(September 29, 2005) -- On September 20, 2005 the Long Beach City Council voted 9-0 to accept a proposal by Aquarium management, supported by city management, that city officials acknowledged would cost the public an estimated $5 million per year in FY 07 and beyond ($4+ million already budgeted in FY 06). That money will be taken from LB's Tidelands Fund that could otherwise maintain and improve LB beaches and shorefront areas...so Aquarium management can pursue an expansion plan.

Councilmembers didn't seriously pursue alternatives. They didn't try to get a better deal for taxpayers. They didn't ask for further study. They didn't pursue options that might cost the public less. They didn't explore how a predicted self-supporting Aquarium turned into a multi-million dollar money pit.

LBReport.com has separately posted extended audio coverage of the August 1, 1995 meeting at which the City Council voted to put public money at risk if predicted Aquarium visitors and revenue didn't materialize. To access it, click here.

What took place in 1995 is excruciating...but what has taken place since then is in our opinion even worse. In April 2001, after predicted visitors and revenue didn't materialize, some claimed the Aquarium wasn't meant to stand alone and the "Pike @ Rainbow Harbor" would provide "critical mass." The Council refinanced the Aquarium bonds, delaying large debt payments for five years (past the 2002 election cycle that kept Mayor O'Neill and several incumbents in power).

In Sept. 2005, when predicted Aquarium visitors and revenue didn't materialize even with the Pike, Aquarium management offered the Council an even worse deal. The Aquarium was legally obligated to send City Hall basically all of its net revenue to pay its bond debt (in FY 07, about $8.5 million a year) although it was paying only about $2.1 million a year, supposedly all it could pay. The Aquarium offered to pay $3.5 million a year (greater efficiency? reduced expenses? magical higher attendance?) in exchange for the Council freezing Aquarium payments at $3.5 million instead of up to $8.5 million as had been required. [One local print outlet actually portrayed this as a rent increase.]

That means instead of using any private donations above $3.5 million to repay its bond debt and reduce the burden for taxpayers, Aquarium management is now free to use these private donations to expand the Aquarium while LB taxpayers struggle to pay $5+ million a year that the Aquarium was obligated to pay. These are sums that could otherwise be used to maintain and improve beach and shoreline areas.

If you represented taxpayers, would you accept such a bad deal? [Hint to Councilmembers: Don't even think about asking voters for a tax increase for police until you fix this.]

Wait, there's more. Despite Aquarium management's spin, the arrangement doesn't exactly use private donations to expand the Aquarium; in reality, it uses public funds because it relies on the $5 million a year that the Council agreed to let Aquarium management escape repaying.

And wait, there's still more. After the initial Aquarium bonds were sold, some studies claimed the building wasn't big enough to comfortably handle predicted attendance levels. How could that happen? Hello?

Three individuals who want to be LB's next Mayor were present at various points in this chronology. Councilman Doug Drummond was part of the 1995 Council action. Councilman Frank Colonna was part of the April 2001 and September 2005 Council votes. SCE exec Bob Foster has been on the Aquarium board since 1998, the opening year of a facility that was supposed pay its bond debt without a taxpayer bailout and now costs the public millions.

We think it would behoove all of them to support reconsidering and renegotiating the Sept. 20 Aquarium deal...to produce an end result that is better, not worse, for taxpayers.

Related coverage:

Archived Audio: Hear What Council Was Told, And Said, In 1995 About Aquarium Paying Its Bond Debt Without Taxpayer Bailout