The City of Lindsay will be able to make its bond payments after all, thanks to a $405,000 loan from Tulare County.
The loan, which is effectively a paycheck advance, accelerates payments of the city’s share of property taxes by about two months. The county, which receives the property taxes first, agreed to issue the money early in exchange for an April withholding plus 2.5% interest. But there wasn’t much time to lose. Four bond payments were due at 10 a.m. on Wednesday.
The shortfall was caused by the disappearance of redevelopment money, which had been used to service bond debt in recent years. When the city lost its $1.5 million in funding, it was less with roughly half the cash necessary to pay the debt service. The situation was simply compounded by a misunderstanding between the city and the state regarding what paperwork would be required and what would not be to receive funds.
From the Visalia Times Delta:
Tulare County has granted a nearly $405,000 loan to the city of Lindsay so it doesn’t default today on bond debt payments.
“I would like to point out the money is in hand,” Tulare County Supervisor Allen Ishida noted prior to the Board of Supervisors voting on the loan Tuesday during the group’s regular weekly meeting.
The Lindsay City Council, in a special meeting Monday night, voted to request the loan from the county.
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