Council Takes Cautious View of Bond Issue Proposal

While quick to praise the work of a blue-ribbon panel that studied methods of financing city improvements, City Council members generally are taking a cautious approach to a recommendation that they ask voters to approve $175 million in bond issues.

“I’m not ready to commit myself one way or another,” said Mayor Ernie Kell, echoing the sentiments expressed by several other council members.

Under the recommendation, bonds would be sold to pay for such capital projects as tree planting and park expansion, along with improvements to libraries and police and fire stations.

The cost of the bonds would be levied against property owners until they are paid off, usually in 20 years. Voters would have to approve each general obligation bond by a two-thirds margin.

City Planning Director Robert Paternoster predicted several months of study by the staff and City Council before a decision would be made whether to place the issue before the voters.

Wide-Ranging Report

The proposal for bond issues is contained in a wide-ranging report to the council outlining how the city can afford big-ticket improvements to maintain the quality of life in the year 2000, a mere 13 years away.

While the report lists several methods of financing, it puts a heavy reliance on raising $175 million through the sale of bonds.

To fully implement the Long Beach 2000 Strategic Plan, the report says, about $900 million would be required,

“However, we are recommending a more realistic, limited and immediate program . . . that maximizes funding from sources other than the general taxpayer, while limiting general obligation bond financing to under $175 million,” the report says. The report does not estimate how much the bonds would increase property taxes.

Without a major effort to maintain the city’s infrastructure, the report warns, “Long Beach will become an ‘old’ city, plagued with potholes, broken sewers and crumbling buildings.”

Benefit Assessments

The seven-member committee was headed by Michael Choppin, president and chairman of the IDM Corp., which is building the World Trade Center and other major Long Beach developments. The committee asks the City Council to launch “a public awareness campaign” to make citizens aware of capital funding needs and to assign a staff member to coordinate implementation of the program.

Besides a bond issue, the report says that such improvements as sidewalk, curb and gutter reconstruction can be paid through benefit assessment districts. It says that code enforcement can be paid through federal Community Development Block Grant funding, sanitary sewer maintenance through user fees, and storm sewer maintenance and replacement through the gas tax and general funds.

But the most expensive items would be financed through bonds. The report recommends, for instance, that the city spend $43.2 million within a year as its share of costs to improve east-west traffic flow through the city. It would include grade separations at the Traffic Circle and the so-called “Iron Triangle” where 7th Street, Bellflower Boulevard and Pacific Coast Highway intersect.

City Council members say they want to hear more before committing themselves to any bond issue.

“I don’t doubt there are needs,” said Councilman Warren Harwood. “The question is how far people are willing to dig deep into their pockets.”

While the decision would be ultimately up to voters, Harwood said, he would have some “major questions” before he would support a bond measure.

“I think the percentages to approve it are very difficult to obtain,” he said. “I tend to lean more to a pay-as-you-go approach where you identify needs and look at your budget and see if there’s some way you can pay for it out of current revenues.”

Councilman Tom Clark skirted the question of his support for a bond issue, although he said the city is “going to have to do something” about improvements to the city’s infrastructure. He said those improvements have been in limbo since passage of the tax-cutting Proposition 13 in 1978.

Any ballot measure, Clark said, would most likely not come before voters before the November, 1988, general election.

Councilman Wallace Edgerton said he has not yet had a chance to study the committee report. While the city needs to maintain its infrastructure, he said, “one needs to be very careful and have enough public input” before holding a bond issue vote.

‘Like a Blueprint’

Kell said the committee “did an outstanding job,” but he wants to fully consider its recommendation. “I think it’s like a blueprint. You look at the print for a while, before deciding how to proceed,” he said.

Councilman Evan Anderson Braude, however, unabashedly said he favors a bond issue to implement the committee’s recommendation for city improvements.

Braude said city leaders should work for a bond issue. Better financial support, he said, is particularly crucial to his fast-growing 1st District, which encompasses downtown Long Beach and the port.

In the past, he said, the city’s strong financial base has made improvements affordable without new taxes. But with dwindling tidelands oil revenue, new funds are needed.

“We have to have some sort of bond issue to get us moving in the right direction,” Braude said. “It will clearly affect my district tremendously. We don’t have the parking. We don’t have the infrastructure.”

A general obligation bond has not been approved in Long Beach since the early 1950s, said James Algie, city financial management director .

Algie said that cities were effectively prevented from financing projects through general obligation bonds since the passage of Proposition 13. But since voters amended the state Constitution a year ago, about three or four cities have had enough voter support to enact bond measures.