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Eureka council clears $50 million in CMFA tax-exempt bonds for two apartment projects
Summary
The City Council approved two separate TEFRA hearings and resolutions supporting up to $30 million for Green Phase Apartments and up to $20 million for EarthCenter Apartments; both motions passed unanimously, and staff noted the city assumes no liability for the conduit issuances.
Eureka — On April 21 the City Council approved two separate resolutions under the Tax Equity and Fiscal Responsibility Act (TEFRA) to permit conduit issuances of tax-exempt revenue bonds by the California Municipal Finance Authority (CMFA): up to $30 million for the Green Phase Apartments and up to $20 million for EarthCenter Apartments.
City staff opened public hearings for each project and explained the bond issuances would be conduit financings handled by CMFA and applied for by the Eureka Housing Authority and developers, not the city. Ben Barker of CMFA, filling in for the project manager, said the structure is intended to prevent city liability. "The city is not issuing the bonds. The city is not taking on any risk liability or moral obligation with the bonds," Barker told the council.
Councilmember Bauer moved the Green Phase resolution; the motion carried 5-0. Councilmember Moulton then moved the EarthCenter resolution; that motion also passed 5-0. Both votes were roll-call and unanimous.
Council discussion focused on procedural questions from the public and confirmation that staff time is the primary city expense, not debt service. City staff clarified notice requirements and explained the public-hearing steps required under state and federal tax rules before the CMFA may issue conduit bonds.
What happened next: With the council'level approvals in hand, CMFA and developers may proceed with final structuring and underwriting. The city will return any necessary ministerial approvals but does not share in the projects'debt service or associated financial risk under the conduit arrangement.
Votes at a glance: the council subsequently approved several other ordinances and items on the consent calendar during the same meeting; see the 'Votes at a glance' article for details.
