The Corporation of Hamilton could reach an agreement with a lending institution “within days” to satisfy its $18 million debt over the Par-la-Ville hotel debacle, according to Michael Fahy, the Minister of Home Affairs.

Senator Fahy said that the city’s council was still in discussions with a local bank to secure a loan to pay off monies outstanding to Mexico Infrastructure Finance (MIF) over the deal.

He told The Royal Gazette he was confident the corporation would endure despite its present financial difficulties.

“The corporation is still in discussions with a local bank to provide a loan to satisfy the $18 million debt with Mexican Infrastructure Finance over the Par-la-Ville hotel,” he said.

“This has to happen in short order and we hope it will happen in the next few days.

“I feel confident that the Corporation of Hamilton will survive.

“If I did not, we would not have done all the things we have. It would have been far easier to close them down but that was not the option we wanted to take.”

Recent legislation passed by the House of Assembly and the Senate has enabled the Corporation of Hamilton to increase its borrowing limit from $20 million to $30 million in order to help pay off the MIF loan.

Sen Fahy said that Government enjoyed a good relationship with the corporation’s new administration, and maintained there was still a place for municipalities in Bermuda.

He added: “In my opinion Bermuda is slightly over-governed already but the municipalities still have an important role to play in the community.

“Down in St George’s there is a real community spirit — it is its own little Bermuda. There is so much history there and the council is full of hard-working individuals who are paid very little but make a huge community contribution.

“The marina development is fantastic and has been driven by the corporation and the developers.

“It does not matter what political affiliation the council members have, that is the beauty of the municipalities. They are there to look after the community.

Sen Fahy added: “Hamilton has the America’s Cup to look forward to and help revitalise the city.

“The city will continue to reinvent itself although it is difficult because it does have financial difficulties. But the city thrives when Bermuda thrives as a business place and we are seeing progress in this area.

“I believe the municipalities do have longevity and so they should.”