Eagle Pass City Council Approves $1.9 Million Reduction from 2019-2020 Fiscal Year Budget Due to COVID-19 Pandemic
By: Ricardo E. Calderon, Eagle Pass Business Journal, Inc., Copyright 2020
The Eagle Pass, Texas City Council unanimously approved the first of three readings of an Ordinance amending the City’s 2019-2020 Fiscal Year Budget by reducing $1,977,794.35 (Million) due to the effects of the temporary closure of the U.S.-Mexico border to non-essential traffic due to COVID-19 on the City-owned International Bridge System revenues and loss of sales tax revenues at their special meeting held on Tuesday, April 21, 2020.
Eagle Pas Finance Director Jesus Rodriguez advised the City Council that the estimated loss of revenues of the City of Eagle Pass for the remaining five months of the 2019-2020 Fiscal Year Budget is $3,444,433 (Million) from the effects of the temporary U.S.-Mexico border closure to non-essential travel and the loss of sales tax revenues due to the COVID-19 pandemic.
Rodriguez told City Council that City Administration has reviewed the impact of the loss of revenues on the City’s budget based on a one-month figures and have developed recommendations to reduce $1,977,794.35 (Million) during the next five months of this year’s fiscal year and the use of the reserve funds of the City’s Bridge System and City to offset the projected $3,444,433 (Million) loss of revenues.
Mayor Luis E. Sifuentes advised City Council that the temporary closure of the U.S.-Mexico border to non-essential travel had been extended for another month until May 19, 2020, which will continue to cause significant loss of revenues to the City’s Bridge System and its projected contribution to the City’s General Fund for this year’s fiscal year budget.
Since the implementation of the temporary closure of the U.S.-Mexico border to non-essential travel between the governments of the United States and Mexico on March 21, 2020, the City’s Bridge System has suffered severe loss of automobile and pedestrian traffic through the two international bridges. For instance, before the temporary closure the two City-owned international bridges averaged an estimated 8,000 to 10,000 automobiles per day, but after the temporary closure the traffic flow of automobiles has decreased to an estimated 2,000 vehicles per day, causing a severe loss of revenues daily to the City of Eagle Pass.
Rodriguez highlighted the projected budget reductions to City Council to come up with the $1,977794.35 (Million) amendment, including reduce transfer to the Bridge Capital Improvement Reserve by $500,000; reduce Public Library Fund by $200,000; reduce transfer to Debt Service by $100,000; reduce transfer to Street and Sidewalks Fund by $400,000; reduce transfer to Main Street Program by $40,000; reduce transfer to Travel Budget by $65,000; reduce transfer to Training Budget by $80,000; reduce transfer Fuel Budget by $65,000; reduce transfer to Fire Department (Chest Compression System) by $40,220.30; reduce transfer to Police Department (NIBRS Upgrade) by $30,000; reduce transfer to IT Supplies Budget by $45,000; reduce Other Supplies Budget by $360,673.65; reduce Other Services Budget by $64,600.40; anticipated General Fund Personnel Savings due to vacancies by $292,000; and anticipated Bridge System Personnel Savings due to vacancies by $75,000.
Rodriguez informed City Council that these projections depend on how long the temporary closure of the U.S.-Mexico border to non-essential agreement lasts because of its direct impact on the City’s dependence on International Bridge System revenues.
Rodriguez advised City Council that the City’s International Bridge System revenues are 55% lower than last year and the worst they have ever been since the 2008 U.S. Financial Crisis. However, Rodriguez did have some good news to City Council stating that the City’s General Fund Reserve has $5,310,568 (Million) and the City can continue to operate until January 2021 if current financial conditions continue. Rodriguez noted that the City will make necessary adjustments to next year’s budget (2020-2021) should current trends continue.
Rodriguez added that currently the City does not have plans to lay off any employee, except extending the Emergency Leave Contingency Plan until April 26, 2020 as approved earlier. City Council members have expressed an interest in not laying off any employees.
The City of Eagle Pass’s financial dilemma depends on how long the temporary closure of the U.S.-Mexico border to non-essential lasts as it directly affects its Bridge System revenues and sales tax revenues from the hundred of thousands of visitors from Mexico who come to shop, visit, and do business in the United States, as well as Americans who travel to Mexico to do the same.
The Eagle Pass City Council still has to approve two more readings to the proposed Ordinance to amend the 2019-2020 Fiscal Year Budget before it takes effect. City Council may still make amendments or changes to the proposed Ordinance before its final approval.
