Thousand Oaks Debt Payment Plan Urged

Concerned about restoring the millions the city stripped from its own departments to fund the Civic Arts Plaza, Councilman Mike Markey is pushing the council to explore new ways to pay off its internal debt.

Markey put the issue on the agenda for discussion at Tuesday’s council meeting, with the hope the members can come up with a game plan by February for repayment. He says the debt is $13 million, though others place it as high as $20 million.

“I want us to set a policy for how we are going to start reducing this debt,” Markey said. “I think it is our fiduciary duty to do that.”

Much of the $86 million needed to buy land and build the civic center came from long-term bonds, which will be repaid over the next 30 years.

But to finish the project, the city also tapped internal funds set aside for everything from golf courses to insurance. The council had initially intended to replenish these funds by selling the old city hall building. But with no buyer lined up, the debt remains unpaid and is accruing interest.

Councilwoman Elois Zeanah, long a foe of the financial juggling that made construction of the mammoth civic center possible, applauded Markey’s attention to the issue. But she was quick to point out that she and Councilwoman Jaime Zukowski have been reminding the rest of the council about the debt for years.

“I’m hoping that Markey means what he says and will back what Zukowski and I have been saying for the last few years,” Zeanah said, adding that her calculations place the internal borrowing at closer to $20 million.

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The discrepancy in numbers between council members comes from looking at two budgets. When Markey refers to a $13-million debt, he is talking about money the city borrowed toward the $64-million construction costs of the Civic Arts Plaza. But Zeanah and Zukowski say more money was borrowed internally to buy the land the plaza occupies. That land cost $22 million.

Zukowski said she always believed the loans should be repaid within five years. But she does not put much faith in it actually occurring by then.

“From the very beginning it was something to be returned,” she said. “But time stretches out. We can vote on it 5 to 0 that we’ll return it. But the result of the council vote has to be implemented.”

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To build the theater and City Hall complex--completed in October 1994--the city issued nearly $43 million in bonds, which it planned to repay with property tax revenues raised from the Thousand Oaks Boulevard business corridor.

The additional money, borrowed from city accounts, was to be repaid with the sale of one of its largest assets, the former civic center at 401 W. Hillcrest Drive, once valued at $13 million. The building, completed in 1973, was abandoned and gutted in 1988 after it was discovered to be riddled with asbestos.

It has stood empty on its hillside perch overlooking The Oaks mall and the Santa Monica Mountains ever since, except for occasional visits by vandals who break windows and cover the walls with graffiti.

Although there have been nibbles of interest in the site--including inquiries by the National Park Service--the city has had no luck in selling the building. Last month the council asked staff members to prepare estimates on fixing up the smaller of two buildings on the site so the city could lease the space and recoup some revenue.

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While Markey said he has not given up on hopes of selling the building, he said it is time to look for other ways to repay the debt.

“I’m not really frustrated,” Markey said. “I’m just realistically looking at it that we have to have other options.”

He said he has discussed with the city manager ways to pay off the debt, including using fees from developers, but was vague about details.

“We’ve got five or six different sources,” Markey said. “We’ve got some litigation issues going on where we might get some money and then there are some ongoing costs that could come in that would help.”

But Zeanah bristled at the idea.

“I don’t want more money juggled around,” she said. “No way.”

Markey said he wants the council--beginning in late January during budget discussions--to consider ways to repay the debt. The council has still not approved a final budget for 1995-96, even though it was supposed to do so last July.

Markey said he wants the council to move fast on establishing a repayment schedule before too much interest accrues on the debt. He said about $500,000 has already been added in interest.

Markey stopped short of saying he disapproved of the financing that created the debt, which was approved before he was elected.

“I’m not going to question the past decision of any City Council,” he said. “It doesn’t do me any good. I can’t undo what has been done. What we need to do now is move forward.”