PAN Claims $100 Million Peso Loan “Illegal”

In a continuing dispute between PAN and PRI representatives over budget matters and the use of public monies, PAN officials claim that a pending $100 million peso loan to the City will be illegal if used by Merida Mayor Angelica Arajo Lara for ”projects of her own choosing.” PRI officials maintain the loan has already been authorized and approved by both City and State officials, and complies with the law.
The dispute’s history can be traced to November 2010, when the City’s budget for 2011-12 was being prepared. The Mayor indicated that she would seek a loan of $100 million pesos to be used on five designated public works projects, including roadways and the preservation and the improvement of specified public spaces. For the City to borrow the money, both its own governing body and the State of Yucatan had to approve, which they did in December 2010. In May, the Mayor announced that the funds would not be used for the originally denominated projects, but for other various unspecified public works. She notified the Yucatan Congress of her changed spending intentions on June 18, which were approved by that body five days later, on June 23. However, Merida’s own governing council never met again nor voted upon the Mayor’s new spending plans, the details of which are apparently still unknown. According to PAN officials, this will make the loan illegal if it is in fact funded, and will place in jeopardy any public projects undertaken with the borrowed monies.


PAN officials claim that by changing the specific purposes for which the loan was originally sought without giving the City’s governing body the chance to approve or reject them, the entire plan is unlawful, despite the pro forma approval last week by the Yucatan Congress. One PAN leader said that Congress in effect had given a “blank check” to the Mayor to use the pending loan funds “as she chooses,” and that its approval was “legally invalid.” Both the upcoming Shakira concert, scheduled for July 16 at a minimum cost of $21 million pesos, and the controversial underpass project soon to get under way in north Merida, were suggested by PAN spokesmen as probable targets for some of the $100 million pesos. Neither item was identified by the Mayor when she originally sought the loan authority last year. PAN claims that any contractors working on projects with the borrowed funds would risk not getting paid, since the projects have neither been considered nor approved by the council. PAN officials also indicated that banks probably will not actually fund the pending loan, given its uncertain legal posture.
PAN deputy Renan Barrera Concha said last week that the manner in which the loan authority had been handled was an “insult” to both city council members and to
“all Yucatecans.” “We’re not opposed to public works projects nor to an extension of credit to the City,” he said. “What concerns us is not being told what the money is going to be used for. PRI deputies changed the planned public works projects which were approved [in December 2010], and intended to divert the borrowed funds to other projects. Legislative procedures have been repeatedly violated in this matter. It’s a very serious problem when a government lies to its constituents,” he added.
Lic. Edward V. Byrne
edvbyrne@gmail.com