T.O. TO CONSIDER LOAN ALTERNATIVES\City's plan to repay Civic Arts Plaza funds frustrated by slow\real estate market.

Byline: Enrique Rivero Daily News Staff Writer

Concerned that other city projects could go unfunded, Councilman Michael Markey has directed staff members to devise a plan to repay $13 million in loans from various city funds used to help pay for the $63.9 million Civic Arts Plaza.

The stalled commercial real estate market has undercut city plans to pay back the loans using proceeds from the sale of the former City Hall at 401 Hillcrest Drive. In addition, the city had hoped for revenue from the civic center's still undeveloped private side. Meanwhile, the 2-year-old loans remain unpaid.

"Basically, we have to identify what funds we can use to repay the loan," Markey said. "Like any loan, you want to pay it off as quickly as you can."

In June 1994, the City Council authorized borrowing $13 million from seven special funds and transferring the money to the redevelopment agency to help pay construction costs for the Civic Arts Plaza. The special funds are earmarked for specific uses such as wastewater or golf course projects.

Most of the land at the site was already owned by the city. The rest of the construction money for the project came from redevelopment agency bonds, which will be paid off with a portion of property tax proceeds, plus leases and other city funds.

According to city finance director Bob Biery, the $13 million loan to the redevelopment agency breaks down as follows:

$2 million from various wastewater funds.

$1 million from various water funds.

$1 million from the golf course fund.

$500,000 from the low-to-moderate housing fund.

$2 million from the insurance reserve fund.

$2.5 million from capital funds.

$4 million from the asset replacement fund.

The loans are accruing interest at an annual rate of about 5 percent, Biery said. Though he did not know Friday how much interest had accrued so far, Biery said that as of June, total interest payments stood at $650,000.

He said it was too early to identify the city's best plan of action for paying off the loan.

"I haven't even gotten to it," Biery said. "The council's position was to pay for (construction of the Civic Arts Plaza) from the sale of property.

"Right now I haven't even considered alternatives."

Markey said that one source of money could be developer fees that will be coming to city coffers from projects such as the Seventh-day Adventist development in Newbury Park and several commercial developments that are coming.

Councilwoman Elois Zeanah said she agrees with the importance of repaying the loan, but added that Markey's request may not go far enough.

Though she wasn't certain how the city should go about it, she said the city should repay the entire loan it made to its redevelopment agency before the council approves any more redevelopment projects.

She also isn't satisfied with the city's accounting of how the project has been financed. She and Councilwoman Jaime Zukowski have in the past requested a detailed accounting, Zeanah said.

"I'm just going to ask that Markey expand that to include what Zukowski and I have been requesting," she said.

The City Council will discuss Markey's request when it meets Tuesday at 6 p.m. in the Forum Theatre at the Civic Arts Plaza, 2100 Thousand Oaks Blvd.

CAPTION(S):

PHOTO

Photo Michael Markey Wants to pay off loan quickly