Rehabilitation of La Laguna Resort & Campground

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Proposed La Laguna RV Resort & Campground Project

Brief Timeline History of the Campground:

  • 1963 – The State of California, Division of Beaches and Parks opens the Lake Elsinore State Park and Campground.

     

  • 1984 - The Lake Elsinore Management Project received $39.6 million from the US Bureau of Reclamation Small Projects Act (Lobbying trip by the City and EVMWD) to build an earthen levee, project wells and a new inlet channel which was followed by a separate project to build the outlet channel and completed in 1995.

     

  • 1993 – The City of Lake Elsinore was deeded the campground in perpetuity from the State of California which was then renamed the Lake Recreation Area.

     

  • 1997 – The City and EVMWD formed a landmark Recycled Water Task Force. State voters approved a $15 million bond to create the Lake Elsinore San Jacinto Watersheds Authority (LESJWA).

     

  • 2002 – The City contracted out the campground operations.

     

  • 2007 – Ten (10) years after the Recycled Water Task Force – Lake Elsinore becomes the 1st natural lake in California to win approval from the State to use recycled water to recharge the Lake and allow full body contact.

     

  • 2008 – The City initiated plans to construct a new boat launch.

     

  • 2012 -   The City opens the $8.66 million recreational boat launch at La Laguna RV Resort and Campground.  Funding included a $3 million grant from California State Department of Boating and Waterways, $4.978 million in RDA bonds, $314k in Parks DIF, and $365k in City funds.

     

  • 2015 – The City commissioned a feasibility study by a national campground consultant who recommended a full rehabilitation of the site to capture the current and growing market in Southern California.

     

  • 2015 – The City took over operations from the campground contractor.

     

  • 2016 – In April, the City Council awarded a design contract for Architecture to STK Architects and kicks off this Visionary Plan to transform the existing facility into La Laguna RV Resort and Campground.

  • The total invested in the lake is approximately $67.5 million for the following:

 

 funds in lake

funds in lake chart

La Laguna RV Resort and Campground Park Project – Rehabilitation: 

  • The La Laguna RV Resort and Campground Park Project will enable the City to further improve the lake area and turn it into a destination area for the city. 

 

  • The Project will create new amenities and renovate the campgrounds for use by the community, residents and visitors.

     

  • The Project initially consists of $10 million of improvements including picnic/shade structures, activity areas, new campsites, RV hookups, parking, concessions stand, bait & tackle shop, administrative buildings and new entry way. 

  • The City will raise about $11.385 million by issuing lease revenue bonds to finance the Project. The financing budget breakdown is below: 

Project Costs

$10,000,000

Capitalized Interest*

$356,000

Reserve Fund

$659,000

Financing Costs

$370,000

Total Financing Budget

$11,385,000

* Represents prepaid interest that will be used to make interest payments (for about 12 months) while the Project is being constructed..

  • The City will issue “lease revenue bonds” which is a low-cost financing structure commonly used by cities and counties in California to finance long-term capital projects.

     

    • In order to secure the lowest interest rates, the City will use its General Fund to backstop the annual payments (ultimately the payments will be covered by income generated from the Project).

    • The City has the option to use various assets to secure the lease for the bonds: (1) Project by itself and/or (2) other City-owned assets such as city hall, fire stations, parks, etc.

    • The City can garner bond insurance/surety for its bonds, which will lead to lower costs, if it uses stronger assets such as city hall, fire stations, etc. The estimated total savings (in lower payments) is about $880,000 over the life of the bonds. 

  • The average annual payments will be about $640,000. Over the 31-year borrowing term, the City will pay about $19,000,000 in principal and interest payments.

     

    • Interest rates are at all-time lows which will enable the City to borrow at long-term, fixed rates ranging from 3.80%-4.10%.

  • The Project is estimated to generate revenues that will cover the annual bond payments.

     

    • Based on conservative projections, the City estimates that annual income from the Project will range from $1.09 – $2.21 million, depending on the level of RV/campsite occupancy.  Currently, revenues are approximately $450k to $500k annually.

  • Currently for FY2015-16, the campground is projected to generate approximately $450,000 with offsetting expenses of $390,000 netting $60,000, which represents an approximately 200% increase over the prior concessionaire. 

     

  • On April 12, 2016, the City Council approved hiring an architect to complete design and drawings for the Project; at that same meeting, the City Council approved the bond financing for the Project.

  • The final Project design is planned to be presented to the City Council in August 2016 for review/comment by the public.

  • The detailed bond financing package will be presented to the City Council in August 2016 for final approval.

campground photo