Hoping to take advantage of a decrease in interest rates, and their relationship with the Philadelphia-based PFM Financial Advisors-Palmview approved a plan of finance for PFM to start the discussions to renegotiate interest rates.
“We’re not approving any kind of loans or interest rates, we’re discussing what the plan is in the next several weeks to start having discussions with banks before negotiations with them on your old debts,” David Gonzalez, an advisor with PFM told Palmview council members at their Tuesday meeting.
PFM was hired by the city last July to help them borrow $2.1 million to pay off three high interest loans from Lone Star National Bank that totaled $3,450,000 with interest rates ranging from 5.25 percent to 7.25 percent.
The city ended up borrowing about $1.57 million to pay off two of those loans thanks to the work of PFM, who helped refinance the interest rates on those loans to as little as 3.3 percent, Palmview city Manager Michael Leo said.
The city decided to hold off on taking any action on a 2014 loan of $650,000 with a 5.5 percent interest rate but it is now one of the debts PFM will begin refinancing.
“Just last week, the Federal Reserve decreased rates one final time so interest rates are lower this week than they were a week ago,” Gonzalez told commissioners. “It’s another reason to try to take advantage of the interest rate in the market at this time.”
The plan, Gonzalez explained, is to start having discussions with banks to find one willing to work with the city on the 2014 loan and two other loans. Once PFM finds a bank willing to work with the city, the firm will negotiate with the bank new interest rates which will be presented to the city at a later meeting for commissioners to approve.
“Part of this process is not to just save money, but help you get out of your loans and some of your agreements made on your other payments,” Gonzalez said. “It’s a double-edged deal we’re trying to accomplish here, clean out another loan and also save you money.”
The city also discussed having a town hall meeting on Thursday, Nov. 21, to discuss street paving, the city’s top priority. The town hall would possibly be a joint meeting with Agua SUD, Leo said.
“Make sure you have a representative from Agua and the construction companies,” Councilmember Anthony Uresti said.
“We invite them, but it’s up to them if they show up,” Councilmember Linda Sarabia replied.
Last month, the city held an informal town hall meeting to address widespread frustrations over the Palmview sewer project, which has led to many streets in the city in need of paving.
Agua SUD utility board Director Roger Hernandez of La Joya and Agua SUD General Manager Jose E. “Eddie” Saenz were invited to attend. The former could only stay for 40 minutes and the latter didn’t show up to the meeting, citing that he was only made aware of it an hour before it started.
“It’d be nice for them to be here for the community, there’s a lot of questions out there that need answers,” Councilmember Joel Garcia said. “Hopefully they’ll be here.”
After the meeting, Leo said the city would begin contacting Agua SUD as soon as possible to give them two weeks of notice for the meeting. As of press time calls to Agua SUD to verify if they’ve received any form of correspondence regarding the town hall meeting were unanswered.
This article originally appeared in the Friday Nov. 1, 2019 issue of the Progress Times.