CEMETERY DISTRICT ASKS SIMI TO FORGIVE LOAN.

Byline: Terry Kanakri Daily News Staff Writer

The Simi Valley Public Cemetery District is asking the city to forgive a $265,047 loan that it received in 1990 but has been unable to repay due to limited revenue, officials said Friday.

Although sympathetic to the district's financial dilemma, City Council members said they are reluctant to transform the loan into a grant, saying such action would set a bad precedent.

"It's taxpayer money, and it's a lot of money," Councilman Paul Miller said. "It's not something that we just want to dismiss. It's money that I'd like to see put back into our city and do something with it."

Councilwoman Barbara Williamson said she wants to work with the district to find out if both parties can find a mutually accepted solution.

"You can't get blood out of a turnip, but I'd be willing to work with them," she said. "Anytime money is borrowed from the city, I'd like to see it repaid. However, being in the banking business, I know sometimes that doesn't happen. So we got to work out some kind of an agreement that will be amicable to all parties involved."

The cemetery district is an independent entity created in 1946 to operate and maintain Simi Valley's only nonsectarian cemetery, located on Thompson Lane adjacent to Rancho Simi Community Park.

In 1990, the City Council approved lending the cemetery district up to $350,000, to be drawn as expenditures occurred, to improve the appearance, safety and security of the cemetery. The money, borrowed at an annual interest rate of 6.08 percent, also was to be used to expand the cemetery.

Because of declining revenue, including state money, the cemetery district has been unable to pay the city back any portion of the loan, which was supposed to be repaid over a 10-year period, officials said.

For instance, the cemetery district reported expenditures exceeded revenue by $37,976 for fiscal 1994-95, and has been relying on money from an Endowment Care Fund to make ends meet.

As a result, Vince Nowell, secretary of the district's five-member governing board, in a letter asked the city to consider converting the loan into a grant in an effort to help the financially strapped district.

Nowell, who could not be reached for comment, said in his letter that such action would help to ensure the district's ability to continue providing needed services for the city.

In a recommendation to the City Council, city staff recommended against forgiving the loan.

Instead, staff is urging the city, through its Community Development Agency, to retire the loan over 20 years using money it allots annually to the district from its redevelopment zone.

From fiscal 1991-92 to fiscal 1994-95, a total of $9,340 was allotted to the district in such funds, and is being held in trust by the agency, officials said. For fiscal 1995-96, it is estimated $2,300 will be collected on behalf of the district.

Staff also recommends that the city re-evaluate the district's ability to repay the loan every other year, and pursue financial assistance from the state Department of Consumer Affairs, which oversees cemeteries.

Miller and Williamson said that they would prefer to see the city work out some kind of a payment plan with the district.

"I'd like to explore other ways before we just roll over and forgive the loan," Miller said. "I want to know that all the other alternatives have been looked at and I don't know that they have, yet."