After at least four hours of debate, numerous motions that went nowhere and repetitive questions and comments, a divided El Paso City Council on Tuesday adopted a budget and tax rate that will increase city tax bills by about $105 on the average-value home.
The 6-2 vote to adopt a $658.6 million general fund budget for fiscal year 2027 was followed by a 6-2 vote to set a tax rate of 79.8 cents per $100 of property valuation – slight reductions from the recommendations made by the city manager and chief financial officer after months of budget workshops and meetings with the council.
City Reps. Alejandra Chávez, Ivan Niño, Art Fierro, Josh Acevedo, Deanna Maldonado-Rocha and Chris Canales voted in favor of the adjusted budget after multiple motions were made throughout the hours-long back and forth. City Reps. Lily Limón and Cynthia Boyar Trejo voted against it.
The compromised budget vote came after Chávez, Niño, Limón, Boyar Trejo and Fierro rejected the recommendations by City Manager Dionne Mack and Chief Financial Officer and Deputy City Manager Robert Cortinas.
“I believe every council member had an opportunity to provide input, use the calculator online, and here we are,” said Mayor Renard Johnson, who can only vote to break ties among council members. “We owe it to the public to get the city a budget.”
None of the city representatives who voted against the first budget proposal made any specific recommendations about where or how to reduce the budget during the city’s work session and public hearings Monday. The City Council traditionally requests final updates to the budget before it’s scheduled to be adopted.
Limón said, in part, she opposed the budget after learning that the City Council would be getting 15% pay raises as prescribed under the City Charter.
“That day (June 23) at that meeting, I knew that I was not going to be able to support this budget, no matter what,” Limón said Tuesday. At that June meeting, she called the raises “disgusting” and “criminal” and said she has donated the “vast majority” of her paycheck – but didn’t explicitly say whether she’d turn down or donate her salary increase.
LEARN MORE: Why El Paso’s mayor, city representatives are getting a 15% pay raise
Boyar Trejo said she wanted to reduce non-essential travel budgets, pause executive salary increases and reevaluate professional development expenses as a way to reduce the budget.
“I want to emphasize that our residents are reaching their financial capacity,” Boyar Trejo said.
After multiple votes, Johnson asked Mack if the reduced budget proposal was something the city could live with.
“It doesn’t gut the organization in a way that we can’t recover and move forward – just to put it plainly,” Mack responded.
Acevedo, Maldonado-Rocha and Canales repeatedly voted in favor of the first $665 million proposal that would have provided additional funding for animal services, street lighting and contingency funds for the impact of the new fire union collective bargaining agreement.
That proposed budget would have required the council to adopt the voter-approval tax rate – the highest tax rate a government can adopt without seeking voter-approval. That would have translated to an increase of about $132 a year in city taxes to the average-value home.
One of the sticking points for council members was not wanting to add to already increasing costs for residents – citing utilities, gas, groceries and tax increases being considered by other entities.
But others argued that adopting a lower tax rate and reducing the tax impact would also mean having to shave off proposed services.
“I absolutely understand what people are going through (financially),” Acevedo said. “I don’t want to be responsible for a reduction in force (or) having our parks department have cuts, whether that’s staffing or programming, our seniors rely on a lot of these services at senior centers, and they are absolutely vital to our community.”
Another point of contention was whether adopting a lower tax rate would be “kicking the can” down the road – meaning that the city would have to raise taxes even higher in the coming years to fund basic services, including public safety.
Prior to last year, the City Council had adopted the no-new-revenue rate – the rate used to generate the same level of tax revenue from existing homes – despite warnings from Cortinas that it was not financially sustainable in the long run.
Public safety contracts
Cortinas has also repeatedly warned the council of rising operating costs and public safety contractual obligations that will add millions more to the city budget as part of collective bargaining agreements.
The city is negotiating a new fire collective bargaining agreement, with the current one set to expire at month’s end. The El Paso Association of Firefighters Local 51 is proposing new benefits that would cost taxpayers about $66 million over four years starting in September. The city has proposed about $43 million in new benefits that would cost about $7.7 million for the first year and about $11.7 million a year over the remaining three years.
“It’s all going to be dependent upon how the negotiations go – so, it’s good to know that we have the budget and tax rate now adopted, so we know what we’re working with,” Cortinas said after the meeting.
The police union’s contract will expire next year. The city and union will negotiate a new contract that will impact the 2028 fiscal year’s budget.
READ MORE: Public safety spending pressures city’s long-term financial outlook
The $10 million in additional revenue that would have been generated by adopting the voter-approval rate would have gone toward street and park lights, fleet replacement for Animal Services, additional spay and neuter surgeries for Animal Services and about $8 million to the city’s contingency fund to help cover potential future costs of the fire union contract.
“I think that these are all vital…I can’t support removing the contingency as well,” said Canales, whose motions to keep the funding for Animal Services and street lights failed.
Canales made a final motion to include $78,000 in funding for spay and neutering services, which was ultimately supported as an amendment under the final budget vote.
Tax season
Other taxing entities – including the county, hospital district and school districts – are setting tax rates that will ultimately add up to 2026 tax bills that will go out in October.
In a unanimous vote Monday, the El Paso County Commissioners Court adopted the no-new-revenue tax rate of 45.1 cents per $100 of property valuation to fund next year’s budget. The impact to the owner of an average-value $229,637 home will see an increase of about $41 per year, bringing the county’s portion of a tax bill to about $1,036 this tax year.
The Commissioners Court had introduced a voter-approval rate that, if approved, would have raised county taxes on the average-value home about $164 a year.
The court will now hold a public hearing and could adopt its proposed budget Sept. 14 ahead of the start of the county’s 2027 fiscal year Oct. 1.
The Commissioners Court will adopt the tax rate and budget for the El Paso Hospital District, which comprises University Medical Center of El Paso and Children’s Hospital of El Paso, on Monday, Aug. 24. A public hearing is not required for the hospital district since they are adopting a no-new-revenue rate, county legal staff said during the Aug. 10 County Commissioners meeting.
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