City Manager Rob Houston told the City Council on Nov. 25 that Southgate faces a structural budget gap that could require cuts of roughly $8 million to $9.4 million if no new revenue is found. He outlined a possible local Utility Users Tax, which would add a percentage charge to utility bills (electricity, water, sewer, gas, cable and streaming services) and return 100% of revenue to the city’s general fund.

Houston said UUT rates in nearby cities vary from about 2% to 10%, and that a midrange example of 8% could add roughly $29–$60 per month to a household depending on usage. He said the city could use the revenue for public safety, pothole and sidewalk repairs, and park maintenance, and that the council could place a general‑tax UUT on the ballot; a general tax requires a majority vote (50% plus one) to pass. He added the mechanics and timing—such as declaring a fiscal emergency to meet a June ballot deadline—would require specific council action.

Why it matters: Unlike sales or property taxes that are shared with other agencies, the UUT would be a local tax that stays in Southgate, making it an attractive option to preserve programs residents often cite as priorities.

What residents said: A long public‑comment period followed the presentation. Several speakers, including Chingas Dominguez and other residents, said they distrust the city’s handling of prior federal ARPA funds and asked for detailed accounting and proof that staff and internal cuts have been exhausted before asking voters to pay more. Dominguez alleged the city attorney’s contract and firm payouts were excessive and demanded transparent settlement reporting; staff said detailed ARPA accounting exists and will be provided.

Council response and next steps: Councilmembers called for more public education and financial detail before any ballot action. Several asked staff to return at the first meeting in January with a clear analysis of reserves, a list of proposed cuts that would be required if no new revenue is approved, and answers to specific questions about ARPA reporting and liabilities. City Manager Houston said staff will prepare two budget scenarios (with and without a UUT) and public‑engagement materials, and described a planned outreach program including FAQs, mailers and a random‑sample survey.

Procedural matters: If council wishes to put a general UUT on a June election, staff said a declaration of fiscal emergency and a resolution would likely be required by the council in late February to meet election law deadlines; a November ballot option would not require that particular declaration but would delay any revenue until later in the year.

What remains unresolved: Residents pressed the council for detailed, itemized ARPA and other spending reports before asking voters to approve a tax. Council members agreed transparency and public outreach are essential, and directed staff to return with the requested financial detail and two budget scenarios in January.