The San Mateo County Harbor Commission on Wednesday gave itself clearance to spend money at Pillar Point Harbor, and then borrow that cash back at a later date.
Under the plan, the harbor commission could begin spending money from its cash reserves on preliminary architecture drawings and permits. Those expenses could then be reimbursed at a future date if the harbor commissioners decide to borrow money, possibly by issuing bonds.
District General Manager Peter Grenell said the action was a necessary step for the district to be repaid on its upfront costs. Going this route would expedite the Pillar Point Harbor improvements, he said.
“It’s a common mechanism that’s used; there’s nothing mysterious about it,” he said. “It’s a preparation for the possibility of a cash-flow reimbursement.”
That construction could mean the harbor district would borrow $25 million, according to a staff estimate. Grenell said that money could come from issuing bonds or by taking out a loan from a government infrastructure bank. He could not say when the district would be looking to borrow money.
The harbor district has enlisted the firm Orrick, Sutcliffe & Herrington to serve as bond counsel, according to the agency’s attorney Jean Savaree.
Some observers on the Midcoast criticized the Pillar Point renovations, saying the notion of borrowing more money was poorly timed. The harbor district is already paying off a $10 million debt to the Department of Boating and Waterways.
“It seems like they should be taking care of what they have instead of going more deeply into debt for these pie-in-the-sky projects,” said Midcoast Community Council member Lisa Ketcham. “Why do they need a new pier? Why do they need to put the public more in debt?”
At the Wednesday harbor commission meeting, candidate Sabrina Brennan asked that the harbor board delay making a decision about the reimbursement until they meet again on the Coastside.
The board unanimously approved the resolution.
By Mark Noack | Thursday, August 16, 2012
At the Aug. 15, 2012 Harbor District meeting Commissioners unanimously approved a $25 million spending plan for a new administrative building and parking lot. The Half Moon Bay Review reported the following: