Eagle Pass City Council Approves Ordinance to Obtain Up to $19.5 Million Bonds for Eagle Pass Water Works and Sewer System Projects
By: Ricardo E. Calderon, Eagle Pass Business Journal, Inc., Copyright 2024
The City of Eagle Pass, Texas City Council unanimously approved an ordinance to authorize the issuance of up to $19,500,000 (million) in bonds for the use and benefit of the Eagle Pass Water Works and Sewer System (EPWWS) at its regular meeting on Tuesday, September 3, 2024.
EPWWS General Manager Jorge Barrera and Bond Financial Advisor David Gonzalez presented an ordinance to the Eagle Pass City Council authorizing the city-owned enterprise, EPWWS, be allowed to issue bonds not to exceed $19.5 million for funding of certain capital improvement projects that are not eligible for state and federal government funding.
According to Gonzalez, the “maximum net effective per annum interest rate on the Bonds shall not exceed a rate greater than the maximum rate permitted by law calculated in a manner consistent with the provisions of Chapter 1204, as amended, of the Texas Government Code.” Gonzalez added that the Bonds will be for a 30 year maturity date, that is, on December 1, 2054. Gonzalez noted that as of the date of the City Council meeting, the interest rate was ranging between 4.3 to 4.5 percent and that the Bonds would be issued, subject to City Council’s approval of the ordinance, on or about September 25, 2024 and the closing date for the Bonds in the capital markets would be sometime in October 2024. Gonzalez highlighted that all Bonds must be sold not later than September 3, 2025, one year from the date of approval by City Council of the ordinance.
Gonzalez advised City Council that from the $19.5 million of Bonds to be issued, approximately $17.6 million of the Bond proceeds would be available to fund these capital improvement projects.
Gonzalez pointed out to City Council that the City of Eagle Pass itself would not be paying for these Bonds from any of the City’s general revenues nor Eagle Pass International Bridge System revenues, but rather the Bonds will be paid from the water and sewer revenues of the EPWWS.
Barrera presented a list of capital improvement projects to City Council detailing the projects needed at the EPWWS in the next five to ten years. Barrera pointed out that the $19.5 million Bonds are to pay for capital improvements projects for which there are no state or federal funding available, including the EPWWS Operations Building Expansion estimated to cost $7,500,000; Ricks Subdivision/Ella Heights Pressure Plain Conversion estimated to cost $1,250,000; the TxDOT Loop 480 Utility Relocation project estimated to cost $2,000,000; the New College Water Pipeline Expansion project estimated to cost $500,000; the second Water Source-Groundwater Source project estimate to cost between $500,000,000 (million) to $1,000,000,000 (billion); the EPWWS Wastewater Treatment Plant Intake Structure Cleaning and Upgrade project estimated to cost $2,500,000; Water Treatment Plant Expansion project (if second water source is not secured) estimated to cost $37,500,000, totaling between $13,810,000 to $1,045,600,000.
In addition, Barrera presented a list of capital improvement projects needed for Wastewater, including the Salem LS Expansion project estimated to cost $625,000; New College Sewer Line project estimated to cost $875,000; Student Activity Center LS Expansion project estimated to cost $625,000; Sewer Department Office Building project estimated to cost $1,250,000; and the Sewer Collection System Rehabilitation-Manholes and Pipelines project with its cost to be determined, totaling another $3,375,000.
Furthermore, Barrera presented a third list of EPWWS Wastewater Treatment Plant Expansion and Rehab Project, including the 2 Million Gallons Daily Expansion estimated to cost $25,000,000; Building, Office, Lab, and Breakroom project estimated to cost $2,250,000; the Aeration Basin Structural Rehabilitation and Clarifier Repair project estimated to cost $5,000,000; the Aeration Basins Grit/Sludge Cleaning project estimated to cost $1,250,000; the Flow Equalization Basins project estimated to cost $$7,500,000; the Lift Stations Rehabilitation and Screening (Orchard LS and River LS) project estimated to cost $3,750,000; the Headworks/Grit Removal Facility project estimated to cost $6,250,000; the Aeration Upgrades project estimated to cost $9,375,000; the Electrical System Rehabilitation project estimated to cost $12,500,000; and the Solar Power Sytstem project estimated to cost $12,500,000, totaling $77,875,000 (million).
Barrera presented City Council a total estimated cost of the multiple Water and Wastewater System projects needed within 5 to 10 years estimated at costing between $95,060,000 (million) and $1,045,600,000 (billion).
Barrera highlighted that the expected growth of Eagle Pass and Maverick County in the immediate future is significant, requiring all of these capital improvement projects within 5 to 10 years. The future of Eagle Pass and Maverick County depends on the availability of water and funding of these capital improvement projects.
The Eagle Pass City Council agreed with Barrera’s assessment and unanimously approved the ordinance for issuance of up to $19.5 million in Bonds for use and benefit of the EPWWS.
