El Paso taxpayers owe over $3 billion in debt according to data legally required to be published by the City of El Paso. The debt is paid for via El Paso’s property taxes. At 2.13%, the City of El Paso has the second highest property tax rate in the nation. On average, El Paso homeowners pay about $3,000 in property taxes. In addition to funding operations, property taxes are used to pay for street repairs and quality of life venues, often via debt payments to payoff the money borrowed by city council to fund the projects. Generally, there are three types of debt that cities can incur. They are certificates of obligations, general obligation bonds and commercial paper.

The Three Types of Municipal Debt

The first of the three types of public debt are the General Obligation Bonds (GOs). GO’s are taxpayer approved debt that the city issues to fund projects such as a library. Unlike Certificates of Obligations (COs), General Obligation Bonds (GOs) require voter approval before the debt can be issued. The second type of debt are the COs, which as stated, do not require voter approval. Although intended for emergencies, many taxing entities like El Paso use them for public works, such as street work. In Texas, Certificates of Obligation were authorized in 1971.

Although COs do not require voter approval, voters can force a vote on COs if 5% of the registered voters sign a petition asking for certificates of obligation to be voted on. If the petition is recognized by the City as valid, it must then hold an election before issuing the COs.

The third type of public debt is Commercial Paper (CP). Think of Commercial Paper as an unsecured credit card with which the city pays bills with. CPs are short term loans that should be paid back within 270 days.

The El Paso Debt

According to the Texas Bond Review Board: Bexar County has issued $571 million, Travis County has issued $555 million and El Paso has issued $541 million. [3] That was before El Paso’s city council recent authorization to issue additional COs. [1] It should also be noted that the El Paso County Hospital District, (UMC) is also listed among the top 20 CO issuers in Texas. The University Medical Center of El Paso has issued $128 million in certificates of obligation. Together, El Pasoans owe almost $700 million in certificate of obligation debt. [3]

However, of the top six cities in Texas, El Paso ranks as the highest issuer of certificates of obligations at $541.1 million, or $793 per capita, according to the Texas Bond Review. For taxpayers, not only is the total debt important to note – especially in terms of certificates of obligation – but when it is shown as a cost per taxpayer (per capita), El Paso’s $793 is much higher than San Antonio whose per capita expense is $278 on $426.3 million in COs and Austin’s $285 on $274.4 million. [3]

El Paso is also issuing Commercial Paper to fund expenses. The City of El Paso began issuing commercial paper (CP) in 2017, pledging taxes to pay them. In 2017, El Paso issued $30.7 million in CPs, $23.5 million in 2018, and $16.9 million in 2019. In 2020, El Paso had $12.6 million in commercial paper debt, according to the Texas Bond Review Board. [3]

That is in addition to the El Paso Water Utilities using $190 million in commercial paper from 2016 through 2020. In 2020, El Paso Water Utilities had $50 million in CPs. [3]

Taxpayers Owe Three Billion Dollars

The City of El Paso owed $1,368,510,000 in certificates of obligation in February 2021, not including accruing interest. Including interest, El Paso taxpayers owed $2,066,262.270 in COs in early 2021. The additional certificates of obligation authorized by city council in July obligates El Paso’s taxpayers to add another $146 million in debt. [1]

The County of El Paso owed $143,173,147, not including interest payments, in May 2021. [2]

Total El Paso Debt

The Texas Bond Review Board tracks the amount of debt issued by taxing entities like El Paso. According to their data (accessed August 12, 2021), in fiscal year 2020 El Paso has 47 outstanding debt bonds totaling $3,207,829,955, of which $975,688,955 is interest.

<object class="wp-block-file__embed" data="https://elpasopolitics.files.wordpress.com/2021/08/ep_debt_report_2021.pdf&quot; type="application/pdf" style="width:100%;height:600px" aria-label="Embed of <em>Download list of outstanding City of El Paso debt here. Download list of outstanding City of El Paso debt here. Download

Although it is a common myth that renters do not pay property taxes, tax costs are built into the rent rates. Economies of scale may tend to suggest that renters pay less in property taxes or none at all, but the reality is that commercial properties pay a higher rate than private homeowners because they do not have access to homestead and other exceptions. However, to understand property taxes and renters it is important to understand the living footprint. In a 1,200 square foot house, the property taxes are paid for by one family. In multifamily housing, like apartments, that same 1,200 square foot footprint can be dividing into four units, or even eight units or more if stacked on top of each other giving the impression that renters pay less in property taxes. Yet, they proportionally pay more on their living footprint – through rent payments – because their property tax is assessed as a commercial property via their landlords.

The only exception to multi-family housing property taxes is the Housing Authority of El Paso which provides 6,500 public housing units, according to them. Because their housing is considered “essential public and governmental purposes,” their properties do not pay property taxes, thus its residents do not pay El Paso property taxes.

The Pandemic Economic Impact

“El Paso finances worsened prior to the pandemic,” says a January 26, 2021, report by the non-profit Truth and Accounting that analyses financial report that cities are required to make public. According to the report, that El Paso’s economy was “in poor fiscal health,” before the pandemic. The report goes on to state that “El Paso did not have enough money set aside to weather” the pandemic and that the city “is expected to lose some revenue as a result of the pandemic.” [4]

In addition to property taxes, the city relies on fees for services like airport and bridge fees to pay its bills. But it is the taxes that fund most of the city’s debt. El Paso’s “financial position worsened by 29 percent” in 2020, “mostly due to low return on investment for the city’s pension plans” says the 2021 report. [4]

Truth in Accounting has given El Paso a “D” grade on its finances. [4]

The non-profit wrote that “El Paso’s elected officials have repeatedly made financial decisions that have left the city” with a large debt burden. [4] In addition to the debt burden, the non-profit says that although El Paso city officials release their legally mandated financial reports within the 180 days deadline, El Paso nonetheless waits until the last possible moment – 180 days – to release its financial reports. [4]

The reports on El Paso’s economic outlook are mixed. However, regardless of how soon El Paso recovers from the pandemic economy its debt continues to spiral out of control putting more El Paso homeowners in financial peril.


  1. El Paso City Council Resolution, “Approving and Authorizing Publication of Notice of Intention To Issue Certificates of Obligation,” February 15, 2021.
  2. County of El Paso, “Notice of Intention to Issue El Paso County, Texas Certificate of Obligation,” May 10, 2021.
  3. “2020 Local Government Annual Report, Fiscal Year Ended August 31, 2020,” Texas Bond Review Board, January 2021.
  4. “Financial State of the Cities 2021,” Truth in Accounting, January 26, 2021.

Martin Paredes

Martín Paredes is a Mexican immigrant who built his business on the U.S.-Mexican border. As an immigrant, Martín brings the perspective of someone who sees México as a native through the experience...

One reply on “El Paso Taxpayers Owe Three Billion Dollars”

  1. El Paso city council members are removed from reality by several magnitudes. COs have been issued for ‘quality of life’ projects that are not needed. Quality of life to me is driving to the grocery store without doing damage to my car, yet the roads are in atrocious shape. Our garbage servic costs more than what for profit companies in localities that are not poor charge and is oppressive for large families (additional containers cost around $20 per month extra). Routine road maintenance, when rarely done, isn’t financed by the general fund. Bonds or COs are sold for that. Quality of contracted work is shoddy and prices are higher than the national average (El Paso is a poor city with poor people who are kept poor by Democrats. Federal government pumps copius dollars into the city, much of which is misappropriated. The latest is diverting COVID-19 funds to street repairs. We have a new stadium that many can’t afford to go to, that the general fund supported since built. It can’t pay its own debt and was financed by the city. Team owners make a profit, but the city pays their way. Before the bonds are paid off, it will need renovations or replacement. Heaven forbid it be maintained. Fenway Park or Wrigley Field would have been long gone in El Paso. Our new arena was approved by voters eight years ago. Bonds were sold, but there isn’t even a site to build it, much less a plan. How did they know how much the cost would be? They didn’t. Bond money is being paid to lawyers fighting over a site. Older bonds are being refinanced. The monthly payment goes down, but the term is stretched from a few years to far longer. City concil and the budget office calls this ‘savings’. The only way these elected officials and a city manager that has a salary, that with bonuses (contract negotiated by city council) higher than POTUS is that voters are apathetic and not paying attention. They talk about ‘brain drain’ in this city… anyone with medium or better intelligence leaves to places that don’t cost more, but salaries and opportunity are much higher. El Paso grew – more indigents and migrants and more people moved here than left, but the growth rate was slower than the rest of the country (ala California at a national level) and will lose representation at the state level. The state may have to take over city finances and strip city council of all powers of increasing debt. They are cheats with no regard for the citizens. Quality of life here is poor and wont get better by taking food off the table of its low income citizens for politicians to build unneeded and under utilized monuments to themselves. We have 100 passenger 1.4 million dollar buses (high cost to operate and maintain) that won’t fit into neighborhoods and high fares, limited routes, and usually from zero to ten passengers. Typical of the mismanagement of our so-called city ‘leaders’. If every taxpayer stepped up and paid off the El Paso city debt today by selling their possessions or retirement savings, this would green light signal to city council to start spending even more. My mortgage principle and interest is less than my property taxes and I am at a seven percent rate (old mortgage). Today’s low mortgage interest has been used as justification to double my assessed value and taxes – already the highest in the United States except one other city that is in financial trouble. I witnessed what happened in Detroit and Pontiac, Michigan with state takeovers, and it needs to happen here in order to fix the city that city council has pretty well destroyed. I will be moving out of El Paso, despite the fine weather and good people. I will move to Frisco, where its much nicer and they have water, and more affordable when salaries are considered.

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