Elida S. Perez just published an excellent report on the City’s abuse of certificates of obligation. It is rare for El Paso Matters to delve into government financial matters, so this report is very welcome.
Perez correctly points out that the City has authorized $389 million in new CO debt since 2020.
She states that “the total outstanding certificate of obligation debt including interest as of 2021 stands at $787 million,” but her figure (from page 85 of the City’s FY 2020-2021 budget book) does not include the $189M in CO debt authorized since April. Adding that debt and future interest brings the total figure to over $1.1 billion.
Perez interviewed James Quintero, policy director with the Texas Public Policy Foundation, who stated that “It looks like the city [of El Paso] is using this device for a lot of discretionary purposes, or at least things that ought to be put before voters using a general obligation bond.”
Quintero goes on to state: “El Paso isn’t alone in abusing certificates of obligation. What’s really unfortunate is there are property tax implications too, to engaging in this sort of bad behavior.”
Perez indicates that 21 Texas cities hold more per-capita CO debt than El Paso, but unlike Anthony Jackson in his report, she does not mention that El Paso holds more per-capita CO debt than the five largest Texas Cities combined, although she provides the relevant chart from the Texas Bond Review Board.
All that said, I am glad to see El Paso Matters investigating the City’s financial policies.
Enjoy your afternoon.