Report to City Council
ID: 26-0308 Page 1
TO: Mayor and City Council
FROM: Felicia London, Chief Financial Officer/City Treasurer
AGENDA DATE: August 18, 2026
TITLE: ADOPT A RESOLUTION AUTHORIZING
REIMBURSEMENT OF CERTAIN CAPITAL
IMPROVEMENT EXPENDITURES FROM THE
PROCEEDS OF A FUTURE INDEBTEDNESS (REPORT
OF: FINANCIAL & MANAGEMENT SERVICES )
(DISTRICT 3)
TITLE SUMMARY: Adopt Resolution 2026 -XX Authorizing Reimbursement of Expenditures From Proceeds Of A Future Indebtedness
Related to the Public Safety Campus Project
DISTRICT: District 3
Recommendation(s)
That the City Council:
1. Adopt Resolution No. 2026 -XX, Resolution of the City Council of the City of Moreno Valley, authorizing reimbursement of certain capital improvement expenditures from the proceeds of future indebtedness ("Reimbursement Resolution") related to t he Public Safety Campus Project.
SUMMARY
This report recommends the adoption of a Resolution No. 2026 -XX authorizing reimbursement of certain capital improvement expenditures from the proceeds of future lease revenue bonds to be issued by the Moreno Valley Public Financing Authority (the “Financing Authority”) related to the Public Safety Campus Project.
ID: 26-0308 Page 2
DISCUSSION
On July 16, 2026, the City acquired real property pursuant to an Agreement for Purchase and Sale of Real Estate for the Public Safety Campus Project (the “Project”). The Project will feature a new Public Safety Building, a new Animal Shelter, refurbishment of Fire Stations, and several other planned initiatives.
The City plans to finance the acquisition and renovation of certain real estate, along with related project costs, using proceeds from tax-exempt lease revenue bonds to be issued by the Financing A uthority. Given the project's benefits, the City believes that debt financing will provide immediate cash and allow repayment over an extended period, promoting intergenerational equity. The total principal amount of bonds expected to be issued by the Fina ncing Authority to reimburse for the land acquisition costs will not exceed $18,000,000. These funds will cover acquisition costs of $16,032,250 and other anticipated expenses.
Prior to the issuance of the tax-exempt bonds to be issued by the Financing Authority for the Project (the “Obligations”) , the City desires to incur certain project -related expenditures from available funds, with reimbursement to be made from a portion of the proceeds of the sale of the Obligations.
The Internal Revenue Service (“IRS”) requires that bond proceeds from a debt issuance be used only to pay for capital improvement expenditures incurred no more than 60 days before the issuance of the bonds in order for the bonds to qualify as tax -exempt. While this requirement was put in place to limit the potential for abuse, it also limits the flexibility to time a debt issuance and could drive up costs for rate payers. Under CFR Title 26 Section 1.150-2 et seq., the IRS has provided agencies issuing tax -exempt debt with a tool to help maintain the benefits of timing a debt issuance.
To maintain the bonds' tax-exempt status and allow capital improvement expenditures to occur outside of the 60-day window, the IRS allows an agency to pass a Reimbursement Resolution prior to that 60-day window. To help minimize the potential for abuse while still allowing agencies flexibility in their debt issuances, the Reimbursement Resolution requires certain items to demonstrate good faith. For example, two requirements supporting this are that the re solution must contain a general description of the projects as well as the maximum principal amount of debt expected to be issued for such purposes. Notwithstanding the foregoing, the City can generally reach back farther than the 60-day window to reimburse itself for design, engineering, architectural, and other soft costs associated with the Project.
Preserving the tax-exempt status of the debt issuance also saves ratepayers money. As such, staff recommends Council adopt a Reimbursement Resolution to afford the City flexibility to time debt issuances and preserve the debts’ tax -exempt status under IRS regulations. This recommendation does not obligate the Council to issue debt or authorize its issuance. By law, the Council must approve the issuance of debt. Staff will return to the Council for their consideration of any debt issuances related to this Project in October
ID: 26-0308 Page 3
of 2026.
ALTERNATIVES
1. Approve and authorize the recommended actions as presented in this staff report.
Staff recommends this alternative.
2. Do not approve and authorize the recommended actions as presented in this staff report. Staff does not recommend this alternative.
FISCAL IMPACT
There is no fiscal impact associated with adopting the Reimbursement Resolution
NOTIFICATION
Posting of Agenda.
PREPARATION OF STAFF REPORT
Prepared By: Department Head Approval:
Patty Yhuit Felicia London
Deputy Finance Director (Operations) Chief Financial Officer/City Treasurer
CITY COUNCIL GOALS
Community Image, Neighborhood Pride and Cleanliness: Promote a sense of community pride and foster an excellent image about our City by developing and executing programs which w ill result in quality development, enhanced neighborhood preservation efforts, including home rehabilitation and neighborhood restoration.
Public Facilities and Capital Projects: Ensure that needed public facilities, roadway improvements, and other infrastructure improvements are constructed and maintained.
Public Safety: Provide a safe and secure environment for people and property in the community, control the number and severity of fire and hazardous material incidents, and provide protection for citizens who live, work and visit the City of Moreno Valley.
Revenue Diversification and Preservation: Develop a variety of City revenue sources and policies to create a stable revenue base and fiscal policies to support essential City services, regardless of economic climate.
CITY COUNCIL STRATEGIC PRIORITIES
1. Economic Development
2. Public Safety
3. Library
4. Infrastructure
5. Beautification, Community Engagement, and Quality of Life
ID: 26-0308 Page 4
6. Youth Programs
ID: 26-0308 Page 5
Report Approval Details
Document
Title:
STAFFREPORT_FMS_AUTHORIZING_RESO_REIMB_OF_EXPENDI
TURES .docx
Attachment
s:
- Reso 2026-XX _Authorizing Reimb Expenditures .docx
Final
Approval
Date:
Aug 12, 2026
This report and all of its attachments were approved and signed as outlined below:
No Signature found
Patty Yhuit
Anna Chacon
Felicia London, MPA
Launa Jimenez
Brian Mohan
Patty Rodriguez
ID: 26-0308 Page 6
Report Approval Details
Document
Title:
STAFFREPORT_FMS_AUTHORIZING_RESO_REIMB_OF_EXPENDI
TURES .docx
Attachment
s:
- Reso 2026-XX _Authorizing Reimb Expenditures .docx
Final
Approval
Date:
Aug 12, 2026
This report and all of its attachments were approved and signed as outlined below:
Anna Chacon
Felicia London, MPA
Launa Jimenez
Brian Mohan
Patty Rodriguez