The Los Angeles County Board of Supervisors has taken the unusual step of underwriting the Los Angeles Opera so that it can extend a much needed letter of credit (L/C) as part of its refinancing efforts.

The five member non-partisan governing board of Los Angeles County in California has also approved a US$14 million private bond offering on Tuesday, secured by a lease of the opera company's home, the Dorothy Chandler Pavilion.

L/C expiry

The last-minute request for the board's support was required for the LA Opera to meet its debts and maintain an L/C, which would otherwise have expired on 15 December.

The non-profit organisation has raised US$30 million to retire its debts, but those pledges by private donors will be paid over the next three years, rendering the opera unable to meet its immediate obligations.

Old debts

Officials at the opera company are convinced that the financing package will work.

They say the opera is now profitable while its debts relate to prior operating deficits and outstanding debts.

This article represents the views of the author and not necessarily those of the ICC or any of the other partners in DC-PRO.