Del Rio City Council Reviews Outstanding Debt, Weighs Future Borrowing Options

Del Rio's total outstanding debt stood at $114 million as of the end of February, a jump of nearly $22.7 million over five months that drew pointed questions from Councilwoman Carmen Gutierrez during a March 10 council meeting where all seven members were present.

Tony Jaso of Estrada Hinojosa, the San Antonio-based firm serving as the city's financial advisor, presented the debt overview and attributed the increase primarily to new borrowing for utility system projects. That included funding through the Texas Water Development Board and a $17 million issuance through the Texas Military Preparedness Commission. When interest is factored in, the city's total debt portfolio, which spans water, sewer, landfill and street projects, carries an additional $42 million in interest, bringing the combined outstanding obligation to more than $156 million.

Gutierrez, who questioned why total debt had climbed from $91.3 million, also pressed Jaso on how much the city expects to pay down in the current fiscal year. Jaso said Del Rio is on track to retire $8,536,706.81 in principal during fiscal 2026, with total debt service payments of $10,796,743.54.

Despite the increase, Jaso framed the city's debt management practices in a favorable light. "One of the things that the rating agencies note about the city, and this is actually a credit positive, is that you all amortize your debt fairly quickly," he said. "Within 10 years, I think, you will have amortized 60 percent of your portfolio."

The meeting also surfaced a potential new funding opportunity: a $15 million grant tied to House Bill 500 for improvements to the North Bedell water system. The grant carries a 10 percent local match requirement. Interim City Manager Manuel Chavez told the council the city's share would amount to approximately $1.5 million.

Gutierrez closed the discussion by urging city staff to publish detailed debt information for public review, including total debt with interest, arguing taxpayers deserve a clearer picture of the city's full financial obligations. The same council meeting addressed several other matters, including the firing of former City Attorney Ana Markowski Smith, plans to rebid the Paul Poag Theatre renovation project, and a lease agreement with the Del Rio Hispanic Chamber of Commerce.