ALAMEDA -- The $5 million needed to pay for the design and construction of a new fire station to serve the center of the Island will come from a mix of one-time funds, an internal loan and external financing under a plan that the City Council will consider Tuesday.
The new station would be built at a city-owned site at Hibbard Street and Buena Vista Avenue and replace Fire Station Three, which now operates out of a former family home that the city rents on Grand Street because the station's building on the same block is not earthquake safe.
The bulk of the money for the new station, or $3 million, will come through a loan from the California State Infrastructure and Economic Development Bank, or "IBank," which offers financing to public agencies for infrastructure projects at interest rates generally lower than what is available on the open market. City officials expect to get about a 4 percent rate on a 20-year loan.
The other major portion of the funding, or $1.2 million, will come through an internal loan from the city's Equipment Replacement Fund, an amount that also includes the anticipated proceeds from selling the site of the currently shuttered station at 1703 Grand St., which has been appraised at $475,000.
The total expected cost to the General Fund over the 20-year period of the loan will be about $8.10 million -- $1.19 million in one-time funds plus $6.91 million in debt service payments, according to a background report prepared for the council.
The cost will be offset, however, by the approximately $50,000 that the city will save annually from not paying rent for the house at 1709 Grand St., as well as the anticipated energy savings from the new station.
Rehabilitating Fire Station Three, which was built in 1924, is not a viable option, plus the building is too small to accommodate current standard fire trucks and equipment, City Manager John Russo said. The building has been closed since 2001.
The proposal before the council Tuesday to begin securing the funding follows its approval of the financing plan for the project in March.
It also follows the council allocating $2.6 million in September 2013 for a new Emergency Operations Center that will be built near the new station at Buena Vista Avenue and Grand Street. That money will come by extending and refinancing lease revenue bonds, or Certificates of Participation, that were originally issued in 2002 for seismic and other upgrades at City Hall.
While refinancing the bonds will cover the cost of a new emergency center, it will not provide enough to pay for the new fire station, according to city officials. Currently, a center to coordinate relief efforts in the event of an earthquake or other major emergency would be set up in the Alameda police station basement.
The moves to seek funding for the new station and emergency center follows Alameda voters rejecting a ballot measure in June 2012 that would have raised the local sales tax by a half-cent to help pay for the projects.
Reach Peter Hegarty at 5110-748-1654 or follow him on Twitter.com/Peter_Hegarty.
The Alameda City Council will meet at 7 p.m. Tuesday in the Council Chambers at City Hall, 2263 Santa Clara Ave.