Thursday, September 16, 2010

Marin County finance move boosts safety facility

Nels Johnson
Posted: 09/14/2010 04:06:22 PM PDT
Updated: 09/14/2010 04:06:22 PM PDT

A program that will refinance existing county of Marin debt while adding to it in order to provide money for a public safety building or other public works projects was authorized by county supervisors Tuesday.

Under a "certificates of participation" deal that does not require voter approval because it will be paid for with existing revenue, officials intend to exploit favorable interest rates by refinancing $18 million in certificates already issued, then issue more over a longer time frame, boosting the debt to about $60 million - while remaining within a $3 million annual debt service target required by county fiscal policy.

The moves, after setting aside money for reserves and providing $300,000 to financial and legal consultants, will provide the county with a net $38 million. The money, in addition to $30 million already in the bank, could be used in a lease-back arrangement to pay for the first phase of a $100 million public safety building on a "preferred site" near the Marin Civic Center, although officials stressed the financial arrangement had nothing to do with selecting a specific site for the controversial facility.

County Administrator Matthew Hymel said the money can be used "for any capital improvement" and need not necessarily be allocated for the safety building, wherever it is located. Several alternative sites are under study.

"We are able to take advantage of interest rates," pay off some old certificates while refinancing others maturing in 2023 and issuing more in a package due in 2040, Hymel said. "With the advantage of the highest available credit rating and historically low interest rates, we are refinancing existing debt and issuing new 30-year debt to address our long-term capital needs," he said.

Hymel noted that the county's financial books are in excellent shape, with a recent audit providing a clean bill of health. In addition, the county's "triple A" credit rating was reaffirmed by Standard & Poor's this month, he said.

The financial arrangement included a detailed prospectus giving an overview of the county's fiscal status, noting that revenues of $361 million were predicted by the 2009-10 budget, $44 million less than actually collected, and $2 million less than projected this fiscal year. Total expenses in 2009-10, proposed at $386 million, came in about $13 million above that - and less than the $383 million proposed this year.

County supervisors had little comment on the refinance scheme, which came up for discussion near the end of a long agenda that was delayed by a parade of speakers concerned with a variety of other issues.

Contact Nels Johnson via e-mail at ij.civiccenter@gmail.com

http://www.contracostatimes.com/news/ci_16074693?nclick_check=1

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