City Council to use millions in Montana Rapid Transit System money to rehab city building

City borrows money from other projects

EL PASO, Texas - El Paso City Council on Tuesday voted 6-2 to use Montana Rapid Transit System funds to renovate the Luther Building for the relocation of city offices.

The motion passed 6-2. City Rep. Carl Robinson abstained and City Rep. Eddie Holguin voted against the move.

The City estimates it's going to cost $13.3 million to renovate the Luther building, which was donated to the City by baseball team owner Paul Foster. Ten million dollars is going to come from leftover certificates of obligation, or debt, of other projects that came in under budget. The remainder $3.3 million will come from the Montana Bus Rapid Transit System.

The transit system is a high speed bus system with more stops that are elevated and easier to access and with the ability to prolong green lights. The City has five RTS planned. The first corridor, Mesa, is now under construction.

"Obviously I never envisioned we having to borrow from Peter to pay Paul," said City Rep. Emma Acosta, who weeks earlier had ordered City staff to find a way to fund the renovation of the entire Luther building and not just the first three floors, which was a previous option.

"If we did not do what you're proposing, we would still need to come up with the funds somewhere. We'd issue debt and if we issue debt, then we would raise taxes. So this is making sure we don't issue new debt and raise taxes," Mayor Oscar Leeser told City Manager Joyce Wilson.

Robinson took issue with Leeser's characterization of the funding options.

"We did incur debt on this relocation," Robinson said. "Some of us understand that, others don't. When you look at the relocation as a whole, we did incur debt. When you single out this building (we didn't issue new debt) but this building was part of the total package of the relocation so we did incur debt."

The City estimates it will cost a total of $45.8 million to completely relocate City Hall. That includes purchasing the former El Paso times and Texas building, retrofitting them and moving City staff and equipment.

Council is in the middle of budget sessions for the 2014 fiscal year and the City is  considering a tax increase partly because of the cost of relocating City Hall.

Construction for the Montana RTS is supposed to start in 2017 or 2018, according to Wilson. Acosta said the City had issued certificates of obligation to partly fund the process of building the RTS and in hopes of luring in federal and state dollars, when the time.

Council approved the using part of the R-T-S money on the Luther building, with the understanding they'll have to somehow replenish the money before 2017. Wilson said the city will still have about $5 million for the Montana RTS, after Council reprograms the $3.3 million for the luther building.

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