City approves $30 million borrowing measures

The City Council approved a $20 million bond measure on Dec. 15 to cover the cost the recent Superblock judgment.

Christina Daly/Herald

The City Council voted unanimously on Dec. 15 to approve two separate borrowing measures, including a 15-year, $20.5 million bond initiative to pay two former owners of the now-vacant Superblock property.

In what was described as a setback for the city in the long and tedious legal saga involving the Superblock, the New York State Court of Appeals in September rejected Long Beach’s appeal of a ruling earlier this year that awarded two former owners of the property millions of dollars, after the court said they were underpaid when the city acquired the property in an effort to develop it through eminent domain nearly a decade ago.

The appellate court affirmed State Supreme Court Judge Thomas Adams’s 2012 ruling in favor of former owners Sun NLF Limited Partnership and developers Louis Bombart and Steve Silverberg, who owned a total of five parcels on the six-acre Superblock.

According to the city, Adams ruled that Sun NLF and Bombart and Silverberg were each entitled to $5.5 million more than what the city had initially paid. Long Beach must also pay 6 percent annual interest, plus attorneys’ fees.

Officials called the eminent domain case the only remaining litigation involving the Superblock, and the ruling means that the city is on the hook for a whopping $19 million.

Officials said they have yet to determine how to repay the bonds. “Going forward, the city will continue to work with its financial advisers to determine the best course of action,” City Manager Jack Schnirman said at the City Council meeting on Dec. 15. “The debt service impact will be analyzed and addressed during the city’s upcoming budget process. The matter before us is not how we will ultimately finance that payment but … immediately make that payment of which, unfortunately, there is really no … alternative.”