LOS ANGELES -- Encinitas, Calif., plans to make its debut as a long-term borrower this week.
The city, incorporated five years ago by popular vote, wants to build a civic center. This Wednesday it is scheduled to offer a $7.4 million certificate of participation issue through a joint powers authority created by the city.
Encinitas also expects to sell an additional $4 million of certificates for the project during the first half of 1992.
An upscale community located on the coast, nealy 30 miles north of San Diego and with a popularion of 56,000, Encinitas has never sold general obligation bonds or any other long-term debt, according to the city's financial adviser.
The adviser noted that it is increasingly rare to find a first-time municipal issuer.
"You don't see this every day," said Richard H. Clark, managing director of the public finance deparment of Security Pacific National Bank, the financial adviser on the competitively bid issue. Mr. Clark predicted the small issue would do well because "it's a new name and the market seems to like new names."
The certificates will fund land acquisition and construction, in addition to improvements on a one-story building that formerly housed a supermarket. The building, which overlooks the Pacific Ocean, will be remodeled into the new civic center.
"We're very happy to be in the market," said Warren H. Shafer, city manger for Encinitas. "This is a critical project for our city."
Lease payments on the civic center building by the city to the joint powers authority will pay off the certificates, Mr. Shafer said. The COPs are not considered debt under California law and do not represent a lien on the city's general fund, according to language in the preliminary official statement.
The certificates received a conditional A1 rating from Moody's Investors Service and an A-minus provisional rating from Standard & Poor's Corp.