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362 Superintendent of the Pleasanton Unified School District in the ' last two months regarding the project and the potential to delay it, and suggested two options: (1) the possibility of converting the project into a single gymnasium; and (2) the possibility of delaying the project for a short period of time to give the City a chance to determine its financial situation in terms of its proceeds from development, its operating budget and the ability to support any kind of creative financing. Both options do not appeal to the School District. She stated that a third alternative that the City has been considering is a loan from the School District with a repayment period that would extend beyond 12 months. She suggested that the City continue working with the School District to come up with a financing plan between the two parties that would enable the project to move forward. Ms. Mohr inquired if the loan payments would be spread over the next years' budget and involve re-prioritizing the Capital Improvement Program (CIP) projects to make the funds available. Ms. Acosta said yes. She explained that the City has reached a point where it no longer has the ability to come up with cash or increase its debt ratio to fund capital projects while continuing to make payments. Mr. Michael Horton, 1275 Harvest Road, inquired what the priority of the gymnasium is in the CIP and how the gymnasium was originally proposed to be funded. Mr. Mercer replied that the City's first CIP priority is the Senior Center, followed by the Harvest Park School Gymnasium. He continued that the gymnasium would be jointly financed by the City and the School District. He indicated that the School District has already spent more than $500,000 to relocate a transformer and construct a parking lot for the double gymnasium and that the City should stand by its commitment. Ms. Judy Markolf, a member of the Pleasanton Unified School District Board, stated that the School District would like to move forward with the project for the benefit of the school and the community. She pointed out that the School District has already spent for improvements for a double gymnasium that would only go to waste if a single gymnasium is constructed. She indicated that having the School District extend a loan to the City to finance the gymnasium would be a viable alternative that could be discussed by the City and the School District so that construction can start immediately and give the School District the ability to proceed with continuing improvements in other areas of the school after the gymnasium is completed. - 14 - 8-6-91