Agenda 04-07-2026; 8-k - Resolution Authorizing Loan to Orange Grove Fire District for Fire Station Improvements as Part of FY 2025-26 Spring Financing and Approval of Budget Amendment #8-A

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2 Under the proposed structure, the Fire District will reimburse the County annually for the full amount of debt service. If the Fire Department fails to make the required payment, the County will have the authority to offset overdue amounts from district tax distributions or other funds payable to the department, and per the promissory note can impose a 5% penalty on the amount due. County Recourse for Annual OGFD Repayment The County provides annual property tax revenues to OGFD in four equal quarterly payments each fiscal year based on their district tax levy. The OGFD debt service repayment date will be set for January 15 every fiscal year which coincides with peak tax collections for OGFD. If debt service payment is not received by January 15, the County will deduct and apply, through a right of set-off, an amount from the fourth quarter (March) property tax distribution to OGFD sufficient to satisfy the annual debt service requirement. The OGFD repayment will be recorded in the County's Debt Service Fund. FINANCIAL IMPACT: Because the Fire District will provide annual payments equal to the debt service obligation, the borrowing will not create a net General Fund tax burden for the County. The OGFD FY 2025-26 annual tax levy is projected to generate $1,133,337 for operating and maintenance expenses and the proposed debt service requirement (See draft debt service schedule). Budget Amendment #8-A increases authorization in the County Capital Fund by $1,700,000 and creates the following project ordinance: Orange Grove Fire Station #2 ($1,700,000) - Project# 17200 Revenues for this project: Current FY 2025-26 FY 2025-26 FY 2025-26 Amendment Revised Alternative Financing $0 $1,700,000 $1,700,000 Total Project Funding $0 $1,700,000 $1,700,000 Appropriated for this project: Current FY 2025-26 FY 2025-26 FY 2025-26 Amendment Revised Project Expenditures $0 $1,700,000 $1,700,000 Total Costs $0 $1,700,000 $1,700,000 ALIGNMENT WITH STRATEGIC PLAN: This item supports: • GOAL 6: DIVERSE AND VIBRANT ECONOMY RECOMMENDATION(S): The Manager recommends that the Board adopt the attached resolution authorizing Orange County to make a $1,700,000 loan to Orange Grove Fire District, approve the Promissory Note and Budget Amendment #8-A in substantially the form presented, and authorize the County Manager and Chief Financial Officer to take all actions necessary to implement the loan.