Page 107 - Moreno Valley 2025 Annual Financial Report

City of Moreno Valley, California

Notes to Financial Statements
For the Year Ended June 30, 2025

Note 12. Successor Agency Trust for Assets of the Former Redevelopment Agency (Continued)

Long-term Debt

A description of long-term debt outstanding of the Successor Agency as of June 30, 2025,
follows:

Balance Balance Due Within
July 1, 2024 Additions Repayments June 30, 2025 One Year
Fiduciary Activities
City loans - Principal $ 6,836,015 $ - $ (595,140) $ 6,240,875 $ 595,140
City loans - Interest 1,865,326 - (167,860) 1,697,466 167,860
2017 Ref of the 2007 TABs, Series A 38,045,000 - - 38,045,000 1,395,000
Unamortized premium 2,505,152 - (167,010) 2,338,142 167,010
Totals $ 48,321,483 $ - $ (930,010) $ 48,321,483 $ 2,325,010

Loans Payable to the City of Moreno Valley
The Towngate Regional Mall notes (Sears Note), totaling $13,000,000, originated from a
participation agreement (as amended) whereby the Agency acquired certain parcels within
the mall for subsequent transfer to major tenants. The notes bear interest of 4.9% and are
payable solely from available site-generated property tax increment. Furthermore, the Agency
had covenanted to use reasonable best efforts to refinance these notes with Tax Allocation
Bonds, provided such financing is determined to be fiscally feasible. During 2003-2004, the
City purchased the rights to the notes from the holder.

In a letter dated May 26, 2012, the California Department of Finance approved this loan as
an enforceable obligation. At June 30, 2025, the outstanding principal and accrued interest
balances are $6,240,875 and $1,697,466, respectively.

2017 Tax Allocation Bonds Series A

On September 13, 2017, the Successor Agency for the City of Moreno Valley issued bonds in
the amount of $38,045,000 for the purpose of paying off the remaining portion of the 2007
Moreno Valley Redevelopment Agency Tax Allocation Bonds ($40,855,000 as of August 1,
2017). These bonds are comprised of both serial and term bonds bearing interest rates ranging
from 3% to 5%. With a final maturity of August 1, 2038 that bear a true interest cost of 3.057%.
These bonds include an optional call provision beginning in 2027. The repayment of this debt
will be financed through Tax Increment and has been approved by the California Department of
Finance to be included in future Recognized Obligation Payment Schedules (ROPS) submitted
by the Successor Agency. This transaction is a current refunding of the outstanding debt, and
resulted in an economic gain of $8 million and a net savings in debt service costs of $9.2
million.

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