Helotes council debates pay raises, reserves and a third‑party salary study

Helotes city leaders spent the bulk of a council meeting debating how to fund employee pay increases after the mayor’s budget presentation showed a prolonged shortfall if the city does not sustain revenue growth.

The discussion centered on whether to continue the mayor’s strategy of building reserves and relying on investment income — which the mayor said has allowed past raises and property‑tax reductions — or to shift more revenue to immediate pay adjustments for police, fire and dispatch. Council also directed staff to solicit a third‑party comprehensive compensation study and a classification assessment and to return with a price and scope for council approval.

The debate illustrated competing priorities: maintaining multi‑year financial resiliency versus closing pay gaps now to reduce turnover among public safety staff. “This is not an employee pay increase‑friendly scenario,” Councilmember Schultz said, urging faster action to raise pay. Schultz argued a modest tax adjustment could add “an additional $134,601 for the city’s budget,” noting that equals about 70¢ a year on a $350,000 home.

The mayor framed the choice as one of long‑term sustainability. He said the city’s strategy over the past four years — lowering the city property‑tax rate while increasing savings and investment income — enabled larger raises without drawing down reserves. “If paying the right amount puts you [short] from somewhere, and absent a lot of commentary is how do we pay for that? If there isn’t an income to pay for it, you have to take it out of savings,” the mayor said, adding that depleting reserves could put the city at financial risk in future years.

Councilmembers and staff discussed specific figures raised during the meeting: the proposed budget contained an estimated shortfall next year of about $559,000 and a forecasted interest income shortfall of roughly $200,000 if investment returns decline. The proposed compensation plan included raised percentages that varied by department; council referenced examples such as 6%–8% increases discussed for certain departments and said those distributions could be revisited.

Several councilmembers pressed for a methodical review of pay structure, including “compression” (where long‑tenured staff and new hires have similar pay) and a total‑compensation approach that compares base pay plus overtime, certification pay and other differentials. Chief Moreland and other department heads were cited as contributors to the data that informed the current distribution of proposed increases.

Council directed staff to seek an independent compensation vendor to produce a data‑driven, total compensation study that would include comparisons to municipalities of similar size in Bexar County and relevant private‑sector benchmarks, plus recommended implementation options. City Administrator Hayes told the council that the study could be procured for under $50,000 and that any final contract or adjustment to the adopted budget would be brought back to council for approval.

Councilmembers who favored keeping the current budget distribution said the package already represented a significant step and expressed willingness to revisit adjustments midyear after receiving the study’s findings. Those who urged reallocation said they preferred shifting some of the current raise pool toward police to narrow a larger pay gap and reduce turnover.

Following discussion the council closed the item without taking an immediate budget vote; staff were directed to work with the finance department to validate numbers, complete the salary and classification study scope, and return with implementation options and any requested budget amendments.

The council also reviewed the first reading of the FY2026 municipal operating budget ordinance and the first reading of an ordinance setting the property‑tax rate at $0.31 per $100 of assessed value; no final votes were taken on those ordinances during this meeting.