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Edinburg council approves $9.2 million certificates of obligation to expand landfill
Summary
The City of Edinburg approved an ordinance authorizing combination tax and limited-pledge revenue certificates of obligation to fund landfill expansion; city officials said the solid‑waste system’s net revenues will cover debt service and the measure passed after public comment opposing the bond structure.
The Edinburg City Council on June 17 approved an ordinance authorizing the issuance of City of Edinburg combination tax and limited-pledge revenue certificates of obligation, series 2025, to fund expansion and improvements at the city landfill.
The certificate issuance was presented to council as a financing plan to build a new landfill cell and related infrastructure. Financial advisers told the council the offering attracted strong market interest and produced an effective interest rate in the mid‑4% range. City staff and the advisers said the city expects the landfill’s net revenues to pay the debt service on the certificates.
The ordinance drew public comment. Resident Fern McClarty warned council against selling bonds and questioned the city’s financial priorities, saying, “Spending 5,500,000.0 to borrow 9,200,000.0 is never a good idea.”
Bobby Villarreal, one of the city’s financial advisers, told the council the solid‑waste enterprise would repay the certificates from its net operating revenues. He summarized the presentation: “The solid waste will be repaying for this issuance through its net revenues,” and said debt service obligations remain within the pro forma capacity shown to council.
Council members asked how the structure would affect property taxes and whether the issuance limits future borrowing. Financial staff and bond counsel said the certificates are secured primarily by landfill revenues but are structured with a limited pledge of the city’s ad valorem tax for the certificates to achieve a lower interest rate than a revenue‑only pledge would produce. Bond counsel said staff would clarify ordinance language where the draft notice included broader project categories.
After discussion, a council member moved to adopt the ordinance and the motion carried.
The council also directed staff to provide documentary items the underwriters requested promptly to complete the sale of the certificates.
