City Council - Special Meeting

Okay, Ms. Bryan, I believe you're ready to convene the special meeting.

Yes, sir. Good morning. This is a special meeting of the El Paso City Council for Wednesday, May 27, 2026. It is 1014 a.m. Mayor Johnson is present and presiding in council chambers along with Mayor Pro Tem Chavez, Representative Acevedo, Representative Maldonado Rocha, Representative Nino, Alternate Mayor Pro Tem Fierro, and Representative Limon. Representative Canales is also joined, and Mayor, we have a quorum.

Okay, Ms. Bryan.

Yes. Item number one on the agenda is a presentation, discussion, and action of the FY2026-2027 budget as presented by the city manager.

Good morning, Ms. Mack.

I am delighted to be here with you all. Delighted. This has been quite a journey, as you know, to get to this budget. It has been a year of learning. I have so enjoyed working with each of you to sort of think about how we could improve this process, be more transparent and serve our community. And so this really has been a result of the feedback that we have received from each of you to really help us to refine this process. Presentation, please. So as you know, we historically began this process in early July. We are a complete six weeks earlier than we generally would have been, which really allows us two months to really refine this process with your input and the input from the community. We heard over and over again that we really wanted to make sure that what gets adopted as the final budget is what reflects the input of the community, the opportunities for you to ensure that the priorities are being funded to the level necessary to continue that work. And this new model of doing this and approaching this really allows us to be able to do that. I want to emphasize from the beginning, before we get to folks sort of losing it over tax rates and other things, that this is preliminary. This is not the budget as will be adopted in August. It really allows us a launch place to be able to have critical discussions about the things that we will be doing moving forward. You'll see from the schedule here that we are starting today and we will probably conclude by lunchtime tomorrow. And then all next week, in the next two weeks, we'll be out in the community sharing a version of this presentation, really allowing community to ask us questions pretty early on. That will also allow you to be able to receive their feedback before we rolled into our June 22nd meeting. That meeting is really going to be structured to allow for us to look at feedback, recommended adjustments, and discussions that you will be able to have as a group about things that you think will be important for us to consider in this budget. We don't actually file our budget until July 17th, so we do have quite a bit of time between then now and then to be able to modify and ensure that what gets filed is really representative of the things that you think are important in our budget. Again, we don't adopt our budget till August, and so we do have time in this process. This year, in terms of key improvements, as I've mentioned, we really have focused on listening to our customers, listening to you, and really working to have more transparency in this process. Our teams have done a phenomenal job. They have been working since September on really reformulating the way that we talk about our work and present our departments through program-based budgeting process. And so I'm so grateful to all the things that they have done to get us here today. We're already also showing as a part of this a two-year outlook. You are accustomed to seeing our five-year strategy. That five-year strategy usually gives you an opportunity to understand what we're seeing in terms of revenues and expenses over a five-year period. What we're doing this year is allowing you to see it a line item what our two-year outlook will be for costs and expenses. I think it's important for the public to see and understand what those growth and costs are year over year, and so you'll be able to see that at a very detailed level. As I've mentioned, we have multiple budget workshops coming up, and I hope that we'll have the community come out to those meetings next week. Our council budget adjustment form has changed dramatically. What I heard from you all as in our after action reviews at the end of budget last year was that we wanted to have a better process for how council members can provide input into what will become our final budget. And so we have that form live for you as you're receiving feedback from your community. We ask that you submit through that process. And when we come back on the 22nd, As a group, we will go through those suggestions and look at items and opportunities for adjustments to the budget. And that will give us time to be able to finalize before we actually submit the adopted budget in July 17th. This really is about ensuring that we are maintaining high quality public service. As we went through our strategic planning process, we certainly heard from the community the need to commit on the things that we are providing to our community. How do we make better the day-to-day things that impact their lives? In order to do that, we really need to continue to focus on our long-term financial sustainability. And we knew that in this budget, there would be competing pressures in terms of requirements for funding. One of the things that we made sure we focused on was taking care of the core services of our city and adopted strategic plan that you have very much had that focus for us. When we talk about our good governance pillar and identifying and implementing sustainable fiscal opportunities, this budget very much focuses on our adopted strategic plan You will hear from each one of our departments who will take you through their alignment. From my perspective, the program-based budgeting that we did really allows for transparency across programs, not just for council but for the community. And again, focusing on making sure that we have a structurally balanced budget ensures that we're taking care and ensuring that the things that are important to our community will be financed and delivered in the future. We're very excited about the strategic plan that you all adopted in February that will be implemented with this budget. So this is just a snapshot of some of the things that we hope to get done this year. The departments will take you through some of the details, but you'll see highlighted a lot of the things that you continue to say that are important that we hear from the community through the CR process, through your community meetings being highlighted as very important. deliverables for our community, whether it's our DWI program that you recently discussed or talking about building permits and doing a better job of that. We often hear folks asking about efficiency through AI. We know that without a data governance process and structure, we will not have the type of data that allows for those tools to be used in our community. So those are just a few of the things that we'll be focusing on this upcoming year and that our team will be talking to you more about as they present. Diving right into some of the budget highlights, we know that public safety is critical for our organization. So I just want to highlight some of the things that this budget will accomplish. We have three planned academies with 90 graduates for the police department. We are looking at graduating two academies for the fire department. We were very fortunate to secure two grants that then allow us to have some relief and funding for a couple of years through the COPS grant and the SAFER grant. But as we talk long-term, we know that those are short-term reliefs for our community and that we need to make sure as we're thinking about our long-term budget, we're then including those dollars back into our budget. For the last item we have here, maintaining funding for the Neighborhood Traffic Management Program, Division Zero, and also our lane striping, we knew that one of the core things that you talked about was focusing on key transportation planning and traffic management. So we are sure that that has continued to be focused on in this budget. For infrastructure, we continue to talk about ensuring that we have cash available to be able to focus on our street maintenance and also roadway safety. Our pay goal funds also include public safety funding. One of your key strategies for this new strategic plan was also ensuring that public safety had the equipment needed to be able to do their work. And so that's also included within that $27.7 million. We know that community pride through cleanliness, maintenance, and beautification of public spaces is really important. You recall last year we opened phase two of the Eastside Sports Complex that's utilized by everyone in the city. We will start the shade canopy program for phase two of that in a couple of weeks. But we were able to identify through funding that was set up through a public improvement district funds that will allow us to have some of the equipment that's necessary to take care of that facility through this budget. As we start to talk about staffing, I think this has been a discussion that we've had quite a bit. So we talk about our economic mobility pillar and really activating workforce pathways We do include adjustments to our regular compensation for both our civilians as well as our public safety. What's important in this, as you see our current year and our outlook, is that we know that we can't jump to the living wage for the city of El Paso overnight. And so it really is a five year strategy. If you look at the current MIT living wage calculator, the current living wage is $18.54 for one adult and zero children. We are looking at getting to $18.25 by FY31. So we know that it's not something that can be done overnight. And so we're starting this year with adding 50 cents to the minimum wage. Our hope is that we have resource to be able to do that over the next five years. But I do think it's important to recognize that we are doing it within the constraints of the budget that we have. recognizing that we have to always balance the needs of the community across all the departments and all the contracts that we have. I'm very happy to report that we're seeing the retention levels across our city really improve, but we're recognizing that turnover is really expensive for our community. in terms of the vital services that we are expected to deliver. So if we look at our tenure of our civilian staff, it has really changed dramatically from what it was prior to COVID. Right now, nearly half of our civilian staff have less than five years of service time. And so when you think about organizational history, how we ensure that we have supervisors who are in place who really understand the work, it really is critical that we have a more stabilized workforce to be able to do that. For our FY26 turnover rate, it is one of the lowest that we've seen since the pandemic. You know, you've heard me report on the civilian side that we have been up to about 23%. So when I go back and look at, you know, FY22, when at the time we still had recreation centers closed, we still had aquatic facilities close, we have come a long way in terms of stabilizing our organization. Compared to just last year, we see that for our civilian workforce, a 36% reduction in our vacancy rate. We have 100 more civilian staff than we had last year at this time. On our uniform side of the house, we've seen an 18.3% reduction. We have 86 more field positions. That's vital for us because we know that the cost of turnover is estimated for the average position at about $46,000. So when you take in consideration the recruitment costs, the lost productivity costs, having a stable workforce really allows us to be able to serve the community at the level that they deserve consistently. Diving into how we look at the general fund cost drivers and efficiencies, I'm really proud of the work that the teams have done to really look at every way that we could save money, to look at efficiencies across the board. At the end of the day, we would like to ensure that all the programs and services have all the resources that are necessary. We will never be in that situation, and so we have to make sure that we're being strategic in terms of how we look at costs and expenses. The breakdown you see here for police, I wanna highlight that as we talked about in previous years, this is the end of the ARPA program. And so we're transferring 18 funded positions that were previously supported through the ARPA program for PD that were supporting our city watch program, our crisis intervention team, and body worn cameras are being transferred over to the general fund. We also in this process looked very closely at the number of people that we thought we would be successful with in terms of the academy. So when you're seeing that negative number there for PD, it really was the opportunity to right-size to the number of people that we thought we could legitimately graduate and knowing that we have a backstop with the COPS grant that we were successful with. So if we go over the budgeted amount, we can then use the COPS grant which gives us six people per year in addition. So we know that we have a buffer there and it then allowed us to be able to do some modifications. you may recall last year we were projecting 120 graduates we did not hit that number and so this year we reduced it to 90 we do believe that we will be able to hit that number and we're not reducing the number of graduates because we know how important it is to make sure that we have officers available to respond but we're really right sizing the budget to what we believe will be accomplished within this year The increase you see there for emergent health network is for them to make adjustments for competitive salaries. I think across the board, we're always looking at retention and ensuring that we have qualified people and we can retain those across the board. And that's also true for our community partners. For the fire department, one of the major changes that we made was actually a shift As you see there, we have the HAZMAT unit that was previously funded through our environmental fee. That had been on the environmental fee for quite some time. We have been utilizing fund balance to balance that fee. We made the decision to have it be on general fund rather than making another adjustment to the environmental fee. That would have cost at least $1.25 additional to the environmental fee. What I heard clearly through the community that a fee is the same thing as an increase in taxes. So putting it where we knew that the dollars would be available made more sense than having to continuously increase that fee year over year. That's 19 positions for the fire department. So there really was a shift and I wanted to call that out. Contractual expenses, we did have a major contract for our P25 radio system contract that was over $3.2 million. We were able to utilize some ARPA funds that were allocated to be able to offset some of that cost. We do believe that one million could be covered by other entities that share in that cost in future years, so we don't see it necessarily as a one-time plug for that particular area. As we talk about wage increases for our teams in the civilian side, as mentioned, this budget includes a 50 cent increase in minimum wage from 15.75 to 16.25. I'm happy to report that this is about a third less expensive than it was last year. Really getting to a place where we've dealt with the compression, we haven't waited as long with the increases, really has allowed us to right-size the entire workforce. So this is a less expensive thing to be able to maintain over time. Happy to report that in terms of healthcare, that our healthcare system is very well managed. Not only do we have no increase to our employees, we also have no increase to the city in terms of our need for contribution to our healthcare program. Our last two year strategic plan asked us to look for additional benefits for staff. And so one of the things the team did was go out and look for supplemental insurance that would be beneficial to our team that would be no cost to the city. So next year we will be offering cancer insurance, hospital indemnification, critical illness accident, and pet insurance. We take advantage of the group discounts with our city and so those will be offered at no additional cost to the city, but I think that those would give our teams even more assurances and security in terms of the things they may be challenged with in their lives. In terms of contractual obligations, we know that we have an election coming up, and that's $1.5 million. And the other major adjustment that we made was to animal services. for their expenditures. What they're seeing is a decrease in our interlocal agreement dollars coming in at about $318,000 and also a decrease in fees for service. And so we had to put some additional dollars to ensure that we can continue the wonderful service that's delivered by that department. So key context, Robert will come up right after me to talk about some of the revenue resources. You know that we have increased costs that are due to public safety and other fixed costs. We haven't issued debt in quite a few years and so we'll talk about what the impact of that debt service for those voter approved projects will be on the budget. And one of the things that we did to ensure that we could balance the budget was really focusing on vacancy management. You've heard me say that we need to ensure that we're making reductions that can be sustained over time. The majority of what we spend on the general fund, 71%, is people. And so when you start to look at contractual obligations that are fixed costs and expenses that we can't move, really the people are the place that we look at. The strategy that we did was across the board, every department took a look at what we could do to ensure that one, we're maintaining our core programs and services, But two, we're looking very strategically at all the positions that we have. And the 75 positions, 75% of the vacancies that we had in place are either unfunded or deleted. And so that comes up to about $26.1 million. So just to kind of wrap some of this up, you know, some of what we've been dealing with, I think we've been in some of these discussions. You've heard CAD's presentation on what's happening at the state level. And we are continuing to talk about our need to sustain our ongoing city operations. We know that we will have continued costs related to public safety, our bond issuance. As Robert has shown, we have a couple years that we will be issuing debt to get our projects done because we promised the community we're going to get those done on time and on budget. We continue to have unfunded state mandates that hit us in terms of our budget. We want to make sure that we can get to a place where we're not using one-time fund balance and one-time revenue because it's really hard to continue to plug that hole. So this really is a balanced budget that takes into consideration the things that we know will happen next year and years moving forward, and it is showing you things that we can continue to do at a level of staffing that we can sustain over time. We have talked about the expiring American Rescue Plan Act, and we've planned for that in many ways. And we're continuing a lot of those programs and services because the staff really has planned well to be able to continue those programs. terms of efficiencies again I've talked about the vacancies the teams will take you through some of what that really looks like for our organization when I started to look at where we could go for some of those dollars it really becomes the equivalent of what we cut is almost two weeks of citywide operation it is multiple departments and so when we start to talk about making those reductions it really is about how do we sustain what we know is core and and include that in this plan. And so it really meant that every department had to take a look at how we were looking at those numbers. I was so proud of the teams. You know, we were maybe two weeks ago coming up with this strategy, folks. I mean, we had a big deficit. We moved this schedule up and we didn't have any place else to go without really sacrificing some of our benefit programs or raises, which we know, you know, hurts our ability to be able to recruit. And every single department was willing to take that look, you know, offer up what was necessary and ensure that what we will present to you today allows us to be able to deliver the level of service that was necessary. You know, one of the things that Sasha said was like, oh, that department came back with X, Y, and Z. They came back with a zero flat budget. And so I'm really proud that people really took the opportunity through both the program-based budgeting process to look carefully at what it is we were doing, ask the question about whether that was the most important thing for our community, and make the adjustments that were necessary to get us to what we're delivering here today. We know that cost recovery is going to be important also, so we have a couple of plans that we want to bring forward to you on June 22nd that are going to allow us to take a deeper dive into how we think about cost recovery and are there opportunities for us to bring more revenue to cover the costs and expenses that continue to grow in areas that we're delivering critical services that community really have asked us to be able to beef up. So three of the things that we have been talking about is really compensation, taking care of public safety. You all have talked to me over and over again about the ability for us to make sure that we're starting to take care of our streets and think about how we do that long term. But in the meantime, we're committed to ensuring that the plans that we have already adopted and you've most recently adopted will be executed and that we are doing that in a timely fashion within the community. We're continuing to look at facility improvements, vehicle replacement, and our IT contracts. We also noted that maintaining costs within those contracts are important. Happy to report that our team has worked really hard to actually come with reductions outside of our P25 contract to a lot of the contracts that were being renewed this year. And with that, I'll hand it over to Mr. Cortinas.

Good morning, Robert.

Good morning, Mayor and City Council. So I will be covering the revenue sections, and then I will be followed by Mr. Sasho Antonovsky. So overall, presenting the numbers related to the FY2027 budget compared to the FY2026 adopted budget, you'll see an overall increase of $22.9 million. You'll see the general fund portion increasing by 29.6 and the non-general fund portion, which we'll have some discussion about, decreasing by 6.6 million. Overall, that $22.9 million increase equates to a 1.7% overall increase in the total all funds budget. We look to the fund by category So I included this slide because we hear a lot of discussion when we go out and do community meeting presentations Individuals will reference the overall 1.4 billion dollar budget that the city has So what this does is it breaks down the different fund types that the city has and so you'll see listed on the far left hand column There are different fund types. And so you'll see the general fund special revenue internal service fund and Then on the right hand side a little bit of description about what those funds are so essentially other than the general fund, all those other funds are either dedicated or restricted for specific purposes. And so overall, out of that $1.4 billion, 57% of that is restricted or dedicated for specific purposes. And so, for example, in that special revenue category, it's primarily grants. The internal service fund category is our self-insurance fund for our health care and our workers' comp and our unemployment. That's also our fleet internal service fund. In the CDBG, that's our community development block grant, which is our federal fund that we receive for our community development department. The capital projects fund, that's our internal capital fund that we have set up, primarily our PAYGO funding in that category. The enterprise funds is the revenue generated by our enterprise funds. And so that revenue is dedicated for those specific departments. So that's the international bridges, the airports and metro, tax office. On the debt service, the pretty self-explanatory there, that's the fund that we need to make our annual debt service payments. And you'll see that roll up into the L funds. And so just a little bit of clarification and a little bit of education for, again, the community as we discuss the overall $1.4 billion budget for the city of El Paso. So looking at the different categories of revenue for the general fund. So as we've been discussing since February, we've done a couple of different presentations really to highlight. One, we've talked a little bit about the structural imbalance. Ms. Mack referenced a little bit about that. I've got a slide that I'll touch on here in just a few minutes. But really looking at the revenue that the city generates to be able to fund the services that we provide, primarily funded by the general fund. And so the general fund, again, is the most flexible funding that we receive that we would allocate to a lot of the services that the community thinks about on a day-to-day basis. And so as you look to this slide, the top two lines there, property tax and sales tax, again, equate for over 70% of the total revenue for the general fund. And so as you look to the variance, the overall increase in those two sources is over $34 million, almost $35 million. And as you go through the different categories, you'll see a couple of decreases. And then the really big one that Ms. Mack talked a little bit about at the very bottom of the slide here, the operating transfers then, you'll see a decrease of $5.8 million. That is due to the reduction or the elimination of the use of one-time fund balance that we had in FY26 that we do not have in the FY2027 budget. And it was also due to the one-time PRZ9 revenue that we terminated that tax and commitment reinvestment zone last year. So there's a reduction of that $2 million one-time revenue that was funded in FY2026. So again, overall increase of $29.6 million on the general fund. And I'm going to go into a few slides here that really highlights the property taxes and sales taxes and the growth and some of the challenges that we're facing. On the non-general fund side, again, you'll see all of the different categories related to the revenue sources that fund the non-general fund portion. Again, thinking back to what I just mentioned on the different fund types. And so you'll hear the department says they come up and speak to their particular budgets. But as you look at property taxes, Again, the non-general fund portion, this is the property tax amount we need to make our debt service payments, which includes the debt issuance that we'll be doing here in a couple of weeks, which was approved by city council a few weeks ago. $70 million debt issuance for community service, community progress bond projects. The sales tax category here, this is the dedicated half a penny that is for the mass transit department, in addition to the motor vehicle rental tax, which was approved by the voters many years ago, which goes to fund the annual symbol game. The franchise fees are restricted economic development funding, and so on and so forth. So you have a little bit of description on the right-hand side there explaining what those variances are. But as I mentioned, overall, the non-general fund side, a reduction of almost $6 million, $7 million, excuse me. So moving into the discussion about the property tax rate and property tax valuation. So I'm going to go really slowly through these slides because there's a lot of important information not only for the council. We've done the briefings with you all, but really to, one, make sure that the media that's here today join us and that we'll be reporting on this information. And then the community fully understands sort of the issues of the challenges that we're facing. And so as miss Mac mentioned all of this is preliminary and so we gave you all my disclaimer when we met with you all over the last few weeks This is all preliminary. So the budget office does a fantastic job of coming up with the estimates and the projections that you all are seeing but these numbers will change and so we received preliminary valuation reports from the appraisal district which they came and presented to the council a few weeks ago and We take that information, we utilize that preliminary information, and we do comparisons to historical information, look at the trends of what we typically see, and we essentially do a forecast or projection on what we expect to see when we receive the certified valuations or the final valuations on July the 25th. So between the preliminary, which goes back again a few weeks, to the end of July, We know that property owners are protesting the values of their home. There's going to be a lot of changes in that information. So essentially what we're doing is forecasting or projecting what we expect those finer numbers to be. So again, preliminary. But we obviously have to have something to develop the budget off of. And so again, as I mentioned, that's what this does. And so looking at the overall property valuation change, So you'll see historically going back to FY2013, and I always believe that providing some historical context really helps just to kind of see where we were historically prior to the last several years where we know that we've all seen a really unprecedented growth in the housing market. We've seen double-digit increases in average value home. But you'll see what we're projecting for FY2027 on the far right-hand side of this slide. So overall, we're projecting just under 3% overall increase in overall property valuations for FY2027. And so again, putting together that estimate of that projection, when we get those certified values on July 25th, again, our estimate is that it's going to come in at just under 3% overall property valuation change. So one of the things that we've talked about with the city council and what CAD sort of touched on a little bit, they didn't go into a whole lot of information. But one of the things that the city does is we provide a significant amount of tax relief through exemptions that are provided by the city council, as well as property tax exemptions that are provided by the state. Ultimately have gone to the voters which have been approved by the voters. And so in the FY 2027 budget We are looking at on the far right hand side of the slide over 56 million dollars of property tax revenue That will not be collected because it is giving being given back in the form of tax leave to the different groups You'll see listed here. So the city's $5,000 homestead exemption is about five million dollars in property tax revenue The $45,000 exemption or discount that's provided to our seniors and to our disabled homesteads, that's almost $19 million of property tax revenue. The disabled veteran, which is, again, a state exemption, which was approved by the voters several years ago for disabled veterans and for their surviving spouses, it's over $25 million of property tax revenue. And then finally, one of the newer ones, which, again, the Apprentice District talked a little bit about, which was approved by the voters in last November, Seven point two million dollars of revenue loss and so the business personal property tax is different as I mentioned approved by the voters in November of this past year Increased that exemption from twenty five hundred up to one hundred and twenty five thousand dollars And so that it has is having a significant impact on the budget and the available property tax revenue for FY 2027 And so this slide shows you, if you combine the disabled veteran and the business personal property tax exemption, those two which are state exemptions, you'll see the increase from FY2026 to FY2027 going from 21.6 million up to 32.4 million. And so that's almost $11 million of less property tax revenue that we have to fund city services. significant and so that that's created a significant challenge for the fy 2027 budget and so again as with mac mentioned we needed to find a way to continue to provide the services and so the departments all of them did an excellent job of really working very closely with the budget office to be able to identify those adjustments necessary to be able to come up with where we're at today so again this is significant so that increase is not only due to the business personal property tax exemption increase But we continue to see year over year between $3.5 to $5 million less revenue from our disabled veterans. So again, it's a wonderful exemption. It's fantastic that our disabled veterans and our businesses now have this tax relief. However, it does come at a financial impact to the city and the available property tax revenue that we're able to generate on a yearly basis. So looking at the property tax rate comparison from FY26 to FY2027. So the comparison has the two separate categories here. So on the yellow-orange portion there, that is the debt service portion of the tax rate. And you'll see that increasing from 21 cents per $100 valuation up to 21.2 cents. Again, that slight increase coming as a result of the $70 million issuance that we will be doing here in the next few weeks. The blue portion is the operating and maintenance component of the tax rate, and you'll see that increasing from 54.9 cents up to 57.1. The right-hand table we included because we really wanted to highlight Some of the challenges, again, I talked a little bit about it, but as we talk about the impact, not only from the exemptions of the tax relief, but also looking at backing out that one-time revenue, what impact does that really have on the tax rate? And so it'll be reported here once we send out the press release and the media reports out that the city is increasing the property tax rate by 2.3 cents. So we're going from 76 to 78.3 cents. But if you look at the right-hand table here, you'll see that essentially backing out that one-time revenue, incorporating the impact of that loss of taxable value from those exemptions, equates to 3.69 cents of the tax rate. So if I were to imagine this, is that if none of those things on the right-hand side were to have happened, if we wouldn't have had the exemption increase, if we were not to have backed out the one-time revenue, we would have been able to actually lower the tax rate next year. Unfortunately, that's not reality. We're dealing with the reality and so this is the position that we're in currently As we look to the impact of that tax rate that I just showed you all, combined with the change in the average value home, which I'll show you here in just a second, this shows you the breakdown of what the average impact is, again, based on the average value home, which I will show you here in just a second. So for those that had the homestead exemption, the average tax bill will be $1,723, increasing to $1,829, which equates to $105 annual increase. Average for the over 65 and disabled individuals who have that exemption their increase will be ninety four dollars and eighty six cents and Then for the disabled veterans, which we have almost twenty eight thousand disabled veteran exemptions in our community That average impact again, and this is an average just so that I'm very clear. That's it's an average that category the average impact will be seven dollars and eighty one cents and Again, it fluctuates. It's going to depend upon what exemptions you have, the disabled veteran, which disability ranking you are in. But on average, for those different categories, you'll see what that variance is on the right-hand side there. When it comes to the average value home, so I showed you the tax rate. This is the change in the average value home over the last five years. You all have heard us talk a lot about this. We've seen double-digit growth in average value homes, 2023, 2024. We started to see the slowdown. For FY2027, that $233,549, again, what I just mentioned a few minutes ago, that is a projection. What was provided by CAD with the preliminary reports was a $240,000 average value home. But again, that was before all the protests and the appeals are done. And so what we factored in, typically based on historical data, we see about a 3% reduction from the time we get the preliminary reports to the time we get the certified value reports at the end of July. And so I've incorporated, we've incorporated that 3% reduction that we expect to see once those values are settled in the average value home coming in at just over $233,000. What does that mean in terms of percentage change? Again, you'll see here in 2024 and 2025, as I mentioned, double-digit increases in the average value home. And we've seen that already start to slow down, which isn't a surprise, something that we've talked about over the last several years. We see these sort of fluctuations happen that last two or three years, and you'll see it start to come back down to those historic levels. And so right now, as I mentioned, we're looking at just under that 3% change for FY2027 in the average value home. When it comes to sales tax, a little bit more of a positive story on sales tax. And so this shows you the budget to actual comparisons for the last couple years, and then the estimate for FY2027. And so I'll draw your attention to the FY26 amount. You'll see the budget was at $142.7 million. The orange portion there for FY26 is what we are projecting to end this fiscal year at the end of August for sales tax. And so we're estimating to end the year at $147 million. So sales tax is performing better than we expected when we developed the budget for FY26. We've taken that into account for FY27. Thus, you'll see the estimated increase going from 142.7 budget-wise to 154 million, which equates to about a 4.8% over the projection that we have for the current fiscal year. Again, looking at sales tax, again, we had two outlier years in 2021 and 2022. Really provided the city an opportunity to really use those funds to build up our fund balance. You'll see what we're projecting again in FY27, that 4.8% and how that compares to historical changes year over year, really in line with where we are typically at. I would say actually a little bit higher. Typically, we're right around 4% is what we expect on a year-to-year basis. So 4.8%, again, encouraging that we are seeing still continued strong growth in our sales tax revenue categories. Ms. Mack mentioned a little bit about the cost recovery efforts. And so, again, on June 22nd, we'll be bringing a presentation before you all so we have hired an outside consultant to help do a review a cost of service study for our parks and recreation services as well as our planning and inspection services that we provide to look at what our current fees are and what potential adjustments we could make or explore look at making to some of those different services that we provide Real estate leases we've had a little bit of discussion about that recently But the city does provide quite a few leases at below market value and something that will continue to review as some of these leases are coming to either expiring or coming up to renew Other fees or potential revenue opportunities we've talked a little about some of those things something that again as we're looking to offsetting some of the impact on our property tax reliance and sales tax reliance something that again more of a longer-term discussion Really tying into the street maintenance discussion that we've had as well as just the overall capital need whether it's for streets facilities vehicles or IT infrastructure which you heard a little bit about one of the big drivers in the budget for next year and And we'll continue to see that year over year as we see those information technology costs continue to increase, whether it's for the hardware, the infrastructure, cybersecurity measures, or just the contracts in general. Those costs continue to go up year over year. Fund balance. A lot of discussion about fund balance, not only from the city over the last several years, but pretty much every, it seems like every governmental taxing agency has had a lot of discussion about fund balance over the last several years. So happy to report that our fund balance is at a very, very well position right now. We are currently at 69 operating days is what we're expecting to be at when we start. our fiscal year 2027. The best practice is to be at least at 60 days. However, with that being said, two of the things that impacts that calculation on the number of operating days is due to the requirement for our cash reserve, our restricted reserve, we're required to maintain 5% of our prior year budget in that fund. So what ends up happening at the end of every year is we're transferring from our unrestricted into our unrestricted. So that has an impact. And then the other thing that impacts that calculation is as your budget grows your daily operating cost increases as well And so over the last several years we've seen that daily operating cost increase from about 1.4 million up to where we're at For next year about 1.8 million dollars. And so that has an impact on the number of operating days We have seen a decrease in the number of operating days since fiscal year 2022. We were at 88 days we've seen that decline to 69 days so this is more of a I think just to keep it on everybody's radar. It's an area that's very, very important that we maintain our fund balance. And again, Ms. Mack mentioned that it's one of the things that we put a lot of thought into. I mean, we could have easily said, well, we budgeted $3.2 million in FY26. Let's just plug in $2 million use of fund balance in FY2027. However, who knows what next year is going to bring. If we try to anticipate everything that's going to come before us, unfortunately, We're not psychics. There's things that may happen that we need to be prepared for. And so preserving fund balance is one of the key priorities in the FY2027 budget. We do not want to budget that one time source of revenue. We want to make sure that, again, going back to the theme and the focus over the last several months with the presentations that we've done, that structural balance, right? You have recurring cost or recurring revenue to fund your recurring cost. That's best practice and that's ideal. Our bond readers did note our fund balance. They were very complimentary. They talked a lot about how We've been able to maintain that fund balance but they did essentially point out that they'll continue to monitor and that if the city does continue to fund balance something that Could potentially harm the city's bond rating in the future but again both are cruel and standard of poor's bond readers and Very complimentary, provided very positive feedback, both reaffirmed the city's AA and AA plus bond rating, which again is very, very important as we're going out to issue the remaining debt that we have to keep those interest rates down as much as possible. Again, not to impact the property tax rate more than is necessary. So as I mentioned, we do have the $70 million issuance, which we will be pricing or scheduled to price those bonds on June the 9th. We will know exactly what that does service amount is We do have again as I mentioned an estimate built into this budget that you're seeing today And that is one of the increases for the increases in the overall property tax rate as I mentioned So well out of that hundred and five dollars that I mentioned on the average home about fifteen dollars of that is due to our debt service portion of the property tax rate And so with that I will now turn it over to Sasha and Donald ski

Good morning.

Good morning, Mayor and Council. Sasha Donovsky, Office of Management and Budget. So as we shift to the expenditure side, 71% from the whole general fund or 655 million dollars, 0.3 million dollars is the salaries. 71% from the whole general fund which is 465 million dollars are the salaries. Everything else is 29%. So if you take into consideration that, for example, in that other category we have utilities, we have liabilities, we have the insurance cost there, we have contractual expenditures, we have appraisal services, we see that the flexibility on the general fund is not big. So we have a small flexibility on the general fund. So in that 71% we have police uniform and non-uniform salaries included. We have fire uniform and non-uniform salaries included. And then also we have included all non-uniform salaries. 71% of that amount. As we look at the general fund by main categories, we already see the biggest increase is in the personal services. I want to mention that the general fund has already increased by $29.6 million, and the $17.3 million of that are the salaries. So that 17.3 million dollars, we have police and fire uniform, and then we have the citywide increases. But also we have, because as the city manager mentioned, our retention rate is much higher than last year. So that also is the impact to our budget. Contractual services, they're increasing by $7.4 million, and we have a couple of huge increases. As we already mentioned, $1.5 million are for the elections, $2.2 million are for the public safety, and then we have increases to some of our contracts, like janitorial contracts. We have EHN, emergency help, the network contracts, et cetera, et cetera. Materials and supplies are increasing by $2.2 million. We are seeing increases to most of our materials and supplies contracts, and you can see the major variances of explanation there. Operating expenditures are increasing by $319,000. The huge increase, the main increase is from the utilities, $794,000, but we are seeing some savings on the phone and internet side. Non-operating expenditures are in line. Intergovernmental expenditures are increasing by $391,000, which is due to the Safer Grant. This is the city match for the Safer Grant. And then the other uses, which are our transfers, is increasing by $1.9 million. $1.5 million from that is the transfer to the Animal Services Department. Overall, all general fund is increasing by $29.6 million, which is 4.7%. When we look at the fund category, as Mr. Koutinas mentioned, only general fund gives us a little bit more flexibility. Every other fund is either restricted or dedicated for a specific purpose. And so we have a special revenue funds. These are funds like environmental fee. We have economic development funds like auxiliary fund, pet fund, and other funds. Internal service funds are two funds, our self-insurance fund and our fleet fund. So we are seeing some increases there on both funds. CDBG, as Mr. Cortinas mentioned, our community development and block grants, that's in line. Capital projects fund, we have $1.4 million increase. $1 million from that is the... $1 million is that for the ARPA funding for the P25 contract. And then we go down to enterprise funds. That's decreasing, and Mr. Cortinas already went through the decreases, and they are attributed mainly to Environmental Services Department. That service is increasing by $5 million. This is due to $70 million community progress bond issuance for the next year for the principal and interest. So overall, all funds are increasing by $22.9 million, which is 1.7%. For the next steps, so today we have the first round of the budget workshops. Probably we will continue tomorrow, next week and a week after that we will continue with community presentations. And on June 22nd we are going to come back for the second round of the budget workshops. where we are going to present the findings from our fee study and feedback from the community. The plan is to file the proposed budget on July 17th, and on July 25th, we are going to receive our certified valuations. And we will come back for another round of community budget workshops where we are going to introduce our property tax and we are going to present our certified valuations. The plan is to adopt the budget on August 18th. And with that, we are open for any questions before we go to departmental presentations.

Very good. I think we're going to have some questions. So Ms. Mack, on page 10 of your presentation, you talked about pre-COVID turnover rates. Can you expand on that a little bit more, that you're down to your lowest levels?

Sure.

Fiscal year?

I can provide counsel our last. five years of turnover because of course they didn't bring it downstairs so we were um we were tracking both our civilian as well as our uniform and so we know that we would when we do a comparison to where we were there is a 53 percent reduction from the turnover rates that we had in fy 22. and you're at 11 what's your number there We are at 11.3% this year. Okay.

And then my next question is going to be for Robert on slide 24.

And I just want to mention that we have all of our folks from OMB in the back. They will be noting anything that you ask us in terms of questions. If there's something that you've asked for or something that we want to bring forward, we will be sending you out responses to those. And so if there's more detail, we'll make sure you have that. as backup in your SharePoint. Thank you.

Okay, thank you. Robert, slide 24. The exemptions seem to be a primary driver of what's causing some of the increases. If you look at the business personal property state exemptions where they went from $2,500 to $125,000, that triggered that $7 million increase. Is that something we could have predicted?

no sir even the appraisal district had a hard time giving us an estimate on what that impact was going to be they had to update their system to be able to apply Those exemptions, because as they mentioned, that exemption applies to every location, not just the business. So the example they gave was McDonald's. McDonald's doesn't get a one-time $125,000 exemption or discount. They get it per location up to that $125,000. So once they updated their system, they gave us the preliminary reports at the end of April. Unfortunately, that's what the numbers came out to be. And so to be clear on this, Essentially an unfunded mandate and we've talked about that from the state right the state approved it voters went it went to the voters the voters approved it what ends up happening is The state essentially the way that I won't say they fund it But the way that it gets funded we have to make it that revenue from somewhere is essentially that impact gets backed out Or included into the calculation when we're looking at developing the tax rate So essentially the state says we won't penalize you from the loss of that value. But what that means is that Property tax rate is going to go up to be able to fund that loss of revenue And so when you take the combination of the increase in home values and you combine that with increasing tax rates, that's the impact that we see on the average value, but No AI we were thinking maybe two million maybe three million we weren't expecting seven million dollar loss of revenue All right, and this is voter approved voters approve this in November. And so this is for business. So to be clear, so this is businesses and personal property exemption. So this is tax relief. This is tax relief for those businesses that will receive up to $125,000 off the personal property associated with their business.

OK. And on page 30, Robert, the sales tax, can you tell us what the primary drivers are for sales tax?

It's two areas. So one is in the retail category, and then the other is going to be in the utilities category. And then we have some increase built into the food services and accommodations. So restaurants and those type of businesses are really what's driving this year. But really, it's the retail category and the utilities category that's driving that growth this year.

OK. And on page 33. You talked about the fund balance and 69 days of operating, which is healthy. And you said 72 is average, I believe? 60 is best practice. 60 is best practice. OK. So when should a city look at using fund balance?

Never. OK. Never? OK. Only in extreme emergencies. OK. And so one of the things added on the slide here I believe I have it on there. We had developed or began to develop a policy related to a fund balance. We currently don't have a fund balance policy. We have a target. We make mention to it in our annual comprehensive financial report. We reference 60 days as the city's target. But we currently don't have a city council adopted fund balance policy. And so in that policy, it would include things such as that, Mayor. When would the city be OK with using fund balance? When would the city be OK with not using fund balance? If the city is at a certain level, if we were at 120 days, we'd probably say, we're in a very, very good position. We can afford to use some of it. But what if the city drops below 60 days? What if we get to 55 days? What is the city going to do? Are we going to be OK with being at 55 days? Or is it the city's intention to say, you know what? We need to incorporate funds in the annual budget to replenish back to where we need to be over a certain amount of time. And so those are the type of things that we've put into this draft of the policy. There's some other things that go into it. We're looking at doing a risk assessment, something we talked about with a few months ago. That 60 days is best practice, but it's a very generic best practice. Every city is different. Every city faces different challenges. Some cities have access to different revenue sources that they can use. If their fund balance dips, they can tap into another revenue source to replenish. We don't have that luxury. Some cities face natural disasters that we don't face, so they may need to carry a higher level of fund balance to account for hurricanes or floods or ice storms or those type of mother nature type events. We're very fortunate we don't have those type of things. But you never know what can come before us. And so we always want to make sure that we're in a position where if something does ever happen, that we have adequate fund balance to be able to address those issues.

OK, very good. And is it fair to say that most cities or municipalities are facing the business personal property deficit like we are?

Yes, sir.

OK. All right, Representative Kanellis.

Thank you, Mayor. Robert, I think there are a few things that are worth emphasizing. Ms. Mack said it in a very punctuated way at the beginning. You've also said the same thing. This is a preliminary budget. I think it's important for the public to understand This is the first engagement that maybe they have with this budget. It's been in development for quite some time. This preliminary look at it is the first step, but there will also be a proposed budget. And that's the next stage before a council-adopted budget. Is that a fair reflection of how that process works?

Yeah, so it's a little bit unique being up here at the end of May presenting because typically we're doing this at the beginning of July. And so as Ms. Mack mentioned, this is six weeks already that we've ever done. So everybody in the budget office is aging very rapidly because it's been a big push to get all of this done. Not only to move everything up, but the implementation of the program is budging. There's been a lot that's gone into developing the FY2027 budget. But the beauty of it is, and the thing that we spent a lot of time in developing this sort of sequence of events is that it gives everybody plenty of time. It gives the council a lot of time to sort of digest it, to let it sit. for us to be able to hear any adjustments that you all may have or any ideas that you all may have. Gives us plenty of time to go out, visit with the community over the next couple of weeks, get their feedback. So as we mentioned, we'll come back at the end of June, June 22nd, 23rd. We'll do another round. We'll come back after we get our certified valuation that's in July. So we'll come back, I believe we're scheduled for August 4th is what we're looking at. So you have another round in August 4th before the actual adoption on August 18th. So plenty of time between now and then to get to that final adopted FY2027 budget.

And ultimately, we made this decision for the public to be able to have a lot more visibility of the process as well, starting much earlier, giving them much more time to digest You know, I've been pushing for this for the last several years, and it took some years to get here. I appreciate all the work that OMB staff has undertaken. And then all of the departments, you know, we piloted the program-based budgeting last year in some departments, and then this year rolled it out in full. And I mean, look, I have the perfect prop here for the public. This is a huge, huge binder. We want to make sure that anyone in the public who's interested in understanding what's in this preliminary budget has the time to do so. the breakout to the program-based budgeting makes it a lot easier for the layperson to read and understand what's in the budget as well. So first, kudos to the entire staff and yourself and everybody who worked on it from all the departments because it's a huge undertaking to get to something as comprehensive as the preliminary budget this year. I do want to ask a couple of questions. Typically, at this point, still quite early in the process, although, again, to all the people who have worked on it, that probably doesn't feel early, but early for us and for the public in the budget process. Are the estimates that you use here still relatively conservative estimates of what we anticipate maybe final numbers will look like after we get the certified values from this appraisal district, for example?

Yeah, I don't anticipate a whole lot of changes between now and then. But again, we're not always going to be 100% accurate, but I don't anticipate a whole lot of changes between now and when we get to certified values. But we will come back at the end of June. One of the other things we'll present to you all when we come back at the second round of workshops is we'll present the third quarter report just to give you all an idea of where we are currently in our fiscal year.

that's important because we're using those projections in this current fiscal year sort of as the base for what we're estimating by 2027 but i don't anticipate a whole lot of changes between now and then okay yeah this is the 10th budget process that i've seen unfold here at the city i don't think we've ever seen a surprise in the negative uh from the certified values in the time that i've been here at least um typically Again, I know your estimations have been very good, very, very close sometimes. But typically, if we see some sort of drift, it's a little bit in the positive. Is that fair to say?

Over the last several years, yes.

But I've seen years where it's been the opposite and we've had to make reductions.

So yes, we try to be conservative in the estimates so that we don't have that situation. But again, we'll kind of wait and see. And we do receive updates from the appraisal district between now and the certified. So if we get those preliminary reports in April, we'll get An updated batch of reports probably in the next couple of weeks. We'll get another update towards the end of June, and then we'll get, again, the final end of July. So we'll look at those updated reports, and we'll see, do we need to make some modifications to those estimates? Or if we look like we're on target with what we originally estimated.

Okay, and then the 26 adopted tax rate of .76, 76 cents per $100 valuation, moving to the preliminary here of 78.3 cents, that's, it's a 3.02% increase, is that, does that sound right to you?

I don't have the percentage change, but it's a... Yeah, 2.3 cent increase in rate.

Right. Yeah, I just want to make it clear, too, for the public. And you did a great job of, I think, showing that table next to the chart on slide 26. We had to. essentially eat Quite large reductions in revenue brought on by by the state And I mean ultimately by the voters in the state right who who adopted for example the business personal property tax Exemption that it's quite large as you said seven point two million an impact on on our revenue I think it's worth pointing out that that is 3.02% increase, essentially 3%, is still less than, and this is a little bit of a simplistic way to think about it, but a little bit less than inflation consumer price index for the year as well. We're still paying increased costs for all the services. members of the public pay more for their gasoline and their home goods and groceries and everything. The city also, in order to provide services, pays that inflated cost as well. We are increasing that tax rate by less than what inflation is for 2026, which is at 3.8 percent on the year. Again, a little bit of a simplistic way to think about it, but I think it's valuable to point that out. YES, AT LEAST IN THIS PRELIMINARY BUDGET, WE SEE THAT SLIGHT INCREASE, BUT IT IS LESS THAN THE INCREASE IN WHAT WE'RE HAVING TO PAY FOR SERVICES. AND SO IT MEANS THAT DESPITE THE SMALL TAX RATE INCREASE, YOU'RE SEEING CUTS IN OTHER AREAS, THE CITY MANAGER EXPLAINED, BECAUSE WE HAD TO CUT IN ORDER TO KEEP THE TAX RATE REASONABLE.

So that's a good point. So Ms. Mack tends to make this point every once in a while. And I think we tend to forget about it is that we talk about the number of employees a city as an organization has. But we also indirectly employ several thousand other individuals through all of the contracts that we have as well. And so your point about those contracts increasing in price is when those contracts come for award, they're typically three to five year contracts. And so when they come for a word typically they increase we don't typically see decreases in contracts costs Don't typically go down labor costs continue to increase and so those businesses that are bidding on doing work with the city submitting their bids those costs tend to go up and You know all of those individuals that work on that contract again are essentially indirectly employed by the city So the city has a huge impact one of the largest employers in the area not only as organization but then when you factor in all of the different contracts that we have as well, which You'll hear about from some of the departments a tremendous impact on on the economy

Yeah, and I mean, our workforce as well has become more expensive. And you'll never hear me say that that's necessarily a bad thing, because you can see the benefit, again, going back to slide 10, looking at our turnover in workforce. And I know Ms. Mack said, what was that amount, $46,000? to turn over a position and onboard a new person between the recruitment and the training, it's quite a large expense. And we've reduced that dramatically. And I think you see the benefit of the increase in paying our employees a fair wage. I'm grateful that this budget continues to do that. I know it's a smaller increase than in some of the previous years largely that's because we've caught up and we still have little ways to go but You know, that was one of the first things I did when I came into office was try to Push for that investment and I'm grateful that the council in 2023 agreed with that with that vision for that um and i mean who would have thought if you pay employees a fair wage they want to stay with you and they do a better job and you know everybody's happier i think in the end um both the employees and us because we don't have to worry about the the turnover and the the the large expense that that incurs for us so um Yeah, I'm really happy to see that the numbers prove out that investment and that we look to continue making that investment in our in our own workforce. Overall, again, one more time for the public, I think we're at least I am very open to engaging on this. We'll have plenty of opportunity for the public to review this, engage with OMB staff and CITY LEADERSHIP AT COMMUNITY MEETINGS AND I ENCOURAGE PEOPLE TO GET INVOLVED. THERE'S A LOT OF PEOPLE WHO TALK ABOUT THE CITY BUDGET. THIS IS A GREAT OPPORTUNITY THAT WE'RE OPENING THE DOOR TO THIS YEAR TO PARTICIPATE MUCH EARLIER IN THE PROCESS AND GIVE THEIR INPUT EARLIER IN THE PROCESS. SO I HOPE PEOPLE TAKE ADVANTAGE AND SHARE WITH US THEIR INPUT. THANKS.

WE STILL HAVE A FULL DAY FOR YOU ALL AND PROBABLY HALF A DAY TOMORROW YOU'RE GOING TO GET TO HEAR FROM EVERY DEPARTMENT

And we're looking forward to it. Thank you, Mayor.

Representative Nino.

Thank you, Mayor, and thank you, Ms. Mack, Robert, Sasha, the entire team for really working on this for the last few months and getting here earlier than usual. I know during our briefing, we also briefly mentioned about slide 24 on the exemptions. Can you touch a little bit more about the reimbursement program that also the state of Texas has in regards of us possibly getting reimbursed for these exceptions, but us not receiving the funding because that program is not funded at the state level?

Yes, excellent question. I'll let that out. So thank you for bringing that up, Representative Nino. So the state does have a program. It's called the Local Governments Disproportionately Impacted by Disabled Veterans. So what it is is we get to put together, it's a calculation. We don't get to submit for full reimbursement of the impact. But you put together this calculation, and you get to submit for the 100% disabled veterans in your community, a portion of it. You don't get to submit all of it, but a portion of it on this calculation. submitted to the state and so We've been doing it for the last few years. And so this past March we submitted our application Submitted the application for eleven point four million dollars was the impact we calculated. So we submitted for eleven point four million And of that amount we got back. I just got notified a few weeks ago. We got back 1.4 million So out of an $11.4 million impact, according to the calculation, we got back $1.4 million out of that. And so the reason why is that it's based on the number of applications the state gets. And the problem is that the state only allocates $9.5 million to the entire state for this program. The city of El Paso alone would take all of that plus more if they allocated more. So one of the things that we've been talking to our strategic and legislative affairs team is we're not the only city that's impacted by our disabled veterans and the exemption that they were provided. Colleen is one San Antonio actually has a lot and so I'm sure that there's something we can do to continue to push to get the State to allocate more dollars to the that program so that we can get At least half or maybe you know closer to 100% reimbursement on that loss of revenue

Thank you for clarifying that. I think it is important for us to advocate at the state level to ensure that that program is funded. Having that exemption for disabled veterans is extremely important, but if there's that program and that opportunity to open that conversation and advocate even further at the state level, I think it's gonna be extremely important to really try to advocate for further funding to help essentially the core services that are important for the community. Thank you for that. Now, in regards to the sales tax, it's funny because the mayor was asking questions and I kind of covered the same slides. Can you mention how much percentage of the general fund is funded through sales tax? 23 percent. Okay, great. The reason I mentioned that is because I know that I briefly asked in regards to the cost of service per home when it comes to the property taxes, which is not something that I'm asking for right now, but I'm just trying to share with the community that the services that the City of El Paso provides gets funded through multiple different funding strings, not just the property taxes. We're always constantly trying to provide excellent services to the community. But it is a challenge when we're trying to navigate the different funding strings and ensure that, again, we continue to provide those essential services. So when it comes to sales tax, it's extremely important for the operation of the city. And, you know, when we bring tourism, when we bring events, it helps even further produce even more sales tax.

Absolutely. And so we did a presentation back in February or March, and we showed that our largest revenue source, property taxes, does not fully fund our two largest departments, police and fire. So there's about a $50 million gap between our largest revenue source and our largest cost. And so when we hear property taxes pays for the entire budget, that's not accurate. So again, that's something that we need to work on. And again, one of the great things about this process is that we'll go out to the community and continue to share that type of information to make sure Community really does understand that property taxes. Yes is very important. It's the largest revenue source But it's just one one piece of the overall puzzle, right? It takes all of the other revenues Pulling in the same direction and being able to generate additional revenue. And so that that's one of the challenges is As I mentioned on one of the slides property tax and sales taxes is where all of the revenue growth is coming from and The licenses and permits is down a little bit a franchise fee revenues down a little bit Backing out that one-time revenue and so those things have an impact But that's an excellent point and that's something that will make sure that we we communicate when we go to do those meetings. Yeah

No, thank you for that. Now, in regards of the fund balance, I know that there has been a decrease over the years, but also the cost of operating the city operational costs has also increased. So even if we don't use the actual fund balance, since the cost is still increasing for our daily operations, that fund is still decreasing. Is that correct?

Yes exactly and so we're required by the city charter to maintain that five percent of the prior year's operating budget in our restricted category of fund balance. So at the end of the year, even if there's no net change, there's a change from the unrestricted to the restricted category. And so in the calculation that we use when we talk about the number of operating days, it's only looking at the unrestricted portion because the unrestricted portion has a lot of requirements. You have to replenish it. You can't just use it and not replenish. So in that calculation, it's only the unrestricted portion.

Now, question for you all. I know that we have briefly touched in a conversation of having a potential policy to protect the fund balance. Whatever happened with that, or I can't recall exactly, would you be able to kind of briefly touch on that?

So as I mentioned a little bit about it, so we're doing a risk assessment. And so the Government Finance Officers Association, GFOA, has a risk assessment that they put out for cities to do when you're trying to determine what your fund balance should look like. What amount should you maintain? We're doing that risk assessment. It's been great having Miss Yvette Griffin on board. She's been very very helpful with us So we've sat down with her kicked around some ideas We'll finish that risk assessment and then we would like to bring it back to full WAC I don't know in the next couple of months so that we can get something finalized so that we can bring to the City Council because as I mentioned We should have a fund balance policy. We should have some guiding document so that everybody's on the same page on what does that look like? Not only from the amount we want to maintain, but what does the city do? This is the key part of it. The main thing is what do you do if you're above your target and what do you do if you're below your target? So if you're above your target of certain amount, you may say the city would be okay with using a certain portion of that. If you're below the target, you'd want to have some action in place that says the city will do X, Y, Z. And so having a policy that does that will speak very highly. It would help us not only how we manage the fund balance going forward, but it would help with the bond rating procedure as well because that's one of the things they look at as well is what's the city's plan of action. So ultimately, they're looking at how are you mitigating risk? How are you going to deal with potentially unexpected situations? And so having a policy in place would be something that we need to get done soon.

Great nothing for being proactive and really looking at all that again, thank you for coming early than usual and looking forward to further conversations and figuring out how we continue to advocate for the city will pass.

Representative trail.

Thank you mayor. I do see a little bit more gray hairs on you, Robert. That's why I keep my hair short. I have a few questions. And I'm going to start with slide 15 regarding the vacancies and the unfunded or deleted. And this is, Dion, you had mentioned this isn't going to affect any of the core services or programs that we have currently, right?

Correct. So what we did was we One, took a look at all the vacancies that we had. We started the process with the departments actually doing the budget process. And so we asked them to submit along with their budget an explanation for any position that had been vacant for more than one year. And then when we sent out the list to the teams, we looked at anything that wasn't in recruitment. We allowed the teams to make choices and decisions about operations. swap out anything that we were looking at. But the difference here from what we have done in the past is we have historically bought for a budget that had a certain amount of attrition. I think that it gives people the false assumption that we have more manpower available to the city than we actually do because we're freezing or holding a certain percentage of positions all the time. We're never gonna get in a place where we can get back to a place where I can release those. So part of the reason why we went through this was when you look at our budget and you look at our staffing, whether it's 6100 and I think that's kind of 61 or 62 is probably where we're going to land with this. It is the true reflection of what we have. And so I think it's cleaner and easier to be able to manage for teams across the board. It does not mean that we would never entertain adding an additional position if it aligns to the strategic plan, but it really gives us an opportunity to sort of start from a place of really having a budget that aligns to a staffing table that really is about the capacity that we have for the organization. And at the end of the day, we only have so many pennies on the tax rate. And so it always becomes about those very difficult discussions about what is key, what is a priority, what can we get done this year? Can we ensure that we're delivering quality services with the positions that we have left? Because the alternatives would be taking deep cuts to other parts of the operation that, from our perspective, are not sustainable. I'm looking at other cities, bring forth budgets where they're closing for libraries, and then You know, they changed your mind right after the budget's adopted. And so we're really looking at sustainability and the things that we bring forward with you.

What is that? How many positions is that? Do you have an idea?

We're looking at unfunded or deleted 358.60.

Contractors, was that taken into consideration as well?

No, that's only that city staff funded positions.

Okay.

And so as you're going through each one of the presentations, I've asked the staff to be prepared to kind of talk to you just a little bit about what the strategy was for their specific department. And we will also load into your SharePoint a one-pager that shows you across the board for every department along with the average cost. We do have that. We developed it, had it finalized yesterday.

Okay. Thank you. You're welcome, ma'am. Let's see. Page 29. Whose question is this? Let's see.

Robert, you might want to come back up with Ms. Mack.

Let me look at my notes here. OK. When we looked at the sales tax, actually, it's not page 29. We're sales tax. Page 30. and the change there from 26 to 27, an increase of 4.8%. You mentioned retail, this is retail, but did you also take into account the concerts that we had recently and those that are coming?

We did. And so again, we go based on what we know and not what we don't know. And so looking at sales tax, again, sales tax is a very volatile source of revenue. It's an important source, second largest for the general fund. But one of the things that we try to avoid, and we all really should keep in the back of our minds is that the volatility of sales tax can create issues. And so Ms. Mack and I have been around for a long time, and so we've seen where budgets were developed, overly optimistic sales tax budgets were incorporated, and then that sales tax revenue doesn't come to fruition early in the fiscal year and then the city is forced scrambling trying to figure out what adjustments are you going to make to account for that revenue that's not going to come in. So we prefer to be more on the conservative side and if sales tax performs a little bit better than we expected, fantastic. But I would hate to be in the opposite situation where you overestimate sales tax and then it doesn't happen and then you're forced to identify how you're gonna make up that difference in that gap. So, yes, I'm pretty comfortable with the 4.8%. One of the other challenges with sales tax, and I didn't mention it today, but I always mention it when we do our quarterly updates to you all. One of the other challenges, besides sales tax being so volatile, is the lag in information that we have on sales tax. And so there's a two and a half month lag in that reporting from the state. And so we're already towards the end of May. And the last sales tax amount that we have is for the month of March. And so we're working off of that data that we have through March, forecasting out what we expect to happen for the remaining five months of this fiscal year, which is incorporated into that orange portion, forecasting what we expect to happen for the next five months, and then on top of that, forecasting what we expect to happen in FY2027. It's a challenge. It's it really is. It's a challenge trying to forecast out sales tax because of that lag in information But again, we utilize historical data. We utilize the information that we do have we get detailed reports from the state comptroller's and that we utilize to incorporate into the development of the budget and so long with the answer, but Yes, we do factor in all of those things into the into the budget for next year.

Okay, very good and then a slide 32 You have the cost recovery, other user fees and revenue opportunities. What would that be?

We've had discussions about a street maintenance fee or transportation user fee. And so incorporated in this budget is the $10 million of annual pay go money for street maintenance projects. You've seen us do several updates and presentations talking about the need for funding to do street projects at the level that we need to be at. $10 million is not the adequate level of funding that we need. We are capped on property taxes by the state on how high we can raise property taxes. And so it comes down to looking at different fees, different options to be able to address some of those bigger issues. And so that's one example. One of the other things that we've talked about Kind of building off of the comment that I made about restrict or dedicated sources of funding the hotel occupancy tax Revenue source that we collect we currently do not collect the hotel occupancy tax on short-term rentals Something we've been talking about now for I think we're going on three years. We have a great relationship with the short-term rental alliance you all took action a couple of months ago to make that ordinance change to incorporate it now to The city's code that we do now have that incorporated so I think the next step is ultimately to look at what what that looks like as far as the implementation and the timing of that and so I Think the recent concerts that we've seen a tremendous amount of people coming from out of town I know tourism is one of the big things the council talked about during your strategic planning session Some of the other projects we're working on the convention center expansion. We just add in really nicely You'll hear from the International Airport and some of the discussion about new airlines how we get people in and out of the city So all of those things tie really nicely into that as a potential future revenue source as well That being said that that's a restricted revenue source But it would help address the marketing and tourism convention center expansion those type of items Just a couple of examples.

Thank you And then police and fire, what page was that? I don't think I wrote down the slide number. It showed the expenses of police being 186.7. Where is it? Okay, slide 36. What was the number of new recruits So we're looking at the wages here for police in uniform and then fire. You had mentioned the number of new recruits for police for 2027.

For 2027, we're budgeting 90.

90, OK.

I recall that because we do have attrition, retirements, and other turnover, that our goal is always to ensure that we're backfilling that percentage, as well as having some net new. So our assumption is that we would have 23 net new this year.

OK. Are there any funds for retaining the police officers as they're coming through the academy?

So a few years ago we were looking at ensuring that our levels of pay for the cadets was comparable across the state. And then the PD also looked at the delta between the starting rate and what we have for cadets in terms of what they will be paid within the academy. And so we right-sized that. And I think that was a couple years ago when we did the new contract.

So it's wages. Are there any other ways that that are being considered to retain the cadets beyond wages?

I mean, we can have Chief Macias is on his way up and he can talk to you a little bit about what their strategies are, what their turnover rate has been. I did not ask him that number this year. I was just so proud that we're no longer in the negative. that we're seeing positive recruitments. I mean, it was probably one of the best classes that we've had over the last year or so. We had at least four years where those numbers were negative. And so we're really seeing, you know, the terms change in terms of what that looks like.

Okay.

And then Preach, 38. So this year we will end with 32. Next year we're looking at 23. but we're also looking at 74 and 75 for attrition for them.

Okay.

Thank you.

Slide 38. in the general fund for salary, staffing, contracts, and utilities. So that's about an average of 4 point, almost, it's 3.87, almost 4%. Is that typical? 4.7. 4.7, okay. Percent. Is that typical for a city? To be in that percentage?

Last year we were at 4.3, yeah, so in the current year we're at 4.3, so that's pretty typical.

but have you compared to see how we are as a city in that increase? Is that typical for a city to have that type of increase? That percentage change?

Yes. Yes.

Okay.

Okay. Those are only questions. Thank you very much.

Representative Acevedo.

Thank you, Mayor. So There's a lot of information to digest I've been digesting since Friday so I'm going to try to be as in line with my thoughts as possible. I wanted to start with slide 30 just because of what you explained earlier Robert. What we're seeing here in the FY 2026 147 million for sales tax. That is a prediction for the months of April and May because you have real data to March of this year and then you've predicted April and May.

Well it's April through August.

April through August. OK. Okay, so then off the top of your head, what have you kind of predicted that we got from the first week of May when we had BTS and Soul Summit, et cetera?

I don't recall, but as I mentioned, we'll bring that back in June until we will get... April we won't see that until July that may report but we expect it to be pretty sizable not only on the sales tax but also the mixed beverage tax is another revenue source that will policy a pretty large growth in and then the hotel occupancy tax as well so I guess we'll have a pretty clear idea once we have real values in July we should have that real data by then as well right yes okay and then But that being said as well, I personally don't know what UTEP has planned for next year. I don't know what are the big concerts they may or may not have in line. Hopefully they have another one or two that would help kind of continue that trend, something that we'll reach out to them and see what they have planned. But there are obviously certain things they can and can't share.

Yeah, and I guess for next fiscal year, we have Carol Gee two nights, and then we have Usher, right? So that could be helpful. I appreciate the slides where you're showing the values going up. There's a lot of information that I share with my constituents and that kind of comes up quite a bit. I'm hoping we could have a better distinction on who is setting the values, right? Because there are people that think that the city sets the values, that we raise house values, and we just look at the tax rate, right? So in the same vein of this chart, you had a really good chart last year that I'm assuming you're bringing back probably in June, but I would really like to see the last 10 years of our tax rate. Because we adopted the lowest tax rate since 2017 last year. But people still saw an increase right because values keep going up and we've seen that go up for the last five years. So in the narrative that we're putting out to the public I really want them to understand that you're working really hard. Somebody said he had gray hairs earlier you. your team has been working hard and it's just really unfortunate that the values go up right when we're trying to be as fiscally responsible as possible and I also wanted to see if maybe in the next presentation in June or something or even if you're able to for the community meetings a one page slide that kind of shows what the state is making us do. You're kind of talking about the impact of the state on one of these slides with the business personal property exemption. But what else is there that can be monetized that says this is an unfunded mandate and we have to do it because the state says that? What what I continue to see is the state washes their hands of a lot of things They're out there saying that you know, the the governor wants to cut taxes completely and There's these outrageous things that they get to say and we're the ones that have to take the hit on Adopting a budget every year and if it's no new revenue Lowering taxes raising taxes. We're the ones taking the hit and a lot of this happens because of the state we're not as bad as The county right where the county's budget is like probably 70% unfunded mandates But I really want to see what the narrative is here at the city in a financial sense.

I Think we can drill down a bit at least on The items that were in the last legislative cycle, you know I think just to make sure we're being very clear to things that sort of happen, you know what some of those shifts were I mean see if we can have a monetary value sort of associated with those.

It would be helpful just because you know people are hurting right now. The economy is not great and and taxes are really difficult on people. But if we could have a better explanation and and show where we're at I think that would be helpful. At least my constituents would appreciate it. And then, Robert, can you tell me a little bit more about what you said on issuing debt this year? This is the first time we're issuing debt in how many years? Can you? Three years. Three years.

So on the slide. on slide 26. So this slide, so I added it in there as well. And so that's a $5 million increase in the property tax revenue that we need to make our debt payment. And so that equivalent on the tax rate is 0.88. So a little bit less than a penny impact on the overall property tax rate. So it's been three years. This is all voter approved debt. WE STILL HAVE, AFTER THE $70 MILLION ISSUANCE, AND I DID THIS PRESENTATION A COUPLE OF MONTHS AGO, WE STILL HAVE ABOUT $400 MILLION OF DEBT STILL TO ISSUE REMAINING FROM THE PUBLIC SAFETY BONDS AND THE COMMUNITY PROGRESS BONDS AS WELL. AND WHAT THAT LOOKS LIKE OVER THE NEXT SEVEN YEARS, I BELIEVE WE GO THROUGH 2033 TO ISSUE ALL OF THAT DEBT. AND SO THAT WILL CONTINUE TO HAVE AN IMPACT ON THE PROPERTY TAX RATE AS WELL AS WE CONTINUE TO MOVE FORWARD WITH ISSUING THAT DEBT UPON THOSE CAPITAL PROJECTS, AGAIN, WHICH IS ALL VOTER APPROVED PROJECTS.

Okay, I appreciate that. And just a suggestion on what Representative Nino was kind of saying earlier on. I believe you said 23% of the general fund is sales tax. Not everything is coming from property taxes. It's a little anxiety-inducing to do predictions on sales tax. Maybe we could break that down into kind of like that dollar bill that you know we've seen for years where it breaks it down by entity school district county city. But maybe we break it down by what the city budget looks like just specifically where people's dollars are going toward. Just I thought that could be a good visual representation. then one other thing that I've been kind of saying since I got here and this could be a good opportunity based on the the numbers that you're showing us I'd really like to see something that shows us if we keep the same tax rate or if we were to lower the tax rate this is all the stuff that we're gonna lose right and I think about public safety and this is where I don't necessarily believe in just saying I'm going to hold the line on taxes no matter what. And it's a little disingenuous. And so I think that when you're going down that path, you're kind of saying, okay, well, what are we cutting? Are we gonna have less ambulances? Or is public safety gonna suffer? Are our parks gonna suffer more? Stuff like that. And I would really like to capture that in a really nice slide. so we could tell people this is what your tax dollars are funding.

We will have that for you all at your next meeting.

Okay.

Thank you.

No, I appreciate it. Overall, thank you for providing all these numbers. I see that there was a lot of work here, and I'll probably be back a little later. Thank you.

Representative Chavez.

Thank you, Mayor. Thank you, Ms. Mack. Thank you, Robert. Thank you, Sacho, for the presentation. Thank you for the colorful presentation. It's helpful. I have also a few comments. On page four, we're discussing, I think this year for the first time, if I'm correct, program-based budgeting. So I wanted to give you, Ms. Mack, an opportunity to talk about why this is so important and if it helped you reduce costs or control costs in any way.

So one of the reasons why we shifted to program-based budgeting Kind of came actually started in my mind regarding some of the discussions I was having in communities when we talk about budget and it was clear that People struggle to really understand how we use our resources what that really looks like they all talk about some of the things that are important to them and but they aren't able to see in detail what our investments are. I'll point out, Representative Trejo and I have been working with Aqua Coalition Northeast, and the question they ask, well, what do you spend on aquatics? And you couldn't see that within the budget before. And so what I am proud of as a team went through this process, not just, you know, going through individually, but we went through a logic model to really understand if we talk about our work from an outcome-based perspective, what does each one of these programs look like? And so we had to be able to prove out and say during that process, what is the benefit to the community? And so I think that was a tremendous amount of work for every single program that you see, and I think there's like 257 in this book, that really allowed staff to be able to have those discussions and conversations. I think this also allows council, as we're making these difficult decisions, as we're talking about discussions about program, to really be able to articulate what things cost in our city. And so if you're able to say, you know, I really care about, you know, our senior centers and I would like to see us provide additional dollars, you know exactly what we're spending on senior centers line item by line item. You know how many staff are associated with that program. And so when we're starting to make decisions across program about what we look like, everybody's seeing the same data. You're not asking us to run a separate report. We put this entire document on the OMB website. I think it's a start for us getting to a place where there's increased transparency about how we're spending the dollars, what those investments are, and how we make choice and decisions across the board. At the end of the day it's always about a trade off and so ensuring that people can see and understand what those trade offs look like. I think is really important in terms of Community trust and how we think about this process, I think, for the teams, it gave them a real good opportunity to kind of understand from every aspect, what does it take for us to run a Program. They had to understand the number of vehicles, computers, I mean, everything. And so we can speak to things, I think, in a level of detail from operations that we were not able to do before we went through this process. It will be even better next year because now we'll take this and we're actually working on KPIs, you know, against those programs. And so you will be able to make better decisions in terms of what we're looking at and how we talk about impact on the community.

And overall and I'm sure probably each department head could answer the question specifically to their department. But overall do you think it helped reduce costs or control costs in any way. Absolutely.

I think the teams really came to the table with their budgets already looking at some of that alignment. But I also think what helps us is a strategic plan. I mean, that is your work plan for us. When you went through your strategic plan, we specifically went through those processes, understanding what is it that we could do with our existing budget. And so it wasn't a case that we're going through this process saying, I'd like to do this, and I'd like to do that, and I think this is the highest priority. The plan dictates to us what the highest priority is. And so my conversations with my team and the conversations they ask themselves, does it help us to deliver? on the strategic plan that is being put forth by city council. And that is setting what is the highest priority for us. And you'll hear each one of the teams talk about that.

And it's almost like you're reading my mind, because that's exactly my next question. So on slide eight and nine, you talk about some budget highlights. And we talk about public safety pillar. And then you talk about infrastructure, economic mobility. But I can't help but notice that there's two pillars that are kind of just not listed here, at least not now, in this preliminary budget. WHICH IS QUALITY OF LIFE AND GOOD GOVERNANCE. MY SUGGESTION WOULD BE JUST TO MAKE SURE TO ADD THEM AND MAYBE HIGHLIGHT SOMETHING SPECIFICALLY TO THEM, JUST BECAUSE IT'S SO IMPORTANT. WE WORK SO HARD ON THAT STRATEGIC PLAN, AND I KNOW THAT ALL OF US ARE REALLY COMMITTED TO IT. SO MAYBE SOME BUDGET HIGHLIGHT TO THAT I THINK WOULD TIE IN VERY WELL WITH THE WORK THAT WE'VE ALREADY DONE.

We'll do. I mean, we couldn't fit everything, and that's why we had that chart. But we can certainly put costs and expenses and really show how we're supporting each one of those initiatives, and the teams will take you through some of that as well. We'll roll it up. Thank you so much for the suggestion, ma'am.

Okay, so my next question is, it goes through different slides, 18, 23, and 37. So I looked up the COLA for Social Security. So something I learned in my campaign when I was knocking on front doors is, you know, The individuals that are living off of fixed income are the ones that are struggling the most with increasing costs. And this year we went through utility rate increases. I think on average gas 10 percent water 12 percent electricity 13 and a half percent. And so when we look at this at this preliminary budget on page 18 I think the budget increase and correct me if I'm wrong Sasha or Robert. I think it's on page 18 1.66 percent. That's the budget increase. Is that right? It's 1.7. 1.7, yes. Okay, round it up. Page 23, the property valuation states a 2.9% increase in property values, and I'm assuming that's both commercial and residential combined. Is that right, Robert? OK, and then on page 37, our expenses as a city went up about 4.74%, mas o menos. So I'm just trying to gather my thoughts here in terms of relaying this information to the community, again, to the people that are living off of fixed incomes. Their social security checks, according to data I looked up, increases about 2.8%. That's the COLA they receive. what is our comments to them? You know, with the increase in utility costs, and obviously we have increase in utility costs as well as the city. How could we explain this in comparison to that COLA that they receive? I don't know who best to answer that, if it be.

I think when we talk about, it becomes a balance. It becomes a balance of ensuring that we can provide the core service, ensuring that we're doing our very best to align to the things that are important to the community. I think one of the good things is that we've just gone through our strategic plan and we have the surveys from the community which really articulate you know what is important we know that community that safety is important we know the quality of life is important infrastructure taking care of the basics I think as you look at this budget we're not talking about not one new program unfortunately we did have costs and expenses that were related to cost-saving items like the arpa and really really being able to utilize those funds in the past but we always know that those are going to be eventually you know absorbed by the city and so i think we had some of those challenges with the budget but we will always do our best to make sure that we are trying to monitor the cost to bring those costs down for the community but there are things that we know that we were expected to deliver on much of when you look at our budget it really are the things that people care about if you look at the general fund budget it is primary police fire streets and maintenance and parks and everybody else is like 1.1 and so those are the things we hear about the most and so we know that it really is about having people who can deliver those services I know every day I see my staff out in the community doing their very best to deliver on commitments. They are proud of their work. You see them taking care of our streets, taking care of our parks. That's the majority of our budget. And so when we talk about the contracts, as Robert said, you see the contractual pieces that we have in this slide that are regarding janitorial. Those are people who work in our community as well. And so I think when we look at our budget, we know that it is about delivering that service and making sure that the core of what's important to our community is taken care of. And it does have costs associated with it. There's things that we can't control. But I don't think that we ignore the fact that we know that people have challenges with the costs and expenses. And I think your strategic plan that was very much about doing what we can or what we have really continues to reverberate through what we are presenting to you today.

Yeah, and I agree. It's about managing that, but also continuing to invest in the community. Yes, ma'am. So, Robert, you mentioned the sales tax being 23% of the general fund. What percentage is the property tax?

43? No, 51. It went up to 51 this year. 51? 51. So between those two, between property tax and sales tax, that's 75% roughly of the total available revenue on the general fund side. So back to the illustration, once you see that breakdown, it's property tax and sales tax and then everything else, which unfortunately, as I mentioned, you've got a couple of categories that we're seeing decreases in next year. And then you see that big decrease when you back out that one-time revenue.

I STILL THINK THAT'S A GOOD COMPARISON, THOUGH, BECAUSE, YOU KNOW, CAT CAME AND PRESENTED AND THEY SAID 63% OF TAXES WAS RESIDENTIAL, 37% FROM COMMERCIAL. SO 51 TO 23 IN OUR BUDGET, I THINK, IS GOOD. I MEAN, WE CAN DEFINITELY INCREASE THE SALES TAX AS WE'VE TALKED ABOUT THROUGH DIFFERENT MEASURES, BUT WE'LL CONTINUE TO WORK ON THAT. LASTLY, MS. MACK, I WANT TO ASK YOU THIS, BECAUSE MY COMMUNITY Some some people in my community have said you know the city has forums meetings to get feedback from us and sometimes for whatever reason or other some of them feel that. it's not productive or they don't feel heard even if they've contributed towards those conversations. So with these community meetings regarding the budget, what can we tell our community to expect or what should we tell them to do to make sure that they feel heard as part of this process?

So we've never done this process this early because I think that this really gives the opportunity for you to capture. on their behalf what it is that they would like to have. And so you can then go through the new council budget adjustment form to make sure that we're putting that forward for discussion in June. I don't think that we've ever sort of allowed for that type of cadence. So what we've asked from you all is to, by the 14th, have all your forms done. intentionally chose that date because it's like four or five days after we finish all the community meetings. So we will be rolling out for the community a budget simulator that is brand new to the city. And what we've loaded it with is the actual budget as requested by staff with the $13.3 million gap. and we're asking the public to balance our budget. That will come to each one of you. And so you'll see that as one input from the community in terms of what their actual very detailed suggestions are. In addition, we will have several staff with us taking notes as we're out in the community. But I do think it's important to note that my job and your job is to ensure the city can move forward. So when people tell me I don't need public safety, yes, we kind of do. We really got to come up with practical things that really can be implemented. And oftentimes I'll hear, I don't want you to raise tax, but I want this huge amount of capital project. And so my job is to make sure that people can understand it through program-based budget, through the process of how we go through this. And at least we can agree to disagree. But my job, because I'm a librarian at heart, is that you have to write information. And knowledge is power. And however you land with it, you land with it. But I want you to understand it.

Yeah.

And so that's our commitment. And that's why we're going to go out and have these meetings and if there's other conversations that we can continue to have, that's important for us for people to understand how we can come to these decisions.

Thank you. Thank you, ma'am.

Representative Rocha.

Thank you, Mayor.

So I have, so Robert, I know we're gonna, you might as well just stay up, Robert. So this goes for both of you, but first, Ms. Mack, honestly, congratulations on bringing this forth in this manner. I think it's a great way to add not only what you've done in the program budgeting, but also the budget simulator, because more often than not, we're out there saying, there's always constituents that are asking for ITEMS, SERVICES, ADDITIONAL, YOU KNOW, HELP, AND THE RESPONSE IS TYPICALLY ALWAYS THERE'S NO FUNDING FOR THAT. AND SO ONE THING THAT I WOULD LIKE TO KNOW, SO GENERAL FUND BALANCE HAS BEEN USED IN THE PAST TO KIND OF COME INTO THE NO NEW REVENUE TAX RATE, CORRECT? HOW MANY YEARS HAS THAT HAPPENED, ROBERT? We budgeted three and last year we used seven million. So when we talk about the fund balance and we're getting ready to issue debt, when you talk about the fund balancing and we have this AA and AA plus bond rating, we need to have a particular amount of fund balance in there in order to maintain those ratings. Is that correct? Typically?

It looks better. It helps. It helps. There's multiple things that go into those ratings. There's, I think, five different categories that they're looking at, but that is one of them, and that's a big one.

Okay. And then I know that it was touched on before, but there is a push that we don't understand what could potentially be coming with the next legislative session at the state. And things could potentially really affect that fund balance in the upcoming year. So this would put that at a... I don't wanna say it, but it would definitely put it more challenging than it is today. I know, very careful with the words.

It could, but I think, The fund balance is a limited resource. We keep seeing the dollars amount go down. And so if we use it to plug this year, I don't have it to plug next year when I know I'm going to be bringing forward, you know, the new collective bargaining agreement. I know what those expenses are going to be. And so what I would like to get to is, you know, even if we chose not to be to land at 60 days or others, What we have historically sort of seen, even in our organization, is if council has a special priority and it's a capital one time, then that's the way that we have historically looked at that. And so having it just be this recurring that we're going to continue to pull down dollars for which I can never replenish, really shows that we have not balanced our budget. And I think we're all looking across the city and we're seeing what's happening with our school districts. We're seeing what happens with others. We don't want to be in a situation where we don't have a fallback if we truly have an emergency in our city. We all lived through COVID in our city. We lived through the humanitarian crisis when we weren't sure that FEMA was going to reimburse us and we would have had to utilize some dollars for something like that. That's really from our perspective when this type of buffer or our rainy day fund really comes to make sure that we're not having to undo, you know, critical programs and services to be able to fund an emergency even if short term.

Thank you. And I say this to lead into, you know, when we talk about what we can do as a city, right, what you can do as a staff. There's also, bodes the question as to what can we do as a community. There's plenty that we can do to be able to minimize, at least to some small degree, the amount of work and money that goes into running, let's say parks or running into the, I think one of the great initiatives is that anti-littering campaign. But we start talking about like District 5 that lost 80 light poles due to DWIs or crashes, that comes out of the city budget, right? Because there's no recovery in those monies that are spent when we have those light poles that come down. Or we have, for example, I have it a lot in my district because I have A VERY BIG PARK. AND I'M SURE EVERYBODY HAS IT, BUT WE HAVE A LOT OF VEHICLES THAT LIKE TO PARK ON THE GRASS. AND PARKS AND REC HAS TO REPLACE THAT SOD EVERY SINGLE YEAR AS A RESULT OF THAT, PLUS MAYBE SOME OTHER THINGS, BUT WE'RE NOT HELPING THE SITUATION. So I think a lot of it, you know, comes in the fact that, yes, we all have our own accountability to be able to make sure that we're spending the money appropriately and correctly. But I think we also need to use those types of campaigns to be able to hold all of ourselves accountable to some degree to help minimize those budgets. So I'll just say that. Thank you.

Representative Limon.

Just a couple of quick, quick points. Robert, when Mayor asked you how many days or what was it, when would you use your, the reserves? And I must admit, I commented and my response before yours was Never. So we're right on target on that. I really appreciate that. My question is on contracted employees. And I know that we don't have necessarily the say, but what is the hourly rate of contracted employees? Do we know that number?

We are capturing that. I think we were asked like last year. So we're capturing what the entry level person is getting and as well as the supervisor with the contracts. But I will defer to purchasing at least I think we can talk about the last couple of contracts that we've awarded.

And the reason the reason for that is I know that when we put out the solicitations I just want to make sure that we're moving in the direction of a livable wage. I remember back when we were, we had some employees at really low rates, that's when we moved it up to 10, but we still had contracted employees who were earning $7.25 an hour. And so I'm wondering where have we moved since that time?

Last I saw was 10 something, right?

Good afternoon. I got to say purchasing and strategic sourcing department. So we don't have that data available, but we can certainly request information as we have been looking some of that information and we are requesting it, but we don't have all the details right now.

And the reason that I'm asking that is because when the city was talking about increasing the salaries of the employees and I also at that time brought up contracted employees the word was well if we we request a certain amount it ends up costing the city obviously because they're going to pass that cost to us but I'm curious to know that range what is the lowest and then what is the highest yes thank you bring back that information thank you very much thank you we'll bring that back but I think what you've seen Mayor and Council

So we've been seeing the increases in the cost of the contracts that are coming forward, and those contracts are almost all salary. And so we'll at least pull some sampling of maybe the janitorials and securities, because those are really the biggest ones that we have. And so you can see what some of those deltas have been. But we do collect that information. Thank you, ma'am.

Representing Nino Thank You mayor and thank you repro chef for mentioning that I know I've had numerous conversations with miss Mac and miss Neiman and the team about the cost it You know, it's costing us to to repair all these damages miss Mac. I know I've also mentioned previously I'm looking at slight 37 where has materials and supplies and I briefly have mentioned different occurrences even with marketplace and I know I talked to miss Cody briefly about of also ensuring that staff does due diligence of requesting quotes, looking at different cost saving measures when it comes to doing any expenditure. Can you briefly touch into what staff is looking into doing and doing also to ensure that there is cost savings because again i've mentioned previously even when i bought those uh life vests for one of the water parks um there was a quote that i got on marketplace for 37 but i was essentially able to call the vendor themselves and i got them for i can't recall it was like a six dollar reduction or something like that can we touch into a little bit of what staff is doing to ensure that there is cost savings so we've talked about ensuring that we do more guided training

for the staff in terms of how best to use the marketplace and sort of a checklist. But we also know that you all approved the contract for the purchasing full overview. And so we're going to be revising a lot of policies and procedures that come out of that piece as well. And so it's definitely something that I talked to the team about. And just because we've been pushing things to the marketplace, as you heard Steve talk about, it's an easier way for us to get some things

a quicker like lighting and other things for the community but we want to make sure we're getting our bang for the buck when we utilize those and so just reminding staff to be able to go through those processes is really going to be important for us and so as soon as we have something in writing i'll be more than happy to share that with council no thank you for looking into that because i've always said you know if we save one dollar from a transaction but we do ten thousand transactions that's ten thousand dollars that we save the taxpayers so really looking forward to that conversation and thank you for all your hard work i don't know for the questions mayor Representative Chavez.

Thank you, Mayor. One last question for Robert. Robert, regarding our reserve funds, how many days did we use up this fiscal year? Or are you forecasting to use this fiscal year?

I believe we're at 73 days and we're projected to go down to 69 when we start at 427. So four days. And again, that's based on what we're projecting right now. As I mentioned, when we come back in June, we'll present the third quarter. And at that time, we'll show you where we're expecting to finish this fiscal year.

And last fiscal year, how many did we use?

I'll get it for you. I believe we went from 78 to 73 last year.

But I think you were budgeting for a few more days than were actually used, right? From 7 to 3 or something like that? We'll look into it and get back to us. Okay. Just so we can be on the same page. Okay. Thank you. I appreciate it.

Hi, Robert. A couple quick questions, and I think we'll wrap this part up. When we talk about a no new revenue increase, does that mean your taxes go down?

No, sir. So the no new revenue rate is a very confusing, not easy to explain calculation that the state prescribes. There's a state prescribed form that is done and Maria Pacias, our tax assessor collector, does a fantastic job. So she is all things So that no new revenue calculation, essentially what it does is it tries to factor in apples to apples comparison on the amount of revenue you have available. And so there's a lot of adjustments that go into that. But essentially, it does not mean that the average taxpayer will not see an increase in their tax bill. So even the years that we adopted the no new revenue tax rate because of changes in property values, More than likely, a lot of taxpayers still saw an increase in their tax bill because that calculation, the revenue tax rate, does not take into account anywhere in that calculation the change in the average value home. That's not part of the equation. It's just looking at overall available revenue. So we did an estimate, I think, that the no new revenue rate, even with the no new revenue rate for FY27, there would still be a $30 increase on the average tax bill. Again, so to answer your question, no, no new revenue tax rate does not mean that you will not see an increase in your taxable. It's all dependent upon the value of your home by your property. into that equation.

OK. And Ms. Mack, you guys did an incredible job, you and the staff, of putting this budget together, knowing that our revenues are declining, our expenses are going up, and you have to solve somewhere in the middle. And then you have surprise expenses from the state or from the federal government where they're cutting grants and things like that. So it's a very complex budget that you did have to put together. And I think simplistically, and they've already touched on it here on the dais, but our expenses are going up. Let's just take, to run our house pest control, utilities, everything continues to increase. But yet our revenues are declining. So it's a very complex budget to solve for. So you guys have done one heck of a job of putting this together. And to be out six weeks ahead, that is remarkable. I mean, it gives you time to work with the public, gives you time to continue to work with council to make sure you get the input from us on how we want to see it. I JUST WANT TO SAY CONGRATULATIONS TO YOU AND THE ENTIRE TEAM BECAUSE WHEN REPRESENTATIVE CANALAS HELD UP THAT BOOK, THAT IS A SIGNIFICANT AMOUNT OF WORK AND IT DOESN'T GO UNNOTICED BY US HERE AT CITY COUNCIL AND THE REPS HERE. SO CONGRATULATIONS AND WE LOOK FORWARD TO GETTING THE INDIVIDUAL PRESENTATIONS FROM ANIMAL SERVICES ALL THE WAY DOWN TO CID and parks and everything else. So congratulations on getting us to where we are today. And we understand it's preliminary. Thank you guys. Representative Lamont.

Mayor, I think this is a perfect time to have a break for an hour. Gives everybody a break. It's a good time. And we'll kick off fresh in one hour.

What if we come back at 1.30? Can we come back at 1.30? Representative Lamont, 1.30?

Yes, sir, 1.30.

All right, there's a motion to recess until 1.30. Is there a second?

There's a motion and a second to recess the special meeting for one hour. All in favor? Aye. Anyone opposed? The motion passes and the council will reconvene again at 1.30. So a little bit more than an hour at 1.30. It is now 12.22.

All right, we're about ready to get started. We need one more. There we go.

Council, is there a motion to reconvene?

I make a motion to reconvene.

Second.

There's a motion and a second to reconvene the special city council meeting. All in favor? Anyone opposed? And the meeting is back in session at 1.32 PM. And we begin the departmental presentations with animal services.

All right. And council, I'm going to ask that we hold our questions to the end. So just keep track of what you want to do. Because there's a lot of presenters.

Yes. Each department. Yes.

Yep. All right. Good afternoon.

Good morning. Afternoon. Yep.

Animal services.

All right, we're going to go ahead and get started. So animal services, what do we do? So we take in animals from a variety of ways. Primarily it's going to be owner surrenders, strays, and then our abandoned animals. And again, we are an open admission shelter. So if I can direct you all a little bit to the right-hand side, you'll see the variance amounts of $1.1 million. And so the question becomes, how do we get there? If I can transition you back to the left side of that budget variance, about $800,000 of that is coming through salary increases. So you've heard a little bit about that with Ms. Mack. and the other presenters this morning. Again, 800,000 is going toward our lower line staff. So our GS 47s, those are gonna be our animal care workers. Those are the guys that are cleaning the kennels. And so we're trying to get those guys to a living wage. The other aspect of that is we have a higher operating and equipment maintenance cost, that's about $160,000, and then our medical expenses are about $80,000. If I can just highlight again, these salary increases, like we've mentioned earlier in presentations, have increased Our retention rates. So we've been able to lower our turnover rates. As a comparison, back in 2023, we had about 41.8% of our staff as an annual turnover rate. We were able to drop that by 12% because of these salary increases and due to shelter restructuring. So of that $17 million, we have it wrapped up into about 14 programs. We'll highlight a few of these. I know District 2 brought up the idea of a piece of money that you can kind of allocate where that money's going to. About 75% of our budget is going toward four programs, and we're gonna highlight that in the next slide. But these are some of those. We have the animal services administration, our community and pet support, communication and event coordination, community cats, customer service and clerical, our education and outreach. Our field program, that's one of those top four programs that's eating a lot of our budget, so at $3.3 million. We have our foster program. We have fundraising and development. And then operation is the second program that's eating up a lot of our money. So these are the guys that are taking care of the daily cleaning and feeding of all of our animals. And then our last slide, second to last slide, we have our transfer program, our volunteer program, and then the last two big programs are our veterinary clinical care side and our veterinary surgical services side. Again, that's taking up 75% of our budget when we talk about all four of those programs together. Specifically, those two programs eat about 22% of our budget. And so we talk about, I know District One was talking about the quality of life and how does that play into some of those things that we're doing. We do offer educational classes to the public. We provide public education, responsible animal husbandry, we go to public schools, we go to civic organizations, we go to local events. Our field team, our field program, if you bump up a little bit to that public safety aspect, those are the guys that, again, are responsible for picking up strays. And then we have an operations field program, administration, economic mobility. These are all the services that we are providing to the public at a discounted price. So we're talking low-cost vaccines, low-cost surgery, because surgery is relatively expensive when you go to outside clinics. We're providing that at a discount. We also provide food services for people that maybe have fallen on a little bit of hard times, can't necessarily determine whether they should feed themselves or feed their pets, we provide some free services to the public so they can feed their pets while they take care of themselves. And that is it for my presentation, relatively quick. Do you have any questions?

Yes, Representative Limon.

I do, thank you. Yes. What can you tell us about the status of veterinarians and the work and the number or quantity that you need for the services?

So it's tough to say. We're currently going through a backlog of foster animals. That being said, we did over 17,000 surgeries last year. So 2025, 17,000. We're currently a little bit under that. But that being said, we're trying to schedule about 100 surgeries per day for our veterinarian team. Right now, we're consistently between 67 and probably about 83 for those heavy surgery days.

So your total count of vet positions Is it still accurate or did you eliminate positions as a result of the budget? Or do you have a cushion in there? Well, let me, Let me roll it all back. Sure. Do you have any veterinarian vacancies?

So with this budget proposal, we have eliminated one full-time veterinarian and one part-time veterinarian. That is, again, due to efficiencies. We've gotten really good at doing a lot of surgeries. And in turn, we're seeing less of them coming in. So we're not seeing as many spay-neuter cats that need spay-neutering from our TNR program. We're not seeing very many of them coming in through our rescue partners. And in general, they're caught up on those foster animals. So in conversing with our chief veterinarian, he doesn't see the need to have those positions in the books right now, potentially in the future, just because they have been so efficient at processing those surgeries.

Okay. Thank you very much.

Representative Chavez.

Actually, that just answered my questions. Thank you.

Representative Acevedo.

Thank you mayor. This is a nice little snapshot. I kind of wanted to understand if there will be any partnership with the county and if there's any effort that's been made to get that paid off what the county owes specifically in this I think it was about a million dollars.

Yes, so we're currently still in conversations with the county. Currently, they do owe us about $1.3 million for services that we've provided to both their constituents, just showing up and the animals that they pick up and bring to our organization. The conversations are ongoing. As a reference, we do have seven other partnerships, so eight total with the other jurisdictions. So we have county, they owe us about $1.3 million. Horizon owes us $217,000, and then Fort Bliss owes us 117, but they are in process of paying, and so we should receive those funds within the next 30 days. So our outstanding balances are county at 1.3, almost 1.4, and then Horizon. Horizon, I just had a conversation with them earlier this month. So I think they're under the same understanding as far as receiving those funds, but they're taking it back to their data scientists to kind of evaluate.

OK. And then on the volunteer portion of this there's salaries and wages for one hundred and twenty seven thousand dollars. How many employees does that cover for the volunteer program.

So we have a total of two volunteer staff members. We have one manager or coordinator and then one underneath her. And so as far as volunteer payment, we don't pay the volunteers. In general, I think we did over 50,000 hours of volunteer work, which equated to about, I think the last math that I looked at was about $3 million of volunteer work that people put in.

Okay. And then how has the development been this year?

In relation to... Just raising money? Decent, yeah. I mean, through our development team, we have run a couple of spade and neuter programs, and we've collected some funds through there. We have our big ones, like... Petco does like a shelter fundraising event. We do small little fundraising events throughout the year. So for example, we just had Bissell came through and they do a match. Per survey, they give us a certain amount of funds. And so we, I mean, the same, if not a little bit more. I don't have that specific number though.

Okay. And one last thing on the, The spay and neuter of the cats, I'm assuming that's kind of like TNR? Correct.

Our trap, neuter, and returns.

And so is there a way that we can track that? Just because I'll give you examples. There's certain areas in my district where people were complaining about stray cats. And I explained to them that they all can't go to the shelter, but we have the TNR program. And we're trying to make sure that there's no more kitty litters that are happening and I don't really have a visual representation of where we're actually doing that and in addition to that how many we're doing each year so it would be really great to at the very least see if we could get a visual representation by district on the success of that program because I think it's essential and having some sort of benchmark would give us a better understanding that we could communicate to our constituents.

Sure, we can do that. Just for record, we did do about 4,100 and some change TNRs last year. So we're on pace for that same thing, but we don't necessarily have a map, but we can work on that. Some of the issues specifically is these are animals that are picked up by our local rescue partners, and so we do try to get accurate information, but we don't necessarily have it broadcasted on a map, but we can work on that.

It would be great, I mean, even for transparency and just to build community overall just because, you know, some constituents are like, well, they're just always here, the cats, and I want to give them a better answer. That's where it's coming from. Okay. Thank you for this. Yeah.

Representative Canales.

Thank you, Mayor. Just wanted to make sure it's abundantly clear. The way you phrased it, I think, could cause people concern. You said we eliminated veterinarians. You mean vacant veterinarian positions. There were no veterinarians who were terminated from the shelter. Is that correct?

So yes, you'll hear that throughout a lot of these departments. These are vacancies that were eliminated. So just so everybody's aware, we've had a hard time filling those vacancies, well plus over a year. So yes, we did not remove any veterinarians from this. We just eliminated the vacancies for our department for that.

OK. And how many veterinarians are there on staff now?

So we have our chief veterinarian. We have one other full-time veterinarian. We have a part-time veterinarian. And then we have contracted two veterinarians, a third part-time veterinarian, and then one's doing pro bono.

Excellent. OK. Yeah, I just, again, wanted to make sure that the public understands we're not reducing the number of veterinarians who are already working at the shelter. It's just the elimination of vacant positions that have remained vacant for some time.

Yes, they've been vacant for some time. Again, we're not removing veterinarians. If anything, we're being more efficient with the veterinarians that we have. So again, 17,000 surgeries is by far our most surgeries that we've ever done, going back to when we first started tracking data in 2013. And on top of that, we have our partnership with EPVMA.

What does the next year look like for the one-time spay-neuter events, the spay-a-thons?

I mean, I would love for it to be on a monthly basis. Right now we're averaging about two. And so this year we did one big one in March. My plan is to get one again in October. We just got wrapped up maybe two weekends ago, a smaller one. That was about 150-ish, I think, surgeries.

Yeah, and the March one was more than 400.

Sure, so in March we did 450 low-cost surgeries for the public. So we went to replicate that in October, so again, another 450 animals. And then we have two smaller ones. This last one two weeks ago was about 150, and then I think we're trying to get another one of those 150 surgeries by July, July 14th-ish. So, perfect world, I would like to do them, if not every month, at minimum quarterly. It's just dependent upon getting, so these surgeries are coming from outside organizations that want to come to El Paso. So this group that just came, they acquired spay-neuter services from a grant, and so that's why they were here. But yes, I would like to do more, and we can do more With funding, we can get them in faster. Some of it is dependent upon their time, so as an example, it sounds silly, but one of the veterinarians doesn't want to come because it's baseball season, so we have to wait for baseball season to end so we can do more surgeries. as an example.

Yeah, and I think, to clarify, I remember this one. This is baseball season for their child, I think. Yeah, baseball season for her child. Yeah, yeah. They're not just trying to go to the ballpark and watch a game.

Well, to be fair, her child is trying to go MLB.

Yeah. Okay, yeah, thank you then for the presentation. I've been very pleased with the growth that I've seen at Animal Services, and I think We have another good year ahead of us there, so thank you. Thank you, Mayor.

Representative Limon.

You're new to this position, right? You're an interim?

Yes, I'm an interim.

And you were the first one up today.

Yep. Trying my best to set the pace, yeah.

You broke the ice. Thank you very much. You did a very good job. Thank you.

Representative Rocha.

Thank you, Mayor. Quick question. So the FTE didn't change year over year. It hasn't changed from what I could tell. But there's a lot of the FTEs in here that are like 1.15, 2.6. So my question is, obviously, you can't split a person in Right? Point two. But is there an opportunity to do some type of cross training or cross responsibilities for work to cover any of the shortages, let's say, that you could still potentially be having operationally? Or do you not have any shortages operationally?

So I kind of highlighted in the presentation, but we've gotten really good about our retention rates So to be fair, we are I mean this again preliminary we are potentially losing those two veterinarian positions a supervisor position and two ACA so those are total of five positions that second veterinarians part-time so technically 4.5 But because we've gotten really efficient about doing our adoptions because we have improved efficiencies throughout the organization, but I not just on intake, but through the outcome aspect. So we've gotten really good at doing adoptions. And in turn, through a restructuring method, we've been able to transfer some of those staff to our education department. So we're really trying to build out our education department, going back to like the quality of life pillar that y'all are trying to implement. So we want to be out in the public more often. We want to be doing more events. We have a need. The public wants more events, and so we want to be there for them. And so through that restructuring aspect from a cross-training thing, we're not necessarily cross-training. We're just moving staff to the appropriate areas.

Okay. Thank you. I appreciate it. And just really quick as a reminder, you have something pretty important coming up this Friday in one of your events. I think it's the heat, the animals. Oh, so yes.

I thought you were talking – I'm going on vacation. So I was like, yes, how did you know that? So – yes we are doing a we want people to realize that we are starting to come up in summer and so we are kind of showing the what happens in vehicles if you were to leave your animal in a vehicle and so yes that is happening on Friday thank you I didn't mean to catch you nice job thank you well animal service is setting the bar high enjoy your vacation thank you thank you aviation Yes, so next we have aviation.

Good afternoon.

Good afternoon. Debbie Olivas with the airport. So what do we do? We provide customers with a safe, secure, efficient airport operating in an environmentally conscious and self-sustaining manner. So for FY27, you are looking at an increase of $3.8 million, and that is made up of salary increases, increases in security contracts, engineering services, and HVAC services. For our FTEs, we currently have 229.5, but we are pending the deletion of three positions. So we're going into FY27 at 226.5. So our true variance is a reduction of four FTEs. So that's made up of seven FTEs being transferred over to CID to the grant funded program. And so those seven positions are still gonna focus on airport projects. And so we will continue to fund those seven positions. We also added three positions in September to bring us back to FY26 levels. So for our program snapshot, we have a total of five programs. For the community engagement program, we have $1.5 million, and that covers all of the community events that we host for the public. That includes the holiday events, the honor flights, leadership academies. All of our marketing efforts are tied into this program. For economic sustainability at $3.8 million, we have the foreign trade zone program, and we also have the redevelopment initiatives that we have for the innovation factory, the AMD, and all of our undeveloped land. And it also includes incentives to the airlines for any new potential routes. For the Office of the Director, we're at $38.8 million, and that seems a little high, but that includes all of our administrative budget, and it also includes the passenger facility charges, the customer facility charges for our rental car agencies, and our debt service. So for the passenger experience at eleven point six million dollars that includes everything related to the terminal So we want to make sure that we have a clean terminal for our passengers when they come through so anything anything related to contracts Janitorial supplies is coming out of this program for safe and secure air travel 22.4 that includes all of police fire and airfield operations so that helps us to stay compliant and So for the strategic alignment, we're highlighting three core programs. For economic sustainability, our focus is on creating the new international route. So we'll continue discussions with Mexican carriers regarding potential service to Mexico. And we'll also continue meeting with the airlines to explore any new routes to our unserved markets. For our safe and secure air travel program, the goal, of course, is to always maintain a safe and secure airport for our passengers and airport operations, and we do that by ensuring that our critical staffing levels support efficient airfield operations, and we're also continuously evaluating security services to improve or strengthen airport security. For our passenger experience, of course, as always, we want to ensure that we provide a welcoming and positive experience for our passengers. And with that, I can pass it over to Javier Acosta with Capital Improvement or take any questions.

Any questions for Debbie? Good job. Thank you. Representative Acevedo.

Sorry about that. Thank you for this. I am trying to understand a little bit on the security contracts going up and then the continued evaluation of security guard services. Can you speak on that a little bit more?

Yes, sir. So we are currently working with our procurement team to go out to bid to procure a new contract. So we are including about a $700,000 increase in this budget. Just because our unfunded mandates by our federal partners, we are accounting for that for additional employee screening.

OK, so it's an extra $700,000 not due to having to cancel the contract and then have a month's- Well, we are accounting, I'm sorry, yes, we are accounting for an increase in the cost as well. Okay. Can you get me that breakdown? It's okay if you don't have it right now.

A breakdown?

Of the 700,000?

Of course. Yes, sir.

That would be helpful just to look at. And then on passenger experience, there's a lot of focus on custodial and cleaning and stuff like that. And on minor equipment and furniture, you have $10,000 allocated. So if you're doing any furniture changes, is that more in the five-year plan for the airport for capital?

No, this is just minor equipment. Our capital project, our capital plan includes the major equipment or the major furniture for the entire terminal. This is just minor chairs or anything that needs replacement in the terminal.

Okay, and then the are there going to be chargers coming to those chairs because I think that's been promised for several years now. And I know when we approved the plan for the next five years that was kind of said, and some constituents kind of reached out and said, Are they really going to do it because they've been promising for at least five years now. So I just wanted to ask that.

Yes, yes, sir. We are I just don't have a specific date, but I can get that for you.

I'd appreciate it. Thank you so much.

Represent canalis

Thank you, Mayor. I actually had a question. So I'm looking at the org chart. I'm surprised to find airport police on the aviation org chart. I don't see the corresponding positions in the staffing table. I mean, these are El Paso police officers, but they respond through the essentially chain of command at the airport. Is that how that works?

Correct, so we do fund police officers and firefighters from our budget, and they report directly to the airport, but police chief and fire chief can correct me if I'm wrong, but they still report to their prospective chiefs.

Okay, and so they don't end up, like they're not in the aviation staffing tables. We would find them in the staffing table for PD and for fire, even though they're budgeted to airport?

Correct. We just fund the positions.

Okay. Do you have an idea of how many positions each those are at airport?

I want to say 32 for fire and 34 PD. 32 fire and 34 PD. Okay. Yes.

Yeah, and I've been out to the aircraft fire rescue at the special station. It's incredible. I think it's a really amazing facility. I just so much appreciate this additional breakdown of the budget. I had never really realized how those FTEs were allocated between police and fire and the airport. So I was curious to learn.

For a total of about $9 million.

Okay, thank you very much. And just to clarify again, that budgeted within aviation, all of nine million?

Yes, sir.

Okay, thank you.

Representative Rocha?

Thank you, Mayor, and thank you so much, Debbie, for the presentation. Just real quick on the rents and other, which is the line item that I'm looking at on the All Funds 562, aviation, and this may be something that you can or may need to defer, but, On that piece, has all of the, I'm assuming the properties that are available in the airport land space have been right-sized as far as rents and others? Or is this, if you could just speak to that, please.

Well, we do that as the contracts come up for approval for city council, so we right-size them at that point.

Okay, so for example, Lone Star Golf Course has been updated and included in this. Yes. Okay, great, thank you.

Representative Nino.

Thank you, Mayor. I don't have a specific question for aviation, but I have a question for Ms. Mack. I think this is a perfect example in regards of if you see the presentation on slide number seven has general fund and non-general fund. Can you just briefly share the difference between general fund and non-general fund when it comes to the operations of the airport, for example? Just for clarification, I think it's important for the committee to understand that this is an enterprise fund. Correct?

Correct. I think if you refer back to one of the presentations that both Robert gave, it was really important for us to break out that when we talk about the $1.4 billion that we have several funds that are restricted. And so you see them listed here as non-general fund. What folks will be hearing from today will be several of those departments. They are airport, bridges, Sun Metro ESD so they have restricted funds that could be only used for the purposes that are defined by the parameters of that program and so as you just asked the question of Debbie everything that's related to the airport is paid out of those airport funds we're not subsidizing anything from the general fund to be able to support the airport and so it's really important that we make that clear for people but also ensure that everything is well aligned for compliance at a federal level when those dollars come from those sources for several departments like the importance of Metro.

That thank you for clarifying that I think it's important for the public to to know that we do have a lot of different programs departments that operate differently from the general fund to come.

REPRESENTATIVE CHAVEZ.

THANK YOU, MAYOR. THANK YOU FOR THE PRESENTATION. I WAS REVIEWING THE STAFFING TABLE AND I NOTICED THAT THERE'S SOME POSITIONS THAT I'M ASSUMING HAVE BEEN CREATED. IF NOT, LET ME KNOW IF I'M WRONG. BECAUSE THEY WERE AT ZERO FISCAL YEAR 25 AND THEN THEY COME UP AS A ONE ON FISCAL YEAR 26. I WAS WONDERING IF YOU COULD GIVE ME A LITTLE BIT MORE INFORMATION. BUSINESS AND FINANCIAL MANAGER, CONTRACT COMPLIANCE MANAGER, and Senior Human Resource Specialist, as well as UAS Flight Operations Manager. So those seem to be pretty big positions in my opinion. Could you talk a little bit more about them?

Sure, so we did a restructuring in the accounting side. We added a contract compliance manager, because we were missing that piece tying to our procurement contracts. We needed the business and financial manager. We have over 400 leases, and so we have a pretty huge AR section and an AP section, so our AR section Like I mentioned, over 400 leases, and so we needed to restructure the accounting side. So those are the business and finance manager and the contract compliance manager. And then on the UAS, we added a new program. I think the El Paso International Airport was one of the first ones to bring that on board, working with PD and FIRE. So that's a new position that was created to support that program. And then the HR specialist, again, another restructuring within the division, within the department. And I think we deleted a position to add that particular one.

Yeah, I think you've deleted, from what I can tell here, the senior office assistant position as well as the grant writer position. Is there a reason why you eliminated the grant writer? I know that the airport applies for a lot of grants.

We did, but we work very closely with our partners at the legislative affairs department. So right now we are paying for some of the FTEs in that division. So we eliminated the grant writer under the airport.

Okay, as well as airport program coordinator. That position seems to have been eliminated as well.

I think that was one that we deleted and added another one, but I would have to get back to you on that one.

Okay. Thank you.

Representative Trejo.

Thank you, Mayor. I have a question on the spreadsheet for page 28. And looking at the rents and other. I don't have a ruler here, but it looks at 92%, a negative 92% on the rents and other from 2026 to 2027.

Are you referring to this massive budget? Yes. What was the page number? I'm sorry.

Page 28. Page 28.

Oh, that was we moved from that account. We moved it into security screening because it was just a reallocation. So they were being posted to the incorrect account. We just moved it to the correct category.

Okay. And then on the same page, Interfund Services. What is Interfund Services? It's on the under expenditures category.

Those are the funds that we pay for our print services, like to the mailroom under the city. So it's a city department, so we just do a transfer of funds from the airport over to them to pay for the services.

Okay. There's an increase of 42% on that.

I would have to get back to you on why it increased so much.

it's the mailroom charges but postage 42% Wow yeah I would have to get back to you as to why it went up so much okay and then under other operating expenditures there's also an increase of 20% what what are the other operating expenditures the other non operating expenditures

will have to get back to you because I'm not all the indirect cost okay so the indirect cost went up that means that our cost to other city departments to pay for the city legal for purchasing for OMB that went up so those are both internal the other expenditures and the inter fund those are expenditures that went up okay thank you

All right, Debbie, you're all done. Thank you. Thank you. All right. Debbie forgot to introduce capital improvements. She ran. Good afternoon.

Good afternoon. City Council Mayor Javier Acosta from Capital Improvements. She did introduce me just early on before the questioning. So what we do, we construct capital assets for the community so they can use and enjoy new and improved infrastructure and amenities that enhance safety and quality of life. CID oversees $1.5 billion in funds for capital projects, so we get a lot of projects done. We currently have close to 100 active projects. The big change in our department is the creation of a grant-funded group. They'll be split out from our group, so 19 positions in total will be transferred to the grant-funded group. This will drop our general fund from 7.2 million to 5.2 million for a variance of 2 million. We do have 66,000 in the non-general fund for a position we're currently working to fill. Our total positions will drop from 80.75 to 49.25 positions due to that 19 that are being transferred over, and also the 12.5 vacant positions that will be removed for a total variance of 31.5. Our program snapshot, the program administration, CID, we are a team. The common goal is to put projects together from inception to completion. So that team mentality is very important to CID. The program administration covers many services such as preparing RFQs, SOQs, agreements, contracts, pay applications, payroll, Verifying compliance payrolls and and rates procurement bonds and insurance and of course the departmental accounting and also the project accounting and Our inspectors are boots on the ground providing project oversight providing vital documentation of projects during construction through daily reports They're making sure projects are built according to design the city state and federal standards Safety is a big component for inspectors making sure sites are in compliance and safety during construction is maintained Our project engineering team oversees project delivery, quality assurance, quality checks, RFIs, field issues, pay applications, along with coordination with key stakeholders to maintain projects on schedule all the way through project closeout. And then the way we align with the strategic plan, public safety, Title IV, the ADA, of course, our project with police and fire. Of course, infrastructure is a big part of a strategic alignment. Community progress bond, resurfacing, street reconstruction, traffic signals. Quality of life, of course, is a big one. Zoo improvements, flat fields, the library improvements, dollabilities, NIP, the Sun City lights is also a big one. Good governance through administration, public outreach is important to us through good stewardship. outreach and coordination through user groups and public support. And the public trust with our funds, we're always trying to put that information out there. Just have good budget transparency through the program-based budgeting. And with that, I'll answer any questions.

Any questions for Javier? You got away, Javier.

Oh, Representative Vero. Turning on.

Sorry, I'm formulating questions as they're coming, so it's a little messy on this side. I was kind of looking through your all funds table and I just wanted to get a little bit of clarification which this is page 41 for maintenance and repairs you're adopting a six thousand dollar budget from 114,000 and then the prior year was 523,000 so I'm trying to understand why it went down so much that I'll have to look into for sure I can I can look into that and see where that's coming from OK. And then on ADA. This was a big point of conversation last year during the budget where ADA moved to capital improvements. So what has been something that has changed since you've had it in the department for the past year now.

I can't say that anything necessarily, but from just my perspective, I guess having our field inspectors is a big part of that. Being able to verify some of that stuff in the field for our inspectors, I think it's going to be something that's important.

I'm sorry. Javier. Yes. Javier just made his 90 days, y'all.

Yeah, I know.

It actually moved to Joaquin's team. And so he can talk to you about the project. So here he's talking about ADA improvements in general across the city. I think you're referring to the specific program and funding that we had. So Joaquin will speak to it when he comes.

Thank you. I appreciate it. Good afternoon, Joaquin Rodriguez with CID slash grant funded program. So the ADA funds will live in CID managed by a CID project manager. At the time that it moved, we are still one department. So it was under us, but it's sort of in a limbo of who's the manager behind it. But it is a CID project manager. Right now, we are working to clear the backlog of projects that had occurred over those two years. There is essentially three groups of projects that are happening, things that we can do through our marketplace contracts, things that we can do through our on-call horizontal construction projects, and then a group of projects that needed to be designed. We're looking at the projects a little more holistically than just the one ramp that was requested. We're looking at entire intersections or corridors. Right now I believe we have a little over 700,000 programs to be completed By the end of this calendar year and then we would move on to some of the newer projects that have been submitted So the goal would be to clear that backlog first Spend down as much of that funding as possible and then work with OMB to start working that funding back into The budget equation once we've spent down those existing funds

OK that that's a lot more clear so I'm happy that it'll be by the end of the calendar year. And one other thing that I notice here is on communications the actual is 3 and the adopted is 100. I don't know if those numbers are right. I don't I'm not understanding them like three dollars and one hundred dollars.

Where's that.

It's on page 41. Under communications.

Is that that portion under travel looks like?

It says it's right above travel. And it's just three and 100. So I don't, I don't know if that's a typo or?

Yeah, we'll get back with you on that. So

So that's $100 is shipping cost for the next year. And $3, we will check. It's $2.99. But that's probably cost allocated for some shipping that they did last year.

Okay. Like literally just $2.99?

It's probably cost allocation between multiple programs. Okay.

All right. Thank you.

Representative Trejo.

Thank you. Two questions here. So with the change of employees to the grant-funded programs, all employees went to the grant-funded programs or were some also eliminated?

No, some went to the grant-funded and some got eliminated. So 19 were transferred over and 12.5 were eliminated. There were empty vacancies that were eliminated.

Of the 19 that transferred over, did they transfer into the same type of job

It's very similar. Yeah, they a lot of them were already doing that's very similar work. So it's it's pretty, pretty close comparison of just transferring those employees over. It's just the work was there. It's just they were doing the work. Now it's just being transferred over into that group as more formal.

Representative Trejo was always the department folded in. So Mr. Rodriguez has always been a department head. We've always had The grant funding department is at least six or seven years old. And so we've made the choice to split that out. We're really developing that into a federal program now. Mr. Rodriguez is also responsible for airports. So all federal things are going to be managed together. And because of the size of it, it made sense to just show it clearly in the budget and do that alignment. And so that work continues. His team went with him. They already have their projects and you'll hear from him next.

Okay, thank you.

Representative Chavez.

Thank you, Mayor. And I was gonna ask a similar question, Javier. So the city architect position and chief architect position, I know Daniela Quesada is the city architect from what I know. So is that under urban and planning? So it's just transferred over? So it was residing here and now moving to a different place? Yes, and they will present to you today too. Okay, got it. That's all. Thank you.

All right, Javier, I think you're done.

Okay, thank you. With that, I'll introduce Mr. Joaquin Rodriguez from the grant-funded group. Thank you.

Good afternoon, Joaquin.

Good afternoon, Mayor and Council.

Joaquin Rodriguez with the grant-funded programs group. As you know, we are responsible for managing all of your federally and state funded large scale infrastructure projects. Wait for IT to catch up for a couple seconds. There you go. So as we just mentioned, the biggest variance you see here, the entirety of our budget is from transferring out of the Capital Improvement Department into our own standalone operating unit. Total of 19 positions coming from the Capital Improvement Department and seven positions coming from the airport. Next slide, please. Our department is divided up into three programs. We tried to keep our program simple for tracking purposes, but essentially we have administration, which covers all of our leadership positions, our contract compliance positions, our record-keeping positions, And then we have our project engineering group, which is our actual on the ground project managers. They oversee the day to day of our projects, including managing construction contracts, construction design contracts, everything related to project delivery from planning through project closeout happens in our project engineering group. These are our project managers and construction superintendents. Finally, we have our transportation planning group, which focuses on things like long-range transportation planning, ensuring that our transportation facilities are working as a cohesive network and providing that safe and reliable transportation service to the city. We have aligned our programs with two primary pillars within the strategic plan. That's public safety and infrastructure. In terms of public safety, our transportation planning group really focuses on the Vision Zero outreach and education programs through projects like Safe Routes to Schools and Safe Routes to Parks, ensuring that we are working with our local school districts to get our schools Safe Routes to Schools certified. Also working closely with the El Paso Police Department and other community partners on bike rodeo and bike safety events. Our bread and butter really is the infrastructure pillar where we focus primarily our project engineering group focuses on completing some of those larger connectivity projects. Top of mind are Ressler and Montwood. We also have projects like the Sean Haggerty extension, the upcoming railroad drive reconstruction, the recently completed Rojas Drive reconstruction as well. Our administrative team focuses on executing our state infrastructure bank loan strategy to keep these federal funds coming into our community, being able to meet those match requirements. Our transportation planning group, in terms of infrastructure, focuses on delivering those quick build projects and working closely with streets and maintenance on the Vision Zero quick build initiatives. and also just other general traffic safety initiatives in collaboration with streets and maintenance. And then finally, our administrative group focuses on maintaining compliance of all those federally funded projects. So our record keeping team and our contract compliance group go through what is probably one of the hardest parts of our job, making sure that all the boxes are checked in terms of not having to pay any of these federal funds back. Happy to answer any questions. If not, I will pass it on to the city attorney's office.

Represent the month.

I don't want to leave with that at least one question. There's an attorney in your department.

There's not an attorney in our department. I think it's part of those sort of fractional shares of the okay attorneys roles that we we pay for we are supported by the city attorney's office pretty extensively.

And the salaries are those in the city attorney's budget? Or how is those?

We pay a portion of a city attorney who's assigned to our department. Good, thank you, sir.

Thank you. Thank you, Joaquin. Captain Serrio.

Good afternoon, Mayor and Council. Sergio Estrada with the City Attorney's Office. We can put the slides up. Well, what do we do? The slide says that we provide quality legal services in a timely and cost-effective manner in order to assist in the implementation of the strategic plan adopted by the Mayor and City Council. But what that really means is that we are the city's full-service in-house law firm. We provide services to every single city department. I would like to start by highlighting that our preliminary budget for fiscal year 2027 is $6.4 million. So the variance there is attributed to salary increases, and that will pay for approximately 51 full-time positions. The 51 full-time positions are comprised of our team. That includes lawyers, paralegals, and legal support and administrative staff. Next budget, next slide. I am now going to present to you a snapshot of the divisions within the city attorney's office. Now even I hate to start any presentation with litigation, but it's the first one on the snapshot because they were listed in alphabetical order. So our litigation division assists and helps carry out the city's interest and objectives by eliminating or mitigating the city's legal and financial risk by representing the city's interest and city employees in state and federal courts, as well as administrative proceedings. Our litigation team is also in charge of handling all the claims that are filed with the city of El Paso, and they also assist all departments in implementing discipline of city employees. Just a quick snapshot, last year we handled over 313 claims. This year we have 260 claims so far. Last year we handled 200 disciplines. This year we're at 126 disciplines. And we have approximately 123 active lawsuits. The next program that I'd like to highlight for you all is open records. You often hear about fair and transparent government And with that, the way that's implemented by governments are through public information laws. And so this department is responsible for safeguarding the public's right to access information while balancing that transparency with protecting the legal, with protecting legally confidential and privileged information. Last year this department handled over 14,000 open records requests and so far this year they've processed over 10,000 open records requests. The third program on the list is prosecution. This team supports the public health and safety and is also responsible for enforcement of municipal ordinances and low-level state offenses. For every police officer that is trained and funded, code enforcement officer, fire marshal, or animal services officer, you need a prosecutor in the municipal courts to prosecute the charge. For every ordinance that you enact regulating some type of activity, you need a prosecutor in the municipal courts to prosecute the charge. These are our lawyers who are in court every single day and have a lot of contact with members of the public. The next program that I'm gonna highlight to you is our second biggest program in terms of funding, and that's our transactional team. This team supports the full-scale operations and objectives of all city departments through the provision of legal guidance and support on a daily basis. Our transactional lawyers are on the phone with all of your city staff, your department heads, managers on a daily basis, answering phone calls and emails that start with, you won't believe what just happened, please advise. And when they're not doing that, they're drafting contracts and agreements and involved in real estate transactions. And lastly, of the programs that we're highlighting for you today is our utilities program. And no one knows what they do, but they do a lot of whatever it is they do. In all honesty, they're actually our growing division because they provide highly technical and specialized legal representation to help advocate for the interest of the city rate payers. in state regulation, regulatory proceedings. And you are all no strangers to that because you're accustomed to seeing utility related items on your city agendas. All of these programs, but specifically our prosecution help with, you know, are aligned with the strategic plan alignment. including good governance and quality of life and quality of life, good governance and infrastructure. So that is a quick snapshot into the city attorney's budget. Any questions?

Of course, there's questions. Representative Lamont, I do.

OK, so now explain to me the salaries of all attorneys are in your budget.

That is correct.

And then departments pay into the city attorney's office for whatever amount of period or time you have already designated.

Uh, that is a somewhat correct and I don't know the exact details, but I was told before I presented today that Sasha is a lifeline. I'm not sure why no one else has called upon him, but he may, he, he, I am making full, full use of that, but I'll try and explain that to you because we do provide services to all of the city departments, including some of the ones that are, you know, enterprise funds, uh, the city charges them for the services of the city attorneys and therefore. depending on, you know, it's not all lawyers, but if they have lawyers that are assigned to them, they do pay for a portion of the salaries. And I think that's true of many, but not all lawyers. Yes.

Sasha said yes. And all of that is already figured into the budget. You've already taken all.

Correct.

Thank you. Representative Kanellis.

Thank you, Mayor. Picking up right there, they're not charged by billable hours, correct? This is some prearranged formulaic termination?

Yes, there is a formula. And we do, in order to assist in the formation of the formula, we keep track of the percentage of the work that that attorney dedicates to that department. But it's not your traditional billable hour.

No, sir. Yeah, I guess I mean to say this isn't an estimate and then it's variable based on the amount of hours. You use the tracked hours to determine the budget for the following year. Correct. Okay. In the giant binder, just a note so that we can adjust it for what the public sees. I think just it was a report running problem. The programs are listed incorrectly for a city attorney. It looks like they're the programs for community and human development.

in right in the report i think it was just a as as the report ran it pulled the wrong titles you know actually uh aside from utilities part of the reason these are these programs are listed in there is uh there if you will look at our at the first slide uh there are some grant funded positions that come from community health and development and so they have to be uh accounted for in our budget okay But it's a very minor amount, and that's what accounts for what is called or listed as the non-general fund. So $73,000 of our anticipated budget is paid for by grants that were obtained by those departments that you listed. Got it. Homeless housing program. I think there's homelessness prevention housing program.

public facilities and human services yes okay and that's just their allocation but because those are grant funded you account for them correct got it i was not i missed the programs on the page before on page 50 so um they're all accounted for then um i did have one other question and i just lost it let me uh Let me see what it was. Oh, again, not a question necessarily, but just an observation. And you'll probably hear me make a few of these throughout the day. Just a thing for clarity, because utilities shows up as a line item across the budget on different departments, I don't know if there's another descriptive name that we can use for that program name, maybe utility regulation, something like that, just so that people aren't confused thinking that There's this huge amount of utilities being paid, you know, utility service costs being paid by the city attorney's office. Correct.

Well, certainly we'll look into that. Some kind of renaming.

Yeah. Don't know if it's a renaming, but a supplement to the name. Right. Yeah. Right. That's all. Thank you, Mayor.

Okay. Representative Chavez.

Thank you, Mayor. I had actually taken my name off the list. But I don't mean to be argumentative, Sergio, but I didn't realize lawyers were so funny.

Oh.

Well, we try, but you know. You try.

Yeah. No, I mean, most of our increases this year are for salaries, and this department specifically seems to not have an increase. You're pretty flat from one year to the next without eliminating any positions. Right. From that first life. So whatever it is that you all did was creative probably in some way. I'm not sure how that happened.

Back to the attrition. I just can't see.

I just can't see it to the big chunk of the church, OK, yeah, well OK it says FTE is 51 and a half to 51 and a half and then when you look at the salary. It stays flat so right.

A lot of it is the manager, a city manager mentioned it is attrition but we we've discussed that and it's you know we're going to proceed as as budgeted so good, thank you, thank you.

Any more questions for studio.

Thank you, Senator. Thank you, Mayor and Council. And up next is Laura Pryne with the City Clerk's Office.

Good afternoon, Ms. Pryne.

Good afternoon, Council. Laura Pryne, City Clerk's Office. I was advised to keep it under three minutes, and I'm going to try my best to do so. So the city clerk's office provides access to city council meetings, governmental records, and election services so our citizens can participate in local government. For FY27, our budget will see an increase of $1.5 million for the upcoming election to fill seats for districts. We have a hot mic. So we have the upcoming elections to fill seats for districts 1, 5, 6, and 8. We also have a small increase related to the across the board salary increases. And our staffing will remain flat at eight positions, will remain small but mighty. For our program snapshot, the budget supports three. I think we still have a hot mic. Our budget supports three programs. The first program is boards and commissions. With 33 internal boards and over 300 members, we want to encourage citizen participation so that these seats are filled and boards can meet as needed. Citizens can find resources online such as the uniform bylaws, a board member handbook, and the code of conduct. We keep our website updated to reflect any vacancies so we can gather interest from the community and fill those seats quickly. We value the interest and willingness of our residents to volunteer their time. This upcoming year will also hold a pension election to fill the seats for two city employees to serve on the Employee Retirement Trust Board. And that has a minimal cost because we've transitioned over a few years ago, we transitioned to electronic voting and so that helps our employees participate in this election easier. For the next program we have is council meeting and administrative support. So before posting the agenda, we perform quality control to make sure agenda items are complete, that paperwork has been signed, and we look for any discrepancies so we can get those corrected before we post them online. For the public, we want to make sure that we provide an easy way for them to participate in meetings by streamlining the sign-up process. We recently added a link so that they can submit statements on agenda items, and we've seen an increase in participation as evidenced by yesterday's numerous statements. Our ASL interpreter provides support for other city departments such as the police department, the health department, municipal court. And the third program we have is election services. We strive to facilitate a seamless and fair election process by enhancing our website where candidates can find information and forms needed to run for office. We also make sure that we post candidate information and campaign finance reports online upon receipt so the public has access to this information or any other information they may need when heading to the polls. In all, these programs align I don't know if we did that without. You forgot to make the message about silencing electronic devices. Silence your electronic devices and mute your microphones please. These programs align with a good governance by strengthening resident facing communication and facilitate access to public records. For election services, we want to encourage citizen participation to increase voter turnout. We provide support for city elections, for all city elections, such as council seat elections, charter elections, bond elections, and initiative petition elections. Along the same lines, we want to increase citizen participation so that boards and commissions can have members that are representative of our community to help shape and carry out the city's policies and goals. That concludes my presentation.

All right, how about some questions from Ms. Bryan? Representative Limon.

Not a question, just a compliment. Thank you for all that you do, keeping us on target, financial reports, sending information for the agenda. You and your department do a very, very good job. Appreciate it.

Thank you very much. Thank you, ma'am, we appreciate your support.

Thank you, Ms. Bryan.

With that, I'll turn it over to Steve Alvarado with Code Enforcement.

Good afternoon, Steve.

Good afternoon, Mayor and Council. I apologize. I thought the city manager's office went before me. I apologize, but I don't know why. Good afternoon. Steve Alvarado, Code Enforcement Director. So what do we do in code enforcement? We do a lot, but our mission is creating a partnership with our community to enhance the quality of life for all Paso residents, businesses and visitors by promptly addressing public nuisances, health, safety and property maintenance issues. We've kind of touched various aspects citywide. We have a great partnership with all the other city departments. And the unique thing about our department, we're ending year one. August 31st will be the end of our first year. With the creation of the department, we brought in different enforcement branches to our division, to our department. But it also created challenges in the fact that we realized that we didn't have certain positions So the variance here is going to be salary increases. In FY26, we had 141 positions. FY27, we have 140. We did not lose a position. Part of that creation and the opportunity that we have is we consolidated two supervisor positions to create a deputy director, which is currently being posted. It's one of the positions that we need. So we didn't lose any positions. We're running lean and mean, as always, and we're identifying the areas where we need to improve. The variance for our budget is $4,336. Pretty small variance by all means. Program snapshots. So we have identified a total of 10 programs. All are equally important. I'm going to go over the two most important this year, which will be BRUSH. BRUSH encompasses a lot of CR requests. It'll be illegal dumping, overgrown weeds, noise violation, things along that line. The second one I'm going to identify and go over will be our public health enforcement. Public health enforcement includes our sanitarians, food safety, vector control. We get a lot of calls city and countywide. As you know, we handle the areas of county as well for all the food establishments and vector issues there as well. So we put our efforts in economic mobility and public safety, increased compliance by providing food truck inspections citywide to accommodate our customers. We're also working with the parks departments. That's going to allow us to do food truck inspections at three locations instead of just one at railroad. We're working on finalizing that. So we'll have a location on the west side, central, and also on the east side. It'll make it easier for our customers to have those services available to them. Vehicle violation enforcement. We're increasing city enforcement citywide. Previously, most of our parking enforcement was centered downtown. We were able to get the vehicles from our PD partners. Thank you, Chief, for that. They have gone citywide. We've gotten a lot of calls, hey, I haven't seen these before. I've been parking this way for 20 years. Well, you know, 20 years is good timing. Public Health Force, like we said, we're part of this whole development of the department was cross-training functionality. So we have already started that process. Our vector control officers have been certified in pool inspections. So when the off season, when it's not too busy, we're getting into the busy season right now, they'll be doing pool inspections to allow us to do that. We're doing the same with our sanitarians as well. So when they do a food inspection at a hotel that has a pool, They could knock them both out with that one inspector So we're identifying opportunities as well as tattoos or sanitarians could do them as well We're making us more functional and you know, what better customer service levels by all means With that I open up to any questions you may have represent Acevedo

Thank you mayor. So last year we were talking about you coming in and having your own department and now we're here and I think I've seen a difference in everything that you've been doing. I just kind of wanted you to tell us a little bit about what you've seen and how it's been

It's absolutely a great question, Representative Acevedo. It's been a wonderful experience. Creating a department is a lot of work. Thank you, city manager, for the opportunity. I appreciate that. I had a full head of hair when I started. Look at me now. But it'll come back someday. Join the club. Fingers crossed. Fingers crossed. It's been wonderful. So we've had the opportunities to excel. We meet monthly on Teams, because it's hard to get 140 people together in one room, believe it or not. But we talk about things. Everybody has the opportunity to speak. How do we do better? We can always do better. Just recently went through an audit. We did excellent, but we can always do better. I'm looking for improvement. One of the positions I identified is the quality assurance and training specialist. How do we meet those metrics and how do we do better than that? And have a standardized training for all our team members. So one person is not being trained one way, another another way. We have the standard operation. So we're still looking for improvements. Once we do onboard the deputy director, that's going to help me immensely. It's giving me more time to focus on how we can improve, how we could do better and, you know, provide a higher level of customer service for everybody in the city.

That's great. And you're so critical to my district. You're critical to the city. But if I'm just looking at my own district, there's so many things happening where your department is involved. And I really appreciate everything that you're doing. At a future budget workshop or sometime in the future, I would just really love to see your budget transferred into measurement, how many cases you have in the different categories that you have. Really enjoyed seeing how you had brush and building without permits I just want to get a better snapshot of of what you're actually dealing with and I'm sure you could quantify that data Oh, absolutely. We can do that. I'd love to see it. Thank you so much.

Thank you represent Chavez

Thank you, Mayor. Thank you, Steve, so much. I have also relied on your department heavily, and I thank you for all the work that you've done along with everyone else that works under you. And I also want to recognize the fact that you and Nikki Barra and Pablo Caballero and Randy Garcia, all of you work collaboratively to not only improve our city in the way it looks, to beautify it, but also to respond to all the calls and concerns that we have from our constituents. So I really appreciate the teamwork. I see it. I know how communicative you all are, and I appreciate the work that you're doing. Thank you so much.

Thank you, Rep. Representative Canales. Thank you, Mayor.

Right there with you, Steve. I'm looking at a couple of line items that I have a question about. On revenue, it's all non-general fund. You have operating transfers in just more than a million dollars. What is the source of that operating transfer in?

I'm going to have to pull my social card here.

So the transfer in that you are seeing is the transfer in from environmental services.

From what? I'm so sorry.

Environmental services.

Environmental services. Sorry, this is the environmental fee covering some enforcement costs? Is that maybe what it is?

No, this is the cause that was transferred from environmental services because they had the nuisance program in their department. Got it. So when they become new departments, environmental services is transferring funds to fund these positions.

Okay. So they became a new department last year. It's not a one-time transfer. This is an annual operating transfer in from environmental services to cover the cost of the nuisance program.

Yes.

Got it. OK. And then does that, and I imagine in environmental services we'll see that as an operating transfer out? Transfer out. OK. And then I had one other question. Let me find it again here. It was also, it's a, I have very few revenue side questions, but this is both questions here, revenue side. Charges for services, what are the, do you have an idea of what the breakdown of charges for services are for code enforcement?

So for charges for services, we have food establishments, we have county food safety, and then we have some miscellaneous revenues.

OK. So it's paying for the inspections mostly for the food permits.

It will be that.

Mostly for the food and also for the convenience store ordinance, tattoo, partners, things along that line, so.

Okay, that makes a lot of sense. Thank you, both.

That's it, Mary, thank you.

Thank you, Steve.

Thank you. Next up, we have Community and Human Development, Ms. Nicole Rodriguez.

Good afternoon, Nicole.

Good afternoon. This is like the first time that I don't come dead last. So this is really exciting for me. So everybody back there knows what I'm talking about. So good afternoon. Nicole Rodriguez with Community Human Development. Nope. There we go. So what do we do? We focus on building strong partnerships and supporting programs that help vulnerable people in El Paso. We do this by investing in homes, families, and neighborhoods. This budget reflects a department that continues delivering core services while adjusting to reductions in grant-related funding. Most of our department's funding comes from non-general fund sources, and the decrease shown here is tied to lower grant revenues. We have 10 programs in community development, but I just want to focus on two on this slide. I think they're especially important because they directly impact housing stability in our community. The first is homelessness prevention. The goal here is to keep people in their homes. before they ever enter the shelter or experience chronic homelessness. Our second program here that I want to highlight is our housing programs, which focuses on expanding affordable housing opportunities, also while protecting residents from displacement across El Paso. Both of these programs are heavily reliant on federal funding. On this next slide, the two that I wanna focus here is on our neighborhood programming, which includes supporting the city's over 100 plus officially recognized neighborhood associations through important initiatives like our Neighborhood Improvement Program and our award-winning Neighborhood Leadership Academy. The second is our public facilities program. And this is a grant funded program that allows us to improve the spaces that residents rely on the most. This includes infrastructure like ADA improvements and nonprofit facilities to address community needs in low to moderate income areas. Our department's work supports several of the city's strategic priorities in economic mobility. We're working to expand affordable housing opportunities and create strategies that help residents stay in their neighborhoods as our community continues to grow and change. Under public safety and quality of life, we work very closely with CID and grant-funded programs to work on projects that support our neighborhoods like the NIP program or the accessibility Title VI program and doing sidewalk gaps that Joaquin talked a little bit about. Then our homelessness and human services programs focuses on helping residents connect to shelter, housing support, and critical support services. And then we also support good governance through programs like our Neighborhood Leadership Academy, which is a 16-week citizen-led academy where we provide a behind-the-scenes tour of our government to our neighbors. And this year, we'll be celebrating our 20th year. Our Title VI and ADA efforts help ensure city services remain accessible, transparent, and inclusive for all residents. And with that, I will take any questions.

Sure. Representative Kanellis.

Thank you, Mayor. Nicole, your department, I think, is one of the more unique ones in the way that it's structured in the budget in that it's not an enterprise fund, but your 27 preliminary general fund is $1.2 million, and your non-general fund is $13.8 almost, which is structurally very different than most of the other departments because You're almost entirely grant funded through mostly federal formula grants. Correct.

There's some state, and then we have AmeriCorps.

Yes. How much of your general fund, that $1.3 million, is actually going toward the provision of services?

Less than 1%.

Less than 1%. That's correct.

Well, the 1.2, the general fund of our budget is comprised of neighborhood services and Title VI ADA. They are our only general funded employees and support staff. We're working on some operational dollars, but for the most part, that reflects salaries and benefits. And then the rest of that, outside of those two categories, is roughly about $60,000 in services, which would encompass everything from our Neighborhood Leadership Academy to the neighborhood outreach that gets done.

And I guess I should have been more specific. I mean, some of the other programs that are more direct provision of services by community organizations. So the majority of your budget is pass-through of funds from state and federal sources.

We are a bank to our not-for-profits.

Yes, and so what level of general fund support serves those programs?

Zero.

Zero. I will continue to bring this up year after year. I think it's a travesty that we have zero general fund support, particularly for homelessness, housing programs, We, you know, it's not entirely unprecedented, but we're pretty unique as a city, especially among our peer cities and other cities in Texas in that we don't have that level of general fund, any level of general fund support for these programs is that would that be? Pretty accurate to say.

Yes, and we do make our dollar stretches as much as possible. The way that we get more money out to the community is by passing it through. And so I think we use it as a strategic leverage of investment. But I would say those that work on the grant funded programs, we take an admin costs towards that, and that's roughly about 10% to 15% paid by the grant.

Yes. And then, I mean, among the grant funding, only a pretty small fraction of that is actually used for service provision, correct? Correct. Can you explain how that breakdown works?

Yes, so the money that comes in, we do a notice of funding availability. That notice of funding availability goes out to the agencies, the nonprofits, the developers. And we administer that grant for them. We ensure the compliance. We ensure the fiscal part of it. So we pay the agencies.

And that all comes through our team, but the actual provision of service comes from a not-for-profit But I mean the funding breakdown so The federal funding that comes in has a lot of strings attached Oh, yes, only certain fractions of that can are used for service provision versus other uses like brick-and-mortar construction That's correct. So can you talk about that breakdown?

Yes, roughly we get about $6.4 million of community development block grant funds. Unfortunately, the federal government says, here is this money, but you have to break it out in a certain way. And so services is our largest category, but we can only use 15% of that 6.5 that actually go out to provide the services. So less than $1 million.

goes to services out of that 6.5 yeah i mean that's uh so i guess i mean to say we have zero general fund support for those service programs and then also can only use 15 of the federal grant funding so it ultimately has less than a million dollars for for service provision in total yes um And sorry to put you on the spot. Can you talk to us a little bit? We saw a presentation a few weeks ago about the Welcome Center and heard that the Welcome Center remains unfunded in the new year, still funded through the end of the fiscal year. Yes. Can you talk to us about that situation?

Yes.

And maybe what the Welcome Center is for someone who's watching who doesn't know.

The Welcome Center is our 24-hour access point for homelessness. When we get a CR request or there's a 311 call or there is a call to the 24-7 Street Outreach Line, the place that they take these individuals experiencing homelessness is our Welcome Center. That Welcome Center was funded through ARPA dollars. that funding unique, it was a one-time tranche of dollars that came in through COVID relief funds. But the reason why that was created was because it allowed us to do things with funding that we couldn't do with our traditional funding sources. So CDBG, even though they give us money, like I said, they only say that we can do 15% of that on services, but then on our homeless provision side, they also cap those amounts for certain things. So we're very limited on what we can actually do with the traditional funding sources that we get from the federal government. So these ARPA dollars allowed us to fill in some gaps that were much needed, like a 24-7 emergency shelter. So we applied for a grant. I thought a little piece of me died the day that we found out that we didn't get it. But I think it's only motivation to keep going after it because it's been wildly successful. And when I go out and see other peers in Texas and I tell them that we have a 24-7 street outreach team that has a dedicated place, they want to know more about it. And so I think we're more than just, I think we're doing something right here. We are working on a plan that that scales the operation down so that we can continue the service in the event that we can't secure funding for the welcome center. So we'll have an operational plan. That way when we still get these calls, we're still acting in a way, it just might not be as fast, but we're doing some operational measures to ensure that that provision is still covered because it's through that El Paso helps portal that has made it wildly successful.

And the Welcome Center, it's, again, operated by a third party. Yes. They would not be able to continue that same operation without the funding that is currently funded by ARPA?

No. Once the ARPA dollars run out, we haven't identified a funding source beyond that. So August 31 is what we're looking at currently.

OK. Do you have an idea of the programmatic cost for Welcome Center?

It's roughly about $600,000 to $800,000. The $600,000 is the bare minimum, keep the doors open. $800,000 allows them to, of course, take in more people and provide more support services. One of the things that makes this unique I talked about it. It's covering things that haven't traditionally been done with the traditional funding sources, is that it allowed us to partner with animal services for channels and shelter support. Anecdotally, when somebody gets picked up from the street outreach team, they don't want to surrender their their dog because that dog is their family. So they don't they don't want to part ways. And most of our shelters don't allow pets and animals. And so the welcome centers, the only shelter in the city of El Paso that that has some kennels kennel space and then vaccines and care are provided through animal services. And what we found is that more people are willing to accept services because their animal is receiving services. Quite frankly, they don't care about themselves. They care about the welfare of their animal. And so we were really excited to be able to do that. It's rare help that doesn't really exist outside of what we're doing. And more and more people are wanting to know how we're accomplishing this.

Yeah, I think it's been a huge, unmitigated success. And so I am pretty dismayed to learn that the ARPA is expiring and we don't have an identified funding source. It will be one budget adjustment that I submit. So I hope that the numbers go our way and there is something available to fund the program. I worry about the situation it leaves us in and the potential ERASURE OF SO MUCH OF THE PROGRESS THAT WE'VE MADE OVER THE LAST FEW YEARS IF THE PROGRAM ENDS AND THE WELCOME CENTER CLOSES. THANK YOU. THANKS, MAYOR.

THANK YOU, NICOLE.

Thank you. Additional questions on the Welcome Center? Yes. How many partners are working through the Welcome Center?

There are three partners. There's the Opportunity Center, the United Way, the Project Amistad. And then there are other El Paso Helps partners, but those are the main, that is the core group. So Project Amistad does the street outreach and homelessness prevention. the opportunity center does the management of the actual shelter and then the united way also does homelessness prevention so they're they work to provide the services the wraparound services that that that individual needs like getting an id card or securing their documents or whatever um health services or get them connected to part other Partners like Emergence Health Network or mental health or or drug and addiction support okay thank you thank you okay any other questions for Nicole all right thank you Nicole Thank you. And with that, I will turn it over to the Brooke Underwood.

Do you mind if we take a quick break before Brooke comes up and takes the center stage? How long? 10 minutes.

There's a motion for a 10-minute break. There's a second? Thank you. Ms. Bryant, motion to take a 10-minute break.

There's a motion and a second to recess the special city council meeting for 10 minutes. All in favor?

Aye.

Anyone opposed? The meeting is in recess at 3.03 PM for 10 minutes.

Just gonna...

Philip, report to the dais, please.

Okay, Ms. Ryan, we're ready and I think Brooke is on deck. Oh.

Council, is there a motion to reconvene? Is there a motion to reconvene? We need a motion. Mayor, are you ready to get started? Were you ready to get started? Okay, three minutes, three minutes.

Great presentation. Thank you, Brooke.

okay we have a motion to okay there's a motion and a second to reconvene the special meeting all in favor anyone opposed the meeting is back in session at 3 11 p.m good afternoon brooke good afternoon mayor mayor pro tem members of council city leadership my name is brooke underwood and i am halfway through my 45th day as your interim president and ceo be gentle I'll be presenting Destination El Paso's budget profile. Destination El Paso operates as the city's contracted destination management organization and is currently in its second two-year contract extension under Legends Global. Our operation is unique in the fact that the majority of our enterprise is not supported by the general fund dollars. We are primarily funded through the hotel occupancy tax and revenues that we generate ourselves through venue operations, events, and tourism activity. The one exception is the El Paso Water Parks Division, which does receive general fund support. The remaining enterprise revenues support our expenses, salaries, benefits and any retained earnings generated are returned to the city while the management company is compensated through an annual management fee. The budget variance is primarily attributed to salary adjustments and planned capital investments, but also we anticipate seeing growth in hotel occupancy tax collections and increased revenue expectations across the enterprise. Our venue management and event operations division, operating as El Paso Live, oversees venues and events while prioritizing safe guest experiences, revenue generation, and long-term stewardship of our facilities. Our destination marketing division, my favorite, Visit El Paso is responsible for promoting the city as a destination for leisure travel, meetings and conventions, sports, films, and the creative industries. That drives visitation and economic impact and community visibility. Our water park operation division manages all four water parks with a focus on safety, of course, guest experience, and operational excellence. The budget also supports our capital improvement plan, which is critical as we continue investing in the maintenance of long-term viability of our facilities. Together, these programs support both visitor experiences and economic activity generated throughout the community. Destination El Paso's work aligns with the city's strategic priorities across economic mobility, infrastructure, quality of life, and good governance. From economic mobility standpoint, our focus is on increasing events, visitations and overnight stays, driving economic impact through tourism, convention sports, and destination marketing efforts. While infrastructure, our emphasis is on long-term stewardship of city assets through proactive venue operations, capital planning, strategic booking efforts, and venue optimization. Quality of life remains equally as important as the events, venues, and attractions, and experiences we support are not only solely for visitors. They are community assets that contribute to the experience and quality of life of our residents as well. Finally, through strategic partnerships and tourism development efforts, we continue to expand our outreach, strengthening collaboration, and enhancing service delivery across the community as part of good governance. Together, these efforts support Destinational Paso's mission of generating economic impact while enhancing the quality of life for residents and visitors alike. Thank you. I will not be taking any questions today. Feel free to visit Monday. I kid. I kid.

Represent Limon.

Sorry. Brooke, in the very beginning, you stated it's managed by Legends slash ASM Global. Correct. Legends is a part of the Dallas Cowboys, correct?

Yes, that is part of the family. I think that gives us... When did this change? Do you know what year it changed from SMG? Well, actually SMG and AEG facilities merged to create ASM Global, and that was right around the end of the pandemic. And then only recently in like the last year, year and a half, did we get acquired by Legends Global. So Legends acquired... Yes. We were a very... attractive opportunity for Legends Global to strengthen their portfolio. So that was a good move for both ASM and Legends.

If you say so.

Hi.

Abraham Chavez Theater. I noticed on here responsibility for maintaining and enhancing facilities. Does that maintenance and enhancement facilities come from your management fee, or does that come from the city?

No, that comes from the revenues that we generate and give to capital improvement plans.

And here comes Ben.

Excuse me, I'm sorry, just since it's only your 45th day. Hotel occupancy tax, part of the proceeds of that actually go into a capital fund that is then used for a capital outlay for the facility and the campus itself.

So what is the plan? What has been the plan and what is a future plan for the maintenance and certainly enhancement of the facilities for the Abraham Chavez Theater, which is a non-AD accessible theater?

So right now, we're actually in the middle of doing a comprehensive look at the Convention Center campus, which will include potential for expansion that we look forward to bringing back to the council in the next few months. That does include work on the Chavez Theater itself.

So the enhancement of the Convention Center is coming out of this capital fund that you referred to right now?

So actually the enhancement of the entire campus and expansion is something that we will have to talk to the council about Because obviously it could not be served by the amount of money that is currently in that fund We will definitely have to have discussions about what that could mean for the council But we want to be able to holistically take a look at the entire campus not necessarily think about expanding and leaving some of the other assets within the campus without being modernized and taking advantage of that opportunity, ma'am.

Is it safe to say that the Abraham Chavez Theater is underutilized?

No. Actually, both of our theaters rank in the top 100 in both Billboard and Polestar. And so, no, both are heavily utilized.

How many events did the Abraham Chavez Theater host last year?

I don't have that information in front of me, but I'd be happy to give you a count on event dates.

I'd be curious because that's the sense that I have received, especially through promoters who find it very difficult to get into the plaza. The plaza, excuse me, not the plaza, the Abraham Chavez Theater. It really has even better acoustics than the Plaza Theater.

We also made some improvements in the sound system that is in the Abraham Chavez Theater. So not only is it an acoustic gem, but it also has the backup in the sound system, which is akin to the same sound system that Taylor Swift toured in her Heirs Tour. So we have one of the best sound systems in the region.

And that is very true. I am concerned. about the inaccessibility of the building. I'm also really concerned about the dressing area, the waiting area in the back. It does not look like what it should be for a theater of that capacity. And so I'm very interested in keeping track of where these funds are and the allocation into the Abraham. I'm not looking at a holistic, I'm looking specifically at the Abraham Chavez Theater.

Understood, ma'am. And I would also say that one of the things we're really excited about is to be able to start bringing forward a capital improvement plan, an annual plan to the council to bring parity to Destination El Paso, as do other departments when they update you on what they see as the capital needs and seek improvement on that. So that will be coming in the next few months as well.

And the funding that we receive through this agreement, where do we see it on the budget?

The retained earnings? Yes. Yeah, all of the revenues that we generate are returned to the city and retained earnings.

OK, and then where do we see them on the budget?

Lifeline. Operating transfers.

No, don't go anywhere.

What was the caption again? We're talking about the SNG contract?

The revenue that is generated through Destination El Paso, how is it reflected in our budget?

So it's reflected as a revenue, as a hotel occupancy tax in the budget. No, let me think.

Not necessarily hotel occupancy, but revenue that comes into the facility itself.

So the operation probably in the fund balance, it will be reflected in their retained earnings in their fund balance. Ooh, this is a hard question.

Here comes Robert too. One, two, three, four.

I guess because we don't understand the question.

And I probably am not making it very clear.

What is the revenue that comes from Destination El Paso show up into the

It's in their budget. And you'll see the different revenue sources in their operating budget. So you'll see sales tax category. You'll see charges for services. You have multiple categories. So the hotel occupancy tax is reflected in the sales tax category. There's $4.5 million. That's the capital fund only. The remaining hotel occupancy tax revenue is budgeted and non-departmental. We pay Destinational PASO through the management consulting amount. So is that the question that you're asking about? No.

I'm asking, for example, Robert, for example, We booked a convention and so the convention people pay and Then yeah, so all of that.

Yes, so that's all booked in the retainer and is this booked into that plan? We've got substantial cash built up but we have it pledged because we're gonna have those future events that are gonna come that we're gonna have to pay out and

Okay. And we know we have history. Yes, ma'am. Okay. Yes, ma'am. And has that risen substantially or risen?

No, I wouldn't say it's risen, but obviously do they have plans? And so some of these events won't occur in the next year. They may not occur for two years, three years down the road. They're booking events for two, three years down the road. And so all of that funding is booked into the retained earnings and then which will be paid out at the time the event happens.

Okay, so if an event takes place in 2026, deposits come in potentially 2025. Are those reflected in the 2020, no.

It won't be in the budget, no ma'am. At all? No ma'am. Okay, when will it be in the budget? It would be in the budget at the time that it's collected. So depending upon when we collect that revenue is when it would be reflected in the budget. but that goes into the retained earnings at the end of the year. So we've got all of the reconciliation as to how much we've collected. We know what those events are going to be in the future, but it's two separate things, the budget and the actual financial reporting on when those funds will be paid out. But I guess, yeah, I think that answers your question. Thank you.

Thank you very much. Thank you, Brooke.

Representative Acevedo.

thank you mayor overall I'm excited for welcome to the city it's day 45 for you I am excited for what capital improvements we're gonna see in this area over the the next years hopefully I'm wondering Brooke Is there a community engagement component to that? Because I'd love to see you on the road all over our districts just kind of getting that community engagement from our constituents.

That is the plan. And I would love nothing more than to be the one to tell the story as I have worked and sold and marketed that facility for 18 years. and I truly understand its capabilities, also its limitations, and what it needs to be even more successful than it already is. So yes, there is a community engagement portion.

And I'm in. That's great to hear. One other thing that I wanted to ask you about is I'm really excited about the potential film incentives that we can have in our city and have another Oscar-winning movie come film here. What are we doing around that?

We actually have narrowed from 86 applicants for our film commissioner down to 12 and now down to four and they're scheduled for interviews early next week. So I'm excited to get a very qualified individual in the helm or at the helm to lead those efforts.

Oh, that's really great to hear. I really hope that we could get more filming done here in El Paso. I agree. The other question, I've probably asked this every year, and I'm hoping that in this next year we could see some sort of plan or just some increase to the water parks in terms of attendance. and see how we could do that. I mean, what what is your your perspective on our water parks over the last year?

The water parks actually have seen tremendous growth. I've got some information here. So if there's a specific question, but we actually all four parks have opened over the last month and saw banner successes over attendance and food and beverage revenues. So Don't have those numbers from this past weekend in front of me But I'd be happy to share the successes that we're seeing and there's also another program that we've piloted over the last month Which is the community swim program? So we're diversifying our offerings to meet the needs of the community and encouraging people to get out to the parks In fact district 4 will be hosting their community meeting there in the beginning of June So I think that reintroduces people to a park right in their own neighborhood

That's really great to hear it. Love to see that information. It seems like you're doing everything that you need to do, and I appreciate it. I appreciate it. Thank you. Thank you.

Representative Trejo.

Thank you, Mayor. Yes, we're looking forward to having that meeting. It's next week. The fourth. The fourth, or it's the following week. Is it next week? Is it next week? Yeah, it's next week. Brooke, how many employees does Destination El Paso have?

Destination El Paso has a total of 100 FTEs, although that slide says zero, so I want you to assume that I'm doing it all myself. 100 FTEs, that's 70 for live, the venue and event management portion, 14 for Visit El Paso, the destination marketing organization, and 16 FTEs for the water parks.

Okay.

And then I noticed on slide, where is it?

Go back and find the slide.

37, the small business support.

37 is economic development.

Oh, no wonder I was asking, how is it economic?

I mean, I'd love to talk about tourism and take up Karina's time as well.

OK, we'll answer my own question. Thank you so much. Thank you.

Representative Chavez.

Thank you, Mayor. Brooke. Is hospitality and warmth a line item in your budget this year?

It should be.

I think it should be, because I don't know how we would measure the return of that, but I'm sure that its impact is great in our community. And that's what you bring. That's what the entire team brings. And I'm very appreciative of it. I don't know how you do it, but you always seem to have a little detallito for someone, something to give, and you never ask for anything in return. So we appreciate that. We value your work and the work of the entire team, because I know how hard everyone works over there. And I do want to point out that Brooke and I have children in the same school. they're both graduating from elementary school next week and we missed their field day today but we're happy to be here and and you're doing great job mom Rep Sim Canales Thank You mayor I have just one question it's about the another revenue side one rents and other

quite large amount of revenue, let's see, preliminary $9,460,000. Is that primarily just, is it like shorter-term facility rentals? Or what accounts for rents? I just know you probably aren't in a situation where another traditional department is where they're collecting rent from a longer-term tenant.

No, I would make a, in a home, Yes, the rent for the convention center, the rentals of the theaters, and the amphitheater as well.

Okay. And then your operating transfers in is the other thing that I'm having trouble accounting for. That might be a social question. Okay.

So operating transfer is just adjustment how we budget these two things. We align the budget with the actuals this year. So if you see sales tax, which is a hot revenue, a hot occupancy tax, it's $4.5 million, and previous year is zero. So we align the budget to the actuals.

I see. Okay. So the okay, you're operating transfers in is just accounting for the actuals in in what's booked here as sales tax, but is sales tax plus hotel occupancy tax? Yes.

In the previous years, we would budget transfer out from their 2321 fund to their capital fund. But that's what that's not the actual what is happening. So we just aligned the budget with the actuals.

Okay. That makes sense. I'm glad I asked. I never would have come up with that on my own. Thank you, Sasha. And thank you, Brooke.

Representative Limon.

And finally, Brooke, do you have anyone specifically targeting the promotion of the mission trail?

Actually, yes. We have a dedicated person on our team, Nora Ochoa, who handles the eco and heritage cultural tourism. IN FACT, WE ARE OUT THERE ON A MONTHLY BASIS GIVING HISTORICAL TOURS. WE CELEBRATED OUR MISSION TRAIL WITH A NUMBER OF ACTIVITIES DURING NATIONAL TRAVEL AND TOURISM WEEK. SO WE'RE VERY ACTIVE OUT AT THE MISSION TRAIL.

I'M GLAD TO HEAR THAT. THANK YOU. AND THEN ONE REAL SPECIFIC LOCATION, VALIONEL FORTI PARK. now Chapoteo, used to have a pavilion. Is it still available for rental aside from the actual use of the water park, or does it have to be associated with the water park?

No, you could rent the pavilion, and we have now outfitted it with a number of pieces of equipment and things that people can use. And how do people know how to get to you? There is signage, and they can call Chapoteo Water Park and get information on how to book that venue. It's a great venue.

It is. It is. Always do outstanding. I want to compliment you and also compliment Chef Puga. He has developed some exceptional lunch meals. He's really good. I appreciate that. Thank you very much. Thank you.

Brooke, congratulations on 45 days?

45 days.

Yeah. And keep up the great work. And you always do it with such a beautiful smile and energy. So keep up the great work.

I appreciate it. Okay, well, I have, again, I would like to speak about tourism for much longer, but I'm happy to introduce Karina Braga Scala with economic development.

Thank you, Ray.

Good afternoon, Karina. Good afternoon. Economic and international development, starting as everyone else is with our mission statement up there for the department. We often summarize this in kind of two bullet points, which is working to diversify the tax base and create and retain those quality jobs for El Pasoans. As you've heard on major variances, no different here. We have the deletion of an FTE and then some adjustments which we'll talk about in the grant programs category. And then other major variances here is a reduction on non-general fund budgeted expenses and that's accounted for by the fact that we expect fewer payments out of the Texas Economic Development Fund for approved agreements for this year. And then general fund positions, you see that deletion of that position, that vacancy. And then non-general fund, these are our ARPA positions as those come off the books. One, we have worked very closely with OMB and HR To transition and reconfigure some of our existing positions to provide permanent support for things like our economic development liaison our direct outreach program And then we have also added in the for build back better regional challenge grant program FTEs And now that the city is a co-recipient on that grant. I Here's our program snapshot. We were a pilot program, so I know folks are a little bit more familiar with some of these. I will highlight here one economic growth that is our largest budget item. That is where the majority of our 380 incentive agreement payments come out of. And so that's accounting for that. Economic growth also includes things like our advanced manufacturing district and international business initiatives, so some of those specific targeted industry programs. I would also like to highlight the addition this year of the compliance and transparency division, separating out the five full-time employees that we have that work on looking at our agreement monitoring, reporting, and finance to make sure that we're safeguarding those taxpayer dollars and ensuring that our performance-based agreements are performing. Strategic plan alignment obviously we are most closely aligned with pillar one economic mobility Looking at small business support so expanding those business support resources. We are at just over 50 Entrepreneal support organizations and so as we head into the new fiscal year Council will be seeing a number of items that the department would like to bring forward to Look at permanent funding solutions or longer-term funding solutions for some of our most successful ARPA programs in the small business support category Economic growth, it has come up that workforce is a big focus, not just ourselves, but some of our partners. And so as part of the 380 policy rewrite, which we did have to kick off with that consultant on Friday, looking at some of our skills training grant programs. In infrastructure, this has come up on a number of agreements, but really just looking at ways that through the negotiation of agreements or business connections, looking at options for private sector investment as we look at infrastructure needs across the city, different kinds of partnerships with neighborhoods, the same as everybody else, so funding and revenue opportunities there. And then I have a number of items starting with redevelopment and then onto the next slide, really focusing on recently adopted plans and policies or things that will be coming before council the ways that we can work on implementation actions. So a new infill and redevelopment policy is part of Envision El Paso, the comprehensive plan effort. We'll also be working on housing with Nicole Rodriguez with community and human development and the urban design programs, which you'll be hearing from. And then parks and the climate action plan. And that's it. I was like, I assume there'll be questions. If not, I can bring Nick up here.

Representative Trejo.

Okay, now I can ask the right person.

I'm going to get the binder open. What's that? Oh, okay.

Yes, so I'm looking at the binder, page 127. Okay. Professional services?

Yes.

There's a big change there. What is that?

All right, Sasha will correct me if I'm wrong on that. So some of that is, it's an increase in outside contracts. Some of that is the pickup of our ARPA licensing agreements. So some of those items that were ARPA funded, paying for those directly. We are also participants on lobbyist services for the federal lobbyist program. And then we have budgeted for the second phase of a sports facility, something focusing on youth sports and tourism. There are also approved professional services agreements with David Torres Consulting and David Pettit, and those are on file.

Okay, and then what's the other one? Community service projects.

Yes, and this came up last year. This is a funky kind of accounting item. These are payments that are actually reflected in the tax increment reinvestment zone number five obligations and budget. That payment is for Paseo de las Luces, and so that's the community service projects that name is coming from that Paseo de las Luces project, and then there is payments being made out of Terce V, so I think that's finally been cleaned up and corrected.

Okay.

And then with the employees, so it's good that there was not a lot of change in the employees. Not a lot of change. That's good, good, good. Did the employees move around to different roles?

Yes, and we do have some positions that are actively recruiting. By and large, what we did is we, one, aligned among our different kind of programs the org chart, so making sure that we had ample opportunity for economic development analysts, senior level positions, our business services coordinators. We worked this year, like I mentioned, with OMB and HR to, a lot of these were down conversions, so we do have a kind of net decrease on personnel costs to reflect you know, just where our pillars of support are. We know that small business support was going to need permanent FTEs and then some adjustments on the international program and prep work for that AMD programming as well.

With the economic development liaisons, are they still going to be going to the different districts and working with small businesses? Yes.

So we still have them. I'm going to put Ms. Alda on the spot. She gave us approval. So all those ARPA contract positions are able to be extended through December of this year when that funding expires. So we'll keep them on that as long as possible. But we do have positions available to move them into if they're good fits. We'll do open recruitments on that. But the plan is to keep Three full-time employees with the department focused on that direct business outreach across the city.

Very good.

Thank you.

Representative Nino.

Thank you, Mayor, and thank you, Carina, for your presentation. You know, small business support is extremely important, and I know that I've mentioned previously how in District 5, there's a lot of investment happening with a lot of small businesses popping up everywhere. Now, I do see on your staff table, in regards to the economic development liaison, you had four in 2025, 26, but in 27, you went down to three. Is there a reason to that?

We have already promoted one of those, so we went ahead and also deleted that ARPA-funded position.

Okay, great. Now, does that still mean that we're still going to be doing the same outreach? I know that we had different liaisons by district that were visiting different businesses to ensure that we were providing the resources for them.

Yes, so the BOSS program, so the business one-stop shop, I said I'm laying the new little pins if anybody want one. We are switching that from the four liaison program to the three, but a part of that is also our long-term sustainability strategy for that. So we've really bolstered with the assistance from strategic and legislative affairs and other folks, our grants programming, which will give us some access to some different funding opportunities and some different programmatic opportunities. We've hugely expanded our partner network. I think it was about 30 this time last year, so we're on track to double it by the end of this fiscal year. And so really looking at ways, I think, again, story of the day for many of the departments, efficiency in those resources. So we'll still have dedicated liaison programs. That boss, like mainline, email address, that sort of thing can be used. But the actual coverage may vary person to person. But at least for now, it's the same for folks that you all have been working with.

Okay, great. No, that's important. Because again, I always want to ensure that the small businesses know that they have access to resources I've mentioned previously how there's been businesses that have closed down due to them not having, you know, just bookkeeping resources that we could potentially provide. I'm also curious to learn further even on the report that you provided that some of these businesses are asking for, you know, marketing, website support and whatnot. But, okay, I just wanted to ensure that we were not, you know, we were ensuring that we continue to fund that role in regards of doing the outreach within the district. So, thank you.

Representative Acevedo. Thank you, Mayor.

I was just kind of wanting to have a better understanding of what the employer-aligned skills training is. You could just go a little bit more in depth.

Absolutely. So one, I won't be the expert on this, but I know that Workforce Solutions Borderplex, in partnership with EPCC, has a state-funded skills training program. The city, as part of our current economic development policies, does also offer skills training grants. It is a component that can be added on to incentive policies. I think good examples are this has been the case for things like Eaton for Schneider. They pulled down on those. We have a number of other agreements, Champlain Cable, also and what that is is it's a per position allocations if somebody swaps out you don't start from zero and to help fund training specifically to grow somebody into a position so that way you can hire somebody who is local that maybe doesn't have a specific certification or experience or if you have proprietary company training and the city helps provide reimbursement for that as a way to kind of develop workforce from within and so we're really looking at what are our focus areas on terms of industry and And I'll be frank here also just being more competitive on the amounts that we offer we do typically 500 per employee We are seeing in other states and other municipalities the baseline being $2,000 okay, and Who is overseeing this specific program? That would be through the department. I

Your department? Yes. But is there like a team? How many people are working?

So that's compliance and transparency. So we have three compliance staff and then two on the finance side. Just like everything else, it is performance-based. It is typically reimbursement-based. So we ask for documentation of the position, the wage rate, what skills training was provided, examples of curriculum if it's not specific to a certification, right? That's very easy to say, you know, they have to get their... XYZ cert, we say, okay, we need proof that they've completed the certification, that the company paid for it, and then we reimburse them for those expenses.

Okay. And so there's no consultants on this? Because you still have one or two consultants, right?

Right.

Okay. And what are they focused on?

So it's a number of different ones. So some of them are just to kind of have capacity, right? So that's David Pettit Consulting is our tax increment reinvestment zone, but he also works on specialty finance districts. There's been, you know, occasionally there's conversations from folks wanting to start up a municipal management district, which is something that doesn't go on the city's books, but we would want to be aware of because it's a special assessment district. David Torres is focused on our redevelopment portfolio so specialty specifically housing projects but kind of things requiring advanced economic incentive analysis impact analyses that sort of thing and then he builds kind of by project by the hour so we have time accounting there and we all projects must be approved either by myself he sometimes does work for the budget office so by myself or Sasha and that gets signed off on As I mentioned, we are a department participating in the federal lobbyist contract, so we transfer that over to SLA. And then we have recently added two licenses. We're picking up the Open Rewards account, and then also Size Up, which is the business assessment and comparison tool. I think those are the major ones there. But all of those are under approved agreements through purchasing. Many of them have come before council.

Okay, that's good to know. And both of I believe you said both of their names are David, right? Yeah. Okay.

Two Davids, two Jessicas.

There's always plenty of Jessicas everywhere. The question that I guess I had on are both of those LLCs or they're still proprietors? Just that's been on my mind. You don't know?

I mean, I can make a guess. David Torres, I would say, is probably a sole proprietorship, but he's appropriate as an LLC. That's on the billing when we get the invoices. David Pettit is actually Pettit and Ayala Consulting Services. They might be a limited partnership.

OK. Thank you so much.

Thank you, Karina. Oh, Representative Chavez. Sorry.

Thank You mayor Karina for the consultants you just mentioned. How do how do we know what deliverables?

So it's her contracts It's gonna depend on what is outlined in their services agreement for things like licenses or like our 380 contract with Newmark consulting That is a one-time right that's an outline of scope of services They are going to deliver us a policy and report at the end of that and it's a one-time payment David Pettit has a scope of services that's in the backup on his contract that says, you know to do XYZ type of report and It's this much flat rate cost, or for consulting on specific projects, it's this billed per hour, depending on whether it's him or someone else in his organization. The same thing with the David Torres contract. He's got an hourly rate. He's got a scope of services for approved amounts. We approve the work that we are assigning him, and then he bills for that. We review the invoices, and that is processed.

But the work isn't tied to a specific dollar amount in terms of return to the city? It's more of a project-based or?

It's project-based. So we would assign a specific project. He would submit an invoice for those hours. That's checked for sort of reasonableness, right? We know how long it takes to run an impact report, how long it takes, those kinds of things. All that's provided in the backup. That's processed in accordance with all of our OTC and purchasing guidance.

Thank you. Thank you.

All right, any other questions for Karina? Karina, thank you.

Thank you. Nick Ibarra, man of the hour.

Good afternoon, Nick.

Good afternoon. Nicholas Ibarra with Environmental Services. So what does Environmental Services do? You keep changing on me. Oh, sorry. We provide an integrated solid waste management services to the greater El Paso community so we could enjoy a healthy, clean, and safe and beautiful environment. And I say El Paso community because we accept waste of the greater El Paso landfill from all our sister cities throughout the county of El Paso. So it is one holistic program here for the city of El Paso. The variance in our budget is 11.6 million, and this is mainly due to one-time capital expenses, which included the starting of the new permit for the Greater El Paso Landfill, and then large vehicle purchases for both our Clean El Paso Group and for the Greater El Paso Landfill. We have a deletion of four positions as part of environmental services. It says 3.5 because one of the positions was funded 50% through the TCEQ grant program. We're no longer doing the BioWatch program through TCEQ. It's something they decided to cancel through our program. Luckily, the positions were vacant, so we're deleting them to adjust for the budget. Program snapshot first is landfill operations the greater El Paso landfill currently disposes of approximately half a million tons of waste on an annual basis On average we accept approximately 1,500 to 1,600 tons per day with a group of 36 out there on site The automated garbage collection, we collect from over 205,000 customers four days weekly, providing trash service for them on a weekly basis. And then the other side, we have recycling collections, and we provide those same services, but just on an every-other-week basis to provide greater collection of the recycling bins and make sure they're full. CITIZEN COLLECTION STATIONS. WE HAVE FIVE CITIZEN COLLECTION STATIONS THROUGHOUT THE GREATER OPASO AREA. WE SEE ON AVERAGE ABOUT 2,000 VISITORS ON A DAILY BASIS AND COMBINED WITH OUR FIVE SIDES DISPOSING EXTRA HOUSEHOLD WASTE AND USING OUR COUNTRY STORES AND DIFFERENT SERVICE THAT WE PROVIDE INCLUDING HHW COLLECTION AND MULCH RETURN BACK TO THE RESIDENTS. And then one of everybody's favorite is our beautification program. That's the program that manages the 375 miles of medians that we maintain throughout the city of El Paso with our group. And with that group, we want to thank Parks and Rec and Streets and Maintenance because they've been a great partner through this whole program, helping us get back to where we're at. I think the meetings are looking great right now because of their assistance, and we couldn't have done it without their assistance working all together. The other program on this next sheet I want to mention is our container management program. We purchase over 20,000 carts on a daily basis. Those are the gray and blue bins that you have at your properties. I know 20,000 doesn't sound like a lot, but they're constantly out there. You know, they break after certain times of use, and we just want to make sure there's a proper storage location for all trash when we're dealing with a daily basis on people's properties to prevent any vector vermin or anything of that sort happening on their property. And then the last group I will speak on is our director's office. And just because our budget is a $55 million within the director's office, but that includes a $24.9 million operating transfer, which includes our capital purchases and division fund transfers to our different programs throughout environmental services. When it goes back to the strategic plan alignment, first is infrastructure. We're looking to expand our efforts on neighborhood association senior centers to provide more information on ESD programs. This ties back to the presentation yesterday when it comes to the anti-litter program. I think we need to get the word out there more about our programs. I know people know we collect solid waste on a weekly basis. We do the recycling, but they need to know about all the other programs to help reduce the recycling contamination and just reduce the anti-dumping throughout the city of El Paso. And those meetings will be focused on community cleanups, anti-littering, and recycling. And the second is quality of life. Once again, it's to maintain the medians on all the city right-of-ways with collaboration with our partners at Streets of Maintenance and Parks and Recreation. And if they have any questions.

Representative Trejo.