LA MARQUE, Texas – The City of La Marque is on the brink of going broke and the council is now considering a multitude of options to keep the city and services running.
“We’re down to our last $1.2 million,” interim city manager Barbara Holly told KPRC 2 News on Monday. “We’re down quite a bit.”
In a confidential email obtained by KPRC 2 that Holly sent to the mayor and council last week, she said the $1.2 million “is enough to carry the city for just over two weeks.”
“They did not bring in the revenues that they projected and they spent more than they said they were going to spend,” Holly said.
Holly estimates the city needs up to $5 million to get through the rest of this calendar year, or as little as $3 million if hurricane season doesn’t cause additional financial harm.
She has been on the job for about five weeks and quickly implemented a hiring freeze and stopped all travel and training.
In the email to council, Holly also recommended a tax rate increase, raising water, sewer, or trash rates, and/or getting an emergency short-term loan.
“What we need now are dollars to keep the lights on,” Holly said.
Holly explained that previous city leadership appears to have not provided the council and mayor monthly financial statements, bank balances, budget versus actual reports for each department, and timely audits.
She said the city needs to have a minimum of 90 days in reserve, and recommended the finance committee create guidance and guardrails.
Last year, a group of residents testified to the council calling for a forensic audit of the city’s books, but the measure didn’t pass.
“They’re just going after citizens again. Where’s our money? Apparently it’s gone somewhere, there’s been mismanagement somewhere,” said Laura Divine, a longtime resident who called for the audit last year. “It’s sad that we’ve gotten ourselves here, and it hasn’t happened overnight.”
Divine, who also previously ran for council, has watched the city’s books for years and is concerned there may not be enough oversight on spending.
“Let’s get rid of this dark cloud hanging over La Marque,” she said during the council meeting last year to call for the audit.
Divine is especially concerned about the lack of funds now in the height of hurricane season.
Holly said her review of the books hasn’t shown any criminal activity, but the financial instability may have started two years ago and gone undetected or unreported.
“We need to make sure that this community survives,” Holly said, “and it has a very real chance of not doing that.”
Monday city council meeting
During Monday’s city council meeting, officials voted to accept a financial plan proposed by the city’s financial director aimed at addressing the budget shortfall.
The plan includes several measures to raise funds and stabilize the city’s finances:
- A proposed tax rate increase to 45 cents, which could generate approximately $900,000
- Adjustments to water and sewer rates
- Short-term emergency and regular loans
- Use of the revitalization fund and grants
- Requesting a loan from the Economic Development Corporation (EDC)
Officials noted if the tax increase is approved, homeowners could see their annual property tax bills rise by about $90 on a $150,000 home and $150 on a $250,000 home.
Some residents voiced concerns during the meeting, demanding transparency and a forensic audit to determine where city funds have been spent.
“We’ve asked where the money has gone... forensic audit to be done... definitely hasn’t been spent on the city,” one concerned resident said. “We have been struggling financially for a while and have asked repeatedly for a forensic audit to find out where this money has gone.”
City officials emphasized that the proposed tax increase would not be permanent. The city has also implemented a hiring freeze, except for essential positions. The mayor has requested monthly financial reports to improve transparency moving forward.
The tax rate proposal is not final and will be discussed in upcoming meetings. City leaders encourage residents to stay informed and participate in the process.