Long Beach OKs $7.7 million bond

City Council vote is 4-1 to borrow for capital improvement projects

Posted

The City Council voted 4-1 last week to approve a $7.7 million bond measure for capital improvement projects throughout the city, ranging from the rebuilding of the lifeguard headquarters that was destroyed by Hurricane Sandy to a study aimed at protecting the Lloyd Aquifer from saltwater intrusion. At a Sept. 20 public hearing, officials said that $4.1 million of the expenditures are eligible for reimbursement from the Federal Emergency Management Agency and other federal and state agencies.

The projects, which were presented in May as part of a five-year capital plan that the council approved unanimously that month, also include $500,000 in road and sidewalk repairs, as well as improvements at the Ice Arena, City Hall, the Maple Avenue firehouse and upgrades to police and fire radio systems and the city’s sewer and water systems.

Major projects that are eligible for federal and state reimbursements, officials said, include a $650,000 rehabilitation of the city’s bus station, using Federal Transit Administration funding; $2.8 million for the reconstruction of beach comfort stations and the lifeguard headquarters; $1.7 million in hazard mitigation projects; and the replanting of trees throughout the city.

Before the vote, Fire Commissioner Scott Kemins urged the council to approve the measure, saying that the Fire Department was in need of new communications systems to replace obsolete equipment.

“Right now, the majority of our communications equipment is 20 years old — it’s beyond its useful life and it’s not even serviced by the manufacturer any longer,” Kemins said. “Our firefighters, our paramedics — and this includes our police officers — depend on these radios; these are their lifelines. They’re actually the public’s lifelines. This funding is imperative, it’s important and it’s a life-safety issue.”

Scott Bochner, a local environmentalist, lauded $300,000 in funding for a study aimed at protecting the Lloyd Aquifer — the sole source of drinking water for millions of Long Islanders — from encroachment by saltwater. “We know that we have saltwater intrusion,” Bochner said. “We are on the cusp of something that is really devastating. This is the most important thing we have on the table right now.”

The bond comes on the heels of a budget shortfall in May that nearly led to layoffs and service cuts, and amid criticism from Moody’s Investors Service and State Comptroller Tom DiNapoli’s office — which is currently auditing the city — that the city has relied too heavily on short-term borrowing in recent years.

In May, Moody’s downgraded Long Beach’s credit outlook from stable to negative, saying that the city continued to issue debt to pay for operating expenses, and that planned borrowing was expected to keep the debt burden above average compared with similar municipalities on Long Island, with total long-term, outstanding debt increasing to $92.2 million.

During the last fiscal year, the city’s former comptroller, Kristie Hansen-Hightower, who now serves as a consultant, said that the city issued $19.6 million in additional debt, including funding for capital projects, ongoing litigation, separation payments and costs associated with Sandy that were not eligible for reimbursement.

Last week, a number of residents questioned the need to bond for capital projects. “It’s a lot of money and I thought the city was broke,” resident Eileen Hession said. “I haven’t seen too much evidence of the council tightening their belts for our city.”

Roy Lester, an attorney and former school board president, criticized the measure. “It seems, what’s happening, is … the city is basically going out and borrowing money every time it has to do a repair,” he said.

Hansen-Hightower said that the city only bonds for new capital projects, while Council President Anthony Eramo maintained that “all municipalities” borrow for public improvements.

“Just to be clear, when we authorize borrowing for a bond … that’s not authorizing to borrow that $7 million at this time, it’s just authorizing the ability to do it,” Eramo said. “With an eye on our finances, this is what we’re able to do at this time.”

Councilman John Bendo — who has regularly criticized the administration about borrowing and its finances — voted in favor of last week’s bond. He said that officials had initially requested $20 million for capital projects earlier this year, but that the council approved less than $8 million.

Council members also cut $550,000 from the bond that was earmarked for an environmental review and study aimed at updating the city’s zoning code as part of a proposed comprehensive plan that has yet to be approved, officials said.

“Anyone who has been coming to council meetings … knows my sentiment on adding debt to the city,” Bendo said. “This is a double-edged sword issue … yes, we’re adding debt, but our infrastructure is crumbling. We can’t just do nothing — we have to maintain our city.”

Councilwoman Anissa Moore, however, voted against the resolution, calling the decision “premature” amid the city’s financial woes. “All the projects … are all worthy projects,” she said. “The real issue is budget reform. I cannot in good conscience tonight approve of another bond at this time. Our debt service is approximately $106.2 million at this time. I’m not saying we can’t do these projects, but that we should wait until the money can come from other sources. As a community, are we financially out of the woods? I have no financial data to support this.”

Department of Public Works Commissioner John Mirando said that all of the projects were discussed “in depth” in the spring. “To wait, I think would be a big mistake,” he said. “Otherwise we’re not going to get our infrastructure corrected and fixed.”