TITLE
Recommendation to authorize City Manager, or designee, to: (1) execute and approve all documents necessary to implement a cash flow loan by the City of Long Beach Tidelands Oil Revenue Fund Group - Oil Field Abandonment Reserve - to the Aquarium of the Pacific Corporation of up to $5 million, and (2) terminate the previous May 5, 2020 authorization for a loan from the Tidelands Operations Fund to the Aquarium for October 2020 rent. (District 2)
DISCUSSION
On March 4, 2020, California Governor Newsom declared a State of Emergency in response to the COVID-19 pandemic (pandemic). Shortly thereafter, the City of Long Beach (City) also issued a Proclamation of Local Emergency, beginning a series of measures to protect Long Beach residents. As a result of the State’s and City’s health orders, the Aquarium of the Pacific Corporation (Corporation) suspended public visitation to the Aquarium facility (Aquarium). Revenues have been severely impacted and will continue to be impacted until the Aquarium can fully reopen.
The Corporation has requested a loan from the City to assist them through this pandemic. The proposed loan has two purposes: (1) to be drawn on monthly for cash as needed to pay for operating and maintenance costs, and (2) to allow the Corporation to be able to pay the annual rent due to the City in October 2021 to the extent the Corporation has not accumulated enough cash to make the rent payment. It is in the interests of the City to assist the Corporation to avoid a default on the rent payment as the City would have to make good on the equivalent of the rent amount, one way or the other for bond debt service, and it would not be in the interest of the Corporation if they were to have a default on the payment of rent.
The Corporation has determined that the loan needed may range between $1.2 to $10 million, but that the range of $1.2 million to $5 million seems more likely. The January 26, 2021 Health Order allows the Aquarium to immediately r...
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