Measure P Update for the City of El Centro
Corissa Ibarra Photo

Amid Shutdown, El Centro Gets Funding Update

EL CENTRO — The Measure P ballot passed in 2016 promoted much-needed upgrades to El Centro infrastructure but two crown jewels on the wish list, a new library and police station, likely convinced 55 percent of voters to approve it.

Both were deemed indispensable since the police station is several decades old and the library was moved to converted retail space after the main library was wrecked in the 2010 Easter earthquake.

Even though Measure P earns $5.1 million dollars annually, that revenue stream is insufficient to build the two projects that were the foundation of Measure P, explained City Council Member Cheryl Viegas-Walker. As such, general obligation bonds will need to be issued and be repaid over the course of the next 25 years. Yet the bonds must not only cover the cost of the projects but also pay the debt service for the bonds.

The initial forecast to complete both projects was estimated at $60 million. Because of that, the city council met with Richard Romero, financial director, to learn if funding could be secured to make these projects viable.

“It was not based on a study but the city’s bonding capacity determined by the annual revenue projections generated by Measure P,” said Mayor Efrain Silva. “Our expectation is we will come up with some adjustments that provide most of our original vision.”

Scaled-back Plan

Romero first calculated the city’s bond capacity at $48 million. But further review found it was actually $55 million.

“That will allow us to build most of what we want,” Viegas-Walker said.

“We determined if we trim a bit on the amenities on both projects we can stay within our $55 million budget,” she added. “The good thing is we own both properties. That helps us stick to our timeline since we don’t have to go looking for a site.”

Walker noted the bonds could be issued by mid-year and construction be underway before 2020 ends with the projects completed during 2022. Yet with nonessential businesses closed and others operating at reduced schedules because of the COVID-19 pandemic, planning is uncertain.

Post-COVID-19 View

“The big unknowns are when the economy re-opens,” said Viegas-Walker. “If it happens in May there’s a potential to issue bonds and still have a good rating (to afford debt service) by late summer and have the library and police station completed during 2022.”

A sustainability task force advised by Romero determined the original $42 million police station needed to be scaled back from a three-story 25,000 square foot building to 21,000 square feet, including an ancillary space at the back that would include an evidence room, lab, firing range, K-9 unit and a supplies and maintenance room. The library was scaled back, to 20,000 square feet.

In a budget presentation at the April 21 council meeting, Romero explained sales tax revenue projections are expected to fall due to the pandemic shutdowns.

Sales tax revenues cover general fund expenses and Measure P projects.

Council Member Jason Jackson noted the economy may bounce back stronger than predicted and there is a small window of opportunity but the economy could benefit by re-opening in May.

“Re-opening can be done on a case-by-case basis with local control,” he said. “We can maintain some restrictions by re-opening small retailers, barber and beauty shops but not movie theaters, or sports stadiums. We’ll sustain social distancing, wearing of masks and do more business by appointment for individuals or a small group.”

Romero explained Measure P is expected to begin the next fiscal year on July 1 with a projected balance of $9.7 million and is forecast to grow to $12.35 million by June 30, 2021.

Jackson cautioned to not to overly focus on the changes from year to year but to look at the bigger picture.

“There’s only so much reserves a small business can sustain,” he said. “If the shut-down lasts four or five months we might have significant small business failure and harm the city’s projected revenue. That hurts a good bond debt service rating, so let’s get business open soon.”

Projects Status

There have been a few delays of other infrastructure projects, noted Liz Zarate, a management assistant in the city manager’s office. The Carlos Aguilar Park improvement project is currently on hold but will resume in about two weeks due to a contractor request. The park near Fire Station No. 3 is currently under construction. Meanwhile, the Adult Center Senior Services upgrades are currently on hold due to COVID-19 guidelines, explained Zarate.

The city is also working toward obtaining a new modular building to serve as an office for the animal control shelter on Pico Avenue.  Funding for these projects was already secured before the COVID-19 crisis struck, Viegas-Walker explained, and are not in jeopardy.


This story is featured in the April 30, 2020 e-Edition.

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