Edinburg city leaders are considering spending cuts to afford employee health insurance.

This time last year, resident Argelia Guadarrama called Channel 5 News wondering what the holdup was with fixing the street next to her home.

"And they would finish some part of it, and then we thought it was done, and suddenly they'd show up again," Guadarrama said. "The manholes were not supposed to have been covered up; they had to dig them out and reset them."

Ebony Lane is already paved over, but neighbors are concerned about cuts made to the street paving program — a decision driven by the rising cost of health insurance claims for Edinburg city employees.

"One year later, the city is raising premiums but we're trying to do it in a financially responsible way," Edinburg Mayor Omar Ochoa said.

To find $1 million to pay for employees' health insurance, Ochoa said the city plans to cut administrative costs at city hall and scale back part of its street paving program.

"We had budgeted $2.5 million for the street repaving project. We were very proud of that number. We're going to have to trim that down now so we can lighten the burden on our employees because of these healthcare costs increasing," Ochoa said.

Ochoa said that for many years the city was insured through Blue Cross and Blue Shield of Texas, but a year ago the city switched to being self-insured.

That means, instead of a third party paying medical claims, the city now pays claims directly.

Blue Cross and Blue Shield of Texas still handles the administrative side, including collecting documents and processing claims.

"If we would have stayed fully insured, the rates would've been even higher," Ochoa said.

The city spent about $9 million on health insurance for employees last year. This upcoming year, the cost is projected to go up to $10 million.

To make up for the costs, Ochoa hopes people will continue to shop in Edinburg and build more houses. He said he does not want to raise property taxes, but if the city can't find the money needed, it may have to.

The public budget meeting is scheduled on September 15 at 6 p.m. at city hall and the budget proposal is available online.

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