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El Campo staff present FY2026 budget with no raises, propose no‑new‑revenue tax rate
Summary
City staff presented a roughly $28.7 million FY2026 budget at a Sept. 15 workshop, proposing a no‑new‑revenue tax rate of 0.49144 and outlining $232,000 in general‑fund cuts after a $656,000 sales‑tax shortfall; staff said there will be no action tonight and asked council for direction next week.
At a Sept. 15 budget workshop, El Campo staff presented a proposed FY2026 budget totaling about $28.7 million and asked the City Council for guidance ahead of the ordinance that must be adopted next week under the city charter. Staff said the proposed tax rate is the no‑new‑revenue rate of 0.49144 and emphasized that the package contains no across‑the‑board pay raises or new general‑fund positions.
The city manager told the council the budget process begins months earlier with detailed, line‑by‑line reviews of every position and that the FY2026 package had been tightened after a fall in sales tax. “We cut 232,000 on the general fund,” the manager said, adding the city saw roughly $656,000 less in collected sales tax than projected. Staff said they avoided setting a tax rate above the no‑new‑revenue level and removed some one‑time items and transfers to balance revenues and expenditures in accordance with the charter.
Finance staff walked the council through fund totals and revenue sources: general fund, water and sewer, EMS, and debt service were presented alongside smaller enterprise and special funds. Staff noted $22.2 million in active grants that sit outside the operating budget and highlighted interfund transfers that cover utilities debt service and fleet replacement. “As required by Charter, your revenues must equal your expenditure,” staff said, noting the legal constraint that the budget not be balanced by drawing down fund balance.
Department‑by‑department adjustments were shown in the stacked slides. Staff said the general fund is down about $221,830 from the prior year after departmental cuts, and that most departments will see only adjustments to reflect actual earnings, retirement and insurance costs. “There are no raises in this budget,” one presenter told the council when summarizing personnel changes.
Council members asked for clarifications on transfers and recurring costs — notably recurring software and IT licensing fees — and requested a concise memo that summarizes total street‑maintenance spending across the general fund and the transportation user fee so they can compare year‑to‑year totals. Staff said IT costs include recurring licensing (financial software, planning software and other enterprise tools) and one‑time conversion charges for implementation.
There was no motion or vote at the workshop. Staff asked for directional feedback and will return next week with the ordinance language needed for formal adoption.
