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Subcommittee advances up to $10 million tax-exempt bonds for Children’s Day School
Summary
The Budget & Finance Subcommittee advanced a resolution to approve up to $10,000,000 in tax-exempt bonds issued by the California Municipal Finance Authority to finance capital facilities for the Children’s Day School; staff said the city bears no repayment responsibility. The item will go to the full Board on 06/08/2010.
The Budget & Finance Subcommittee on June 8 advanced a resolution allowing the California Municipal Finance Authority to issue tax-exempt bonds, not to exceed $10,000,000, to finance capital facilities owned or leased by the Children’s Day School.
Anthony Ababond of the Office of Public Finance told the committee the action is required under federal tax law to allow the borrower to access tax-exempt financing and that the measure carries no fiscal impact for the city. "There's no fiscal impact to the city, and the city is not responsible for repayment," Ababond said.
The clerk introduced the item as a resolution authorizing the state sale of tax-exempt bonds; committee members were told representatives of the school and counsel were available for questions. Chair Supervisor John Aveloz opened and closed public comment after seeing no speakers and asked for a motion. The committee approved the item without objection and advanced it to the full Board of Supervisors agenda for 06/08/2010.
Why it matters: Tax-exempt bond financing can lower borrowing costs for nonprofit and private entities that operate facilities serving the public; the county's action is procedural authorization required for tax-exempt status and does not create a city liability, according to staff.
What happens next: The resolution will be listed on the full Board of Supervisors agenda on June 8 for final consideration.
