CITY HALL — Councilmembers winced over the potential cost of a new fire station but were clear that the new facility is critical to the public’s safety.

City Council Tuesday voted unanimously to move forward with a $32 million bond that would cost City Hall $2.7 million every year over the next 30 years, or a total $81 million.

A final council vote on the decision to approve the bond, a majority of which will go toward a new fire station, will occur next year.

The fire station was previously to be financed by redevelopment agency funds, but the agency was dissolved, along with hundreds of others throughout California, to plug a state budget shortfall in 2011.

For a building that is going to last 30 to 50 years, City Manager Rod Gould told council the long-term bond makes sense.

“Because interest rates are relatively low and because Santa Monica’s bond rating is high, we can do it less expensively than most cities could imagine,” he said. “I think it’s prudent in this case and the need is apparent.”

Fire Chief Scott Ferguson spoke to the need, explaining that for a variety of reasons, including the coming of the Expo Light Rail Line and new developments, the fire department needs more space for firefighters and vehicles. The new station would replace Fire Station 1, which was built in 1955 and does not meet seismic standards.

Previously, council asked city officials to poll the electorate to determine if they would support a different type of bond, one that would raise property taxes. More than half said they would. But not enough to reach the two-thirds super-majority that would be required to approve the bond in an election.

Other poll questions showed that a significant majority of the electorate favored ensuring that all fire stations meet seismic standards, so city officials decided to pursue a different bond, one that requires council approval.

This bond would not require a tax hike, but would come from the general fund over the next 30 years. The general fund pays for services like police and fire, as well as maintaining parks, after-school programs and libraries.

“There’s an opportunity cost to committing $2.7 million a year of general fund money for 30 years, absolutely,” Gould said. “Those are dollars that you cannot spend for services or other projects. Absolutely.”

Councilmember Ted Winterer pointed out that City Hall can afford to make those cuts.

“We have cut, over the two-year budget, 5 percent per year in our expenditures and we’ve not been getting a lot of complaints about reduction in services,” he said. “So it’s certainly eminently doable to accommodate those extra $2.7 million in debt service.”

Councilmembers Bob Holbrook and Tony Vazquez were interested in the feasibility of paying back the debt early. City officials said that the rate is locked in for the first 10 years. Noting that it is a complicated calculation, city officials could not determine on the fly how much could be saved if City Hall paid back its debt in year 11, but they said it would be “millions.”

“That’s a bridge that (City Hall) will be able to consider crossing in the 10th or 11th year,” Gould said. “And at that time look at its cash position, look at its reserves, look at interest rates, look at its investment income, and decide whether or not it would be prudent to pay it off, all or portion of those bonds, at that time.”

All council members who spoke were in agreement that the fire station needs to be built.

“This council is fortunate to spend a lot of time on exciting new things we do and social services and all the very enjoyable things that the city does for its residents,” said Councilmember Kevin McKeown. “But I don’t think we could ever afford to lose sight of the fact that one of our prime responsibilities here is public safety. And sometimes to provide public safety, you’ve got to cough up the cash.”

Civic uses

Council voted unanimously on a list of interim uses allowed at the Civic Auditorium, which was shuttered earlier this year and is in need of an upgrade.

The cash for the upgrade was another casualty of the RDA dissolution that occurred in 2011.

City officials are hoping to make the space a destination for filming while the future of the building is debated. A television show and a few commercials have already been shot there.

The uses were supposed to be approved by council in January, but BMW recently approached City Hall about holding a five-week media event at the auditorium.

Public assembly is not allowed inside the auditorium — it’s in need of a seismic upgrade — but BMW would store its cars there.

 

dave@smdp.com