Dear Media and Friends,

Yesterday, underĀ agenda item 13.1, City CFO Robert Cortinas updated the City Council and public on the budget crisis sparked by the COVID-19 pandemic. I have attached his presentation to this email. Here are the salient points:

1. City sales tax revenue was down $1 million (11%) in March compared to March 2019. (pp. 13-14)

2. Airport operating revenues declined by $200K from February to March and another $600K from March to April. Airport enplanements were down 87% in April compared to April 2019. (pp. 15-16)

3. Sun Metro enterprise revenues declined by $97K from February to March and by another $377K from March to April, with daily ridership down 70% because of the pandemic. (pp. 17-18)

4. International bridges enterprise revenues declined $200K from February to March and another $600K from March to April, with a huge decline in southbound vehicular and pedestrian traffic. (pp. 19-21)

5. Hotel occupancy revenues were down $300K in March compared to March 2019, and they are set for a much steeper decline since hotel occupancy ranged from 27 to 38% in April and early May, compared to 67% to 75% at the same time last year. (pp. 22-23). This means that our insolvent Ballpark will need a much larger subsidy from the general fund in order to stay afloat.

In addition to this, we know that the City has furloughed 400 employees and cut the pay of more than 3,000 others.

Mr. Cortinas did not revise his previous figure of $26.4M in revenue shortfall for FY2020, even though the City revenue outlook looks more abysmal than ever.


In order to weather this extreme budget crisis, Mr. Cortinas stated that in FY 2021 the City should be “focusing on basics (priorities)” and cancelling all “debt issuance (defer non-essential projects)” since there will be a continued “decline through most of next fiscal year” and “sharp decreases in most revenue categories” (p. 24).

Yet, the City apparently cannot do without four new waterparks and a $500M+ multipurpose basketball arena!

City Manager Gonzalez and CFO Cortinas both know that there is no money to complete the QOL bond projects but the Mayor and fiscally illiterate City Council refuse to listen, for fear of offending their big developer donors. I believe that these two men know the truth but feel forced to remain silent.

As you know, on April 28 City Council voted against suspending the “Arena” and Mexican-American Cultural Center, claiming that they were suspended anyway. However, KFOX 14 reported only three days later that the City would hold a workshop on May 9 to discuss the design of the MACC! That does not seem like much of a suspension. Meanwhile, the City continues to pay millions in bond interest on these projects every year.

Enjoy your afternoon.