The City of Elephant Butte has not been able to pinpoint the expenditures made with a nearly $600,000 loan despite city councilors’ requests for that information during the October 21 meeting.
Mayor Edna Trager, in a recent interview, blamed problems in accessing needed financial records on administrative turnover. “We’ve had three city managers, a change in mayor and a change in city clerk,” Trager explained.
In 2019, the New Mexico Department of Finance and Administration warned city officials the loan in question “was about to expire,” Trager said. That meant the city had to expend the money on a project within a certain time limit. If the money were not spent, the city would still have to pay off the loan, with interest, “with nothing to show for it,” Trager said.
Elephant Butte originally took out the loan from the New Mexico Finance Authority for “road and building renovations,” in 2015, Trager said.
Work on Rock Canyon Road was first to be completed. Trager said she did not have figures on that project’s cost.
The city then explored whether to renovate the Annex Building, “But the more we got into it,” Trager said, “it was decided it was an inefficient use of the money.”
After the 2019 warning from DFA, the city decided to use the remaining balance on the loan on the improvement of Camino Cinco road. Again, Trager acknowledged that she could not provide either the loan balance at that point or that project’s cost.
During the Oct. 21 and Nov. 18 city council meetings, the Camino Cinco project engineer, David Shields of Albuquerque’s Bohannon Huston firm, reported incorrectly that the $600,000 NMFA loan was initially used for a wastewater project.
Trager said Shields was not corrected by the city council, “but we all knew the money never went to a wastewater project.”
Shields said, during the Oct. 21 meeting, he had submitted the last two invoices for the Camino Cinco project in September, even though the NMFA’s extended deadline for expending the loan money was June.
The city could “restructure” the loan, Shields advised, in order to use the remaining funds for the last two Camino Cinco payments and a new project. The restructured loan would have a new interest rate, which Shields could not supply.
Shields recommended road and drainage work around Camino Seis be undertaken next.
NMFA approved the city’s application to restructure the loan on Nov. 19, with the remaining balance to be to be used for Camino Seis, according to Elephant Butte City Manager Vicki Ballinger.
Mayor Trager told the Sun the remaining balance on the loan is $148,000, contradicting Shields, who reported it would be $256,000 after Camino Cinco “was closed out.” The final two payments for Camino Cinco will come out of the remaining $148,000.
During the Oct. 21 council meeting, Shields projected the Camino Seis project would cost $400,000. He suggested New Mexico Local Government Road funds allotted to Elephant Butte this year be used to pay for the rest of the Camino Seis project.
Neither Trager nor Ballinger could provide answers to the Sun’s questions about the cost of the Camino Seis project or what other funds might be used to complete it.