Council approves increase to interest rate for ballpark debt

The ballpark is going to cost El Paso more.

Thursday afternoon, members of the El Paso City Council, acting as the Downtown Development Corporation, voted to raise the interest rate on ballpark bonds by 1.5 percent.

This means the interest on $60 million meant to pay for the ballpark is up from 5 percent on tax exempt bonds to 6.5 percent, and up from 5.75 percent on taxable bonds to 7.25 percent.

The city’s financial team asked council members to raise the bond interest rate in order to make the bonds more attractive to buyers in the open market, but this means the city’s debt is projected to increase by up to $17 million, according to city CFO Carmen Arrieta-Candelaria.

City officials cited Detroit’s recent bankruptcy as one of the reasons the bond market is not as favorable as it was when the financing plan for the ballpark was put together.

If the bonds are not sold as soon as possible, city officers said the city will have to find other means of financing the construction, or halt the project.

Officials said the money the city will pay up front to cover the additional cost of the debt will be paid back from ballpark revenues.

The announcement did not sit well with any council members.

Representatives Eddie Holguin, Carl Robinson and Lily Limon voted against the increase. Mayor Oscar Leeser and council members Emma Acosta, Larry Romero and Ann Morgan Lilly also said they were not pleased with the rate increase but agreed it’s necessary to move the project forward.