City takes first step to new $43.2M budget

HARLINGEN — The city is closer to approving its biggest general fund budget in history.

Earlier this week, city commissioners approved the first reading of the proposed $43.2 million package that comes with a $764,715 shortfall.

On Sept. 5, commissioners are expected to consider its adoption.

“It’s a lean budget,” City Manager Dan Serna said yesterday. “It’s a balanced budget that will provide resources needed to provide services that our citizens deserve. We look forward to a very productive year.”

The city plans to dip into its $16.2 million cash reserve to balance the budget, Serna said.

He said shifting the money would leave the cash reserve fund at $15.5 million, enough to operate the city for more than 130 days.

Some of the proposed budget’s biggest expenditures would include a new $587,000 fire truck and $114,000 worth of breathing equipment.

Serna said the city’s “top priorities” include a bigger street program.

This year, the city has proposed spending $1.9 million to improve the city’s streets — up from $1.5 million this year.

In past years, the city has funded its annual street program through its general fund budget.

Now, the city’s new street maintenance fee charged to all utility customers is expected to generate about $1.4 million during the upcoming fiscal year.

The city plans to add $460,000 in fees expected to be generated from last June, when the ordinance became effective, through Sept. 30, which marks the close of the fiscal year.

As part of the budget, Serna earmarked about $200,000 to fund proposed 2-percent raises for city employees other than police officers and firefighters.

Meanwhile, the city continues collective bargaining negotiations with the local police officers’ and firefighters’ unions, both requesting either pay or benefits increases.

Serna said he has set aside money to cover possible pay increases during the upcoming fiscal year.

But the city could amend its budget to cover expenses stemming from collective bargaining talks, Mayor Chris Boswell said earlier this week.

“The commission can always change the budget even after the budget is adopted,” Boswell said. “Just because we budget doesn’t mean we have to make the expenditure.”

Last year, the unions failed to reach agreements on new contracts, so police officers and firefighters have worked under the contract’s so-called evergreen clause, which expires Sept. 30.

Serna said he believes the city can reach agreements with each union before the fiscal year closes Sept. 30.

But if the parties fail to enter into contracts, the city would approve a resolution to preserve police officers’ and firefighters’ salaries and benefits while entering into mediation, City Attorney Ricardo Navarro said.

The proposed budget also includes more than $300,000 set aside to fund an increase in employee health insurance coverage.

Earlier this month, commissioners approved a $6.5 million contract with Blue-Cross Blue-Shield, up from $6.2 million this year.