Yesterday the El Paso Commissioners Court voted 3-2 to post notice to issue up to $400 million in certificates of obligation in support of UMC and the Children’s Hospital, with Commissioners Holguin and Stout dissenting.
Commissioner Holguin again stated her support for a bond election rather than issuing debt without voter authorization.
Commissioner Stout decried the lack of transparency and information and wanted to delay consideration for several weeks until all options could be thoroughly explored.
Commissioners Leon and Robinson expressed zero hesitation about issuing up to $400 million in debt without voter approval, with Robinson making the argument that UMC recently saved his life, therefore the County should issue COs rather than a general obligation bond.
Judge Samaniego insisted that he does not necessarily support a CO issuance but he does support posting notice even though, as Stout rightly pointed out, posting notice constitutes moving forward with the process per the posting language.
The CEO of UMC, Jacob Cintron, had told KVIA (see the 5:20 mark) that issuing a general obligation bond would cost up to $100 million extra and take until next spring to execute, but Stout corrected him, stating that it would cost at most $37 million extra and that there is still time to place a bond proposition on the November ballot.
Of the 15 members of the public who spoke, 11 of them–including myself–oppose issuing certificates of obligations and instead support a bond election so that voters have a say.
Among the opponents were the local Chair of the Libertarian Party and representatives of the Republican Party, as well as two Democratic Party leaders.
According to Kolenc, other opponents included “representatives of the El Paso Apartment Association, the El Paso Association of Builders, which represents homebuilders, and a hospital union. An El Paso Hispanic Chamber of Commerce survey found a majority of small business owners believed the proposed tax increase would damage their businesses, a chamber representative told commissioners.”
Under current interest rates, the debt would increase our property tax, already the second highest in the US among the 50 largest cities, by $55/year per $100,000 of valuation.
In addition, the City is putting a $399 million Community Progress (to Insolvency) Bond on the ballot that would raise our property tax by another $55/year per $100,000 valuation.
Between the City and County debt issuances, the owner of a $200,000 home would be on the hook for another $220 per year.
This means that in 2023 El Paso would likely surpass Detroit to have the highest residential property tax in the US among the 50 largest cities.
Let us hope that when the CO issuance comes up for final discussion and action 45 days after posting notice (per Texas law) that at least three of the five members of the Commissioners Court will choose to let the voters decide how to issue the debt.
Please write to the County Judge and Commissioners to let them know your opinion:
email@example.com; firstname.lastname@example.org; email@example.com; firstname.lastname@example.org; email@example.com