Council Given 11 Options to Pay Off Loan for Arts Plaza

Two years after draining $13 million from several city funds to build the Civic Arts Plaza, the City Council today will examine an array of options to pay off that debt.

Finance Director Robert Biery has put together a report outlining numerous ways Thousand Oaks can raise the $13 million plus $500,000 in interest needed to pay off the internal loans used to finance the construction of the $64-million City Hall and performing arts complex.

The report identifies 11 options the City Council could consider--from selling some land near the former city hall on Hillcrest Drive to refinancing Redevelopment Agency bonds--to raise a total of $20 million.

Mayor Andy Fox said he thinks that Thousand Oaks needs to replenish the city funds that were drained before the internal debt builds up any further.

Although the city essentially lent itself the funds, it is losing the money it would have made in interest if the millions had been left alone. In addition, the lack of funding could affect the city’s long-term operations.

“It’s an important issue that the council needs to deal with, and we need to deal with it now,” Fox said. “We have to repay these loans.”

But Fox said he is concerned that council members Elois Zeanah and Jaime Zukowski may turn the discussion into an “I told you so” tirade against the methods used to finance the landmark building--methods they did not support.

“We need to pay this money back, and it doesn’t serve any purpose other than to be an obstructionist to bring up the past,” Fox said. “Those are all important funds. I’m hoping it doesn’t become a finger-pointing debate.”

Zukowski disagrees. She said the funding of the Civic Arts Plaza is an issue that needs to be reexamined and added that she is unhappy the report does not include the internal loans used to purchase the land.

Although the complex itself cost $64 million, Zukowski noted that its actual cost was $86 million when land costs are factored in, and part of the additional costs also were paid for with internal loans from city accounts. She estimates that the actual Civic Arts Plaza debt is close to $20 million.

“This is only half of the picture,” she said. “The other loans, which have to do with the land costs, are just as important.”

Zukowski said she was particularly upset by a memorandum from City Manager Grant Brimhall in which he stated that, in his view, “there is very little value or need for this City Council to revisit the actions or policy decisions of past councils.”

“I think it’s important to deal with the facts and resolve all of the loans,” Zukowski said. “I just feel that the past is invariably a factor in the present, and it’s disturbing when some people don’t want to discuss the entire financial picture.”

Zeanah said she is also upset that the report does not include all internal debts related to the financing of the Civic Arts Plaza.

“Let’s not play any more shell games with money,” she said. “I think we need to admit the millions we have borrowed.”

Although the Civic Arts Plaza was funded mostly with bonds, city leaders agreed to pay for part of the building by borrowing from their own accounts, intending to pay the money back within a few years.

Originally, council members planned to pay off the internal debt with money from the sale of the 11 acres beside the Civic Arts Plaza, valued at about $9 million, and the former city hall overlooking The Oaks mall, previously valued at $13 million but now thought to be worth less.

However, the “private side” of the Civic Arts Plaza is still an empty lot today as city officials negotiate with a potential developer. And the old city hall building, which was abandoned and gutted in 1988 after it was discovered to be riddled with asbestos, is also still in city hands today.

Councilman Mike Markey, who pushed the council in January to look at ways of repaying the internal loans, said he was excited about several of the options. He believes the City Council can easily reduce the debt right now, if not eliminate it altogether. He is particularly interested in replenishing Thousand Oaks’ golf course and waste-water funds, from which the city borrowed $3.5 million.

“I’m looking for some immediate reduction,” Markey said. “There is about $5.5 million that I think we can take care of right away. If we eventually sell these properties, we’ll be OK. But for now, we need to do something, because the interest is racking up.”

Like Fox, Markey said that dwelling on the past would be a waste of time.

“I’m only concerned with what’s in front of me today,” Markey said. “I wasn’t on the council back then. My job is to fix the problems we have, not blame the people who came before me for our problems.”