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Perris council OKs hybrid funding approach for new South Fire Station 105
Summary
Council approved staff’s recommended hybrid funding plan (combining assigned reserves, development impact fees and a secured line of credit) to finance a new South Fire Station 105, with an estimated project cost of about $15.4 million; staff will return with financing details and draw schedules.
The Perris City Council voted to proceed with a hybrid funding strategy for Fire Station 105, combining assigned reserves, a portion of unassigned reserves/DIF and a secured revolving line of credit to finance an estimated $15.4 million project.
Assistant City Manager Ernie Reyna told the council design is roughly 95% complete and presented four options: (1) all internal funding using assigned and unassigned reserves and development impact fees (DIF); (2) a significant external financing component; (3) a hybrid recommended by the public safety committee that minimizes external borrowing to about $4.1 million; and (4) fully external financing. Staff noted assigned reserves relevant to public safety total about $6.2 million and DIF availability is about $1.0 million. Construction and contingency assumptions produced a not-to-exceed figure of about $15.4 million.
Staff also presented a secured, revolving line of credit offered by Citizens Business Bank at roughly 4.75% interest; staff described that as cost-efficient because interest would be charged only on draws and there is no prepayment penalty. Reyna said staff expects to use the line prudently, draw as progress payments are needed, and aim to repay principal within roughly five years.
Councilmember Corona moved to adopt the public-safety committee-recommended hybrid (option 3); the motion passed 5-0. Staff will return with financing documents and periodic construction updates to the council.
