$68 Million Borrowed by Schools for Hotel Site
The Los Angeles School Board took another step Monday toward acquiring the Ambassador Hotel site from millionaire developer Donald Trump by voting to borrow $68 million--using “certificates of participation” that will be sold to investors.
The district is locked in a battle with Trump over the land, where school officials want to build a high school to relieve overcrowding in other schools in the area. Trump wants to construct a 120-story office building on the site.
The State Allocation Board has pledged to give the district $50 million if voters approve a construction bond issue on the November ballot. But the cost of the land--to be determined by the courts--is likely to be higher.
In order to launch its court fight, the district had to deposit its estimated cost of the land--$47.9 million--in an escrow account. The district borrowed that money from one of its insurance funds and will use the $68 million to repay the fund and cover other costs.
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