(Alton, Texas) The police chief in this South Texas town has been charged with two counts of sexual assault for allegedly violating male employees who were passed out at his home during parties.

Jose Luis Vela, 42, was being held in the Hidalgo County Jail on $200,000 bond after his Thursday arraignment on the two felony charges. The city has placed him on paid leave pending the outcome of the case.

"This is the first time I've ever heard of a chief of a police arrested for sexually assaulting his employees," said Sheriff Lupe Trevino, whose office started an investigation last week based on a tip from a friend of one of the alleged victims.

As he was led out of the courtroom Thursday, Vela denied the charges and said he did not know who his accusers were.

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City Manager Jorge Arcaute said the city's employees must work through the shock of Vela's arrest. The town of about 4,400 residents is located 10 miles north of the Mexican border in the Rio Grande Valley.

"This will reflect poorly on us," Arcaute said. "The challenge for us is to keep doing a good job and work harder. We're up to the challenge."