AG Paxton looking into El Paso, other Texas cities as part of financial transparency review

Update (3:18 PM): A spokesperson for the City of El Paso provided ABC-7 with the following statement addressing AG Paxton's financial transparency review:

"The City of El Paso has always complied with all applicable laws, rules, and regulations related to its budgeting, tax rate adoption, and financial reporting. We take our responsibility to uphold transparency and fiscal accountability seriously and consistently meet all deadlines for audited financial statements and required disclosures. Each year, the City submits its audited financial statements to all pertinent agencies and posts them to the Electronic Municipal Market Access (EMMA) system, the City’s website, and the Federal Audit Clearinghouse. Our most current Annual Comprehensive Financial Report (ACFR), along with reports for the prior 20 years, is available on the City’s website.

We share the State of Texas commitment to transparency in government finances and appreciate efforts to further strengthen public understanding of how tax dollars are managed.

Transparency and accountability have long guided the City of El Paso, and have also been recognized by the Government Finance Officers Association, which has awarded the City the Distinguished Budget Presentation Award for its budget as well as the Certificate of Excellence in Financial Reporting for the ACFR for 30 consecutive years, in addition to recognition for the Popular Annual Financial Report.

Regarding Senate Bill 1851, which took effect on September 1, 2025, the City has not raised property taxes in violation of this law. SB 1851 was not in effect at the time City Council adopted the fiscal year 2026 tax rate, and the City remains in full compliance with the statute and all related requirements.

The City has not received a request from the Office of the Attorney General related to this initiative. As with any request from state authorities, the City will review and respond in accordance with state law and established public information procedures. Because our financial practices already align with state transparency and reporting standards, we do not anticipate any operational or budget impacts as a result of this review."

Laura Cruz-Acosta

AUSTIN, Texas (KVIA) -- Texas Attorney General Ken Paxton is reviewing nearly 1,000 cities to ensure they are following SB 1851, a recently enacted state law that bars cities that do not strictly follow the state's financial statement audit and transparency requirements from raising taxes above the no-new-revenue rate. El Paso is one of the cities under review, Paxton's office says.

"To enforce that law, Attorney General Paxton previously sent letters to La Marque, Odessa, Tom Bean, and Whitesboro to stop their unlawful tax raises," Paxton's office explained.

The office says that during that process, they discovered some cities allegedly fail to comply with the requirement. In response, Paxton has launched an initiative to look into these cities and to request audit information from them.

"Any cities not in compliance put themselves at significant legal risk, and any city who has received an email information request from the Office of the Attorney General should promptly respond," Paxton's office stated.

Paxton is reviewing the following cities, according to his office:

• El Paso
• Houston
• Galveston
• San Antonio
• Dallas
• Fort Worth
• Lubbock
• Wichita Falls
• McAllen
• Beaumont
• Amarillo
• Corpus Christi
• Laredo
• Texarkana
• Brownsville
• Waco
• Tyler

“Local officials will not be allowed to ignore the law, cover up their finances, and burden Texans with never-ending tax increases,” said Attorney General Paxton. “Our cities and municipalities must prioritize transparency and minimizing the tax burden of every citizen across the state. While many cities have already complied with these requirements, I’m launching this review to ensure that the law is universally followed, taxpayers are respected, and local government is accountable to all Texans.”