ALAMEDA -- The City Council has approved loaning the Alameda Unified School District $1.5 million to upgrade the Emma Hood Swim Center, but district trustees still must decide whether they will accept the money or whether they will seek funding elsewhere.
The council also voted Tuesday to provide trustees with 30 days to accept the terms, and to extend its agreement with the district to operate the island's public swim centers until Oct. 21.
If trustees reject the terms, city officials say they will begin exploring building a new swim center at the former U.S. Navy gymnasium at Alameda Point.
About $1.9 million is needed to renovate Emma Hood on the Alameda High School campus. It features two heated outdoor pools that are used by the school's swim and water polo teams, as well as the public.
Much of the work would consist of removing the diving pool and creating a joint competition and diving pool, said Amy Wooldridge, director of the Alameda Recreation and Park District.
The terms of the city's 10-year loan call for a 4 percent interest rate, or for the district to pay $142,000 annually. It also calls for the district to put up security.
"I think what we are laying out is fair," Councilman Tony Daysog said.
But Wooldridge told the council that public schools Superintendent Kirsten Vital has offered different terms, including an annual interest rate of between 1 and 2 percent, and for the district to face a financial penalty if it fails to make a payment instead of having to put up collateral.
Vital also asked for a memorandum of understanding instead of a loan to help protect the district's credit rating, Wooldridge said.
Mayor Marie Gilmore said any move to take collateral off the table would be "a deal-breaker" for the city.
City and district officials have been working to find a way to make needed upgrades at the swim centers for about two years. They will meet again Tuesday, when Vital is also expected to brief trustees on the issue and what the city has offered.
The one-year joint operating agreement, which the council voted unanimously to extend until Oct. 21, calls for the city to pay for ongoing maintenance at Emma Hood and the swim center at Encinal High School, and for the district to fund major capital work. Each side currently pays about $150,000 annually.
The district will pick up the city's share when the agreement expires.
Don Krause, the former president of Alameda Island Aquatics, said the council was forcing the district to accept the city's loan terms because otherwise the swim centers could close.
"Where's the cooperation?" Krause said. "This memorandum is a threat to AUSD. Do it within 30 days or we are picking up our toys and we are going home."
The council approved the operating agreement with the district in June last year after voters rejected a proposal to raise the city's sales tax to help pay for a new swim center, the construction of an emergency operations center and other projects.
The loan for Emma Hood would come through the city's equipment replacement fund. The city has already earmarked $750,000 this year in its capital improvement program toward the pools.
Councilwoman Lena Tam cast the lone vote against offering the loan, questioning whether it was the "best and highest" use of money from the city's equipment fund.
Contact Peter Hegarty at 510-748-1654. Follow him at Twitter.com/Peter_Hegarty.