Hidalgo County presents $344 million 2026 general fund; 5% COLA accounts for $16 million in salary increases

Hidalgo County officials reviewed net changes to the proposed 2026 budget at a workshop, where staff said the county’s proposed general fund operating budget is $344 million, including a proposed 5% cost-of-living adjustment that accounts for roughly $16 million in additional salary costs.

“This is more of a recap of, summary of, of the 2026 budget,” Budget Officer Dabo Sotto said at the start of the workshop. He said staff sent supporting detail to commissioners over the weekend and were presenting only net changes at the session.

The recap shows current revenues of $344,000,000 matching proposed day-to-day expenditures: $222,000,000 for salaries and $122,000,000 for operating costs. Staff identified a net salary increase of $16,000,000—about half of which is attributable to a proposed 5% COLA—and net operating increases of about $12,000,000 compared with last year.

County staff told commissioners the general fund proposal would draw from four funding sources: current revenues, assigned fund balance, restricted fund balance and undesignated fund balance. Assigned fund balance available for appropriation is listed at about $42,000,000; staff said roughly $7,000,000 of that is set aside for countywide IT initiatives and facilities management.

Sotto said some funds labeled as “repurposed” are ARPA projects reallocated for one-time capital expenditures and will move into restricted fund balances. He described restricted funds tied to court fees and similar state-mandated accounts; staff said the county expects to begin the year with about $2,500,000 in those restricted accounts and proposed initially appropriating about $1,500,000 from them for 2026.

On undesignated fund balance, staff projected starting 2026 with about $105,000,000 before accounting for capital spending discussed at the first workshop. Sotto said the budget includes a contingency line equal to 3% of the operating budget—roughly $10.3 million—to allow flexibility for unforeseen initiatives or projects. With the county’s minimum policy balance of $50,000,000, staff estimated the proposed ending balance would be about $63.5 million under the current plan.

Road and Bridge highlights: staff reported estimated 2026 revenues of $29.2 million, up from $24.4 million in the prior year, producing a small projected surplus of roughly $64,000. The road fund’s available resources would include an estimated beginning fund balance of $6.9 million, about $12 million in 2026 revenues, and a one-time transfer in from the general fund of $10.3 million; after other costs, staff said about $28.1 million would be allocated across the county’s four precincts.

Commissioners and the judge asked staff to confirm departmental line-item changes and how certain costs were allocated. When Judge Richard F. Cortez questioned a $3,000 reduction for justice of the peace offices, staff said the amount was reclassified to the appropriate departments (janitorial and IT) so each department could track those expenses. Cortez also asked about funding tied to emergency services districts; staff said a newly created district would not collect revenues until the following year, so the county has set funds aside at the same level as 2025 and will appropriate them only if needed.

Sotto confirmed the county will file the proposed budget with the county clerk by the end of the day for public inspection and will also deliver a copy to the county auditor. He said the commissioners court will reconvene in one week with a motion to adopt the budget and to set the new property tax rate.

A motion to adjourn the workshop carried by voice vote at the end of the session.