Orange County, Calif., supervisors have authorized the sale of $178 million of bonds to pay for the construction of a building that marks the first phase of its planned two-decade overhaul of the Santa Ana Civic Center.
It will cost taxpayers $315 million to repay that debt over the next 30 years.
The bond issuance, approved by the board on Tuesday, May 9, is one of the largest long-term debt commitments the county has taken on since its 1994 bankruptcy. The county paid off its bankruptcy debt two years ago, emboldening officials to consider larger projects requiring bond issuances.
The bonds will finance the construction of a new six-story building at 601 N. Ross St., where the vacant, dilapidated, 1950s-era structure known as Building 16 has stood. The county began demolishing that building in February.
The new building, which is scheduled to open in 2020, will include a "one-stop public counter" that will provide a single location to conduct almost all county business. The building also is set to consolidate offices for OC Public Works, OC Waste & Recycling and Treasurer-Tax Collector. The county hasn't released design plans or renderings for the facility.
The county did not issue the bonds itself, instead opting to fund construction through a public-private partnership. Under the plan, the county has formed a nonprofit public-benefit corporation, which will issue the bonds, fund construction and then lease the property to the county. The county's lease payments of $10.8 million annually will repay the loan, meaning the county has committed to repaying the debt even though it didn't issue the bonds.
County spokeswoman Carrie Braun said the funding mechanism is used in other Southern California counties and will allow the county to maintain its credit rating. However, the county's Auditor-Controller office said the debt will still be recorded on the county's financial statements, which could potentially undo the benefit of the workaround.
The $178 million cost for the overhaul's first phase is $28 million more than county staff stated when the project was announced last year.
Los Angeles-based Griffin Structures is the project's developer.
