El Paso City Council begins process to issue $68.5 million in debt
Updated On: Jan 16 2014 12:59:52 PM CST
El Paso City Council is thinking of borrowing $68.5 million to reimburse itself.
When the City approves a project that will be paid with debt it doesn't borrow the money right away.
In fact, the City holds off as much as it can so the debt will accrue less interest.
Instead the City sees if it has money in its reserves to start the project and when those reserves start running low then they borrow the money for the project.
So this $68.5 million dollars is going to be used for projects council has already approved and the City has been using reserve funds to start off.
They include Sun Metro stations, part of the bus rapid transit systems, the relocation of City Hall, renovation of the Luther building, and some street paving and the design of the proposed trolley route.
"We issue debt only when we need the cash and we use our general fund reserves and other capital project money to be able to float those projects until we're able to reimburse ourselves," said Carmen Arrieta-Candelaria, Chief Financial Officer for the City.
Every year the City is required to have $16 million in reserve.
But in the last couple years the City has had up to $40 million in reserve.
These reserves throughout the year though go back to the general fund which is the big pot of money that keeps the City running.
Copyright 2014 KVIA. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.