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RIO GRANDE GUARDIAN: Cuellar: North American Development Bank is changing lives along border

Rio Grande Guardian, November 16, 2020

MISSION, Texas – U.S. Rep. Henry Cuellar has praised the work of the North American Development Bank. 

At a virtual board meeting of the bank, Cuellar said: “You have been changing lives on the U.S. side and on the Mexican side. That is why I am so supportive of NADBank, because of all the work you have been doing.”

Cuellar made his remarks from Mission, Texas, while the bank was holding its meeting in San Antonio. He connected with the board via Zoom.

Cuellar noted how the reauthorization of NADB had occurred through the inclusion of language in the United States-Mexico-Canada Agreement. At the same time, more capital was added, allowing the bank to fund more infrastructure projects along the U.S.-Mexico border.

Cuellar said his only request, as the reauthorization took place, was that NADB streamline the process by which projects and funding are approved. “We got it done,” Cuellar told the bank’s board of directors. 

“We needed to up the money on capitalization. I always had money there but without the reauthorization we could not get it done. I want to thank the Treasury and their counterparts on the Mexican side,” he said.

Cuellar said NADB’s directors can “count on me as a strong supporter.” He noted that his involvement with the bank goes back many years.

“I started working with NADBank back when we did the waste treatment plant in Nuevo Laredo. When Nuevo Laredo was dumping 25 million gallons of raw sewage in the Rio Grande and we worked with the Mexican government, the U.S. government and the state of Texas to get this project done. This is the type of project we want to see.”

Cuellar said he has been talking to NADB’s leadership about providing more loans for solar projects. “I know you are looking at a $130 million solar plant in the Webb County area,” he said.

The Laredo Democrat also thanked NADB for working with the Aqua Special Utility District in Hidalgo and Starr counties to get a $13 million debt refinanced. “That is going to save the taxpayers a lot of money,” he said. 

Cuellar and other members of Congress had been trying since 2015 to increase funding for NADB. As an appropriator, Cuellar had put aside additional monies but could not get authorization. So, working with House Speaker Nancy Pelosi and U.S. Trade Representative Robert Lighthizer, agreement was reached to reauthorize NADB through the United States-Mexico-Canada Agreement.

The bank’s capital was raised by $450 million and loan guarantees by $2.55 billion. With this infusion, the bank will have $900 million in capital and $5.1 billion in loans guarantees from both governments.

“Nuestros amigos, nosotros sabemos que el Rio Bravo no los divide, pero, los une como dos paises. Por eso trabajamos con Marcelo Ebrard, and other folks, to get the job done,” Cuellar said.

(“My friends, we know that the Rio Grande (Rio Bravo) does not divide, but unites our two countries. That’s why we work with Marcelo Ebrard, and other folks, to get the job done.”)

Marcelo Luis Ebrard Casaubón is Mexico’s foreign secretary.

At the board meeting, NADB leaders announced the publication of an environmental impact report marking the 25th anniversary of the bank. Over the first 25 years of operation, NADB has supported the implementation of 268 environmental infrastructure projects, of which 236 were in operation at the close of 2019. The completed projects represent a total investment of $9.53 billion, with $2.99 billion financed through loans and grants from the Bank.

The report says “significant advances” have been made in the water sector on the Mexican side of the border. Drinking water service coverage has increased from 86% to 96%, wastewater collection services have increased from 77% to 95%, and wastewater treatment coverage has increased from 21% to 91%. 

NADB has also participated in the construction of 34 renewable energy projects with a combined generation capacity of 2,861 MW on both sides of the border. In Mexico, the bank has participated in the financing of 92% of current generation capacity in renewables (wind, solar and biogas) in Mexican border states. 

The report can be accessed electronically at the following link:

Salvador López-Córdova, NADB Chief Environmental Officer, stated that “these achievements have been made possible thanks to the guidance and ongoing support of the NADB Board of Directors, the dedication of Bank staff and the collaboration of many border stakeholders, in particular municipal and state governments in both countries.

López-Córdova added: “Although significant progress has been made, challenges remain, and thus NADB will continue to promote the sustainability and development of the U.S.-Mexico border region.”

The NADB virtual board meeting took place Nov. 12. At the meeting, NADB’s board of directors approved five new environmental projects representing a total investment of $21.5 million. Of this new investment, NADB will provide $19.3 million in loan and grant financing for the five projects. The bank says this will benefit close to 137,500 residents on both sides of the U.S.-Mexico border region.

And an umbrella program was approved to expedite the refinancing of existing public debt under the bank’s COVID-19 Recovery Program.

Calixto Mateos-Hanel, NADB’s managing director, said the objective of the umbrella program is to “expedite the approval of refinancing proposals for public entities that meet the eligibility criteria in order to free up cash flows that can be redirected to support public services and mitigate the effects of the pandemic.” 

Of the five projects approved by the NADB board, four are related to water infrastructure improvements and represent a total investment of $8.45 million. 

“NADB will provide a US$4.26 million loan to Jim Hogg County, Texas, for the replacement of a water treatment plant and upgrades to water meters for the entire city of Hebbronville. The communities of Socorro, Texas and Agua Prieta, Sonora, will each receive a $500,000 grant through the Bank’s Community Assistance Program (CAP) for their respective wastewater projects. The water utility in Ojinaga, Chihuahua will receive a $1.02 million grant from the Border Environment Infrastructure Fund (BEIF), which is funded by the U.S. Environmental Protection Agency (EPA) and administered by NADB. The BEIF grant will support improvements to wastewater collection infrastructure, reducing the risk of pipeline failure and eliminating approximately 281,000 gallons per day of untreated wastewater,” an NADB news release stated.

“The fifth project consists of a $13 million debt refinancing project for Agua SUD, which will result in annual savings of roughly $140,000 for the utility during the first 13 years of amortization and increase available cash flows for the maintenance and operation of existing water and wastewater infrastructure.”

About NADB:

NADB is a binational financial institution established and capitalized equally by the Governments of the United States (U.S.) and Mexico for the purpose of financing infrastructure projects that preserve, protect or enhance the environment in order to advance the well-being of border communities, as well as providing technical and other assistance to support the development of such projects. 

In November 1994, NADB began operations in accordance with an agreement between the two governments (the Charter), which also created the Border Environment Cooperation Commission (BECC), its sister institution charged with supporting the development and certification of projects seeking financing from NADB. In November 2017, NADB and BECC merged into a single entity to streamline their processes and maximize their services for border communities. 

Its ten-member Board of Directors is made up of five representatives from each country, and the chairmanship alternates between the U.S. and Mexican representatives every year. NADB is headquartered in San Antonio, Texas, and has an office in Ciudad Juarez, Chihuahua. 

NADB’s area of operation comprises the region within 100 kilometers (62 miles) north of the U.S.-Mexico international boundary in the U.S. states of Texas, New Mexico,
Arizona and California and within 300 kilometers (186 miles) south of the border in the Mexican states of Tamaulipas, Nuevo Leon, Coahuila, Chihuahua, Sonora and Baja California. 

Projects that qualify as eligible infrastructure are those that will prevent, control or reduce environmental pollutants, improve the drinking water supply or protect flora and fauna; provided that such projects also improve human health, promote sustainable development or contribute to a higher quality of life. In its early years, NADB was exclusively dedicated to financing projects related to the drinking water supply, wastewater treatment and municipal solid waste management, and they continue to be its main priority. In 2000, the eligible sectors were expanded to include water conservation, storm water management and projects that improve air quality, such as street paving, public transportation, clean energy generation from renewable sources and energy efficiency. 

NADB provides infrastructure financing in the form of loans and grants through various programs. The grant programs consist of the Border Environment Infrastructure Fund (BEIF), which is financed by the U.S. Environmental Protection Agency (EPA) and administered by NADB, as well as several programs funded from its retained earnings, including the Water Conservation Investment Fund (WCIF), the Solid Waste Environmental Program (SWEP) and the Community Assistance Program (CAP) for public projects in low-income communities. 

During its first 25 years of operation, NADB has approved a total of 268 environmental infrastructure projects in both countries for financing, 236 of which were in operation at the close of 2019, benefitting close to 17.5 million border residents. The projects in operation represent a total investment of US$9.53 billion, of which NADB has financed US$2.99 billion through its loan and grant programs, as well as channeled US$626 million in EPA-funded BEIF grants to water and wastewater projects. 

In addition to financing infrastructure, NADB also plays a key role in the development phase of projects and in strengthening the institutional capacities of border communities through its technical assistance programs and the EPA-funded Project Development Assistance Program (PDAP). To date, NADB has invested a total US$69 million in technical assistance through those programs to finance 548 project development and institutional strengthening initiatives, benefiting more than 160 border communities. Likewise, NADB has supported EPA and the Mexican Ministry of Environment and Natural Resources (SEMARNAT) in administering and channeling more than US$16 million in grants through the U.S.-Mexico Border 2012/2020 Programs for the development and implementation of 351 environmental initiatives. 

Its binational nature has allowed NADB to bring together and work with local authorities, state agencies and other entities from both sides of the border to create synergies that foster the development of environmentally sustainable and resilient border communities. With the strong support of its partners in both countries, significant progress is being made towards improving the quality of life for millions of residents in the region. 

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