New detention center could get green light
RAYMONDVILLE — The federal government has proposed a revised contract that could generate money to let Willacy County pay off more than $100 million in debt, the county’s financial consultant said Friday.
Under the proposal, the county would construct a $45 million building that would expand its 2,000-bed immigrant detention center by 1,000 beds, said Michael Harling of Municipal Capital Markets Group in Dallas.
The U.S. Department of Homeland Security’s Immigration and Customs Enforcement would revise the county’s two-year contract to generate money that would let it repay $60 million it borrowed to build the complex of 10 tent-like domes, Harling said.
Under the government’s original contract, the county had two years to repay its $60 million debt, County Commissioner Aurelio Guerra said.
Now the government has agreed to stretch out the payment period, County Judge Eliseo Barnhart said. Each year, the government would renew the contract, he said.
Under the proposal, the government would continue to pay the county $78 a day for each undocumented immigrant it holds in the detention center, Harling said.
Out of the $78 payment, $48 goes to repay the $60 million debt, Barnhart said.
When developers planned the detention center last year, they projected the government would hold an average of 1,800 illegal immigrants there, Harling said.
But numbers fell short, with the government holding an average of about 1,500 undocumented immigrants, Guerra said.
Like the original project, the proposed $45 million expansion poses no risk to county taxpayers, Harling said.
The county would sell $45 million in municipal revenue bonds to investors to fund the project, he said.
If the county failed to repay the municipal revenue bonds, default would not affect the county’s credit rating, Harling said.
But a state official said default on the repayment of municipal revenue bonds could damage the county’s credit rating, which could hinder its ability to sell bonds for future projects, said R.J. DeSilva, spokesman for the Texas Comptroller’s Office.
“Generally speaking, this definitely affects bond ratings,” he said.
But the project’s expansion would spur windfall profits, Barnhart said.
“There’s no way this thing could default,” Barnhart said.
