TITLE
Recommendation to receive supporting documentation into the record and conclude the public hearing regarding the issuance of bonds by the Long Beach Bond Finance Authority, in an amount not to exceed
$45,000,000, the proceeds of which will be used to purchase the Redevelopment Agency's tax allocation bonds; and adopt a resolution of the City Council making findings with respect to, and approving the issuance of bonds by, the Long Beach Bond Finance Authority and approving the issuance and sale of bonds by the Redevelopment Agency of the City of Long Beach to the Long Beach Bond Finance Authority. (Citywide)
DISCUSSION
Staff recommends that the City Council authorize a restructuring of a 2002
Redevelopment Agency bond issue that would reduce the North Long Beach Project
Area's debt service payments in future years and produce approximately $300,000 in
additional funds for the Downtown Project Area. The restructuring would not provide
new funds for the North Long Beach Project Area at this time.
The City's Department of Financial Management regularly reviews the Redevelopment
Agency's (Agency) existing bonded indebtedness in order to assess interest rate levels,
determine debt service savings thresholds, and review existing covenants and capacity.
When practical, staff will recommend refunding (refinancing) certain bonds in order to
take advantage of lower interest rates. Interest rates for municipal bonds recently fell to
their lowest level in twenty years. An opportunity now exists to reduce debt service by
restructuring existing tax allocation bonds for the North Long Beach and Downtown
Redevelopment Project Areas originally issued in 2002.
In recent weeks, interest rates on municipal bonds have risen and fallen unpredictably.
On some days, prevailing interest rates have been sufficiently low that restructuring
some North Long Beach and Downtown bonds would result in significant savings
(Exhibit A). On other days, interest rates have risen to a level th...
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