Consultant warns council: broad cuts risk service disruption; recommends targeted plan before 2026 budget

Jerry Pacheco of Tactical Governance Group briefed the Pueblo City Council on Oct. 6 about lessons from the 2008–2012 recession and how the city might approach potential shortfalls in the 2026 budget.

Pacheco told council that “percentage across the board cuts… don’t work” where departments have differing minimum staffing needs and enterprise funds operate independently. He said in 2008 the city faced a severe deficit and that staff needed to examine the undesignated fund balance and minimum mandatory staffing in public safety and other departments before proposing cuts.

Pacheco urged that the council clarify its undesignated fund balance, the city’s cash‑flow and stop‑loss insurance posture, and to consider citizen or blue‑ribbon panels for public outreach if difficult operational reductions become necessary. He described public‑safety, fire and wastewater as high‑cost areas with minimum staffing requirements and warned that cutting certain positions could produce outsized service disruption.

Councilors asked for concrete guidance on reserve targets and how to weigh one‑time options such as a premium holiday (a temporary rate reduction for employees) against long‑term investments such as an on‑site clinic. Pacheco recommended relying on actuaries and finance experts to model stop‑loss levels and reserve standards, and he said replacement of key senior staff may be unavoidable in a severe downturn but should be managed to minimize service impacts.

No formal council action followed the presentation. Pacheco made materials available and offered follow‑up consulting; councilors signaled interest in additional financial detail from HUB International and the finance department to ground decisions during the 2026 budget process.