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Environment

July 6, 2018

Volume 40, Number 14

In this holidayshortened week, it seems appropriate that a number of short items should dominate this edition of the newsletter.  Not that they are any less significantIts just they can be covered with a few sentences or paragraphsTake the now-defunct ban on single-use plastic bags as our first example.

It didn’t take long after the Texas Supreme Court ruled local bag bans ran afoul of state law for the state attorney general to take action.  (Austin has had a bag ban since 2013.)  This week, Attorney General Ken Paxton officially notified Austin and other Texas cities their local ordinances were illegal and therefore unenforceable.

To make sure the word got out, Paxton directly notified the City of Austin, Mayor Steve Adler and the 10member Austin City Council, then he issued a press release to the media.  Now what?  The ruling that banning plastic bags is illegal as of this moment should stand until some counter action – if at all – is taken.

 

 

It may not be long now before you see electricpowered, autonomous transit vehicles circulating in Downtown Austin.  It will be a pilot program instituted in two phases technology testing and actual service runs.

The testing by Capital Metro and the City of Austin Transportation Department could begin later this month and take up to 60 days.  During the second phase, proposals will be evaluated to lease six vehicles, carrying up to 15 passengers, to run in the pilot program for 12 months.

CapMetro thinks the fleet of vehicles will be in operation on downtown streets in late fall.  Not to worryCapMetro says operators will be on board while the autonomous electric vans are being evaluated and running in service.

 

 

For Austin airport travelers, and those picking up arriving passengers, the renovated cell phone lot is offering this month a Texaco fuel station, 120 parking spaces, a convenience store (serving tacos, BBQ, etc.) and electric vehicle charging stations.

Read more →

June 22, 2018

Volume 40, Number 12

Too often the debate about energy sources becomes an usversusthem discussion – “fossil-fuelsversusalternativefuels.”  Energy is vital to Austin and the rest of Texas.  Texas is a world leader in fossil fuels with enormous oil and gas availability.  Not as well-known, is the fact that Texas is fast becoming a leader in capacity to generate electricity from an alternative fuel source — wind power.  Its an enviable position.  With such a wealth of resources, how about peaceful coexistence in Texas as an energy policy?

The City of Austin has committed big bucks far into the future to use wind power to generate electricity, while currently relying on other sources such as natural gas, coal-fired power, nuclear power and solar (which will be discussed at a later date).  Wind is an important and growing part of the Austin economy.  So, just how big is wind in Texas?

According to Texas economist Ray Perryman, Texas capacity of 22,799 megawatts is larger than most countries around the world.  And in the US, Texas capacity is triple that of secondplace Oklahoma.  The Lone Star State also tops the list for capacity currently under development.

Just as with fossil fuels, geography is key.  Texas has abundant land with the right wind speedsAdditionally, there have been billions of dollars of investments in transmission lines that are needed to get wind power from the often rural areas, where it is generated, to Austin and other growing population centers where it is needed.

It’s not been widely discussed, but development of wind power has been an economic boon.  The American Wind Energy Association estimates more than $42 billion has been invested in Texas wind farms, creating jobs during construction, and to a lesser extent, on an ongoing basis through operations and maintenance, Perryman reports.

In addition to the economic benefits of the industry itself, wind generation capacity works to reduce electric power prices,” Perryman continued.  And wind gives electric power customers more choices.  There are also more benefits.

How many states would love to have Texas oil/gas/wind energy resources?  This situation will inure to the economic benefit for Austin and the rest of the state for generations. Read more →

May 11, 2018

Volume 40, Number 6

Multiinch rainfall fell throughout much of the Austin area last week.  The benefit is obvious when you look at the trees, shrubs, grass, etc.  Vegetation is thriving nowBut, emergency crews will tell you the dog days of summer harbor the potential for disaster.  Were not talking about flooding, were talking about wildfires.  As the summer temps rise, dry vegetation provides fuel for fastmoving wildfires.

Specifically, we’re referencing the northwest quadrant of Austin, lavishly graced with massive amounts of trees – especially cedar/mountain juniper.  Fire casualty companies have rated Austin #3 in the nation for high wildfire risk, with more than 37,000 homes at risk.

Public Safety Commission member Mike Levy says the Austin City Council chooses to ignore the critical, immediate need for another fullystaffed fire station in the Loop360 corridor.  “If a wildland fire pushed by high winds from the northwest is not contained at 360, there goes Austin,” Levy warns.

Pointing to recent widespread fires in California and Colorado, Levy says the heavily-wooded area of Austin along the 360 corridor poses even greater risk.  “We have massive amounts of cedar and persimmon,” he said.  “Because of their oils, they dont ignite; they explode.”

He envisions a scary perfect storm scenario:  Thirty-to-thirty-five mile an hour winds that don’t “lay down” at night.  Low humidity.  Very dry vegetation in large quantities serving as hot fuel.  “One home on the urban interface ignites, most likely by a flying ember under the eaves rather than direct contact with flame, similar to how Bastrop homes, several miles from the actual flames, ignited,” said Levy.

“Then that fire igniting homes on either side and then on either side of those, with the same pattern across the street, with the fire jumping to the homes behind those … Well, you get the idea of the checkerboard pattern of rapidlyspreading house fires,” he continued.  “A monstrous inferno.  In less than 2-3 hours, thousands of homes will be lost along with lives of firefighters and civilians.”

Levy continues to press for expanded fire protection in Austin’s northwest quadrant, saying “Austin so far has dodged the bullet.” Read more →

April 13, 2018

Volume 40, Number 2

Dont know if you noticed, but the #2 person in line to become US president spent a lot of time in Austin this past week while the USCongress was in recess.  House Speaker Paul Ryan also hit other cities to preach the administration gospel and raise money.  But, he also participated in a 3day Republican retreat in Austin, discussing politics and policyAll this was before Ryan announced Wednesday he was retiring at the end of his term in Congress.

According to the Texas Tribune (TT), Ryan has just concluded a swing through Texas that included a retreat in Austin with about 100 GOP donors.  Additionally he held fundraisers in Dallas, San Antonio and Corpus Christi.  Along the way, he was promoting new legislation like last year’s sweeping tax overhaul.

The Wisconsin Republican raised almost $4 million with these events – quite a haul.  Where did the money go?  It went to “Team Ryan” — a joint fundraising committee composed of Speaker Ryan and other Republicans running for Congress, reports TT.

Three Texas GOP Congressmen have been publicly targeted for defeat by the Democrats – Will Hurd from Helotes, John Culberson from Houston and Pete Sessions in Dallas.  Some of this money will go to help their re-election.

Make no mistake.  There were a lot of Republican heavyhitters here in Austin, both elected and powerbrokers.  The focus was on elections later this year.  It is somewhat interesting Austin was chosen for this politically-oriented retreat.  After all, Austin leans heavily democratic.  (Apparently, the attractions of our fair city appeal to a wide political spectrum.)

Ryans retreat and fundraisers were private affairs, but he did make a few public appearances, including stopping by the Austin Police Department to thank local officers for their response to the deadly bombings last month.  This rare, high-level GOP concentration in Austin – albeit briefly — brings to mind the enthusiasm powering local Democrats.  As we mentioned two weeks ago, there are three Democratic Party runoffs May 22nd that will determine which candidate will run against local GOP Congressmen Michael McCaul and Roger Williams, as well as, who will contend for the seat left vacant by Lamar Smith, who decided not to seek re-election. Read more →

March 23, 2018

Volume 39, Number 49

Jobs data for the Austin area can sometimes be confusing and contradictory.  One reason is the gatherer/keeper of such stats, the Bureau of Labor Statistics, regularly revises its numbers.  The March 2018 revision changed the Austin areas employment stats from great to even greater.  How about that!  And even before revisions, Austins job growth is the 2nd best performing among the nations 50 largest metros.

The latest figs:  Austin added 36,900 net new jobs in the 12 months ending in January, making Austin the second best performing metro area among the nation’s 50 largest.  Its very strong 3.7% growth is, by far, tops in TexasDallas (up 2.6%), Houston (up 2.2%), Fort Worth (up 2.1%) and San Antonio (up 2.0%) ranking 12th, 17th, 18th and 21st respectively, according to Beverly Kerr, the Austin Chamber’s VP/Research.  This data is not seasonally adjusted.

But look what happens when you adjust the mind-numbing numbers seasonally, taking in a number of factors, including taking into account state and federal unemployment insurance.  In the Austin metros case, the adjusted numbers usually reflect a better economy.

For instance, “preliminary 2017 estimates for jobs in Austin have been revised upward,” noted KerrThe job growth percentages got better – going from previously estimated 2.7% to 3.2% — a significant increase.

When you dive a bit deeper in the numbers, some interesting tidbits emerge.  As an example, Austins sizable government sector lost 2,800 jobs over the past 12 months.  When we say “sizable,” the government sector includes more than 17% of the jobs in the area.  Yet, the job picture grew despite this loss.  Impressive.

So, which portions of the Austin private sector grew?  Darn near all of them.  Professional and business jobs grew by 12,500 over the past 12 months at a rate of 7.4%.  But, manufacturing jobs grew the fastest, at 9.2%, when adding 4,600 jobs.  Only retail lost jobs in the past year – just 200, for a rate of -0.2%.

One aspect of positive economic growth is just now showing signs for even better growth in the very near future.  Get ready for it.  The next oil/gas surge is starting to happen in Texas and this will help state government as well as the overall economy.  Check the next item. Read more →

March 2, 2018

Volume 39, Number 46

So far, nearly 1,300 City of Austin employees during a six month period have earned paid time off from work because they have agreed to cut down on solo driving.  They are paid with your tax dollars while they are taking the earned time off.  In other words, the City is offering strong incentives to employees if they log a commute using a bicycle, or walk, participate in a carpool or vanpool, take transit, or telework.  The goal:  get more cars off Austin roadways.

Implementation of the program is structured in a way that a bureaucrat can love.  First of all, for a city employee to participate in the commuter incentives program each employee is given a demonstration video explaining how to participate in the program.  Here is a brief summary of how it is set up so you can see why a video is needed to bring the city employee up to speed (so to speak).

Participating employees accrue points when they log a commute using an approved, sustainable alternative to solo driving” – bicycle, walk, carpool, vanpool, transit, telework.  There is a two point per day maximum.

Then, when employees reach a specified point threshold, they are rewarded with four hours of paid time off.  But it doesn’t stop there.

Participants are permitted to continue accruing points beyond the minimum threshold.  This means they can earn even longer periods of paid leave in fourhour increments.  Yeah, but, how does the City keep track of all this?

Well, hiring an outside contractor to trace each employee’s activity, of course.  The firm called RideAmigos is running a special administrative leave commuter program that provides automatic tracking for participants on what it calls a “transportation demand management platform.”  Claiming “success,” it looks as if this program will continue.

While on the topic of non-auto travel on city streets, the city is now starting to spend about $20 million on bicycle improvements approved by voters in 2016.  One element under consideration by the Austin Transportation Department is the installation of buttons on city streets to delineate bike lanes.  Also called “tortoise shells,” they are white-cake-pan-shaped and will be attached by adhesives.  They cost about $2 to $4 per foot.  This is obviously a lower cost than precast concrete barriers.  But there is still opposition to their usage. Read more →

February 23, 2018

Volume 39, Number 45

As you might imagine, there has been quite a todo after the Austin City Council voted to make Austin the first city in Texas to mandate/require that private businesses provide their employees paid sick leave.  It wasnt even close.  After much debate, the vote was 92 to implement the policy.  Now what?  Lets examine what is likely to happen now.

First of all, start with the fact the Councils controversial action is not slated to go into effect until October 1, 2018.  Private businesses with five or fewer employees were not exempted from the ordinance, but they won’t be required to provide paid sick leave until October, 2020.

How much paid sick leave is required?  A worker can accrue up to 64 hours, or eight days, of paid sick leave per year.  Small businesses, with 15 or fewer employees, get a slight break.  Workers at small businesses can accrue up to 48 hours, or six work days, of paid sick leave per year.

When we mentioned there has been a “to-do” since the controversial decision, criticism came from several quarters.  Check our Archives for the 2.2.18 edition where we detailed the opposition position from the Austin Chamber of Commerce.  Additionally it asked the vote be delayed 90 days – didn’t happen.

A TV station from Houston jumped on this story.  It interviewed Austin business owner, Peter Morales, who told KHOU “I have several friends in the construction industry, several companies, that are “specifically saying they are going to move outside the city limits.”  A conservative policy group weighed in saying the City of Austin “should ease regulations that prevent businesses from locating here, staying here and expanding here.  Instead, they add new ones.”

The most significant opposition came from a local State Senator (Donna Campbell) and a local State Representative (Paul Workman).  They can do more than simply wring their hands and express dissatisfaction – they can get it overturned in the State Legislature.  And, they indicated they will do just that, having already lined up support to overturn Austin’s action.

While the Legislature has regularly overturned what it terms “Austin overreach,” the problem is the Legislature doesnt meet until January 2019, three months after Austin’s paid sick leave ordinance goes into effect.  No one has yet publicly stated what might happen during this interim.  Dont be surprised, though, to see some sort of legal delaying action take place.  Stay tuned. Read more →

February 16, 2018

Volume 39, Number 44

Okay, new Austin City Manager Spencer Cronk, sure hope you packed your running shoes when you moved to Austin to take the citys CEO job.  Surely, youve done your research and know that its been almost a yearandahalf since this city had a permanent city manager.  And, surely youre aware in that timeframe, Austin has incurred vacancies in almost 20 of the citys top executive positions.  Talk about hitting the ground running.  This is your first week on the job.  Youve got a lot to do in a short time.

Yeah, yeah, we know interim appointments by an interim city manager have been made in most of those positions.  But, you know the drill.  Those who have interim as part of their job title are seldom invested with a sense of permanence to make longrange decisions.  And, what about those just below the “interim” level?  Think about how they function when they believe their jobs may be in limbo.

How serious is this situation?  About onefourth of the highest executive positions in city government have become vacant over the past yearincluding a couple of Assistant City Managers, the Police Chief, the #1 and #2 positions in the citys Economic Development department, etc.  Think about this.  These are key positions.

After Cronk finds his way around City Hall (“tell me again, where’s the men’s room?”), he must meet and assess those now in interim positions.  Any new CEO wants to put his team in place.  Will he bring in trusted friends and associates from outside Austin who must also learn their way around?  Or, more broadly, will he re-organize city departments?

A kind of malaise has been reported in the city bureaucracy, with many leadership positions vacant or occupied by interim appointees.  Now, comes the uncertainty of “what next?” that can easily filter down several bureaucratic levels.

Just who is this guy, Cronk?  What is his managerial style and his personality?  City employees want answers to those questions.  And then, there are Cronk’s bosses – the ten members of the Austin City Council with their own district fiefdoms, as well as the mayor.  How will they be involved in the dynamics of running the city?  City Manager Cronk is facing a big job.  He may need a 2nd pair of running shoes to keep up with the complex urgency. Read more →

January 26, 2018

Volume 39, Number 41

Traffic issues abound in major US cities and, in fact, worldwide.  New traffic solutions, some quite controversial, are being tested or actually installed.  Austin is facing some of the same congestion/traffic problems that have triggered actions elsewhere.  But, so far, Austin has not officially adopted any of them.  However, it is important to track these trends just in case.

What are the trends?  How about congestion pricing?  This is where cities are so concerned about traffic in their downtown areas, they charge a premium if you drive downtown.  One US city is getting ready to levy a paypermile gasoline charge versus a per-gallon gas tax.  And, of course, the long-discussed increase in gasoline taxes.  Here’s what’s happening now.

CONGESTION PRICING.  Just this month, a proposal to charge motorists $12 to drive into the busiest parts of Manhattan started gaining steamLondon, Stockholm and Singapore already have congestion charges.  Trucks, Uber and Lyft would also be hit by differing amounts with Manhattan’s congestion tax.

PAY-PER-MILE GASOLINE CHARGE.  Seattle, in a coupla weeks, will start a one-year pilot program to charge 2,000 individual drivers a paypermile gas tax, instead of a pergallon gas tax.  “Oregon, California and other states have proved that it can be done, at least on a small scale,” according to Governing.com.

INCREASE GASOLINE TAXES.  This has been cussed and discussed for years.  But this month the powerful business lobby, the US Chamber of Commerce, said it will push Washington to increase the federal portion of the gasoline tax by 25cents per gallon.  (Texas state officials have shown zero appetite for increasing the state’s portion of the gasoline tax.)

The argument used to implement these money-raising options is the revenue will be spent on infrastructure improvements.  This is in face of declining gasoline tax revenues due to better gasoline mileage, hybrid or electric vehicles, lower gas prices, etc.  So the pitch to get additional revenue in addition to, hopefully, decreasing congestion is getting traction.

As we said at the top, no serious effort has emerged in Austin or at the state level to install any of these options.  And there are huge logistical problems to implement some of them.  But its our job to keep you abreast of trends elsewhere just in case they pop up here. Read more →

December 15, 2017

Volume 39, Number 37

As we wind down 2017 and look ahead to 2018, it helps to know where the local economy standsespecially when it comes to residential real estate.  After all, not only is real estate an important underpinning of the Austin area economy, but the fact you either own or rent, means you are personally affected.  Real estate is an Austin economic barometer, but it also affects your financial bottom line.  So, lets analyze this alwayschanging market.

When we say “always-changing,” consider what an Austin real estate expert, who has been a long-time observer of the real estate market in Austin and Texas, has to say:  “Austin real estate has been traveling at light speed with over 60% appreciation on residential real estate in the last ten years,” reports Independence Title’s Mark Sprague.  Let this sink in for what it means for the homeowner who has owned the same home for the past ten years.

After the wild swings of the real estate recession years, Austin and DallasFort Worth have led the nation with steady appreciation for the last ten years.  In fact, since 1990 Sprague reports “Austin has had an average (annual) residential real estate appreciation of 5.4%, Houston 4.9%, San Antonio 4.7% and DFW 4%.”

Regular readers of this newsletter know that in many real estate segments, sales have slowed this year.  “Not much, but a little,” Sprague points out.  Okay then, Mark, what does this mean?  He emphasizes an important distinction when he says “residential appreciation has slowed, but not declined.”

The differences in housing price movement are stark when you look at the luxury home price points, compared to homes of lesser value.

If you are shopping for a house with a budget above $2 million, I have good news,” Sprague said.  “You have more than a six month supply of homes to choose from, as opposed to a couple months’ supply of homes in many of the lower prices.”  Repeat after me:  it is now a buyer’s market in the luxury market.

Not so in the lower price points.  “Below $700,000, we are still seeing multiple bids,” he said. But, still, the market is slowing.  Its not really slow or crashingIt is simply slowing.  And this is the watchword as we look ahead to the New Year.  It bears watching closely. Read more →