City of Eagle Pass to Furlough 63 Employees Up to 3 Months Due to COVID-19 Pandemic
By: Ricardo E. Calderon, Eagle Pass Business Journal, Inc., Copyright 2020
The Eagle Pass, Texas City Council unanimously approved an Emergency Contingency Plan to furlough 63 employees up to three months, a savings of $500,000, due to the COVID-19 pandemic effective April 29th at a Special Emergency meeting held on Thursday, April 23, 2020.
Since the City of Eagle Pass 2019-2020 Fiscal Year Budget approved on September 17, 2019 heavily depends on approximately $14 Million of revenues from its two International Bridges to fund it, the temporary closure of the U.S.-Mexico border to non-essential traffic agreed between the United States and Mexico governments, effective March 21, 2020 and recently extended to May 19, 2020, has caused a significant decrease of revenues to the City of Eagle Pass budget as well as the loss of important sales tax revenues from retail sales within the City. The result of these two key factors is an estimated loss of revenues of $3,444,433 (Million) to the City for the remaining five months of the City’s 2019-2020 budget, which ends on September 30, 2020, according to City Finance Director Jesus Rodriguez.
Earlier this week on Tuesday, April 21, 2020, the City Council unanimously approved to slash $1,977,794.35 (Million) from the City’s budget as a means to manage the budget and continue providing the same level and quality of city services to residents. The City Council approved to cut certain capital expenses, transfer funds from both the City and Bridge reserves, and not fill current vacancies within the City to reduce $1,977,794.35 from the budget.
Although the City Council and City Administration had expressed interest in not touching City employees during the current COVID-19 outbreak, the seriousness of the financial shortfall facing the City left them with no choice but to examine the City’s employee payroll expense.
City Administration developed an Emergency Contingency Plan regarding employees and are recommending that 63 hourly salaried employees be furlough for up to three months starting on April 29, 2020. This temporary Emergency Contingency Plan is estimated to save the City of Eagle Pass the total amount of $500,000 in employee payroll expense.
City Finance Director Jesus Rodriguez advised City Council that by placing the 63 employees on furlough the City will not have to pay them a salary, but will have to continue paying their benefits such as health, dental, and life insurance. Rodriguez added that the 63 employees placed on furlough will become eligible to file for unemployment with the State of Texas plus the federal government’s Pandemic Unemployment Assistance Program which pays a guaranteed $600 per week up to four months. The City will file a mass unemployment claim with the Texas Workforce Commission for these 63 furlough employees. Rodriguez noted that City furlough employees will actually make more money while being on furlough than when they are working at the City. This furlough is anticipated to be temporary for a period of up to three months. The goal is to bring back the furlough employees to the City payroll upon its completion.
Rodriguez advised City Council that City Administration was recommending approval of this Emergency Contingency Plan to become effective immediately upon its approval.
Rodriguez highlighted other recommendations such as keeping City buildings closed to the public except for the Police and Planning Departments, the City Manager will begin phasing in all other employees beginning on April 27th and impose safety measures within departments, and furlough of 63 full-time employees starting April 29th for a period up to three months. These recommendations will save the City an estimated total amount of $500,000 in this year’s budget.
After a discussion among City Council members, Mayor Luis E. Sifuentes stepped down from the dais to make the motion to approve the recommendations presented by City Administration as the Emergency Contingency Plan and Council member Rudy Villalpando seconded the motion and the motion was approved unanimously by a 5-0 vote.
