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Commission approves PILOT resolution to return housing authority funds to resident services
Summary
The commission adopted Resolution 2026-636 allowing the Weslaco Housing Authority's PILOT payments to be returned to a nonprofit arm for targeted resident services: 60% for scholarships restricted to housing authority residents and 40% for a food bank and resident programs.
The Weslaco City Commission voted April 1 to adopt Resolution 2026-636 to formalize a pilot payment-in-lieu-of-taxes (PILOT) arrangement with the Weslaco Housing Authority that will direct PILOT funds to a nonprofit entity for resident services.
Marisa Carranza Hernandez, general counsel for the Weslaco Housing Authority, told the commission that the housing authority is a property-tax-exempt entity and that HUD rules restrict how PILOT funds can be used. "For this year, it's approximately $20,000 in taxes that would normally be paid to the city," she said, describing a program already adopted in nearby jurisdictions that returns PILOT funds to a nonprofit arm to support scholarships and resident programs. Under the proposal presented to the commission, 60% of returned funds would support scholarships limited to Weslaco Housing Authority residents and 40% would go to a food-bank program and other annual resident services.
Carranza Hernandez said the resolution has been reviewed by the city attorney and that the arrangement would not reduce the city's current receipts because the city previously waived the PILOT for the authority; instead, the payment would be processed and then returned to the nonprofit to fund resident services. Commissioners asked clarifying questions about the housing authority's portfolio and unit counts; the authority's representative summarized properties and programs that would be served.
A motion by Commissioner Perez, seconded by Commissioner Garcia, approved the resolution by voice vote. The commission directed that the housing authority report annually on the use of funds and invited commissioners to participate in the authority's scholarship banquet.
The resolution is intended to provide a stable local funding stream for scholarships and food assistance targeted to housing authority residents; the authority said it has modeled the proposal on similar programs recognized nationally.
