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Alamogordo commission votes to authorize up to $12.87 million for natatorium funding, delegates loan choice to staff
Summary
After weeks of financing work and a last-minute removal from the state bond sale, the city commission approved an ordinance allowing up to $12,865,000 in bonds or loans to fund a new natatorium and delegated authority to the mayor, city manager and finance director to finalize the best financing option within set limits.
The Alamogordo City Commission voted 7-0 to approve final publication of Ordinance 17-22, authorizing up to $12,865,000 in bonds or loans to fund construction of a long‑planned natatorium and directing city officials to accept the most favorable financing terms within parameters set by the commission.
The measure, introduced by the finance team, preserves a limited pledge of the 0.125% municipal infrastructure gross receipts tax for repayment and includes a maximum interest cap set by the commission. "We are back in front of you today to discuss funding of the new natatorium," Finance Director Evelyn Huff told commissioners during the presentation.
Why it matters: The project was previously slated to go through the New Mexico Finance Authority (NMFA), but the city was removed from NMFA’s bond sale on short notice, which risked months of delay. Consultants presented alternatives — public-market underwriting, direct bank placements, or an NMFA loan — and emphasized tradeoffs: NMFA would require a reserve fund but can offer long-term, predictable pricing; direct bank placements can be faster and avoid the reserve requirement but may include a short-term balloon payment that would have to be refinanced later.
Mark Valenzuela of Bosque Advisors summarized competing offers and the advisors’ recommendation: "Given the timeline, our recommendation was the direct placement with Bank of Albuquerque at the illustration rate of 4.175%," he said. City legal counsel and municipal advisors explained that the ordinance delegates to the mayor and city manager the authority to accept final terms consistent with the presentation and within the ordinance’ caps; the ordinance requires a supermajority to pass and did so, 7–0.
What commissioners asked: Commissioners focused on timing, bond ratings, and refinancing risk. Consultants said a bond rating could be obtained in roughly four weeks if the city pursued a public-market transaction; advisors also warned that some bank offers include a seven-year final maturity (a balloon) that staff would plan to refinance earlier if market conditions allowed. "If rates get to a level the city is not comfortable with, staff will not finalize the deal," counsel said, and the commission retained the ability to limit or rescind delegated authority.
Votes and next steps: The commission’s adoption of Ordinance 17-22 authorizes negotiations and gives staff flexibility to execute the best available financing within the agreed parameters; staff said they will circulate final term sheets to commissioners before closing. The city expects to finalize loan or bond documentation, then include the financing in the upcoming preliminary budget so the project can move to bidding once documents are closed.
Formal actions at the meeting included the 7–0 vote to approve Ordinance 17-22. The city also recorded other related administrative steps: the finance team indicated the 2024 audit is near completion, which will strengthen the city’s ability to pursue public-market options if desired. The commission’s action does not immediately obligate full borrowing; it sets the maximum authorization and delegates final acceptance of terms to staff.
