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Council approves tax‑exempt bonds to support La Maestra Family Clinic expansion
Summary
The council conducted a required public hearing and adopted a resolution to issue tax‑exempt revenue bonds for La Maestra Family Clinic’s Main Street property acquisition and improvements. The city disclosed no liability; a staff conflict of interest was announced and the city attorney recused.
The El Cajon City Council on July 9 opened and closed a required public hearing and adopted a resolution to issue tax‑exempt revenue bonds to reimburse La Maestra Family Clinic for property acquisition and project improvements at East Main Street.
The process: Jose Dorado, housing manager in the Community Development Division, explained that the public hearing is an IRS requirement for tax‑exempt bond financing and described the project location (1242–1248 East Main St.). The city attorney announced a conflict of interest and stepped out of the meeting, saying he represents La Maestra in the financing. Council received presentations from the California Municipal Finance Authority (CMFA) and La Maestra staff.
CMFA’s role and project scope: Jared Suzuki of the CMFA explained that the authority serves as the municipal issuer for qualifying nonprofit projects. Jeff Newman of La Maestra said the organization has provided health and social services in San Diego County since 1991, serves a patient population that is largely low‑income and multilingual, and is expanding services in East County. “We see this as an area of great need for the 84 percent of our patients who are at or under 200 percent of poverty,” Newman said.
Financing details and council questions: Staff emphasized that the bonds are being issued to reimburse La Maestra and that the city bears no liability for the financing. Council members asked how existing tenant leases on the acquired properties (a restaurant and a tobacco outlet) affect financing and tax status. CMFA and La Maestra staff explained the structure: portions of the acquisition and redevelopment tied to nonprofit services are eligible for tax‑exempt financing while lease portions that are for‑profit may be handled in a taxable piece of the financing; the bonds are publicly issued and purchased on the market at prevailing interest rates.
Vote and outcome: After receiving no speaker cards, a council member moved to adopt the staff recommendation; the motion carried by unanimous vote.
What this does and does not do: The council’s action allows tax‑exempt revenue bonds to be issued so La Maestra can be reimbursed for the acquisition and improvements; it does not transfer city liability to the general fund. The action also preserves public oversight steps required by federal tax rules and the joint powers agreement with CMFA.
The city attorney’s conflict disclosure was noted on the record and the attorney left the dais for the item.
