THOUSAND OAKS : Reserve Funds OKd to Cover Plaza Work

With just four months to go before the Civic Arts Plaza’s grand opening, the Thousand Oaks City Council has agreed to borrow $13 million from city reserve funds to cover construction costs at the $64-million facility.

In drawing up an original financing plan, city leaders had counted on selling the former City Hall on Hillcrest Drive to raise money for the new cultural and government center.

But with the sour economy dragging down real estate prices, council members have decided to hold on to that property until the recession ends. In the meantime, they must borrow from seven different city accounts to pay the bills.

Finance Director Robert Biery assured the council at Tuesday’s meeting that he would dip only into funds held for future projects, and would not take money from day-to-day operating budgets. As soon as the city sells the Hillcrest Drive parcel, or any other surplus property, the funds will be replenished, with interest.

“This is a loan,” Councilwoman Judy Lazar said. “These are not gifts of public funds.”

That argument did not reassure Councilwoman Jaime Zukowski, who cast the only dissenting ballot in the 3-1 vote. Councilwoman Elois Zeanah was absent.

Zukowski said she could not approve the internal loans before seeing a detailed list of the city’s property holdings and each parcel’s estimated worth. She has also expressed concern that such borrowing could leave reserve funds short.

Defending his proposal, Biery said the city would save $400,000 a year by borrowing internally, instead of taking out a bank loan. The city can charge itself lower interest rates and set more flexible payment schedules, he said.

With the council’s authorization, Biery will borrow $4 million from the asset replacement fund, $2.5 million from capital funds, $2 million from the insurance reserve fund, $2 million from waste-water funds, $1 million from water funds, $1 million from the golf course fund, and $500,000 from the low- and moderate-income housing fund.