Dr. Michael Flores hasn’t been on the Donna Economic Development Corporation 4A (EDC 4A) board of directors for very long. But his position on one of the city’s two EDC boards may prevent him from obtaining a USDA-backed loan to help supplement his medical practice.
Flores submitted an application to borrow $35,000 from the Economic Development Corporation 4B (EDC 4B) revolving loan program.
According to Donna City Manager Carlos Yerena, Flores had hoped to use the funds “to purchase PPE equipment, surgical masks, surgical gowns and some COVID equipment.”
The USDA provides revolving loan funds to municipalities looking to spur economic development by investing in local businesses. The city, in turn, lends those funds to small business owners at low or reduced interest rates.
The programs are meant to be self-sustaining, with the capital and interest payments from existing loans revolving — or going toward — the program’s administration costs, as well as future loans to additional small businesses.
During a meeting of the EDC 4B board Tuesday afternoon, Yerena recommended the board approve Flores’ loan application with a six-year repayment schedule at an interest rate of 4%. However, one board member wondered if Flores, who serves on the board of the city’s other EDC, is eligible to apply.
“Is he a member of our COVID board?” asked Thomas Marroquin, referring to a group of health professionals and other stakeholders who have guided Donna officials in their pandemic response since last year.
“No, he’s an adviser, Tommy. He’s an adviser of the city at no pay,” replied Mayor Rick Morales, who also serves as the president of the EDC 4B board.
Flores has been instrumental in the city’s response to the pandemic. His counsel to the city has resulted, in part, in the city purchasing COVID-19 test kits last fall, and — most recently — moving to purchase a super-cold freezer to store the highly perishable vaccine.
Flores and his medical practice have also made COVID-19 test accessibility for Donna residents a priority, regardless of their ability to pay.
Last year, the city council appointed Flores to serve on the EDC 4A board. One of his first public meetings occurred in late-September, when the city council and both EDCs met in back-to-back-to-back meetings to discuss and approve their respective fiscal budgets.
But it’s that very position about which Marroquin expressed concern Tuesday.
“He doesn’t qualify if he’s involved in anything with the city,” Marroquin said.
“No le hace . No adviser, no nothing. Look at the charter,” he said, before asking for input from the EDC’s attorney, Gilbert Vasquez.
Vasquez was unsure what the city charter has to say on the matter, but the USDA itself has rules for how its funds can be distributed via the program.
“I do know that there’s an issue with the revolving loan itself,” Vasquez said.
“Like, from the federal government. They exclude members or employees. And they define members or employees as members of a governing body, board, committee, contractors and immediate family members,” he said.
Morales, the mayor, reiterated that Flores is not a paid city employee, but asked if stepping down from the 4A board would qualify the doctor for the loan.
“I would like a little bit more time to look into it then, if we do have a member that’s related to one of the boards or a committee, before we go to that drastic step,” Vasquez replied.
Ultimately, the board tabled the discussion in order to give Vasquez time to look into the issue.
“We’ll table this and bring it back once the attorney has done his research,” Yerena said.