Corpus Christi City Council Workshop on CIP, Debt Profile, and FY26 Budget Amendments\n\nThe Corpus Christi City Council held a workshop on August 28, 2025, receiving presentations on the Capital Improvement Program (CIP), an overview of the city's debt profile, and a wrap-up of proposed amendments to the FY 2026 operating budget. No formal votes were taken during this workshop. The meeting began with a roll call by City Secretary Rebecca L. Huerta and a quorum was established.\n\n### Presentation on the Capital Improvement Program (CIP)\n- Jeff, from Engineering Services, presented the CIP as a 10-year planning document updated annually. He highlighted a record year for project delivery, with 85% of FY25 CIP projects (229 of 272) on schedule and a record $624 million in contracts awarded.\n- Engineers reviewed the FY26 CIP, which totals $765 million across 243 projects, including 33 moving from long-range to short-range planning. The largest funding sources identified were revenue bonds and SWIFT funding.\n- Councilman Hernandez raised concerns about a lack of clear project prioritization across departments, noting most projects are designated as "Priority Level 1." Staff acknowledged the request to further rank projects and will explore providing a ranked list.\n- Councilwoman Campos inquired about the status of unspent 2018 and 2020 voter-approved bonds, particularly for North Beach projects delayed by the Harbor Bridge alignment and permitting. Staff confirmed these projects are now under design and construction.\n- Councilwoman Vaughn and Mayor Guajardo discussed the efficiency of the city's two grant writers, noting $35 million in awards so far in FY25 against $38.9 million in applications. Staff confirmed a recent report on grants awarded will be shared with the council.\n- Councilwoman Paxson asked about the Nueces Groundwater System funding and the reclaimed water feasibility study, confirming both are in progress but awaiting further council action and study results.\n- Councilman Scott expressed desire to see the full master plan for the North Beach area post-Harbor Bridge demolition, which staff committed to providing.\n\n### Overview of City's Debt Profile and Bond Planning\n- Financial Advisor Victor Keogar presented the city's debt profile, noting strong credit ratings (AA/AA2 for GO debt, AA- for Utility System debt). The city's 10-year CIP is viewed favorably by rating agencies.\n- Recent financings were highlighted: a $300 million utility system bond issuance in June was 4 times oversubscribed, and an $84 million GO bond issuance in August came in under budget (4.39% interest rate).\n- Outstanding debt stands at $578.6 million ($1,221/capita) for property tax-supported debt and $1.45 billion ($4,575/capita) for utility system debt. A key concern raised by Councilman Hernandez was the total increase in principal and interest owed, which rose by $600 million to a total of $3.1 billion in the past year.\n- Councilman Roy explored how Industry Development Agreements (IDAs) affect the city's credit rating. Mr. Keogar stated that if IDA properties were fully within city limits, it would be a credit positive but acknowledged the broader service implications.\n- Councilwoman Campos raised concern over potential state legislation (Senate Bill 10) limiting property tax revenue growth to 1%, which would severely constrain the city's budget.\n- Councilman Scott directly asked Mr. Keogar if he was comfortable supporting the FY26 CIP and 5-year plan. Mr. Keogar responded affirmatively based on current projections and capacity.\n- Councilman Hernandez questioned the city's debt limit and state legislative trends (House Bill 19) that could cap debt as a percentage of tax revenue, suggesting the council should proactively consider reducing the I&S tax rate from 22 cents.\n\n### Proposed FY 2026 Operating Budget Amendments\n- Amy Cowley, Director of Management and Budget, presented amendments to the proposed FY26 budget based on community input and council feedback. Seven community input sessions were held, averaging 40 attendees each.\n- Key changes in the General Fund include: restoring $50,000 to the libraries for books and periodicals; restoring a branch manager position at the Heart Library; and removing 16 part-time lifeguard positions slated for the next fiscal year.\n- Staff recommended reinstating the street user fee at $6.67 per month (generating $11.3 million for street maintenance). Councilman Hernandez and Mayor Guajardo expressed strong opposition to adding this fee to the utility bill, arguing it could harm low-income residents and that funding should come through the normal tax process or a new bond referendum. No consensus was reached.\n- Technical corrections were made to the vehicle and equipment replacement fund and the engineering fund for new positions.\n- Councilman Hernandez requested an additional $53,000 for the City Secretary's office to fill a position. Staff confirmed this would be added to the Tuesday agenda.\n\n### Key Outcomes\n- No formal votes were taken, as this was an informational workshop.\n- Direction Given to Staff:\n - Add funding for the City Secretary's office position to the Tuesday budget agenda.\n - Create a CIP project page for the Evangeline raw water supply project in the FY27 budget document for public reference.\n - Consider moving community budget input sessions earlier in the process and exploring additional outreach methods to increase participation.\n - Provide the council with a detailed list of grants applied for and awarded.\n- Continuation Items: The council will continue discussion on the proposed budget, including the fate of the street user fee, at the first reading and public hearing on Tuesday, September 2, 2025. Final adoption is slated for September 9, 2025.