McAllen, City Commission, Desalination, City Hall, Parks, Sister City, Tampico, Zoning, Procurement
Staff Report
McAllen TX - The McAllen City Commission on Monday approved a $49,355,000 bond issuance to continue funding the city’s brackish groundwater desalination plant, the third of five planned annual issuances for the project.
The bonds will be sold through the Texas Water Development Board’s State Water Implementation Fund for Texas program at a subsidized interest rate of 4.3%. Financial advisor Anne Burgerer told the commission the rate represents a 14% subsidy over the board’s cost of funds and is projected to save the city more than $6.6 million in interest costs over the life of the bonds compared to an estimated open market rate of 5.10%.
“By utilizing the program last year and this year over the life of the bonds, we project that you will save over $10,600,000,” Burgerer said.
Mayor Javier Villalobos noted the significance of the project. “This issuance is in furtherance of the incremental debt that we are taking on to build the brackish groundwater desalination plant,” he said. “That is progressing nicely. Congratulations to MPU for the hard work they’re putting into this and furthering the project responsibly.”
Burgerer said approximately $100 million in additional funding will still be needed to complete the project, with three more issuances anticipated in 2027, 2028, and 2029. She noted the Texas Water Development Board has committed to the multi-year program for five years, with the subsidy locked in for that period.
New City Hall
The commission advanced the selection process for a construction manager for the new McAllen City Hall, approving three firms to move to Step 2 of the Construction Manager-at-Risk process: D. Wilson Construction Company, Small Glass Contractors Inc., and Noble Texas Builders LLC.
City staff said no financial obligation was created by the vote. The firms will submit pricing based on design completed to date, along with a construction management fee, before returning to the commission for a final selection in approximately 30 to 45 days. A commissioner requested a future agenda item with a design and timeline update for the project.
Parks Master Plan
The commission approved a $59,800 contract with Legacy Engineering Group of San Antonio to update the city’s parks master plan for the next 10 years. City staff said the process will take approximately one year and will include community and stakeholder involvement. The city manager said findings will be presented at a retreat planned for the next couple of months, with results brought back to the commission for approval before the plan is finalized.
“That’s going to come to you in a retreat that we do in the next couple of months,” the city manager said.
Sister City Agreement
The commission approved a formal sister city agreement with Tampico, Tamaulipas, Mexico, following a friendship agreement signed in 2024.
“Mexico is very important to us,” Mayor Villalobos said. “We want McAllen to be the gateway to the United States.”
Zoning
The commission approved two customer-initiated rezonings and one conditional use permit, all with favorable recommendations from the Planning and Zoning Commission. The commission also approved 63 city-initiated rezonings updating properties from the city’s old zoning code to the new Unified Development Code.
Procurement Award
The commission recognized the city’s Purchasing and Contracting Department for receiving the 2026 Achievement of Excellence in Procurement Award from the National Procurement Institute for the seventh consecutive year. Purchasing Director Gerardo Noriega accepted the award, noting McAllen was one of 93 cities in the United States to receive the recognition.
“Our department is honored to accept the 2026 Achievement of Excellence in Procurement for the seventh time in a row,” Noriega said. “The staff’s daily commitment ensures that we serve our community with transparency and integrity and excellence.”
Source - McAllen City Commission meeting transcript, Oct. 12, 2026