Nearly one year ago, the Nogales City Council set a 2018-19 budget that included a $1,000 holiday bonus for all city employees, to be distributed near the end of 2018.
That represented a doubling of the $500 holiday bonus city employees received in 2017.
Almost a year later, the council has effectively decided that city employees, who eventually received a $500 bonus in 2018, won’t receive the full $1,000.
At a June 5 meeting, City Manager Frank Felix told the city council that he recommended foregoing the additional $500 payouts.
“Given what we have discussed in the budget hearings these last couple of days, perhaps it would be more prudent to pass on this at this time,” he said.
After Mayor Arturo Garino and Councilman Marcelino Varona, Jr. stated their opposition to distributing the second half of the bonus, the council took no action on an agenda item to distribute the second half of the planned $1,000 bonus.
“I hope the employees understand what we’ve been faced with this year on this budget season and all the work we’ve been doing just trying to balance the budget,” Garino told the NI.
“I respect the employees and I love the work they do,” he added.
In 2012, 2013 and 2017, city employees received a $500 bonus. In 2014 and 2016, they received a pay raise.
The latest bonus was approved by the council in 2018 under then-Mayor John Doyle, and the city’s budget for Fiscal Year 2019 (which began on July 1, 2018) included a $1,000 holiday bonus for the city’s 250 employees.
But in November 2018, Varona persuaded the council to halve the planned bonus after raising concerns that the “hardening” of the local ports and border fence by Army troops would discourage Mexican shoppers from crossing into Nogales. Varona suggested that the council consider paying the second half of the bonus in Spring 2019, after reviewing holiday sales tax collections.
Sales tax revenues did decline year-over-year during the November 2018-January 2019 holiday shopping season, but only slightly.
Transactions made during that period generated $2.20 million in tax revenue for the city, down from $2.26 million for the same period in 2017-18, but still up from the $1.86 million collected in 2016-17.
The council returned to the question at its April 17 meeting, where Felix said: “We feel at this time we have the dollars available” to pay the second half of the bonus.
City Finance Director Jeanette Parrales stated at that meeting that the city’s revenues exceeded spending by $1.5 million for the Fiscal Year through March, even though revenues were $648,000 under budget expectations.
Distributing the additional $500 bonus to all employees would cost the city a total of $151,000, she said.
But Garino criticized Felix for not being conservative enough with the city’s money and, after more than a half-hour of discussion, the council agreed to defer the issue again.
On June 5, Felix changed his tune and the council only needed four minutes to scrap the additional payout for good.
Varona endorsed the city manager’s latest recommendation and Garino added that he wanted to put the matter to rest.
“I don’t want to table it (and return to the issue at another time). I want to make sure that this is something that doesn’t come back,” the mayor said.
“We have not taken a vote, but we have reached consensus here,” Varona added.
In fact, only Varona and Garino had spoken on the issue.
When the mayor solicited comments from the other council members, none responded.