Mayor Jerry Sanders predicted today that the city of San Diego will return to the public bond market, where borrowing for big municipal projects is cheaper than the private loans relied on for years by San Diego, by late April.
Sanders said the financial ratings agencies will only give clearance for the city to reenter the public markets once the city receives its 2006 fiscal year audit, a milestone the mayor said he expects the city to reach by late January. In June, the mayor said the city would only need to complete the backlogged 2005 audit to return to the good graces of Wall Street, but additional delays have drawn the process out further. Sanders blamed the City Attorney’s Office for eight weeks of delays, saying documents weren’t prepared in a timely manner.
The ratings agencies’ negative opinions of the city’s financial practices have left the city barred from Wall Street since 2004.
In the meantime, Sanders said he hopes to take out two private loans. Sanders said $120 million is needed to continue making upgrades to the city’s water system in order to comply with state health regulations. Another $100 million will be borrowed privately to improve city facilities, streets, sidewalks and storm drains, he said.
Sanders said he has plans to issue more debt after the city reaches Wall Street in order to borrow funds to pay off pension debt and to upgrade the sewer system so the city can abide by a settlement with the U.S Environmental Protection Agency.