|"I don't care if the voters rejected this bailout, I did it! Heh heh heh"|
From The McAllen Monitor
HIDALGO — Five years ago, with interest on State Farm Arena’s debt mounting, Hidalgo Mayor John David Franz went to U.S. Rep. Henry Cuellar, D-Laredo, for help.
Just like many American homeowners, the city’s Texas Municipal Facilities Corp. had borrowed money at a variable rate and now found the payments uncomfortably high. To build the arena, the corporation — a nonprofit local government corporation overseen by city leaders — borrowed $9 million from Texas State Bank.
While the arena transformed Hidalgo into a destination, the loan became a headache. The interest rate, which started at 6.25 percent in June 2002, had slowly climbed to 9.75 percent by September 2006.
As a result, Hidalgo still owed nearly $8.4 million to Texas State Bank in September 2006, despite four years of payments, according to city financial records. In 2007, during one of their first conversations, Franz asked Cuellar for help.
“Quite honestly, sometimes things don’t work out the way you expect them,” Cuellar said, recalling the conversation. “And he said, ‘We need some help with the interest rate, is there something that’s available?’ And we kept pushing through USDA. Pushing and pushing. And they kept saying no.”
Eventually, under President Barack Obama’s administration and with help from Cuellar, the U.S. Department of Agriculture came around. On Tuesday, Cuellar and the department’s Rural Development state director, Paco Valentin, presented Franz with a nearly $11.5 million, low-interest federal loan designed to solve the problem.
Voters narrowly rejected a previous attempt to refinance the debt, defeating the proposition 787-664. ("Heh, heh heh! who cares")