Odessa staff preview fee changes, revenue upticks and a proposed 5% citywide pay increase

City of Odessa staff opened a budget workshop by presenting proposed revisions to the city fee schedule and early revenue projections, and by recommending a 5% across-the-board cost-of-living adjustment for city employees pending completion of a market salary study.

The presentation, led by a staff Presenter, noted the city is negotiating with Allstate on electronic-payment contract terms and plans to add a line to the fee schedule clarifying that “all electronic payment convenience fees are charged by the provider and not included in the City of Odessa payment system.” The Presenter said the proposed fee schedule “is a more, fair distribution” and conceded it ‘‘isn’t perfect’’ but should reduce the largest revenue shortfalls.

Why it matters: the fee and payment changes are incorporated into the budget package staff will return with final numbers before formal approval; some fees and software arrangements—particularly the merchant licensing system and online payment provider—affect how much of the convenience-fee revenue the city actually keeps.

Staff displayed revenue projections showing several sources trending upward: real-estate tax receipts were projected to rise about 11% because of valuation increases, personal-property revenue was forecast to increase about 5%, and merchant-license receipts were expected to climb roughly 12.5% as more businesses licensed through the city’s cloud-permit system. Presenter also flagged an anticipated 50% jump in building-permit revenue tied to fee-schedule changes.

Council members pressed staff on timing and authority. One member asked whether the city’s governance limits how much base rates can be raised; another warned about the county’s pending ballot measures that could alter the allocation of sales- or property-tax revenues. Staff recommended waiting for the ongoing electric-rate study before changing utility rates and said any adjustments would be made prior to finalizing the budget.

On personnel, staff described a draft market salary study and proposed a 5% cost-of-living increase to begin the budget cycle while continuing work to phase any market-based adjustments. Staff warned the salary study remains in draft and that implementing its full recommendations will require phased changes, employee involvement and careful communication to preserve confidentiality around individual salaries. “We want to make sure that they’re involved, and we have a legitimate communications plan before we hit go,” the Staff member said.

What’s next: staff will revise the fee schedule as contracting with the payment provider is finalized, incorporate the rate-study results when they are available, and return a full budget packet for formal approval. The city also scheduled a follow-up budget workshop to review detailed departmental impacts of the salary study and projected fund balances.

Ending note: the workshop did not include any formal votes; staff described the items as proposals and next-step recommendations to be reflected in the final budget documents.