Santa Ana : $40-Million Bond Issue Sold to E.F. Hutton

A $40-million bond issue that will finance the Westdome arena if the project is approved in March was sold to underwriters E. F. Hutton and Co. in San Francisco on Tuesday, the deadline day for the sale, city officials said.

The firm will put the bonds in the hands of the trustee, Dai-Ichi Kangyo Bank, pending a final decision on the 20,500-seat arena, which is expected to come before the City Council in March.

Westdome partner Allan Durkovic and city officials traveled to San Francisco on Tuesday to complete the deal. The sale of the industrial development bonds had to be completed Tuesday because of impending federal legislation that could end such financing by removing its tax-exempt status.

The bonds are earmarked to pay for an arena at Flower Street and Civic Center Drive; the existing Santa Ana Stadium would be demolished to make way for the project.

The City Council ruled Monday night that the downtown site would be the primary location for the project. If another site is selected, the city would have to seek approval from the Internal Revenue Service to transfer the tax-exempt bonds, and city officials have said that there is a “substantial risk” that the transfer would be turned down.

A study of the downtown site has indicated that the project would have substantial adverse impact but added that so-called mitigation measures can be worked out.