TITLE
Recommendation to receive and file report titled “Review of the Viability of Alamitos Bay Marina Rehabilitation Project” (Rebuild Project); and request City Management to review the recommendations, develop strategies for implementation, and update the City Council and City Auditor as to the status of the Rebuild Project within six months from the date of receipt and filing of this report.
DISCUSSION
Our Office performed a review of the Rebuild Project to determine if the Marine Bureau could absorb the anticipated $90 million in additional debt associated with the project without requiring subsidies from the Tidelands Fund or City's General Fund.
Overall, we found several important issues related to the funding of the Rebuild Project that raise questions whether moving forward with this considerable project is in the best interest of the City of Long Beach. Specifically, we found the total costs for the entire Rebuild Project at the close of our fieldwork were estimated to be over $96 million of which $90 million will be paid through debt - $40 million in Department of Boating and Waterways (DBAW) loans and $50
million in municipal revenue bonds. The key findings and conclusions are:
Ø We were unable to conclude on the Alamitos Bay Marina's (Marina) financial viability to undertake the Rebuild Project as the preliminary pro-forma financial analysis prepared by Marine Bureau Management to justify construction was incomplete, insufficient, and lacked critical financial assumptions. This finding relates to all phases of the Rebuild Project, including Phase I - Basin 4 where design and engineering contracts are already in place and DBAW loans have been received by the City.
Ø Marine Bureau Management's decision in 2007 to request contractor bids for a single design and project costs for the rebuild instead of requesting several solutions/options with varying levels of repair/rebuild and costs, limits the City's ability to select the option that best meets ...
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