The city of Mission solidified its intent to terminate an energy savings contract with Performance Services Inc., a company that remains at the center of a federal investigation into a kickback scheme involving several officials from western Hidalgo County, and agreed to settle a lawsuit that stemmed from the contract.

During a special meeting Wednesday, the city council unanimously voted to pursue a mutual termination of the contract with Performance Services Inc., or PSI, which was approved in March 2021 for the installation of smart water meters, City Attorney Gus Martinez confirmed via email Thursday.

The PSI contract was the subject of a lawsuit filed by former Mission Mayor Norberto “Beto” Salinas in which he accused the city of violating state law by allegedly not following the proper procurement process when it awarded the contract to PSI.

Earlier this month, a judge presiding over the case granted Salinas’ request for a temporary injunction, which prevents the city from making further payments to PSI while the order is in place.

In response, attorneys representing PSI filed a notice of appeal with the 13th Court of Appeals last week.

But now, the city seems intent on resolving the case out of court since part of the council’s action on Wednesday included directing legal counsel and staff to “negotiate any and all outside disputes with all parties in the best interest of the city of Mission.”

Martinez, the city attorney, confirmed it meant the city intends to negotiate a settlement in the lawsuit.

In addition to the civil suit, PSI, a company based in Indiana but with offices in nine other states including Texas, is tied to an investigation into a kickback scheme that has already forced three officials from western Hidalgo County to plead guilty to bribery.

Among them was Armin Garza, a former board trustee for the La Joya school district who resigned from the board after entering a guilty plea last month.

Garza confessed to accepting bribes as part of a kickback scheme with a PSI employee.

He admitted to voting in favor of having the school district grant a contract to PSI and using his influence on the board to convince other elected officials from the area to also grant contracts to the company.

In return, Garza received bribes and kickback payments from subcontractors which were facilitated by the PSI employee.

PSI has denied any wrongdoing and said it was conducting an internal investigation.