SAN FRANCISCO - Books, ambulances, and wild animals will be among the beneficiaries of capital projects financed by proceeds from $201 million in general obligation bonds the City of Los Angeles plans to issue tomorrow.
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The largest portion, $113 million, will finance land acquisition and design costs for 21 fire stations and paramedic facilities throughout the city. It will be the first sale of bonds approved by voters last November. The city plans to sell the rest in three series, said Marla Bleavins, a finance specialist in the chief administrative office.
Proceeds from $36.7 million in bonds will be used to replace three animal shelters and build two new ones. Voters approved $154 million for shelters as part of the same bond measure as the fire and paramedic facilities.
Another $36.5 million of tomorrow's proceeds will finish up the city's 1998 authorization for library construction and renovation. Finally, $14.9 million will finance projects at the Los Angeles Zoo, including a new reptile and insect house, South American rainforest exhibit, sea lion exhibit, and entry plaza for the zoo, Bleavins said.
Bond counsel on the competitively priced deal is Mallory & Associates. Public Resources Advisory Group and Municipal Capital Management, Inc. are co-financial advisers.
The city had $602.6 million in outstanding GO debt before the sale, and another $1.14 billion in non-voter approved lease obligation debt, according to official documents. The city has no bond elections pending, but hundreds of millions of dollars in authorized but yet-to-be-issued debt.
Moody's Investors Service assigned an Aa2 rating to the bonds with a stable outlook. The city's multiple credit strengths includes a large, highly diverse economy and growing property tax base, sound financial management, and moderate current debt levels, which the city retires relatively quickly.
Fitch assigned an AA rating, citing the city's fiscal discipline and moderate future debt issuance plans.
Standard & Poor's affirmed the AA rating assigned to the city's GO debt. The city's economic base continues to demonstrate renewed growth following the decline in the early 1990s, analysts said.
Rating analysts disagreed as to what the impact would be if the San Fernando Valley succeeds in its attempts to secede from Los Angeles and create a new city. The city also may be held liable for approximately $125 million in civil damages stemming from illegal activity by the police department's Rampart Division, according to the city attorney's estimates.
The city next plans to bring $80 million in sanitation revenue bonds to market before the end of September, Bleavins said. It also hopes to close a $135 million Mello-Roos tax bond sale to finance development of the Playa Vista area of the city.
