The short answer is no.
The refinancing of these bonds and loans - otherwise known as the outstanding debt of Coronado's former redevelopment agency - by its governing body, the Successor Agency, cannot possibly affect the density of the town. There is no correlation. No new development is needed to pay off the outstanding debt, which was the result of funds used over the past 15 years to build City facilities and Coronado Unified School District schools. What is currently paying off that outstanding debt is tax increment revenue from the School District's share of property taxes and there is more than enough collected annually to pay off the bonds and loans, and then some.
Property taxes in Coronado have risen steadily over the years due to a very strong real estate market. Many of these homes pay today's tax rates because they were sold after 1978. But there are many homes in Coronado that continue to pay a property tax rate that is more than 40 years old. Approximately 82% of all single-family homes are assessed below the May 2018 median sales price. Proposition 13, which voters approved in 1978, rolled back most real estate assessments to 1975 market value levels, limited the property tax rate to 1%, and limited future property tax increases. Under Proposition 13, properties are reassessed only upon a change of ownership or the completion of new construction. Eventually, homes will be reassessed once sold, which will continue to increase the City's property tax revenues.
The refinancing of the outstanding debt of the former Coronado Development Agency, an entity separate from the City of Coronado, by the Successor Agency has been misconstrued by some in the community. The Successor Agency acted to refinance the outstanding debt solely to help the Coronado Unified School District. The Successor Agency could have continued paying the outstanding debt with the current tax increment revenue. The City is not benefitting nor is it harmed in any way from the refinancing action. It stands to gain nothing from the early payoff of the outstanding obligations of its former redevelopment agency. However, the School District will realize substantial benefits once the bonds and loans are paid off early, and for this reason, it is a benefit to the community. The sooner the debt is refinanced and paid off, the more revenue the School District will receive. The School District will receive the full amount of its allotted property tax revenues, or 32.46%, instead of it going to the former agency's debt.
The initial repayment schedule would have had the redevelopment agency's obligations paid by 2036. However, by restructuring the agency's obligations - a process similar to refinancing a home mortgage to take advantage of lower interest rates - the debt will be paid off seven years sooner. The steady rise in Coronado property values and lower interest rates are the means by which the debt will be paid off sooner. Once the restructured obligations have been paid off, the School District can remove itself from the California School Funding formula and achieve the financially preferred "basic aid" status. The School District will then receive its entire allocation of property taxes from the San Diego County Auditor-Controller.
Understanding how the refinancing works will help people understand the Successor Agency's reasons for taking this action and the School District's full support. For a full breakdown of Coronado's tax increment please view the Coronado Tax Increment Breakdown (DOCX).