LONG BEACH, CA — Long Beach is preparing to borrow approximately $246 million to finance major infrastructure improvements and refinance existing debt, a proposal that could leave the city paying more than $473 million over the next three decades.
The financing package would help pay for the long-awaited Belmont Pool, extensive renovations to the Long Beach Convention Center, street repairs, park improvements and other public facilities. But it would also commit future city budgets to years of repayments at a time when Long Beach is already confronting significant financial pressures.
The Finance Authority of Long Beach, a city-controlled agency, approved the proposed bond financing Oct. 28. The City Council is expected to consider the plan Nov. 10, after which the bonds could be sold if the council gives its approval. According to the official financing documents, the city expects approximately $246.4 million in bond proceeds, with total payments through maturity estimated at $473.44 million. Those figures remain projections, and the final borrowing costs would depend on the terms secured when the bonds are issued.
Among the proposed expenditures are approximately $24.6 million to cover the remaining funding gap for the Belmont Pool and $50 million for roof, air-conditioning and structural improvements at the Convention Center. The package would also support improvements along Anaheim Street, new soccer fields at Heartwell Park, storm drain and pump station upgrades, and work at Belmont Pier. Additional allocations include $500,000 for the historic VIP Records sign and $2.2 million for the city's LGBTQ Cultural District.
Some proceeds would refinance existing obligations associated with public safety facilities, including the city's police academy and a fire station, rather than fund entirely new construction. City officials contend that borrowing would allow long-delayed improvements to move forward before construction costs rise further. Several projects are also expected to improve public facilities ahead of the 2028 Olympic and Paralympic Games.
The financing documents estimate a 5% true interest cost, although the agreement would permit borrowing at a rate of up to 6%.
Long Beach proposes using lease revenue bonds, a financing arrangement in which the city leases existing municipal properties to the Finance Authority, which then leases them back. The city's lease payments would provide the revenue needed to repay bondholders. The arrangement would involve 15 city-owned properties, including the Convention Center, Long Beach Museum of Art, two downtown parking structures, Fire Station 9 and the Emergency Operations Center.
The city would retain ownership of those properties, and the financing documents specify that bondholders would have no right to take possession of them. Repayments would come from several municipal funding sources, including the General Fund, Tidelands funds and Measure A revenue.
Annual debt service is projected at approximately $14.8 million in fiscal year 2027, increasing to about $16.5 million annually through fiscal year 2031 before settling at roughly $15.7 million annually for much of the remaining repayment period.
The proposal follows a difficult budget season in which Long Beach adopted spending reductions and eliminated hundreds of positions to address a $58 million deficit. Although money borrowed for capital improvements cannot be diverted to cover routine operating expenses, the repayments would become long-term obligations affecting the city's financial flexibility.
The Long Beach Post reported that the General Fund, which supports services including police, fire protection and libraries, would cover approximately $2.6 million of the first year's debt payments. City officials maintain that delaying construction could ultimately cost taxpayers more, particularly as rising material prices and competition for contractors continue to drive up expenses.
The city's financial management director, Kevin Riper, told the Long Beach Post that there is no alternative plan to fully finance the Belmont Pool if the borrowing proposal fails. The City Council is scheduled to consider the financing package Nov. 10.
Sign up for free local newsletters and alerts for the
Long Beach Patch
Patch.com is the nationwide leader in hyperlocal news.
Visit Patch.com to find your town today.