LOS ANGELES — Plans to place a $1.2 billion bond on November's ballot to house Los Angeles' homeless won out over a parcel tax.
The Los Angeles City Council voted 12-0 Friday to place the bond measure on the ballot, but tabled the proposed parcel tax that would have brought in $80 million a fiscal year for 10 years.
The bond measure needs support from two-thirds of voters to pass.
The city plans to devote 80% of the bond's proceeds to construction of permanent supportive housing, which offers on-site resources such as substance abuse counseling. The city has a goal of creating 10,000 new units.
The city has 26,000 homeless residents, according to city officials.
"Every night in Los Angeles, tens of thousands of Angelenos — men, women, children, veterans, and seniors — sleep on our streets," Mayor Eric Garcetti said in a prepared statement. "This crisis is pervasive and it endangers public health and stifles economic prosperity. It is my highest moral calling to address this with urgency."
The council's action comes five months after the council adopted a $1.85-billion plan to provide relief to the city's homeless population.
After exploring 60 different options for funding the program, the council narrowed their options last month to two property tax measures.
City officials tabled the parcel tax without debate on Friday.
Bonds place more restrictions on how the money can be spent than a parcel tax, but voter surveys have indicated more support for a bond measure, according to city officials.
Bond proceeds would have to be used to purchase land and develop housing or other facilities for the homeless.
City officials are hoping that in the coming months, they can also secure the ability to use the bond proceeds to provide loans and grants to developers of homeless housing.
The issuance of the $1.1 billion in general obligation bonds will result in average annual debt service payments of roughly $62 million for 28 years, assuming an average interest rate of 4.6%, Chief Administrative Officer Miguel Santana said in a June 27 report he submitted to the council.
"The issuance of these bonds will not cause the city's debt service payments to exceed 15% of general fund revenues as established in the city's debt policy," Santana wrote. "There is no fiscal impact on the general fund as a result of the proposed bond measure, because the bonds will be repaid from ad valorem property taxes levied upon taxable properties within the city in an amount sufficient to pay the debt service."