Measure FP
General Obligation Bonds
City Manager/Financial Services
October 13, 2026
Overview
• Resolution to Authorize
• Measure FP Recap
• About the Municipal Bond Market
• Competitive Bid Process
• Documentation
• City Credit Rating
• Bond Structure and Tax Levy Rates
• Next Steps and Recommendation
1 Resolution to Authorize…
• Issuance of the full $93,350,000
• Sell the GO Bonds competitively (a “public auction”) in the municipal bond market
• Approve the use of the Preliminary Official Statement • Delegate authority to complete documentation
2 3
Measure FP Recap
• Approved November 5, 2024
(71.4% yes)
• $93,350,000 General
Obligation (GO) Bonds
• Replace: Fire Stations 1 & 2,
Main Police Station
• Renovate: Police Annex
To recruit/retain qualified
firefighters/paramedics/police, improve Redondo
Beach’s ability to provide fire/police protection
and 911 response, help keep Redondo Beach
safe by repairing/replacing/upgrading
deteriorated fire/police stations/facilities,
including removing asbestos and mold, shall
Redondo Beach’s measure authorizing
$93,350,000 in bonds at legal rates, levying on
average $17.45 per $100,000 of assessed
valuation, generating approximately $6,280,000
annually while bonds are outstanding, requiring
oversight, spending disclosure, and all funds
spent locally, be adopted?
BONDS
YES
______
BONDS
NO
______
4 Project Timeline
• Current in Phase 1 Design
2026 2027 2028 2029
Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
N.T.P.
Concept
Design
Schematic
Design
D.D. Phase
G.M.P.
C.D. Phase
Permitting
Construction
Project Cost (est.)
• Initial planning
expects the
Projects to use the
full $93,350,000
• PDB/GMP
approach
maximizes value
and keeps delivery
on budget and on
time
5 Fire Police
Pre-Construction Design & Support
Services
$2,250,000 $2,400,000
Construction Materials & Labor 26,300,000 26,500,000
Construction Services, Admin Oversight
and Project Management
9,300,000 9,750,000
Temporary Facilities and Relocation 5,350,000 2,000,000 Environmental, Testing, Utilities, FF&E
and Miscellaneous
2,300,000 2,700,000
Contingency 2,500,000 2,000,000
Total $48,000,000 $45,350,000
6 About the Municipal Bond Market
• $4 trillion of bonds issued by
state and local governments
• Interest generally exempt from
Federal and state income tax
• Yields often below taxable bonds (U.S. Treasuries, Federal agencies, corporates) • Fully amortizing bonds that
fund capital projects
• Most carry high credit ratings,
reflecting strong likelihood of
repayment
$0T
$10T
$20T
$30T
$40T
$50T
$60T
$70T
$80T
Recent Municipal Bond Market
Conditions
• Rates have risen in 2026,
especially since July 1
• Drivers include:
• Federal Reserve and other
central bank rate hikes
• Record municipal bond
issuance
• Competing demand for
borrowing
• Current estimated cost of
Measure FP GO Bonds: 5.19%
7 2.0%
2.5%
3.0%
3.5%
4.0%
4.5%
5.0%
5.5%
5-Year, 10-Year, and 30-Year MMD
Since January 2026
5-Year 10-Year 30-Year
5Y 10Y 30Y
1/2/26 2.40% 2.78% 4.25%
7/1/26 2.59% 2.96% 4.20%
Current 3.53% 3.98% 5.12%
Competitive Bid Process
• One of two common ways to sell municipal
bonds
• Alternative: negotiated sale
• City sets sale parameters (amount,
amortization, bond type, etc.)
• Investment banks submit sealed bids to buy
and resell the bonds to the public
• Lowest effective rate, or true interest cost (TIC),
wins
• TIC compares debt service to purchase price
8 Method of Sale
(2026 YTD)
Negotiated
Competitive
Method of Sale
(2025)
Negotiated
Competitive
Private
Industry Best Practice
• Competitive bid process awards the GO Bonds based
solely on lowest effective borrowing cost
• Ensures the lowest tax levy rates
• GFOA and CDIAC guidelines recommends using
competitive bid process for:
• Highly rated bonds
• General obligation bonds
• Traditional bond structures
9 Documents for Approval
• Resolution
• Fiscal Agent Agreement
• Preliminary Official Statement
(prospectus)
• Appendix A
• Notice of Intention to Sell Bonds
• Official Notice of Sale
• Continuing Disclosure Agreement
10 11
“AA+” Credit Rating from S&P
• “…The rating reflects…Redondo Beach’s robust, high-income economy…, conservative fiscal management…, and a reserve policy that has been maintained above its formal policy… • The fiscal 2027 budget is balanced and there are no material draws planned for reserves…
• Despite the notable cushion, if continued draws on their reserves occur, it could pressure the rating as the current level is below similar rated peers…
• Stable outlook reflects our view that Redondo Beach will maintain a sound operating profile supported by its robust tax base and prudent management…”
Bond Structure
• Repaid in equal annual amounts (level debt service)
• Principal paid 2028–2056 (30-year term)
• 2027 interest paid from sale proceeds (capitalized) until taxes can be levied
12 $0
$2
$4
$6
$8
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
2038
2039
2040
2041
2042
2043
2044
2045
2046
2047
2048
2049
2050
2051
2052
2053
2054
2055
2056
Millions
Estimated Debt Service
Principal Interest Capitalized Interest
13 Estimated Cost
Current
Estimate
(10/6/2026)
Ordinance No.
3274-24
(Aug. 2024)
True Interest Cost (TIC) 5.19% n/a
Finance Charge $525,000 n/a
Total Proceeds Received $93,350,000 $93,350,000
Average Net Annual Repayment
Requirement $6,610,100 $6,280,000
Total Net Repayment Requirement $191,692,923 $182,004,931 Tax Levy Rates
• Property taxes levied to cover annual debt service
• Each owner pays a “fair” share: their property’s assessed valuation (AV) divided by total City AV
• Levies adjusted annually for AV changes
• Average rate over bond life: $17.40 per $100,000 AV (vs. $17.45 est. on ballot), assuming 3.5% overall AV growth • Prop 13 limits changes to each owner’s levy
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Next Steps
• October 14, 2026: Publish intention to sell bonds
• October 15, 2026: Publish Preliminary Offer
Statement and Notice of Sale
• October 27, 2026: Bid Opening
• November 10, 2026: Bond Closing
16 Fiscal Impact
• Reimburse approximately $1.5 million of expenditures for the Projects
• Reimburse $53,150.40 of Measure FP election costs
• Debt service will be paid primarily from property taxes • Ongoing administrative costs will be included in future annual budgets
17 Coordination
• City Departments:
• City Attorney’s Office, City Manager’s Office, City
Treasurer’s Office, Financial Services
• Budget and Finance Commission:
• Municipal Advisor Selection
• Presentation 10/8/26; discussion informed Admin Report to Council
• Bond Financing Team:
• Municipal Advisor, Bond Counsel, Disclosure Counsel,
Fiscal Agent
RECOMMENDATION
• That the City Council adopt the Resolution to authorize the issuance of the Measure FP GO Bonds
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