HARLINGEN — Members of the Harlingen city commission’s new majority are calling on a private investigations firm to review the city’s investment policy along with investments in a bank employing two members of the airport board, Commissioner Frank Puente said Monday.
During a special meeting Thursday, commissioners voted 3-2 to hire Safe Track, a McAllen private investigations firm, for $80,000 to conduct a compliance review of the investment policy.
While Puente and Commissioners Richard Uribe and Frank Morales voted to hire the firm, Commissioners Michael Mezmar and Rene Perez voted against the proposal.
“We want to know how the transactions and funds were utilized, moved around and if it complied with state and federal law,” Puente said Monday.
During Thursday’s meeting, Mezmar and Perez expressed concern Safe Track couldn’t conduct a financial review because it doesn’t have the experience while its staff doesn’t include certified public accountants and attorneys.
Meanwhile, Perez, who said he wanted to go ahead with the compliance review, suggested commissioners give the job to Ernst and Young, the international accounting firm hired late last year to conduct a performance audit on the city’s public works department for $60,000.
During the meeting, Mezmar and Mayor Chris Boswell stood behind Finance Director Robert Rodriguez, who said his investments complied with the city’s investment policy along with state and federal laws.
Texas Regional Bank offers highest rate of return
During Thursday’s meeting, Rodriguez presented commissioners with a five-year summary of the city’s cash and investments while explaining he invested $3 million into a certificate of deposit already holding $2 million at Texas Regional Bank because the bank offered a rate of 0.46 percent, far higher than other banks he contacted in 2020.
Uribe also said the Harlingen WaterWorks System moved $9 million in CDs into the bank.
While Texas Regional Bank offered its rate of 0.46, Frost National Bank offered 0.0001, TexPool offered 0.147, BBVA offered 0.20, Lone Star National Bank offered 0.3 percent and the U.S. Treasury offered 0.12 percent.
Amid discussions, Morales said he wanted to review any connection between the city and Texas Regional Bank employees who sit on city boards.
Meanwhile, Mezmar questioned whether the review was aimed at investigating a “political connection” between the city and Texas Regional Bank, which employs two airport board members.
While Uribe said Hilltop Securities, the national financial advisory firm that has served the city for years, had limited its latest review of the city’s investment policy, Boswell said the company found the city’s investment policy, which commissioners had approved in April 2021, in compliance with Texas law.
On Monday, Puente said commissioners plan to hold off on further discussions surrounding the investment policy until the investigations firm presents its report in about six to eight weeks.
