Archives

Government

March 22, 2019

Volume 40, Number 49

Its almost here.  One more edition of this weekly newsletter is all that remainsAfter exactly 40 years — we are ceasing publication.  It is triggering a bit of personal nostalgia.  But, put that aside.  Lets dive into this weeks look at the Austin area.

Speaking of looking,” if you want to know about a major overhaul of downtown Austin, you can get an elaborate look at the future plansIt will be more than just a dog and pony show, it will be dogs and ponies with bells and whistles.  The Downtown Austin Alliance (DAA) and the City of Austin call it The Downtown You Will Always Love.”  They call the presentation a celebration.”  And it will take place at the Austin Public Library downtown.

Plans are still evolving for the event April 30 (weeks after this newsletter ceases publication).  But, based on preliminary announcements of what is currently in place, they are going allout to convince you the redo of downtown will be spectacular (my word, not their’s).  Some examples:

Be the first to hear findings from our new State of Downtown report while enjoying some of the citys best food, drinks, and live entertainment,” said DAA in a promotional piece.  Okay, this is all well and good.  But, what about the bells and whistles?

“Take a step into the future with our unique VR experience,” DAA said.  “As the goggles go on, guests will be transported into a virtual world representing the future of Austin mobility.”

Or to put it another way:  “Guests will learn about the community’s vision for the future of downtown – and how we are going to get there – through compelling speakers and hands-on activations featuring local artists and the latest technology.”

Okay, let’s read between the lines.  When DAA says “the future of downtown will certainly feature welcoming, engaging places for all to enjoy” the translation is likely to include less auto access, less parking, wider sidewalks and more emphasis on bicycles and scooters.  Also, you need to raise some questions:  what will be the total cost, the impact on businesses and, importantly, will such a costly project with drastic changes be submitted for voter approval?  Participants at the 4:30 pm to 7 pm will be charged at least $55 to be dazzled. Read more →

March 1, 2019

Volume 40, Number 46

Dear [MM_Member_Data name=’firstName’],

So, whats Michael Dell up to these days?  You know, Austins most famous billionaire who made so many Austinites millionaires the moniker Dellionaires took hold.  That was back in the day soon after the computer whiz kid came up with an industrychanging computer manufacturing concept in his UTAustin freshman dorm room.  Hes changed, his company has changed a lot.  Lets check in on how the now 54yearold is doing.

First of all, he and his wife Susan have poured immense amounts of their personal fortune into making Austin a better place.  Providing enough funds so the new UTAustin medical school bears the Dell name is just one example and no small deed.  But, as Michael Dell has grown older, his company has gone through a number of iterations.  The official company name change illustrates Dell’s new focus.  No longer is it Dell, Inc. it is now Dell Technologies.  Make no mistake, though:  Michael Dell is still very much in charge.

As the tech scene has changed since the 1980s, so has Dell.  It would take too much space to detail the move from the dorm room concept of a transformative way to build and sell computers, to going public, going private, then going public again.  The marketplace has changed and Michael Dell has continued to change with it.

A big part of the change was the acquisition of EMC, a company almost twice as large as Dell.  It cost Dell $67 billion — the largest tech deal at the time — reinforcing Dell as a powerful company specializing in selling technologies to businesses and running it for them.  Transformative!  You bet!

Wait a minute, what about the personal computers business?  As Darrell Royal used to say in a different context, you “dance with the one who brung you.”  Dell is still peddling PCs.  And, yes, you can still buy Dell personal computers.  But it is a smaller part of Dell Technologies business.

Dell is betting on the hybrid cloud, the latest iteration of cloud computing,” reported Texas Monthly (TM) in its March 2019 issue.  “Thanks to the EMC acquisition, Dell can manage … those tasks,” noted TM.  The mag also states:  “The new Dell will profit from being one of the largest, most comprehensive, most integrated product and service companies on the market.”  Check the March 2019 Texas Monthly article by Loren Steffy for more detail. Read more →

February 22, 2019

Volume 40, Number 45

Televised presidential primary debates played a huge role in helping newcomer Donald Trump beat a crowded field to win the nomination of the Republican Party last time around.  Now its the Democrats turn.  And it wont be long before the Dems line up maybe as many as 20 wannabe presidents on TV appealing for votes.  The first debate hold on is right around the calendar corner in June.  So how will the Dems decide who gets to debate?

Somehow it seems appropriate to review this topic in a week that started with the President’s Day holiday, and this issue is now being published on George Washington’s birthday.  Anyway, be that as it may, let’s get to the nitty gritty.  First of all, the Democratic National Committee (DNC) is running the show – setting the rules, negotiating with the TV networks and deciding which candidates “qualify” to participate in the debates.  And, the DNC is planning 12 – count them, 12 debates during the course of the 2020 campaign cycle.

The DNC has selected NBC News, MSNBC and Telemundo to carry/host the first debate on back-to-back weeknights in June 2019.  The second debate will be carried/hosted on CNN on back-to-back weeknights in July 2019.  The DNC says both agreements are unprecedented.  No debate has ever aired in prime time on back-to-back nights before.  Location, venue, moderators, date and time, format and logistics for both debates will be announced at a later date.

Which candidates will be selected out of what looks like a very crowded field?  Just because a person declares I am a candidate for president is not enough.  The DNC said candidates may qualify by meeting one of the two following sets of criteria:

A candidate must register 1% or more support in three different preselected polls conducted by different organizations and released between January 1, 2019 and 14 days prior to the debate.

The second criterion is the candidate must demonstrate the campaign has received donations from at least (1) 65,000 unique donors and (2) a minimum of 200 unique donors per state in at least 20 US states.

The Repubs haven’t announced any plans.  Trump is running for reelection and no one has yet officially announced a run against him.  Don’t worry.  Things will heat up in due time. Read more →

February 8, 2019

Volume 40, Number 43

No doubt the availability of affordable housing is important inside the Austin city limits.  Check the exploding growth in metro suburbs where less expensive residential units can be found.  Austinites recognized this and voted in last Novembers bond election to raise $250 million toward affordability initiatives.  But, did they realize this expenditure could possibly reduce parking?  This is part of a proposal the Austin City Council will consider 2.21.19.

Austin City Council member Greg Casar has put forth a plan that will be considered in less than three weeks, and it has gained support from other council members.  City staff has been directed to draft a resolution to accomplish his objectives.  Generally, his plan would relax building size and parking restrictions if affordable housing is included in specific projects.

Right now, his plan would apply to the entire city – not limited to areas such as downtown or the West Campus adjacent to UTAustin.  As an example, this could include the high-dollar West Austin neighborhoods where it is difficult if not impossible to find lower-priced living units.

Admittedly, Casar’s plan is aimed at developers who are already specializing in subsidized, low-income housing.  It would allow those developers to make at least 50% of all rental units available to renters who earn 60% or less of the median family income.  For homeowners, income restrictions would be set at 80% of the median family income.

In return, developers would have looser height restrictions.  They could go 25% higher than the current building codes allow.  Also, and this is important, parking minimums would be eliminated.  Casar maintains that waiving these current requirements would allow a significant number of affordable units to be build at little cost to the taxpayer.

Of course, this does not address the additional stress of more vehicles in areas with no parking provided for them.  Don’t forget:  once these regulations are in effect for areas where affordable housing is currently desirable, the plan is still slated to be citywide.  So the devil will be in the details as the language is lockedin prior to the 2.21.19 City Council meeting when it will be up for consideration.  Another factor to consider:  this is planned to stand apart when the City Manager presents an overall code rewrite in the weeks ahead.  Stay tuned. Read more →

January 19, 2019

Volume 40, Number 40

To rent or to buy in the Austin area?  And where?  These are not only important decisions facing newcomersEven longtime residents have to weigh this decision during various stages of life.  A new report analyzed this question for several metropolitan areas in the USAnd, according to the national 2019 Rental Affordability Report, it is more affordable to rent than to buy in Travis, Williamson and Hays CountiesThis is true even as rents are rising, as well home prices.

The report calculated rental affordability as a percentage of wages to rent.  For housing affordability, it was calculated as a percentage of wages and the monthly cost of owning a 3-bedroom, median-priced home, based on a 3% down payment plus mortgage cost, property taxes, homeowner’s insurance and private mortgage insurance.  

In a separate study, rents in Austin ranked highest in the state.  In 2018, rent grew an average of $57 a month, or 4.4%, to yield an average monthly rent of $1,361, according to RentCafe.  So, even though rents are rising at a fast rate in the Austin area, it continues to be more affordable to rent than buy.

The flip side of the equation – home prices – is a major factor.  Even though Travis County home sales are declining, the median home price continues to rise.  In Williamson and Hays County, prices and sales are both rising (as many opt to leave Travis County.)

Rising interest rates, regulatory barriers, higher building material costs and labor shortages all contribute to the increasing cost of housing.  Not to mention, demand.

As long as the Austin area continues to be a magnet for newcomers (many from higher cost areas such as California), the demand for new homes will increase.  And some newbies opt to pay rent until they have time to become established in the area, before deciding where and when to buy a home.

Of course, as home prices rise, many potential homebuyers will be priced out of the market, making them renters.  Its a cycle that keeps repeating itself.  And, it looks like there is no immediate end in sight. Read more →

January 4, 2019

Volume 40, Number 38

As a New Year begins, most folks only look ahead and plan for the upcoming year.  But, economists are not most folks.”  Part of what they do is go out on a limb and look waaaaay out.  In the case of Texas economist Ray Perryman, would you believe 25 years between now and 2045?  Austins economy is strong now, and his longrange prediction for the next quartercentury is very positive for the Austin metro area.

Long range economic forecasts for the Austin area have not always been bullish.  Back when Austin was only a state-government-state-university town — modest economic growth was the standard.  In fact, going back to only 1980, a 25year forecast would have been grossly underestimated.

That was then.  This is now.  Here’s what Perryman said in the first days of 2019:  “The Austin-Round Rock metro area remains one of the top performers in the state and continues to attract national attention; the area is projected to be a strong performer over the forecast horizon.”

All that verbiage is well and good.  But what about numbers?  What will happen to the job situation?  “Nearly 665,100 new jobs are likely to be added by 2045,” Perryman predicted.  Whoa!  This is a whole lot of new jobs, new payrolls, new residents in the 5-county metro area.

When you break down his job numbers, you find it amounts to a 1.78% annual growth rate, spread out over the next 25 years.  Sure, the Austin metro has notched a higher annual growth rate than that in the past.  But, when you average the ups-and-downs certain to occur over a quarter-century, this is impressive.

In fact, Perryman’s predicted 1.78% job growth rate ties the DallasPlanoIrving Metropolitan Division and leads the others:  the Fort WorthArlington Metropolitan Division, 1.58% … El Paso metro, 1.5% … HoustonThe WoodlandsSugar Land metro, 1.64% … McAllenEdinburgMission metro, 1.64% … and San AntonioNew Braunfels, 1.66%.

Interestingly, about 72.4% of Texans live in these major metros.  And that percentage has been rising.  In fact, Perryman predicts through 2045, 80% of new jobs will be in the seven largest metro areas in Texas. Read more →

November 30, 2018

Volume 40, Number 35

Dear [MM_Member_Data name=’firstName’],

As we move into December its time to look ahead to 2019.  This is especially true when you single out real estate an essential portion of the Austin economy.  It also affects personally so many residents of the fastgrowing 5county Austin metro area.  So, what can you expect to happen next year?

The Urban Land Institute and PWC’s Emerging Trends in Real Estate:  2019 gives high marks to the Austin area and to Texas’ major metros.  In fact, Austin ranked #6 in the study, but it took a back seat to #1 Dallas/Fort Worth.  San Antonio ranked #20, while Houston ranked #37 in the review of the nation’s major markets.  These strong Texas cities have a significantly higher percentage of a younger population than the rest of the US.  This means there should be strong labor force growth and productivity.

As a result, demand for housing in these Texas markets is expected to remain strong through 2019,” Dillon Cook, founding partner and COO with Range Realty Advisors (RRA), told GlobeSt.com.  “Also Millennial demand for housing in these Texas markets is expected to continue for many years as a growing share get married, attain higher income levels and have children.”

There’s more to this positive real estate outlook than just demographics.  “Housing demand continues to be fueled by relatively low interest rates, low unemployment and continued economic growth,” Cook pointed out.  And Austin is among the nation’s leaders in these categories.

Yeah, but, what goes up must come down, right?  This may be true, but it’s all relative.  Range Realty Advisors points out “the ups and downs of economic cycles can vary substantially globally, regionally and by state.”  Cook says it is entirely possible the next nationwide economic downturn will look and feel very different in Texas compared to other states.

In previous economic downturns, there have been several causal factors – rampant speculative development for oneIn Austin most speculative real estate development is leased/sold as soon as its finished.  There are other national and international factors that are not currently apparent.  Conclusion:  “Add to this strong economic and job growth, high level of consumer confidence and business investment, and many believe Texas will continue to be a magnet for real estate investors and developers for years to come,” notes RRA. Read more →

November 23, 2018

Volume 40, Number 34

While enjoying leftovers from the Thanksgiving holiday weekend, its time to look ahead at a special Austin City Council runoff election that will likely be largely overlooked.  Even though Council positions are theoretically nonpartisan candidates are not listed by political affiliation Council District 8 has taken on an aggressively partisan Dem vs Repub tone.

It’s a special runoff election December 11, 2018 for three seats on the Austin City Council.  No candidate got 50+% of the vote November 6, 2018.  So the top two votegetters for District 1, District 3 and District 8 must face voters once again.  Here’s how it breaks down.

District 1 features newcomers Natasha HarperMadison against Mariana Salazar.  District 3 is a re-match of a family affair:  incumbent Pio Renteria is in the runoff with his sister, Susana Almanza.  Neither of these contests has partisan overtones.  No matter who is elected, these districts will continue to be represented by another leftleaning Council member.

The change in tone is for the District 8 Council seat.  You’ll recall this is the Council district currently represented by Ellen Troxclair.  An avowed conservative, Troxclair – who was frequently on the short end of 10-1 votes – decided not to seek re-election.

The runoff for this seat pits Paige Ellis against Frank Ward.  Why do we say this is a highly-partisan contest?  The Travis County Democratic Party endorsed Ellis.  And described the contest this way:  “Her opponent Frank Ward is a TrumpRepublican and former staffer for the Republican National Committee endorsed by outgoing conservative Council Member Ellen Troxclair.”

The Dem Chair says of Ellis:  “Paige is an advocate for Planned Parenthood and believes that Austin can be a leader in gun safety reform … and is running to ensure environmental responsibility.”  The Democratic Party is raising money for Ellis and is block-walking Sunday, November 25th to get out the vote for her.

If Ellis wins, there will be no conservative voice, much less a lone vote, on the Austin City Council.  And, as the Austin American-Statesman noted previously, in the very diverse 11-member City Council, there will be no white, heterosexual, Christian male serving on the lawmaking body.  Early voting runs from November 29th to December 7th. Read more →

November 16, 2018

Volume 40, Number 33

Dear [MM_Member_Data name=’firstName’],

What would a race for President of the United States be that didnt include a Texan or two in the mix?  Remember last time around, the Republican primary featured Ted Cruz and Rick Perry.  It also included Jeb Bush, who was born in Texas and is a family member of the famed twoBushpresidentsfromTexas.  Now its the Democrats turn.  Lets start with two Texas Democrats in the very early speculation Julian Castro and Beto ORourke.

Castro is the Texan frontrunner as we speak.  The former San Antonio mayor and former Housing and Urban Development Secretary is making the most overt moves to get the Democratic Party’s nomination for president, even saying he is “likely” to run.

What do we mean by “overt” moves?  Just last week Castro had a private meeting in the Alamo City with roughly 20 possible donors to fatten his presidential campaign war chest, as first reported by PoliticoHes also building a paid staff in the early nominating state of Iowa.  And, he’s talked to lawyers about “the mechanics of a possible 2020 presidential campaign.”

Just as important, he crisscrossed the country during the recentlyconcluded midterm elections campaigning for Democratic candidates.  This was a significant effort to build support, as his Opportunity First PAC endorsed (meaning, gave money) to 89 Democrats.  He’s visited early primary states like New Hampshire, South Carolina and Nevada, as well as Arizona and Florida.  He was an early (2017) endorser of Andrew Gillum’s Florida campaign for governor.

And, right now, he is the only Hispanic to privately make major presidential moves.  Not coincidentally, Castro is raising money and speaking in Hispanic-heavy California late this week.

Ironically, O’Rourke while not making anywhere near the national moves as Castro, is more top-of-the-mind with his fellow Democrats.  He is a media darling, as well as an inspiration for liberal Democrats – with many speculating about a presidential run for him.

The El Paso Congressmans term ends in January.  So he has a national platform – if he decides to use it – as Dem leaders urge him to seek the presidency. His mega-financed race against Cruz raised his profile.  Check the next item for stats about O’Rourke’s campaign. Read more →

October 26, 2018

Volume 40, Number 30

Historic flooding upanddown the Central Texas Highland Lakes is affecting many more than those touched by the flood waters.  Lakes Buchanan, Inks, LBJ, Marble Falls and Travis have been closed by the Lower Colorado River Authority (LCRA) until further notice, as the surging waters move rapidly downstream, causing dangerous conditions on Lake Austin and Lady Bird Lake.  But the impact is broader than that.  A boil drinking water order was issued for 1.4 million users because of the massive amounts of silt, mud and debris1.4 million users!

One lakeside resident watching water surge into Lake Austin through the Mansfield Dam floodgates from the bottom of Lake Travis said the roaring water looked like chocolate milk because of all the silt, mud and debris.  This is the same water that is straining the facilities at Austin area water treatment plants.  These extreme levels of crud are 100 times the typical condition of the Highland Lakes.  And these levels have to be treated for your drinking water as well as for use by businesses, industries, agriculture interests, etc.

But here’s what is not being talked about in the lake water.  Think how many septic systems are being flushed by rising/flooding water.  Thats human wasteWhat about animal waste that is being washed from the nearby land into the lakeCan you say fecal coliform?  And what about flooded home propane tanks that are floating (leaking?)?  Construction portapotties?  And agricultural pesticides washed from the land into the water?  To purify your drinking water will take a massive effort beyond getting rid of silt, debris and mud.

As this is a weekly publication, it is not possible for us to provide up-to-minute info as you read this.  Buchanan is set to open to the public at noon Friday.  LCRA will assess the other lakes Tuesday.  But, when we are talking about such widespread impact, we can provide you with a sense of how we got here and, importantly, what you can expectbecause, frankly, millions of dollars are being spent right now to address the situation.

Just think what this unbelievable amount of water would be doing to the area if the LCRA weren’t controlling that water through its system of dam floodgates.  The biggest reservoir lake, Buchanan, was built way back in 1938.  It straddles Burnet and Llano counties.  Mansfield Dam created the other reservoir, Lake Travis.  It wasn’t completed in its present configuration until 1942.  It overlaps Travis and Burnet Counties.  Renovation work is underway on Mansfield now.  We’ll explore that and different solutions in the next item. Read more →