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Council holds TEFRA hearing and approves revenue bond issuance for Community Health Centers of the Central Coast project
Summary
The council held a Tax Equity and Fiscal Responsibility Act (TEFRA) hearing and approved the request to act as the public hearing body for California Municipal Finance Authority revenue bonds supporting Community Health Centers of the Central Coast projects in Santa Maria.
The Santa Maria City Council on July 1 opened and closed a Tax Equity and Fiscal Responsibility Act (TEFRA) public hearing and approved a motion allowing issuance of tax-exempt conduit revenue bonds through the California Municipal Finance Authority (CMFA) for Community Health Centers of the Central Coast.
The finance director, Rebecca Campbell, explained that the TEFRA hearing is required by federal tax rules when a municipal conduit issuer is used to issue tax-exempt financing for a nonprofit borrower. In this case the borrower is Community Health Centers of the Central Coast, and the CMFA will issue revenue bonds up to an aggregate principal amount of $47,000,000 for two projects: acquisition/new construction/renovation at 2100 South Bossler Road for health and mental health services for seniors, and approximately 30,000 square feet of acquisition and renovation at 1550 East Main Street for a medical clinic.
Key clarifications: Campbell said the bonds would be payable solely by the borrower and that the city would incur no financial liability, legal obligation or indebtedness related to the issuance. She also corrected a background item that had misidentified the issuer in a draft as the California Statewide Community Development Authority (CSCDA); the correct issuer is the California Municipal Finance Authority (CMFA). She noted that a portion of CMFA proceeds supports local charities through the California Foundation for Stronger Communities.
Public comment: Representatives of the American Legion and local veterans emphasized they had not been informed about the plan for the 1550 East Main Street site (the current VA clinic) and asked that veterans be included in future planning; the council asked staff to send a letter indicating the concern and encouraging better outreach. No written comments were filed and no opposition was recorded at the hearing.
Outcome: After the hearing, the council voted to approve the TEFRA hearing procedural component (the motion to conduct the hearing and allow CMFA issuance) and the public hearing was closed. Staff and bond counsel noted the bonds are sole obligations of the borrower and would not affect the city’s appropriations limit or create city liabilities.
