We are ready to go.

Good morning, Mayor.

And good morning, everyone.

This is a work session of the El Paso City Council for Monday, February 16th, 2026.

It is 9 02 AM.

Mayor Johnson is present and presiding in Council Chambers, along with Mayor Pro Tem Chavez, Representative Acevedo, Representative Malonado Rocha, Representative Boyatrejo, Representative Nino, Alternate Mayor Potem Piero, and Representative Limon.

Mayor, we have a quorum.

Okay, thank you.

Uh Representative Nina, would you lead us in the pledge of leaders?

I pledge allegiance to the flag of the United States of America and to the Republic for which it stands one nation under God, indivisible of liberty and justice for all.

Thank you, Mayor.

Okay, Miss Brian, let's take item number one.

Yes, sir.

Item number one is presentation and discussion on records outreach, which includes programs consisting of Keep Al Paso Beautiful and affiliate of Keep Texas Beautiful and Reconnecting with the Disconnected, currently working with environmental services.

It seeks other partner opportunities with the City of El Paso to increase outreach to the cities at risk youth, seniors, and veterans.

Okay.

Good morning, how are you?

Good, good.

I guess I'm I'm a little short.

I brought my team with me this morning.

They left me on the bench.

So I just want to introduce myself real quick, uh, and then also my teammates.

So I'm Miss Wrecker.

Uh I'm the owner and operator of Wreckers Outreach, which is a transitional housing for homeless veterans, and reconnecting with the disconnected, which is a youth program for at-risk teens.

Um behind me the gentleman is Jeremy.

He is my secretary for the youth program, uh and the vice president for my transition house.

And then we have Miss Christina, and she is our program development manager uh for both of them.

Um so that's that's my team.

Great team.

Uh so yes, today uh I just want to talk about partnering together um in conjunction with cleaning and making El Paso stronger as a as a unity and a collaborative team.

Um I don't know how to there we go.

So reconnecting with the disconnected is the youth program.

It's a and then Wreckers Outreach is the veterans program.

Um together they are we are the affiliate for Keep Texas Beautiful.

Uh we believe that together we're transforming the lives of neighborhoods, one block, one family, and one opportunity at a time.

We're a little unique.

Uh some of the challenges um that El Paso faces, right, are the at-risk youth giving them that purpose, the motivation, and the positive guidance and leadership.

Um so many many young people face truancy, uh, minor offenses and lack of structure or mentorship.

So we're trying to kind of combat that.

Um so we have an eight-week program.

It's very structured.

Two hours a week they do social emotional learning uh with myself and Miss Christina.

And then on the weekends we do five hours of community engagement.

So that involves a variety of different things, but a lot of it is is cleaning, uh, helping the elderly or the disabled or veterans.

Um we'll hand out goodie bags to those that are in need of bedding, clothes, shoes, um, personal hygiene items, and then neighborhood clin cleansiness and code compliance.

So senior and veteran residents struggle to maintain their properties due to financial or physical limitations.

So we have a partnership with Desert Rescue 915, and we've also been working with Sun City Pickers.

Uh Desert Rescue 915 is a partner of our organization for the Key Texas Beautiful Affiliate.

So he focuses more on the illegal dump sites, and then Sun City Pickers does the litter pickup, and then we do residential cleanups.

So anybody who is financially or physically unable to perform it themselves, they're able to fill out an application, send it in, and then we prioritize it by tiers.

So we have tiers one through four.

So these issues affect the safety, the pride, and overall community well-being.

I think that having them out, we've we've gone to a few of the different district cleanups, and it really at first in the morning the the kids will kind of be a little hesitant, but then by the time they're done there, it's they're really turn themselves around and they get to have that one-on-one interaction with the with the representatives that are out there, and and that means a big deal to them.

Um so I think that that'll help with the connections and expanding that outreach to our our youth to let them know that they're there are positive interactions that they can have, and they and it's bigger than just their immediate foxhole, right?

Um this is their home, and I want to be able to show them and with partnership and expanding this outreach, it'll it'll allow us that opportunity to show them that they can have in fact a positive impact uh on their community and then promoting civic pride and environmental responsibility and public safety, right?

It's all about education and showing them like if we if they're out there cleaning it up, right?

The likelihood of them being one of the ones doing an illegal dump later is slim, right?

Um, because well they know that they're putting in that hard work.

Uh just the last community cleanup we did was an illegal dump site with um Desert Rescue 915, and we picked up 201 tires, right?

So they actually get to see how they can how they get to make a difference, right?

Um, and there's no judgment when they're with us, and I think that that's one of the biggest things.

So reconnecting with the disconnected as a youth program, their purpose is to empower youth ages 12 to 18 through education, accountability, and service.

Um, some of the program highlights is an eight-week curriculum combining life skills, mentorship, and emotional learning.

A lot of it is they don't really know how to deal with those emotions that they're going through their their children, right?

They're learning, um, and then it's just trying to figure out like how how can what can they control, right?

Because you know, sometimes they'll stress over things that they have absolutely no control over, um, and they just kind of figure it out in different means, right?

Or they're they're seeking attention and they're getting it in the means that may not always be positive.

Uh so we try to give them that positive encouragement and the positive and um involvement in their community, and then weekly community engagement products.

So, again, it's a minimum of five hours.

Um, part of my program, the requirement is to improve their grades and attendance for school.

Um, so if they have a tardy or an unexcused absence throughout the week, they owe me an additional one hour of community engagement.

So if they're late to three classes that week, they're gonna give me eight hours instead of five, right?

Um so that kind of gives them the the accountability and makes them understand the importance.

So the impact is to build their confidence, prevent recidivism, and strengthen families and community bonds.

Um, the last four weeks of our eight-week program, we do involve their guardian or caregiver.

Uh we do some communication exercises and training and uh get them to kind really build on their relationship.

So one of the biggest things that we are trying to expand this year is our senior and veterans lawn care and cleanup initiative.

Um we have we've done a lot of the illegal dump sites in the community, you know, park and area cleanup neighborhoods, um, but we really want to start expanding on the senior and veteran lawn care.

So there is an application on our website where anybody who is physically or financially unable to perform the task themselves are able to fill it out.

Uh, we also have third-party um referrals.

So the goal is to maintain a safe and healthy and code compliant homes for seniors and veterans unable to perform or afford the maintenance themselves.

Um services include the lawn care supplies, volunteer cleanup, um, trash bin distribution and temporary dumpsters, depending on what needs to be removed, um, debris removals and property revitalizing.

So a lot of it is, you know, we we just want to make sure that we're improving the neighborhood safeties and beautify the community and honor those who who served our country.

Uh I myself, as is Jeremy.

Uh Jeremy is a veteran and I am still a active duty soldier for 21 more months.

Um, so that is near and dear to our hearts.

So that is, and it also gives the students an opportunity to speak to somebody who's had a very uh impactful experience.

Um, whether it's the elder, whether it's their seniors or their veterans, you know, they you've gone through things, uh, and it gives the students an opportunity to speak to somebody else who has gone through things in their life so that they can see that you know, with the right with the right guidance and mentorship, they can in fact control their their destiny.

Um so currently um we have partnered with the environmental services for waste disposal coordination, dumpster support, tools usage, and the the CCS passes.

Uh ESD has been amazing since our partnership.

They have ensured that we have the proper tools and PPE to make sure that the kids are able to do it safely.

Um there's we have knock on some wood, right?

Uh we've zero injuries thus far.

Um but the PPE is really important to us, um, but it does get a little expensive.

So through environmental services, they've been able to assist me with that and the CCS passes so that we can in fact dispose of what it is that we're cleaning up.

Um, some of the partners that we would like to seek this year is code enforcement, so we can get the referrals and the property identifications and neighborhood associations, the community outreach and residential engagement or resident engagements, right?

So uh just this past weekend we did an event with the um Ralph Cloud Bel Air Neighborhood Association.

Uh we did some tree planting at one of the parks.

It was amazing.

Um the kids had a lot of fun.

It was 25 trees.

We're supposed to be there till 12.

We were done by 1150 or like 1050, I think it was.

Um, so again, once they get out there and they they see that they get to have that impact, it's great.

Uh, and then city representatives, right?

So we would like to coordinate with each and every last one of you to participate in a minimum of one cleanup per district annually.

So I know like we we've worked with district three and district four, we've done a district seven, uh, and we've done a dish one district five.

Um so I truly we want to make it so that uh we can collaborate together on your community cleanups so that we can get the kids out there with you.

Uh because this the students that we get, they're they're from all of El Paso.

It's not just one district or you know, two districts.

It's we cover all of El Paso and it is open to to everybody.

So we would just like to partner with each and every last one of you this year and make sure that we're we're doing at least one per, right?

Um so how city support makes an impact.

Well, with the city collaboration, we can increase the cleanup capacity.

Uh last year we did 50.

Um I would like my goal is to do 150 homes annually.

Um again, it is an eight weeks where we're doing community engagement every seek single weekend, and there are some that require additional hours.

So sometimes we'll be out there on a Sunday because I really it is really about accountability and making them understand the importance of their choices and what control they have.

Um so uh we engage we want to engage over 600 youth volunteers each year.

I've in the last year we've had 266 students enrolled in the program.

So uh with now we have a partnership with East Leta High School, so it is a last effort to before East Leta High School brings their students to truancy court, they are uh offering them my program in the school on Wednesday nights.

So right now it's just one high school, right?

But um we're gonna use it as a pilot and hope that we can reduce the number of truancy cases that are actually brought to court.

Um, and then that'll also help us raise the number of youth that are engaged.

Um reduce the bright the the and code violations um by 25% in targeted zones.

Uh I really want to work with code enforcement this year and kind of see how it is that we can help them with the most success.

And then building lasting civic pride and intergenerational cooperation, right?

It's all about knowing, you know, who's in your community and what do you have, like what are the resources, what's available, and who's there?

Like what did you do?

Right?

What makes you you?

Because everybody has their own story, uh, and I think that it's imperative that we teach that, right?

Um so partnership opportunities, we're looking for referral support, so I to identify the eligible seniors, veterans, and the youth, right?

Um, so it's not just about you know who's gonna who needs help with the cleanups, but also opening the doors for the the more youth to come in and not wait until they're referred to be there, but you know, just word of mouth, it's it's spreading and it's it's going far and wide pretty quickly.

It's it's spreading and it's it's going far and wide pretty quickly.

Uh we actually have a few word of mouth students this time around on Monday nights, um, that they they weren't um court ordered due to truancy.

Um it was actually the fact that their friends had to come through my program, and the parent was like, How do I how do I get mine in there?

Fill out an application, right?

Um so and Miss Christina is a parent of a student who went through the program and graduated successfully and has turned himself around.

So uh it's really all about the collaboration and the teamwork that we have.

So resource sharing, um working with getting dumpsters and supplies and safety equipment.

Again, the PPE is probably one of the most important things.

ESD has really done a great job of taking care of us to make sure that we have functional tools and gloves and hats.

Um the more we can collaborate together, the the better off we'll be, and then join events, right?

Residential cleanups, beautification days and community cleanups.

Whenever you guys have yours scheduled, by all means, please please reach out.

We will be there, right?

Um it's all about collaboration and working together.

So we really want to be there to support you in your efforts.

Um, and then in return, I just ask that you help me support my youth uh and understanding that they can overcome any mistake that they've made.

And then education awareness, right?

Co-branded campaigns with Keep El Paso Beautiful.

We are the affiliate for Keep Alpha Keep Texas Beautiful.

Um, so we're really just trying to get that brand back out here in Al Paso.

It's been a it's been a minute since um Keep Texas Beautiful has had an active affiliate.

So uh we just kind of want to show the pride that we have within our own community.

And then sustainability model includes you know volunteer engagement through middle and high school civic groups and local colleges.

We have a out of the last uh two classes ago, we had 11 students graduate, seven of them still return every single weekend.

Not because they have to, merely because they want to, right?

Uh to me, that is amazing.

I have students who uh they have three opportunities to continue.

They can either just show up on the weekends and do community engagements, they can show up on the weekends and lead a community engagement, or they can become student instructors.

I have three that are from uh two from the one class of 11, and I have another one from five classes ago, who are in fact student instructors, they are learning how to teach this program themselves so that they can really make a difference to their peers.

And then in-kind support from local businesses and nonprofits, and then federal and private grant partnerships for long-term funding.

Um that is something that myself and Christine are are are learning, right?

Um, so we are an official 501c3.

So we are now in the process of learning how to do grants and funding and fundraising.

Um Paso del Norte Community Foundation has taken us under their wing to teach us the ropes, and I'm super excited to learn.

Um, but that's how we plan to sustain where we're at or what we're trying to do.

And then our annual goals is for our us to you, we want to participate in a minimum of one cleanup per city rep and commissioner per district, um, and then complete at least 50 residential cleanups.

Um the more the better, right?

Uh, because that's just the the more beautiful that this city will become, right?

And then successfully empower at least 600 students, and that's my outstanding.

That's incredible, all the great work you guys are doing, and the kids that are referring to other kids and they show up and they're not even in the program.

Yeah.

That's fantastic.

Uh representative Lamont.

Thank you, Mayor.

Good morning and congratulations, Ms.

Wrecker.

It it it was um I have the opportunity to work with you and the students at a cleanup at uh the Ralph Cloud earlier this year.

And it took me a little bit uh flashback to the students that I served at Cesar Chavez Academy.

Um really the kids that were the outcast got in trouble and were really written off.

And I could see a sense of belonging uh with the group.

Um I took the time to visit with most of them, find out what school they came from, why are you here, and those kinds of things.

And I'm really very happy to hear that you have some students that are now as what we would call by choice students that decide that they want to be a part of this program, that they're they've learned something.

There's something meaningful about it.

I am ready to go.

Um this weekend and driving uh down Yarborough.

I remembered a constituent who is suffering from stomach problems, elderly man, and the two women next to him on either side are much much older.

And the parkway, which faces out to Yarbrough, he has done the the task of cleaning up for all three of them over the years.

And I saw it was a little bit overgrown, and I thought, hmm, we need to help them.

I'm gonna reach out to you.

I my staff and I will be there with you.

Um and hopefully we can get that project started pretty quickly for them because it it would hit so many aspects.

Working with the youth, working with at risk youth, working with our seniors, and beautifying the area.

So we'll reach out to you and thank you and congratulations.

Wish you the very, very best with this project.

Yes, ma'am, thank you.

Thank you.

Representative Nino.

Thank you, Mayor, and thank you, Ms.

Wrecker and Jeremy for serving our country as well.

Um I've been waiting for this presentation for some time.

I know I've had a great conversation with Ms.

Mack and ESD and also with Tracy at the Paso Norte Community Foundation when the first conversation came forward about Cube O Paso Beautiful.

But I wanted to thank you for empowering our community, our youth, um, you know, to become civic litter leaders and take pride in ownership in our community.

This is really about working together for a better opaso, and I'm extremely grateful that there's organizations as you, yours, and you know, does it risk when I want to five?

Because at the end of the day, I know that it's a priority for all of us of this council in the city of El Paso to help King El Paso keep it beautiful as it is.

And um, again, you know, who we're here to support you.

I'm you have my full commitment of supporting you and the organization as well.

And again, thank you for this presentation.

It gives us really an in-depth uh of all the efforts that you're doing, including you know, empowering 600 students a year, and again taking that pride in ownership in our community.

So sorry, excuse me.

Um, thank you for for taking part of this initiative and helping our community.

Thank you.

Representative Trajo.

Thank you, Mayor.

So Mantha, thank you for all that you're doing with our youth and in our community.

You know, uh sharing life skills, but you're also showing them leadership skills as you're going through this program.

Um, you mentioned that this is our home.

This is their home, and they're making a positive impact in the community.

Uh, but they're also taking pride in the community, and that's also very, very important.

Uh the services of assisting our our seniors and veterans, those services are invaluable.

Uh, you know, I often talk also about you know, our seniors are veterans, and then those that can't they they can't clean up their home, and and it could possibly be a single parent, right?

That does not able to do that.

And so you know, I really appreciate all that you're doing for our community.

Um looking forward to the cleanup that we're doing this weekend.

I appreciate you having your students at our at our cleanup in the in the past, and we're you know, really looking forward to collaborating with you this coming year on additional cleanup.

So thank you again for all that you're doing.

Absolutely, thank you.

Representative.

Thank you, Mayor.

Uh, thank you for this presentation.

It's it's very enlightening to hear all the work that you're doing, and I I know that my constituents in one way or another have been asking for something like this.

I had no idea this existed, so I really appreciate how you went over the entire program.

I have a few questions related to some of what you said, and um the referral support on site night you said identify eligible seniors, veterans, and youth.

What what is eligibility look like?

Um, so as um District 4 rep stated, it's for seniors disabled or or veterans who physically or financially can't afford um to do it themselves.

Um, and then so there's an application process, they fill it out and they they get they get placed in a tier one through four.

Uh if they have been visited by code enforcement or ESD, um they end up in tier four, which is like the highest priority for us.

Um, and then we try to get out there within 15 days.

Again, our community engagement is only on the weekends, um, but there'll be some most weekends we'll do Saturday and Sunday.

Um so the referral is you know, either a neighbor could could send a notification, they can contact us through the website, uh, ESD can reach out at we're we're open.

What however that communication comes through, uh just like um district seven, rep, she's absolutely I drove down here, all right, Miss Wrecker, I'm gonna call you.

All right, Miss Wrecker, I'm going to call you that we'll absolutely take it.

And then you know youth is the same thing.

Right now we're working with um precincts two and five for truancy.

We have an ongoing partnership for a pilot program with East Leta High School.

And I'm currently in the works with I just had a meeting with the West Texas juvenile Justice Department director um who is coordinating a meeting with me and the El Paso Justice Department director so that we can also try to you know again it's it's about minor offenses right we all make mistakes we're all we're all learning who we are and you know what's important to us and sometimes we slip and sometimes we make mistakes.

My philosophy of it is you can overcome a mistake if you choose right it's nobody should be able to hold you accountable or hold you responsible for that mistake for forever.

You gotta be given an opportunity to overcome it right so I tell the kids all the time you gotta overcome the mistake not live by the mistake.

So I was a I was a kid once I grew up in the foster systems.

So I know what it's like to to do what I feel that has to be done in order to get where I need to be to handle the things that must be done.

Right.

And again now here I am I got 19 years 11 months in the army right and you know I I'm a business owner and you know not to toot my horn right but I think that I've I've made a pretty decent impact on the those that I do interact with in one way or another.

So it's all about the partnerships and collaboration but most importantly to let these students know that they can overcome anything they just have to want it.

Yeah that that's that's incredible work and thank you for sharing your story.

Because that continues to come up at community meetings as well.

Why isn't JPD helping in this sense?

So that would be a perfect partnership for what you're doing.

So you would be okay if my office started showing up to people's houses that call us or something and we give them the application and fill it out and help them do that.

Yes absolutely no that's that's what we got a team for that I am no longer a one woman show.

Good when I started it was uh it was rough uh I was running the transition house I'm an active duty soldier and the youth program and uh I'm also a single mom of three kids and I just adopted another one.

Wow so I at first it was it was a little rough and you know uh shaky at the start but you know uh my team is growing and and we're strong and we're ready so well thank you for your leadership that's that's that's amazing.

Um I have a few more things that I wanted to ask it does this look like a formal partnership that you want to do with the city or is it more let's just kind of have this um referral system going and we work with Mr Ibarra or we work with council offices and that's that's the idea.

So he is um my secretary and I believe I just don't want to speak out of turn I believe that yes we are looking for a formal partnership um so that we can ensure that fairly and evenly across the board we are helping every single one of you in each of your districts.

Okay that sounds great.

Correct I don't know Mr Butter has something or sorry um and one one other thing or did you want to say something sorry Nick Nicholas I for the record yes uh we are working with legal to get a formalized partnership together with uh Ipo Passab Beautiful so all of Ms.

Records group so we are working on that to to get that formalized uh through legal because of the use of the citizen collection stations and eventually probably the Lamp also just to have everything on record and and connected.

Okay so today's kind of an intro what this is and in the next few months we should expect some other item on the agenda to approve a formal partnership.

Yes and then it'll be included as part of the item that uh Rev Ninja brought up about the last meeting that to it'll be all bundled together as a okay that makes a lot of sense I appreciate that.

One one other thing that I I wanted to bring up was in the last year there's been conversations that we've had at council over people that have liens and a lot of those people from what we kind of experience in in our districts seem to be seniors that cannot clean up their yards and then now they have a lien and I think this would be a great avenue toward preventing those liens and working that in the partnership to say well we don't want to get them through code enforcement and make them go to court etc and we could prevent liens so I'm hoping that's kind of the conversation that you're having.

And we could prevent liens.

So I'm hoping that's kind of the conversation that you're having.

Yeah, but yes, the the way we're looking at it is that if uh we provide her a list of the the properties that are needing to be cleaned, we'll work with the code department and also put like a delay on uh getting the clean-out passel group to clean up the properties that way we'll provide additional time for those uh residents because we know she's gonna get a lot of referral, so we'll be able to work with them and determine when we could if um we could help them out uh through her program.

Okay, amazing.

Thank you so much for everything that you're doing.

Thank you.

Representative Rocha.

Thank you, Mayor.

Thank you, Miss Wrecker.

Good to see you see it all worked out okay.

Yeah, this started as a project last year, last year, and it was something that evolved with uh Ralph Cloud Neighborhood Association, JP5, you myself.

We were we kind of work through it, and it's so great to see you where it's at today.

Um I think this is the the best way to be able to provide it available to every person that's that's in need within the county now, which is just remarkable on your part to be able to uh, you know.

I know we sat on a call, seems like what, eight months ago, six months ago, something like that, trying to work out and hash out these details, and you all just ran with it.

And congratulations.

It you know, honestly, congratulations on seeking the Texas uh keep Texas beautiful, keep El Paso beautiful, just way to way to really just hold on to that goal and move toward it.

The kids are amazing.

We've worked with them, I think, on every single cleanup, every tree planting that we've had.

They definitely need uh mentors that are out there that are willing to just share your time and and your life experiences with.

And I have been it has been an honor for me to work with your your kids in this program.

A real privilege to be able to see where they go once they're complete.

So congratulations again.

I can't wait to see what it what the future holds for you all.

Thank you.

Thanks.

Yeah, Miss Wrecker, congratulations on all the success and and thank you for your service to this country.

And thank you for all you're doing to keep uh our city beautiful.

We really appreciate it.

It's good to see your team is expanding.

And this is a small but mighty team, and it's only gonna continue to grow.

Thank you.

Yeah, thank you so much.

And for the record, Representative Gonales joined the meeting at 9 05 a.m.

May we go to item two?

Yeah, that's it.

Thank you, Ms.

Record.

Item two is a presentation and discussion on the FY2027, 2023 one multi-year financial outlook, five-year financial forecast, key revenue assumptions, major cost drivers, and FY2027 budget timeline.

Good morning.

Good morning, Mayor and City Council.

So this presentation is a presentation that we do every year on something that's aligned in one of our our budget policies that we come forward and bring a long-term outlook.

So this presentation is going to cover the next five years, 2027 through 2031.

Um, I'll present the first few slides, introductory, and then the revenues and then Sasho and Donoski will pick up the expenditure side and then cover the summary at the end.

So it's already been a year.

It seems like it was just last week that I was doing this presentation for you on.

So I last year you all may remember that I started with by saying this five-year forecast is exactly that.

It's just a forecast, it's a planning tool.

That's a document that's really intended to guide discussions, particularly right now.

I think the timing is perfect to have you all are about to lead into your strategic planning session next week, really to help identify long-term issues, but also long-term opportunities that come along with it.

Um, so really again, just really understanding a lot of the fiscal constraints.

Um, Sasha did a presentation for you all a few weeks ago talking about some revolute revenue limitations.

We did a presentation covering the ARPA, the American Rescue Plan Funding, and how we were able to utilize that funding source over the last few years to help um implement some new or expanded programs on the public safety and public health side and some other departments as well.

Um but really with this again is intended to serve as a planning tool.

Um, and so with that, again, this provides the opportunity to be proactive and not reactive to again better understand the issues and the challenges ahead.

But as I mentioned, along with that comes the opportunity again to take advantage of some potential opportunities as well.

Really, this slide I think really sums up the whole presentation, and it's really that balance.

It's balancing the available revenues that we currently have, and then how do we offset that with our increase in expenditures?

We talked about that structural imbalance quite a bit because with that comes revenue limitations, obviously, that we face currently.

But then with that comes, what are we going to do to ensure we're maintaining or continue to do to ensure that we're controlling our expenditures as well?

And so, with that, again, a lot of discussion, and you'll see that here in the next few months as we roll out the program-based budgeting for all of us, our city departments, really just be able to better communicate not only with the mayor council but with our community as well as to where their tax dollars are going.

So I don't want to get too much into this because you're going to hear a lot of this information next week in the strategic planning session, but it's quite simply these strategies can't be implemented without funding.

We need available funding in order to be able to execute a lot of priorities.

Not only existing priorities that we currently have that we need to add additional funding to, but new programs that continue to come up.

It seems like every year limited flexibility again.

We have continuing increase in our expenditures, just like our homeowners and our businesses, the city continues to face increased costs as well, whether it's on the labor side or with the contractual obligations that we have as well.

When we talk about balancing the budget again, a lot of discussion, and this mayor council took quite a few proactive steps this past budget process by again limiting the use of fund balance in order to balance the budget.

Restoring some funding that we had deferred or reduced in prior years for our facilities and our vehicles.

State legislative impact, something that again really leading into the strategic planning session next week that we should probably keep at the forefront of some of the discussion that we have.

So you all may have saw the article that came out late last week, the governor's five-step plan to further reduce property taxes.

And so with that comes potential further restrictions or limitations on what the city's able to do, not just on property taxes, but there's some other revenue sources that have been impacted in the past.

And so, again, something that we just need to keep at the forefront as we already face revenue limitations.

Again, what are potential uh further restrictions that we're gonna have and new as far as generating the revenue that we need to fund our city services, setting appropriate cost recovery plans, so something we're working on.

We've talked a little bit about.

So we do have a consultant on board that's helping us review our uh parks fees and our planning inspection fees, and we'll bring that forward when that study is done, just to look at how we are currently recovering fees and what those current services are currently costing the city, and then coming up with the plan on going forward what we want to do as far as the cost recovery on those fees.

On the expenditure side, again, I talked about the increasing expenditures.

Again, no surprise here.

The biggest expenditure that the city has is our labor, our workforce, not only our police and fire uniform employees, but all of our civilians as well.

The push has been to get to that living wage target, which we've had a lot of discussion about.

We've made tremendous progress in the last several years, increasing our minimum wage, not only for our entry level, but adjusting the pay for all of our city employees as well.

But we need to continue to push in order to get to that living wage over the next several years.

Um, the health care is something that the city has continued to absorb all of those health care increases over the last eight years.

It's becoming quite burdensome on the city side to be able to continue to take on that additional burden, and so want to be very thoughtful about how we go about increasing the pay, but at the same time, not offsetting those pay increases with increase in health care costs for our city employees.

Um collective bargaining agreement.

So we are currently about to begin negotiations with the fire union on their new agreement.

That agreement expires at the end of August.

And so we've already reached out to them.

We'll begin scheduling those meetings.

We know that there's more than likely going to be increased cost or some negotiations that are going to require some very thoughtful, again, long-term review to ensure one that we're operating within the available revenue that we have, not only in the coming year but in the future years as well.

And so these agreements are very, very important.

One to ensure that we're being competitive as far as retaining and recruiting new uh firefighters and police officers, but at the same time, we have to ensure that we're being fiscally responsible and ensuring that we have the available resources and able to fund these agreements over the coming years.

And then the last point here is very, very important the debt versus pay go, which is the annual cash that we have in the budget for our essentially our capital projects or smaller capital replacements, so vehicles, our city facilities, our street maintenance.

Really, the intent and the push should be to get off the use of debt to be able to do a lot of those things.

I did a presentation of FOAC, which I'll post as backup to this presentation as well, so you all, if you haven't seen it, can see that as well.

Again, but what we've been able to do by lowering the city's debt, and again, one of those keys has been utilizing cash to fund a lot of those things and not having to rely upon debt to do those particular purchases.

So as we move into the uh revenue side here, and then Tush will cover the expenditure side.

Just remember again that this is not a budget, these numbers are not set in stone.

These are preliminary estimates just based on historical data that we used in order to populate what it could look like.

And I think the the key takeaway here is, and you'll see this.

I I found this quote and I thought it was very good.

That the biggest risk is not doing anything.

And so that's really the sort of the key takeaway is this assumes just based again on preliminary estimates for revenues and expenditures, not doing anything to change what we currently have in place.

This is what we're facing again.

So just remember that that planning tool, these numbers will change.

Um, so we'll talk a little bit about property valuations, we'll talk about sales tax.

Um, I'll cover the revenue side as I mentioned.

Sasha will cover the expenditure side, what we're looking at as far as public safety, um, and then our workforce and the compensation adjustments that uh we'll have for the next five years.

And then this, I know that we saw somebody send out an email in regards to this particular slide here and talking about a 205 million dollar deficit.

Want to be clear again that this is a planning tool, and so this is looking at currently the revenue that we have in place, the expenditures that we're facing, again, no adjustments to future years.

Well, we all know that we don't sit around and do nothing.

This is our jobs, that not only the city manager and all of our city staff, but the mayor and council with what you all do and setting the vision for the organization, and so there will be adjustments to this.

Again, this is based on currently available revenue projected out for the next five years, currently available expenditures of what we're looking at again for the next five years as well.

But there is one key to this slide is that if you look to each of the years going forward, is that that gap continues to widen.

And so, one of the things that you're gonna see and hear from us is that currently, right now, with what we're projecting, the two biggest revenue sources in property tax and sales tax, the other sources very, very minimal growth is that our revenue growth growth is about 2.3 percent a year going forward, but the expenditures are almost doubling that at over 4% each year.

So that's currently with what we're projecting as far as what's built into this model with the projected property valuation, sales tax growth, and then what's built in for our main expenditures and those cost drivers.

Same information just in the table format.

And so, as we look to again the revenue side here, again, you'll see property taxes there, the green portion, sales taxes, the blue portion, those two revenue sources make up almost 72% of our total general fund revenue.

And so, as you'll see here in the next few slides, it's really those two sources right now that we rely upon for our revenue growth to be able to fund the increase in our expenditures.

You have here the table of what we're projecting out by revenue category, and so as I mentioned, if you look at the bottom line, the net percentage increase, averaging right around 2.3% going forward.

Again, based primarily on property valuations of what we're projected in the future sales tax growth over the next five years.

We talked about this a little bit.

I'm gonna skip right over because this is these next couple of slides are really the key on the revenue uh projections.

So we've been very, very lucky because it's not luck, but we've been able to benefit tremendously from strong property valuation growth over the last few years.

Uh, you'll see 2023, 24, and 25, almost double digit growth in property valuations.

Um, so we went back to 2013, just to tell you historically, I think it's important to understand where you were or where the city was before we entered COVID, and then what we saw with the strong property valuation growth.

And so historically, we're right around the two and a half to three percent growth in property valuations, and so in this model we're projecting in 2027 to see a little bit of a decrease from what we saw last year, and then really tapering off to around the two percent growth mark into the future years.

Again, these are projections, these numbers will more than likely change, but based on what we've seen and based on just what we're projecting right now, just based on the current market, again, we project property valuations to really taper off to back to um those historical levels that we saw prior to 2021.

And so, with that, this slide is very very important as well.

And so you'll see going into 2027, we do have about a 16 million dollar projected increase in the property tax revenue.

But again, it's important.

This is the five-year forecast, so it's looking beyond that first year, is that once you get beyond 2027, you look at the annual increase in property tax revenue, right around the six to seven million dollar increase every year.

So, again, primary revenue source combined with sales tax, those two 72%.

And if you're only generating six to seven million dollars of new revenue, and your primary expenditures are increasing by more than that amount, it there's and lies the structural imbalance and the revenue limitations.

And so these assumptions again, not only that property valuation growth that I just showed you all, but also looking at maintaining the same operating portion of the tax rate as well.

So now projecting out any increase in the operating portion of the tax rate.

On the sales tax side, again, showing you the same time frame for sales tax as I just showed you for property valuations, and on sales tax, again a lot of volatility in this revenue source.

Um again, 2021 and 2022, really outlier years where we saw very, very unprecedented growth in sales tax.

Um the future years in the model uh projected right now at 3.4%.

Um that's the tenure average that we've seen, excluding those two outlier years in 2021 and 2022.

So again, that's what's built into the model.

In 2026, you'll see right now that we're um at 4%.

That's what was built into the budget.

However, year to date right now, we're at about 8%.

And so very, very strong revenue growth right now in sales tax.

We received our December sales tax last week.

It came in at 4.5% higher than the December 2024 sales tax.

So very, very encouraging that that holiday shopping was very, very strong.

Um, we know we've seen some stories about unfortunately some small local businesses having to close down, but um, with what we've seen so far in the sales sector, the overall local economy is doing really, really well right now.

And we actually broke a 16 million dollar payment for that month, which is the highest ever.

We've never broke 16 million dollars for payment.

So uh the local economy is doing well.

However, we don't want to be too optimistic in the model.

Again, this is really just to utilize historical data again, looking at the projections of where we're typically at.

So again, that 3.4% is what's built into these numbers that you're seeing today.

So on the actual or projected sales tax growth on the revenue, what we're projecting right about $5 million increased every year.

So looking beyond 2026, we have strong property value growth still, but then 2027 and 28, 29, 3031.

If you take property tax and sales tax growth, you're looking between 12 and 13 million dollar increase every year on new revenue growth without increasing the operating tax rate on for property taxes.

So overall revenue with property tax there in the blue, sales tax in the red, you'll see all their sources in the green there.

Again, 2027, almost 20 million dollars of new revenue.

As those property valuations come down a little bit, what we're projecting in those outer years, right around the 14 million dollar amount each year in new revenue.

And so, with that, when Tosha gets up and presents its slides, you're going to see with what we're projecting right now for the expenditure side, and how much it really is out going to outpace right now.

As I mentioned, so revenue right now that 2.3% expenditures over 4%, and there lies the issue that we've really been working on.

We've identified and you've seen us present some different things that we can do as far as potential opportunities for new revenue, expanding our current sources, looking at uh potential new sources of revenue to help offset the expenditure side, and then with that also the program-based budgeting.

I know we're very very excited with what that's going to do is just one how we communicate, we're able to actually see the cost of all of our city programs, the wide list of I think we're over 250 different programs total that we have, and so really beginning to prioritize and looking uh strategically to the future and how we're gonna make some of those decisions to balance again the revenues and the available expenditures.

And so, with that, I'll turn it over to Sasha who covered the expenditures and then wrap it up for this presentation.

Good morning, good morning, Mayor Council, Sasha Landonowski, Office of Management and Budget.

So let's shift to uh expenditures.

So, as you keep as you see from this slide, uh almost 72 percent from general fund expenditures goes to personal services, 72 percent.

As as we saw from uh Mr.

Cotina's presentation, uh property tax and sales tax, they they bring us 72 percent.

So whole uh revenue from property tax and sales tax goes to personal services.

Slide.

So this slide shows um uh main revenue categories by by by category, and uh on the bottom you see what he was talking about uh revenues uh expenditures increasing by four percent on average every year, and as we saw revenues are increasing by two percent and expenditures are increasing by four percent.

We want to talk uh a little bit about uh what assumptions we included in the model.

Uh so pro normally most of the assumptions will be linked to uh uh uh personal services.

So, what we built in the model, we built uh full year of impact for the salary increases that just happened in in January.

Also, we are we are targeting a cost of living wage.

So in the model, we have increases that are trying to bring the salaries for the civilian employees to the cost of living expenses.

Also, what is really also important in the model uh we uh we kept this the staffing status quo, so we essentially didn't uh increase uh any staffing or decrease any staffing.

So we kept the vacancy level the same in the model, which is really also important.

Uh and then in the last couple of years, uh the city has been absorbing uh health uh healthcare uh uh part of the employee increases, so we are continuing that in the model.

Um when we are talking about uh uniform, uh we we know that we have uh new contracts for fire uh union uh that is going to start in 2027 and and then police union union association in 2028.

Um what we are doing in the model, we are continuing the same uh the same uh contracts that we have right now in the place because we don't know what will end up uh at the at the end.

So with regards to other increases, uh we do have uh increases uh for other uh categories in the expenditures uh for the contracts because that's about 10% from total general fund uh uh total general fund expenditures.

We are we are increasing on general three percent uh for most of the contracts.

We looked at some of the contracts uh that are coming uh for new procurement in the next couple of years, and we adjust it uh based on the historical levels.

We do have uh assumptions for for elections, for assumptions uh increases increases for utility expenses and also for uh cut uh cut uh charges to the city.

With regards to inform uh for uh to IT uh contracts, we built a little bit higher increases uh for the IT contracts because uh uh as we saw uh in the past couple of years, these contracts are tend to tend to increase a little bit higher than the other contracts.

Next slide.

The main cost drivers uh uh the same cost drivers uh we have been communicating in the past.

We have uh uniform uh salaries and cola increases for for police and fire, including uh staffing, and also civilian increases uh and then elections and and animal services.

I just want to mention here on this slide something uh when you when you look at the police and fire uh increases, we are going to invest uh we are uh the projection is to invest 90 million dollars by the end of 2031.

This is uh with continuation of the current uh uh CBA contracts.

Next slide.

With regards to civilian compensation increases, the city uh in 2022, the city started uh uh project or uh the goal was to increase the the minimum uh the minimum uh wage to the comparable uh wage with the with the and to be competitive with the with the other entities here.

So we started with uh 1036 in 2022, right now we are at uh 1575.

So in less than five years, we increased uh minimum wage by five dollars.

Going forward, the plan is to increase the minimum wage and uh provide uh across the board increases uh and we we are going to target living wage for the civilian employees.

Uh public safety is always uh major cost driver as we know.

Um the the good thing here is that we have the contracts and uh with the contracts we can estimate the impact for for uniform salaries, uh, but uh the cost is compounding, and uh uh as you can see that uh we have been allocating 9.4 million dollars uh for uh equipment and vehicles.

However, we have not increased that uh that amount, and we know that uh the cost increases make that uh purchasing power for that 9.4 million dollars less.

So this slide uh shows uh budgeted versus graduates for the academies for the so this one is showing for police academies.

As you can see, in the last couple of years, up to 136th academy, the graduation rate was uh 45%, 40 to 45 percent.

However, we have been seeing we feel we are seeing major shift uh starting from September twenty twenty-four, and uh right now the graduation rate is a little bit higher, so it's uh eighty percent.

So what we are doing, uh we changed the strategy a little bit, so we we allow them to fill the academies more than the budgeted, so they are able to bring more more officers.

Uh next slide.

Um so that next slide is showing uh projection for the next couple of years.

Really good uh information right now for fiscal year twenty twenty six, and we are confident in that that we are going to bring uh additional forty-five officers to to the police department, which will bring them uh to uh closer to pre-COVID levels.

By the end of uh twenty twenty twenty thirty-one, we are projecting uh that they will add additional two hundred and twenty offic officers.

Uh when we are talking about uh fire academies, uh it's a little bit different with fire academies.

Their graduation rate is 78 to 80 percent.

Um and um uh they haven't had that type of like a major shifts uh uh in their staffing.

We are projecting additional 45 fighters by the end of uh thirty-one.

Next slide.

So this is the same slide uh that Mr.

Cortina has presented.

We just want to show this this again uh uh and reiterate that uh based on the on the current projections that we have, uh with all the assumptions that we have in the model, uh revenues are increasing about two uh two percent or two point three percent on average, and expenditure are increasing by by almost double and the gap is widening.

Uh as a closing statement, uh we had uh this is fourth presentation in the series of presentations to lead to strategic planning session that is going to happen next week.

As continuous uh Mr.

Cortinos mentioned, we had a re uh presentation for revenue limitations and opportunities.

We had one time funding for ARPA.

Uh he presented uh fourth year uh first uh quarter uh year end projections and then we have the forecast.

Um implementation of uh program based budgeting will be really important for us because it will bring bring us more visibility how we spend uh the fun uh the funds uh and then uh uh constituents will be able to see where the money uh goes.

And I just want to mention that uh uh together with the backup of the agenda, we have uh and probably this is the first time that that that is happening in the last several years.

Uh we have uh about 24 page document to accompany this produ this uh this forecast.

Uh so that uh explain in depth our our uh assumptions and uh what we are looking uh for the future.

And with that uh we are open for with any questions that you can very good, Sasha.

Thank you.

And Robert, you might want to come up on the revenue side.

There's gonna be some questions on revenue and and the expense side.

So uh representative Limon.

Thank you, Mayor.

And and thank you, both of you, for this presentation.

Uh slide 27.

So slide 27 is the projected main major cost drivers, and I can see the first four, but I'm curious about animal services.

How does that rank up in that area?

So animal services is a special revenue fund, so they're not reflected in the actual general fund, it's it's uh transfer from the journal fund into their funds.

So we wanted to make sure that we were capturing all of their wage increases, and so that's why you see that called out here because it does roll up within the personal services in the general fund.

So just based on what we've seen with their wage growth, um so doing the pay raises with their wage growth and staffing, um, just an area that we wanted to call out uh particularly because dimension is not reflected in those general fund numbers and the salary benefit category.

So this is unique from other departments, other areas that it would rise to this level.

So that is the only department that we transfer from the general fund into the journal fund.

Okay, thank you.

And then um I compliment you on the the backup document that's in there.

Excellent, very, very good.

Thank you very much.

You're welcome.

Sasha.

And while we're on slide twenty-seven, just a quick question.

So normally here in the industry, health care costs have been gone up double digits.

And I think you mentioned health health care absorption absorption into the city that we're covering that.

Out of the civilian comp and the health care, what's the percentage of that that is healthcare out of that seven point three?

Do you have the breakout?

Do you know?

So we are increasing health care by uh nine to twelve percent from year to year.

So uh uh I will give you the R amount.

Okay.

I have it in the way.

But but again, that number that 12 percent you're not passing on to the employees.

No, this is uh this is what the CT is absorbing.

Okay, that's what I thought.

Okay.

Uh Representative Nino.

Okay, so that's it's been eight years as they mentioned that we've been doing that, and so going back to when we originally started that, it was because we were coming off of multiple years where city employees were not getting wage increases.

So the city's strategy at the time was let's give the wage increases first.

Let's not increase their health care to offset that wage increase.

So we've been doing that, but we've never reversed that trend yet as to passing in those health care increases on.

Well, we are beginning to look at it.

So we know that we've seen tremendous increases in that amount, and what I would like to be able to do is not have that be a surprise to staff.

So what we have modeled in here is looking at 50 cents um to the minimum wage, what would it bring us from the 1575 to the 1825 to this five-year period, or two point five percent?

And so we're looking at as the wages, you know, sort of normalize across, and then we're keeping up with being comparative across.

What does that look like in terms of that cost share for health care?

Because I know it's going to be very difficult for us to do both.

I want to make sure that as we model that we can push that out to staff, that they can see that before at least a year before you know that might hit and be implemented.

But I want to make sure that we're super transparent in what we're looking at and how we're planning in those areas.

Okay, thank you.

Representative Nino.

Thank you, Mayor, and thank you, Robert and Ms.

Mack for this presentation.

Question for you.

I can recall if it was during FORWAC or during a council meeting.

You mentioned how the sales tax portion, for example, if Amazon has a sale, the sales tax now gets diverted specifically to where the end user is going to be, correct?

Correct.

Yes, based on destination.

And can you mention how that is being seen as a positive for the city of O Paso?

You have briefly touch base on that.

If you could just do like a quick little recap on that.

Well, we know there's many more distribution sites in larger Texas cities, and so I think El Paso would benefit from having that destination point be the point of how sales tax is calculated.

Um if we were a large manufacturer in a large distribution city, then obviously a lot of that um service or product would be going outside of the city.

So it does help the city to some degree.

And so we're capturing all of the um distribution manufacturing coming out of Dallas, Houston, San Antonio, those largest cities coming to El Paso.

So being based on the actual destination point, it does help the city of El Paso.

Perfect.

Thank you for that.

Um Robert, quick question for you.

This presentation is specifically for the general fund, right?

Correct.

It doesn't include all the funds that uh are with the city of El Paso.

So when people see this, they might panic a little bit with the projections, but they're not taking into account all types of different revenue strings that potentially could help uh any operating costs for the city of El Paso.

One thing that stands out for me, for example, is um we have the costs for fire and PD and the graduations, but for um we received a grant that the FEMA safer grant for one point six million dollars, which is helping us fund 20 new firefighters, right?

Were those firefighters originally part of this general fund?

And now since we would possibly get this grant, it's gonna help us offset that cost.

Yes, and so all of that will be factored in both those safer grants, it's uh I think a two-year or three-year grant.

So great benefit to have that grant for two years to bring on the additional firefighters, but after two years that grant goes away, and so all of that cost is onto the journal fund.

Correct.

And so really, I mean the point with the expenditures that Sasha talked about is it's not just the collective bargaining agreements where we have increasing wages, obviously for our first responders, but it's the the dual sort of prong issue is that one you have increasing labor costs just based on your existing personnel, and then on top of that, we're actually growing the police department pretty substantially.

So Sasha touched on it, but I don't that slide can't be understated with the growth in the police department.

To grow 45 officers in one year is tremendous.

That is a tremendous increase.

Obviously, it's gonna help the police department with their operations, but with that comes the financial impact as well, right?

So we know there's gonna be an increased cost going forward.

But I mean, looking forward again, I don't think that it can be understated that one, we're being competitive with our pay, but then two, we're actually growing the size of the police force.

The fire department not to the same degree.

Um but again that's one of the big drivers that we see in the budget every year.

I mean, it's no surprise when we talk about the budget every year, it's our uniform salaries and benefits going up, and then it's our civilian employees with the uh wage increases we have uh for that given year.

So I've I really really like the slide.

The 1157 plan for the end of this fiscal year again is based on the net growth, and so that's taken into account.

Um the officers that we just saw graduate a little over a week ago.

There's another um academy that have graduated May, and then also with what we have planned out for the rest of the year on uh retirements and resignations.

So this is the planned net growth again, increase of 45.

And Representative Nino on that same one, and I think this is a really good slide.

You know, we ended up with the uh police or the cops grant, which added an additional 13 officers and 2.5 million dollars that will help offset some of the salaries, and I would hope that that grant, as we continue to go after it, can only increase to help uh so we don't understate 220 officers.

It's a big number.

Correct.

Ms.

Mac, you were gonna add.

Yeah, I would just wanted to add, um, I think it's important to note that the fire departments staff and labor cost more than PD, even with this growth.

You know, they're not being neglected, they have you know the staffing that they need, the additions that we've added to the fire department are because we're adding additional resources.

They've never had the type of attrition that police has had to deal with, but you certainly see if you look at the uh thing of slide 27, Robert, um the cost over the five years, you'll see that that's actually um quite expensive, and it is a substantial investment also in our fire department.

Yeah, and I wanted to highlight you know the grants because again we're just talking about the general fund, but I know that staff, Ms.

Mac's team and Robert, and even our state and legislative affairs department is really looking at how to possibly help offset these costs, going after grants, and essentially it's gonna help offset the cost when it comes to any expenditure.

So I really wanted to highlight that because I know that you know, in people could see this presentation, they could worry, but at the end of the day, we are being proactive and ensuring that we protect the local taxpayer.

Thank you, Mary.

Representative Rocha.

Thank you, Mayor, and thank you, Robert.

I I think the most important thing to understand is this isn't the budget.

And and I think you know, it can get misconstrued that we're talking about the budget.

I mean, it does play a role in it, but it is not this is not the budget, this is just for strategic planning.

So I'm gonna go to slide five.

And the most important thing that stood out to me out of all of this is that there has to be strategy without strategy without funding can't be executed.

So I have a question on that because you know, as council members, we bring items to the table.

Some of them have a price tag, and some of them don't, in terms of actual what's gonna come out of the general fund, let's say.

So to me, and I'm making a statement, and I just need you to see if I if I'm if you're aligned with what I'm about to say.

If I bring an item to council and I say I I need to add it to the agenda, I should have done my due diligence to make sure that there's no additional funding that's associated with that because there is no way to execute it at this time, or we don't do something else to the same degree, you lessen another area.

So it's but that's the that's the trade-off, right?

Yes, we have to trade something off in order to make sure that that let's say this particular item, whatever it is, passes, then something's going to have to be traded off instead of that.

Is that my understanding?

Is that correct?

Yes, okay.

I just want to be sure.

And then um slide seven.

The mayor actually asked my question to absorb it.

You say that it's nine to twelve percent increase right now in health care costs that we're absorbing year over year.

That's that's about the cost.

And two percent or three percent of revenues are are currently increasing year over year, but we have expenditures that are doubling year over year, correct?

Yes, okay.

I needed to confirm all of that piece so that it ties back to the strategy without funding can't be executed without a trade-off.

I'm gonna add that additional piece to it.

Yes, and so actually I I had that uh on the slide, the second to the last bullet point.

Trade-offs are unavoidable.

So again, it's that balancing act that we're working on.

Okay, thank you.

I appreciate it.

You're welcome.

Representative Chavez.

Thank you, Mayor.

Thank you, uh, Robert, thank you, Sasha.

Thank you, Ms.

Mack, for the presentation.

Um Robert, just like uh representative said, this we're not talking about the budget right now, but I know that we identified a gap potentially right in the future, but from what I know, year after year we've we've always adopted a balanced budget.

Is that correct?

Yes.

Yes.

And can you talk a little bit more about that?

I mean, there's always a lot of work that goes into, particularly right now, the budget office is about to gear up with the actual development of the FY 2027 budget.

Um we'll start doing finer details on the revenues and expenditure projections for the upcoming year.

And then we start to begin that the process of looking at you know ensure we've got really, really sound projections on those revenue sources that we've gone through the budget line by line to try to identify is there line items that we can adjust down.

Are there new revenue sources that we can tap into?

Can we expand a revenue source?

We've done quite a bit of that.

Um can we take advantage of the refunding that we talked about on the debt side to lower the debt service portion of the tax rate?

So there's uh a long list of things that we'll do to try to identify different adjustments to get to where we need to be.

But at the end of the day, one of the key takeaways from this is we need to strive to avoid doing one-time fixes or one-time patches to balance the budget.

The use of fund balance is something that this council was very proactive about last year of lowering the amount of fund balance needed to balance the budget.

We actually restored some funding for our city facility improvements.

Um that pay-go funding unfortunately a few years ago was one of the things that we reduced, and we talked about that in the past.

Um, a lot of deferment, uh, more attrition on vacant positions.

So in the past, some not so ideal adjustments have been made to get the budget balance.

So looking forward, really, again, that's structural imbalance, and we keep using that term, and that's it's critical because you can balance the budget year after year with these sort of one-off one-time adjustments either on the revenue or exponential side, but at the end of the day, are we properly funding all the city services that the city provides?

Are we meeting the expectations of the community?

Um, do we have the response times from our public safety?

Do they have the resources that they need?

Um, are we being competitive?

Are we able to actually hire people to come work for the city to provide those services?

So there's a lot that goes into it, but really the key takeaway is ensuring that again, as we look to the long term, do we have the available revenue, the available resources to be able to fund the services that we currently provide at the level that we need to fund them at.

And you talk about identifying new um resources or revenue streams.

Have we done an analysis of identifying what could potentially be in our tax rules that's not currently there?

Um, and then pursuing that in some way on property taxes, yes.

But what could potentially be in our tax rules that's currently not there right now?

Um either by partnering with other members in the community, either private developers or people in the in the real estate market industry, you know, identifying I would think that the work that the county I mean that this council is doing right now in terms of trying to return our properties.

We have over 3,000 city-owned properties, and we as you know, we've just got you know moving with getting a lot of those back on the tax rolls.

I think that was a that's a really good thing that's really in our control.

And so, as you're seeing those items come forward, they go back onto the tax roll, and certain certainly helps us.

Um, you've seen quite a bit of those.

I think we have uh quite a few coming up in the next couple of months, and so I think that's something that was a missed opportunity for the city for quite some time.

We had property that were not being developed, it was costing us money to take care of it, which also hits you know our budget, and so then I think it's a it's a really easy way for us to think about how we're doing something immediately.

Yeah, and that's been a very proactive role that we've now taken.

And I and I appreciate that.

Um, and then sales tax on slide 14.

Um it breaks down uh the revenue sources and sales taxes 23.5 according to this slide.

Robert, um, I I know that you work closely with economic development.

I'd like for you just to share a little bit more about what that looks like to try to pursue more uh opportunities for our community to increase that sales tax revenue.

I know that it's a priority for many of us here on council, um, but you know, being very strategic about how we do that.

Can you talk a little bit more about how you and economic development partner in that sense?

You you'll hear a lot about this next week.

I mean, one of the the key pillars is gonna be the economic mobility pillar, and so looking at one, all of the different efforts that we're doing to fund um helping small businesses, the job training uh programs that we have, the boss providing just a tremendous amount of resources to help our smaller businesses be able to grow and have the things that they need to be able to provide, um the products and services that they are providing.

Um but at the same time it's also the education piece, so working with all of our different partners in the education sector as well.

Um, and then we do have some larger projects that are are scheduled to come online here in the next few years as well.

So that's that's really been the strategy is how we continue to grow our economic development tax base, right?

And so we've talked about the residential and the commercial, and you saw that.

Um, but I will tell you back again.

And so um, as we go into next week as well, the available funding that we have on economic development.

So we talked about the American Rescue Plan, the ARPA funding, we utilized 14 million dollars of that our ARPA funding to help kickstart a lot of these programs.

That ARPA funding goes away at the end of this calendar year.

And so as we look to the future again as well, and again, as we talked about the strategic planning session, uh the TED Fund, another source of revenue that we use for economic development incentives and a lot of different programs, that funding goes away in 2036.

And so while we have those tools now, we need to be very thoughtful and very strategic about how we're using those revenue sources now to really ensure that we're getting the most benefit for our community.

But I think it's important to note that um we're all uh searching for alignment at the city so that we're all uh putting our efforts into the same um strategy and uh to achieve the best results for our community.

Absolutely so that that gap, whether it's um big or small, that we uh are able again to balance the budget year after year by working together.

So thank you for that presentation, Robert.

I appreciate it.

Representative, I just want to add that the work you all are doing to help us with the bridges also contributes.

We saw increase in rich revenue that really correlated with the increase in sales tax.

And so we also, you know, we we recognize that you know we're an international city and we rely on each other, and a lot of that cross-border activity certainly helps that number as well, and so ensuring that we're continuing to focus on those connections across the border important as well.

I know that's a key area for you.

Thank you, Ms.

Mack.

And Robert, before I pass it over to Representative Canales, you know, your slide for uh generate more revenue and reduce costs.

That's kind of where you started and said it was one of the best slides that was in the presentation.

Uh in order to do that, the city has to be open for business.

I mean, we have to go out and be super focused on economic development to start reducing uh the cost and minimizing the impact on taxpayers.

I have just kind of a uh a general question before I I pass it.

You said that sales tax revenue was exceeding your projections already.

What was that number again?

So we developed the budget we're estimating four percent, and right now for the first four months, so we have up through December sales tax collections, we're at eight percent year to date.

Okay, and then my question is is gonna be so knowing that we have two major shows coming up, BTS and post Malone and Jelly Row, will that affect that number?

Sure, absolutely.

It'll help sales tax, it'll help our mixed beverage, so the liquor tax that we collect as well.

And so we hope that we see more and more of those shows in the future.

So really getting at, you know, you know, moving the needle is is is creating additional sales tax and doing the things we need to do to increase revenue.

Absolutely.

And so I I was I wanted to be very clear that a lot of challenges, but I also mentioned that a lot of opportunities in front of us as well, and so it's being thoughtful and being very strategic about how we add to those opportunities and take advantage of them.

Okay, thank you.

Uh Representative Canales.

Thank you, Mayor.

Uh yeah, thank you, Robert and Sasha as well.

I think it's a as always a really excellent look forward um a presentation that helps us to think about the next five years.

Um I've been at the city since 2017, and I've seen somewhat similar presentations in 2018 and 2019, all the way all the way through to today, and inevitably, every year, like this year, you gave a 36-slide presentation and uh an excellent 24-page document attached with a lot of extra information.

And one slide gets shared online showing the the chart like slide 11 in this case, showing the chart of revenues and expenditures, and uh people talk about how this is finally the year the city will be bankrupt.

And I've heard that in 2018 and 2019 and 2020, and all the way through to today.

Um I think it's you know uh other folks have touched on it, but it's so important to clarify.

This is a planning tool.

You said it multiple times in the presentation.

Um, you know, unfortunately, those slides are conveniently ignored when it gets shared online.

People only want to look at the one the one chart.

Um, but can you just say one more time very clearly?

This isn't an indication of poor financial health or um you know that that the city is headed toward bankruptcy, that this is a a tool that we use to plan and that we adopt balanced budgets every year.

Yeah, so I would say it's actually quite the opposite in that we could make these numbers say whatever we wanted them.

We could be very overly optimistic and say, you know what, we're not gonna have a gap going forward and say, oh, we think we're gonna collect 10% sales tax every year.

We think property valuations are going to come in at 10% every year.

No gap, no deficit, everything's fine.

Mayor and council, we'll see in a few months with the budget.

We know that's not reality.

So what this does is it really just helps provide context and provides discussion points.

And so that's what the intent of this presentation is.

Is we need to think about long-term sustainable sources of revenue, long-term sustainable services that we're going to provide to ensure that we're properly funding.

So again, this is a planning tool.

It's encouraged to kick start and ignite those discussions, which you all will have a lot about next week.

We have a lot of information shared.

Ms.

Mack has put together a very thorough, a lot of time and effort went into developing the session for next week.

I know a lot of good conversation will come about from it.

So again, just really intended to serve as that a starting point for a lot of discussions for the long-term continued financial success of the organization.

So would you say then it's safe to say the city is not on the edge of financial collapse and ruin?

Absolutely not.

Okay.

Good.

Thank you.

Thank you, Mayor.

Representative Trejo.

Thank you, Mayor.

I have a few questions, Robert.

Um in regards to so I'm on page 34, and we're looking at the at the revenues and the and the expenditures.

One of the things that you mentioned was was salary increases.

What what percentage of salary increases is that?

What what percentage are you looking at?

For the annual increases for employees.

And so right now it's built into the model.

And we didn't want to put too much detail in there because nothing is guaranteed until the council approves the budget.

Right.

But in the model, it's continued to grow the minimum wage by 50 cents every year.

That would put us over $18, 1825 by the end of this five-year cycle.

And then looking at doing a two and a half percent increase across the board each of these next five years.

Again, it's all going to be dependent upon each of those budget years and council's approval, but that's what's built into the model.

Okay.

And what was it going backwards?

Is that has it been two percent?

So we've done different things.

So in this current fiscal year, uh, we did no increase to the minimum wage, but we did do adjustments to the pay scales for our professional managerial employees.

And that was due to the large increase we had done previously for our general service level employees.

And so we did one right size of those pay scales, and then we did a minimum of only one percent.

So it was only a one percent increase, which we know that we need to identify ways to make that a little bit larger going forward, offset increased costs that we're all facing.

Um but I will say there are other governmental agencies that gave zero pay increases the last two years.

So uh while one percent we know is not ideal, um, at least we continue to push in the right direction.

Okay, thank you.

Uh and then, you know, it was touched a little bit on economic growth and being, you know, that being a a an area of what we want to concentrate on.

In this in this projection, what percentage was taken into account as far as economic growth.

Well, I mean, it's really the property tax and sales tax are gonna be the two big drivers.

And so, again, we are using historical data to help forecast the next five years.

Anything can change six months down the road, a year down the road.

Um, but I will say one of the big things that we always point out is on the economic development side, it's typically the city and the county to some degree, but typically the city leading those efforts, providing the rebates, providing the incentives, providing um what's necessary to bring these businesses here or keep the businesses here to expand.

Um, but it's really all of the other tax entities that continue to benefit immediately.

Right.

And so that growth on the school district side on the community college side, the university medical center side is a tremendous benefit for our taxpayers.

And so while right now we're not the city's not currently capturing all of that revenue because we're waiting, rebating back some of that, it does benefit the overall tax bill for our community.

Okay.

And then the other thing that was brought up was land sales.

Was was that taken into consideration and what we what was projected as far as land sales at the city?

So there's um we have a few, but we don't have anything like we've had in the past.

I mean, we've had in the last few years we had uh a $13 million sell of property from one property and then an $18 million sale of property.

We don't have anything quite substantial like that that would have that type of impact.

Um and those dollars when we do those land sales can only be used for capital asset purchases or to retire debt service.

And so you can't use those four day-to-day operating expenditures.

Okay.

That's all thank you.

I appreciate your answers.

All right, any other questions, council?

All right any other questions council Robert very very good presentation and again this is not the budget.

We've got to make sure we're clear that with the and the as representant canala said the sky is not falling.

And the biggest risk is not doing anything.

So it's incumbent upon us to go out and generate the sales tax do some economic development which can will completely change the the model and and some of the projections and I think this is very good and again the detail on the backup was was very very good so we we appreciate you guys doing that.

Thanks to Sasha and his team putting that report together.

Yeah thank you guys for putting this together all right council missile um city attorney's office has requested that EX1 be deleted so we need a motion to delete that process second okay there's a motion and a second to delete EX1 all in favor anyone opposed and that motion passes there a motion to retire into executive session motion to retire second there's a motion and a second to retire into executive session all in favor anyone opposed and the city council of the city of Al Paso may retire to executive session pursuant to section 3.5A of the El Paso City Charter and the Texas government code chapter 551 subchapter D to discuss any of the following executive session item two claim of Marisol Rodriguez claim dash 888 under 551.071 executive session item three claim of Alberto Duran claim six ten under 55101 executive session item four United States of America versus United Road Towing Inc.

DBA UR Vehicle Management Solutions and Rod Robertson Enterprises Inc.

City of Al Paso Cause number 323-CB-00044 under 551.071 executive session item five el Paso Electric Company to amend its certificate of convenience and necessity CCN for a 100 megawatt solar 100 megawatt battery storage facility PUC number 57501 HQ number utility dash 61 under 551.071 executive session item six statement of intent of Texas Gas Service Company a division of one gas inc to increase rates within the company's incorporated areas of Central Gulf West North and Rio Gran Valley service areas OS-25-00028202 HQ number utility dash sixty seven under five five one point zero seven one executive session item seven application of Al Paso Electric Company for approval of an amended distribution cost recovery factor PUC number 58910 HQ number utility dash 73 under 551.071 executive session item eight discussion on economic development opportunities in el Paso HQ number 256478 under 551.07087 executive session item nine discussion on memorandum of understanding for interstate highway 10 deck plaza coordination between the city of alpaso the county of el Paso and the downtown deck plaza foundation hq 25 4962 under 551.071 and 551.072 and executive session item 10 legal update regarding sun metro facility fire of February 11 2025 under 551.071 these matters are taken into executive executive session under 551.071 consultation with attorney 551.072 deliberation regarding real property and 551.087 deliberation regarding economic development negotiations it is 1029 a.m ex2 thank you miss prime you could give me just a second here just one second motion made seconded and carried that the city attorney's office in consultation with the city manager be authorized to deny the claim of Marisol Rodriguez in HQ matter number claim dash eight eight eight and to take all steps necessary including the execution of any required documents in order to effectuate this authority all right we have a motion is there a second second all right miss prior yes sir the motion was made and read into the record by mayor pro tem chavez seconded by representative rocha and this is to deny the claim on x two on that motion call for the vote and the voting session and that motion passes unanimously ex three motion made

The motion was made and read into the record by Mayor Pro Tem Chavez, seconded by Representative Rocha, and this is to deny the claim on EX30, EX2.

On that motion.

Call for the vote.

And the voting session.

And that motion passes unanimously.

EX3.

Motion made, seconded, and carried that the city attorney's office in consultation with the city manager be authorized to deny the claim of Alberto Duran and HQ claim number six ten and to take all steps necessary, including the execution of any required documents in order to effectuate this authority.

Okay, is there a second?

Second.

All right, Ms.

Bryan.

Yes, the motion was made and read into the record by Mayor Pro Tem Chavez, seconded by alternate mayor pro tem Piero, and this is to deny the claim on EX3.

On that motion, call for the vote.

In the voting session.

And that motion passes 721.

Representative Acevedo voting nay, the remainder of council voting aye.

The motion carries EX4.

Motion made, seconded, and carried that the city attorney's office in consultation with the city manager be authorized to deny the claim of Marisol.

I'm sorry, I opened the wrong one.

Excuse me.

Excuse me.

Can I start over, Ms.

Pine?

Yes.

For the record.

Motion made, seconded, and carried that the city attorney's office be authorized certain authority to settle the matter of United States of America versus City of El Paso and others in matter number 323 C V00044 and to take all steps necessary, including the execution of any required documents in order to effectuate this authority.

Is there a second?

All right, Ms.

Bryan.

There's a motion made and read into the record by Mayor Pro Tem Chavez, seconded by alternate Mayor Pro Tem Piero on EX4.

On that motion, call for the vote.

And the voting session.

And that motion passes unanimously.

EX5.

No action.

Thank you.

EX6.

Motion made, seconded, and carried that the city attorney in consultation with the city manager be authorized to file a motion for rehearing with the Railroad Commission of Texas, the RRC, in the statement of intent of Texas Gas Service Company, a division of One Gas Inc.

to increase rates within the company's incorporated areas of Central Gulf, West, North, and Rio Gran Valley Services Are the application filed with the RRC under docket number OS 25028 202, matter number utility-67, and to take all steps necessary, including the execution of any required documents in order to effectuate this authority.

Second.

All right, there's a motion and second, Ms.

Pry.

Yes, the motion was made and read into the record by Mayor Pro Tem Chavez, seconded by Representative Ganales, and this is on EXX to file a motion for rehearing on that motion, call for the vote.

And the voting session.

And that motion passes unanimously.

EX7.

No action.

Thank you.

EX8.

No action.

Thank you.

EX9?

No action.

Thank you.

EX10.

No action.

Thank you.

Is there a motion to adjourn?

May I make a motion to adjourn on second?

There's a motion and a second to adjourn the work session.

All in favor?

Anyone opposed?

And the work session for Monday, February 16, 2026, is adjourned at 142 p.m.

Thank you, Council.

Thank you, guys.