Damage from Hurricane Harvey and precipitously declining sales tax revenues have led Hitchcock officials to institute a hiring freeze and halt capital projects and have inspired calls for a deep dive into the city’s finances.
Commissioners on Aug. 21 approved a balanced general budget of about $4.58 million in both total revenues and expenditures, documents show.
But that was before Hurricane Harvey made landfall on the Texas coast.
Parts of Hitchcock, just north of Galveston Bay and west of Interstate 45, were hit hard by Hurricane Harvey, which made landfall Aug. 25 in Rockport, 200 miles south of the county and moved up the Texas coast.
The storm dumped more than 50 inches of rain in some areas, swelling creeks and bayous and flooding an estimated 20,000 homes in Galveston County.
More trouble came when Mayor Anthony Matranga was briefly hospitalized following the hurricane and eventually resigned Nov. 27.
City commissioners in a 3-1 vote appointed Dorothy Childress, who was mayor during Hurricane Alicia in 1983, to replace Matranga.
Meanwhile, some commissioners are calling for a close look at the city’s books and for the cause of a 55 percent decline in sales tax revenue that began well before the storm.
“We need a clear idea of where income is coming from and going,” Commissioner Monica Cantrell said. “We just need a clear budget process that is audited properly.”
Childress vowed Wednesday to keep Hitchcock’s budget in order through a difficult time for the city.
“I’ve looked at the budget, which is balanced, and intend for it to remain that way,” Childress said. “It’s a pet project of mine to do right by those projections.”
Since taking office, Childress has instituted a hiring freeze for open city positions and has temporarily halted all capital improvements as city officials work through the Hurricane Harvey recovery process, she said.
Hitchcock has about a month to produce all the necessary paperwork to get reimbursed for Hurricane Harvey damage through the Federal Emergency Management Agency, Lucy Dieringer, Hitchcock’s city secretary, said in an earlier interview with The Daily News. It needs the help of an engineering firm to get that done, officials said.
As city officials work to complete FEMA-related deadlines, they are also coping with declining sales tax revenues.
The city in 2015 received about $2.38 million in sales tax revenue from the state’s comptroller office, records show. That number declined to $1.53 million in 2017 and down to $1.06 million this year with one month left to go, records show. That was a 55 percent decline in two years.
Several city officials have blamed the decline on different companies not paying sales taxes.
“There is a company we were getting a decent amount from, and then all of a sudden it got cut in third,” Commissioner Mark Cook said.
Cook was uncertain which company was responsible and directed inquiries to Dieringer for more specifics.
Dieringer, along with Mayor pro tem Randy Stricklind, did not respond to multiple requests for comment about sales taxes Wednesday.
“I haven’t seen anything about the sales taxes yet,” Childress said. “But if I find out some of the rumors merit my time, I will spend it and do my own analysis.”
Before Childress was appointed to replace Matranga, Dieringer was the ranking city employee because Hitchcock does not have a city manager.
Multiple city officials, including Childress, said they were hopeful that a planned deal with a consulting firm to review the city’s organizational structure, financial operations and planning would help clear up some of the issues.
Commissioners on Nov. 7 authorized Mayor pro tem Randy Stricklind to negotiate a deal with C.B. “Bix” Rathburn, a former county economic development director who resigned in June to become an independent consultant.
That power has since gone to Childress, who said she was working on an agreement with Rathburn and hoped she would have something to present to commissioners soon.