FROM THE OFFICE OF PUBLIC AFFAIRS

Treasury Secretary Robert E. Rubin announced Monday that the North American Development Bank (NADBank) will begin its lending and guarantee operations in the United States by approving financing for $28.9 million for environmental infrastructure projects.

The NADBank board of directors approved financing for a $24.8 million water treatment facility for the city of Brawley, California, and for a $4.1 million improvement in the water supply and wastewater system for the community of Mercedes, Texas, subject in both cases to confirmation of the participation of other parties to the financing packages. In addition, the board approved a $2 million management development program for U.S. and Mexican border communities.

"The Brawley and Mercedes projects demonstrate the ways in which the NADBank can provide financing for communities that lack access to capital and play a role in solving environmental problems through innovative market finance," Secretary Rubin said. "The United States and Mexico share a clearly defined interest in helping to promote and finance these types of projects which benefit both sides of the border."

The water treatment facility in Brawley will replace an existing facility that has been cited for non-conformance by the California State Department of Health Services. Brawley had difficulty accessing capital markets as a non-rated community. The NADBank designed a financing package that leverages $2-5 million in loans into $24.8 million in financing by helping the city gain access to private sector institutional investors.

The Mercedes project highlights the NADBank's capacity to mobilize local, federal and international organizations to assist small border communities. The bank's interim financing of $1.875 million will be combined with grants from the U.S. Economic Development Administration and the Rio Grande Valley Empowerment Zone in a sustainable financing package for environmental cleanup in Mercedes.

The Border Environment Cooperation Commission (BECC), which assists border states and communities in designing and coordinating environmental infrastructure projects in the border region, has certified both of these projects. The NADBank works closely with the BECC as the lead bank in arranging financing for BECC-certified projects.

The $2 million NADBank management development program is designed to help communities on both sides of the border achieve effective and efficient operation of their water, sewage and solid waste management services. Many project sponsors seeking financial assistance from the bank need technical assistance in order to develop and implement projects that will be environmentally and financially sound. The program will focus on improving the institutional and financial capabilities of the project sponsors.

On September 20, the NADBank board announced its first Mexican project financings with the approval of an $830,000 water supply and wastewater treatment facility in Naco, Sonora, and a $1.1 million wastewater treatment plant for the Fraccionadora Industrial del Norte, S.A. (FINSA) industrial park in Matamoros, Tamaulipas.

The NADBank, which was created under the auspices of NAFTA, is an international financial institution capitalized and governed by the United States and Mexico to finance environmental infrastructure projects along the U.S. - Mexico border, as well as community adjustment and investment throughout both nations. Once the bank is fully capitalized, U.S. appropriations of $225 million will be leveraged into $2-3 billion in financing for border environmental projects and community adjustment that will provide significant benefits for U.S. citizens and businesses. The states of Arizona, California, New Mexico and Texas in particular will benefit from NADBank environmental lending. In addition to its environmental operations, the NADBank's U.S. community adjustment window will operate nationwide to offer financing directly through existing federal credit programs to assist communities and businesses adjust to the new trade environment created by NAFTA.

NADBank Contact: Annie Alvarado, (210) 270-1427

FOR IMMEDIATE RELEASE
December 2, 1996
Contact: Jon Murchinson (202) 622-2960

Treasury Secretary Robert E. Rubin announced Monday that the North American Development Bank (NADBank) will begin its lending and guarantee operations in the United States by approving financing for a $4.1 million improvement in the water supply and wastewater system for the community of Mercedes, Texas.

"The Mercedes project demonstrates the ways in which the NADBank can provide financing for communities that lack access to capital and play a role in solving environmental problems through innovative market finance," Secretary Rubin said. "The United States and Mexico share a clearly defined interest in helping to promote and finance this type of project which benefits both sides of the border."

The Mercedes project highlights the NADBank's capacity to mobilize local, federal and international organizations to assist small border communities. The bank's interim financing of $1.875 million will be combined with grants from the U.S. Economic Development Administration and the Rio Grande Valley Empowerment Zone in a sustainable financing package for environmental cleanup in Mercedes.

The Border Environment Cooperation Commission (BECC), which assists border states and communities in designing and coordinating environmental infrastructure projects in the border region, has certified this project. The NADBank works closely with the BECC as the lead bank in arranging financing for BECC-certified projects.

In addition, the NADBank board of directors approved a $2 million technical assistance program for U.S. and Mexican border communities. This program is designed to help communities on both sides of the border achieve effective and efficient operation of their water, sewage and solid waste management services. Many project sponsors seeking financial assistance from the bank need technical assistance in order to develop and implement projects that will be environmentally and financially sound. The program will focus on improving the institutional and financial capabilities of the project sponsors.

On September 20, the NADBank board announced its first Mexican project financings with the approval of an $830,000 water supply and wastewater treatment facility in Naco, Sonora, and a $1.1 million wastewater treatment plant for the Fraccionadora Industrial del Norte, S.A. (FINSA) industrial park in Matamoros, Tamaulipas.

The NADBank, which was created under the auspices of NAFTA, is an international financial institution capitalized and governed by the United States and Mexico to finance environmental infrastructure projects along the U.S. - Mexico border, as well as community adjustment and investment throughout both nations. Once the bank is fully capitalized, U.S. appropriations of $225 million will be leveraged into $2-3 billion in financing for border environmental projects and community adjustment that will provide significant benefits for U.S. citizens and businesses. The states of Arizona, California, New Mexico and Texas in particular will benefit from NADBank environmental lending. In addition to its environmental operations, the NADBank's U.S. community adjustment window will operate nationwide to offer financing directly through existing federal credit programs to assist communities and businesses adjust to the new trade environment created by NAFTA.

NADBank Contact: Annie Alvarado, (210) 270-1427