent years • Current enrolled year 6 & above exempt • Applies to staff with some payment support • New students at any level pay after Aug 2011 • Fully Refundable (subject to no fees outstanding) • Not applicable to PIS or Kindergartens

  9. Funding Components ESF Cash Flow & Commercial Borrowings Refundable Capital Levy Government Capital Grants

  10. Refundable Levy Collection

  11. Refundable Levy Accumulation HK$ Mil

  12. Questions?

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