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Growth & Development

June 15, 2018

Volume 40, Number 11

All you have to do is check the skyline to know that downtown Austin is undergoing amazing change.  But, theres more to this change than skyscrapers.  The Downtown Austin Alliance (DAA) points out that within the last few years investments have also been made in parks and green spaces, a new Central Library, a flood diversion tunnel, roadways and transit planning, and a stateoftheart teaching hospital.  But, what does DAA envision for the future?

DAA took a long-term view toward downtown’s future.  Long-term?  Yeah, they referenced 2039, when Austin will be 200 years old.  DAA went through an extensive process to arrive at a vision.  “We engaged 3,000 people in 75 ZIP codes, using surveys, focus groups, interviews and events to learn their aspirations for downtown,” said Mike Kennedy, Chair of the Downtown Austin Vision Steering Committee.

“The Downtown Austin Vision is the north star to guide the future of downtown toward the communitys values and aspirations for a thriving, welcoming, vibrant and connected downtown,” reads the vision report.  It also calls it “the downtown you will always love.”

Lofty words.  And its priorities seem to cover all the bases, under four headings:  Thriving CenterWelcoming PlacesGrowing Neighborhoods … and Leading Mobility.  All worthy subjects.  But referenced in general terms, with few specifics.

There is some precise language, without detail.  Such as:  “provide a variety of options for people to get to and from downtown, including a robust transit network in central Austin.”  See what we mean.  No mention of what this would look like.  Or “create extremely viable and walkable streets.”

Other phrases:  improve the experience and availability of parking in downtown while planning smartly for the future position downtown for a successful retail futurebroadly address the needs of people experiencing homelessness, and the associated impactsmake downtown a familyfriendly place to live and visit.

To be fair, this “vision” is not intended to be a blueprint for construction.  All bases seem to be touched.  But, the devil is in the details.  And the details will be debated ad nauseum.  Stay tuned. Read more →

June 8, 2018

Volume 40, Number 10

You hear a lot about the Austin area being inundated by newcomers from California, New York, Boston, etc.  And its happening.  But you dont hear much about your fellow Texans leaving their hometowns to settle down in the Austin area. The common denominator is jobseeking. This is an important, often overlooked, part of the growth in the Austin metro.  And, in some cases the peoplemoving event is a twoway street.

According to a new study by a career-analysis website, Glassdoor, the biggest supplier of jobs for newcomers to Austin is tadahh, wait for it the DallasFort Worth (DFW) metroplexHouston and San Antonio are next.  New York City and Los Angeles follow in the pecking order.

Glassdoor measures job applicants.  The availability of wellpaying jobs in Austin is the lure, which we’ve chronicled for you for years.  And, of course, it’s easier to uproot and move down the road to attractive Austin, rather than make a cross-country move.  So, in that sense, it makes sense for ambitious Texans, seeking a better situation, to consider a move to the nearby Austin metro.

Not all Austinites stay here (I know, I know, it’s hard to believe).  And you must (grudgingly) admit, the much larger D-FW metro is also a pretty good area.  While Glassdoor reports DFW attracts the most job applicants from Houston and New York City, Austin comes in at #3, just ahead of Chicago and Los Angeles.  Aside from Austin, there’s a pattern here:  big city attracts residents from other big cities.  (Maybe, for some Austinites, it’s trying to “move-up” to the big city life.)

Another point that needs to be made:  weve always mentioned Austin area.  This population influx is not limited to the Austin city limits.  As we have regularly referenced, the nearby communities within the Austin metro offer more affordable accommodations and civic amenities such as nearby schools, quality neighborhoods and access to all Austin offers in terms of quality of life.  It’s part of the big picture.

Speaking of smaller Texas cities, didja know the most prosperous city in America is a small town in Texas?  And, a nearby city is also in the Top TenOdessa as #1 and Midland as #10 are stories unto themselves.  But, these boomtown oil patch Texas success stories bring with them a number of trade-offs.  Check out the next item. 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 6, 2018

Volume 40, Number 1

This week the Austin AmericanStatesman, an important, venerable Austin institution dating back to the late 1800s, is under new ownership.  Gatehouse Media, a national media giant, paid $47.5 million for the news operations (real estate was not included).  Will there be changes?  You betcha.  A lot of changes.  Not this week.  But soon.  What can you expect?

Assuming the price tag was a good deal for the buyer, you can further assume the buyer is convinced it can do a much better job with the Statesmans assets than the former owner.  Otherwise, why make the purchase?  In other words, they obviously feel they can make a lot more money — even at a time the revenue streams have been shrinking for years at the Statesman.  How will this manifest itself?

First of all there will be layoffs.  “That’s inevitable” the new owner was quoted as saying.  The Statesman is now part of a media behemoth.  So you can expect some consolidation of functions, and that could result in job increases in certain areas, as well as decreases.

Yeah, but what about reporters, writers, photographers, etc.?  Right now, only about 100 employees fall into that category.  This is about half of where it stood ten years ago.  So, the editorial staff is not likely to be hit with a meat axe approach.  But some attrition is likely.

You can look for Gatehouse to focus heavily on the digital side of the business.  Subscriptions to the Statesman’s digital offerings have grown, even as print subscriptions have dropped precipitously.  This includes new approaches to advertising revenue (the mother’s milk of publications).

Also, bear in mind other Statesmanowned news assets were part of the sale, such as community newspapers like the Bastrop Advertiser, Westlake Picayune, Lake Travis View, Pflugerville Pflag, Round Rock Leader and the Spanish language weekly, Ahora Si!.

And for what it’s worth, Gatehouse Media also has another major presence in the Austin area.  The Center for News & Design opened in 2014, where more than 240 employees provide editing and design work for publications nationwide.  Add it up.  It’s a New Day for news and reporting in the Austin area, playing out over the coming months.  Stay tuned. Read more →

March 30, 2018

Volume 39, Number 50

It hasnt come close to peaking yet, but a coupla races for Congress in Central Texas will soon start coming into focus in the public eye.  Its only a handful because the next election is a runoff.  It will be held May 22ndThis will determine the Dem vs GOP contests to ultimately select the final winner in the General Election contest in November.

The most wide-open runoff race will be for the District 21 Congressional seat that extends from parts of Austin to parts of San Antonio.  Lamar Smith decided not to run for reelection.  One reason was, under House rules, he is term-limited and would not be able to keep his powerful committee chairmanship even if he were reelected. So what does the race to replace him look like now that the Dems and GOPers both have runoffs to select their party nominee?

First the Democrats.  Two candidates will be on the May 22nd ballot – Joseph Kopser and Mary Street Wilson.  They emerged from a crowded field, but neither, obviously, got 50+% of the vote to avoid a runoff.

The same is true for the Republicans. Matt McCall and Chip Roy will be going head-to-head for the GOP nomination.  The primary contest was notable in that USenator Ted Cruz went all-in for Roy, his former chief of staff.

Two Democrats will be scrambling for the opportunity to challenge District 10 Congressman Michael McCaul, who is the high profile chair of the USHouse Homeland Security Committee.  They are Mike Siegel and Tawana WalterCadien.  This district includes all of Austin, and runs east through several conservative counties to the edge of Houston.

Another congressional district race, that encompasses a portion of Austin and runs all the way north to the edge of Fort Worth, has two Democrats vying for the chance to challenge incumbent Roger WilliamsJulie Oliver and Chris Perri emerged from a crowded field of Dems to make the runoff.

These are the only Congressional runoffs in Central Texas.  But, there are others in Texas that bear watching if you’re interested in the balance between Democrats and Republicans in the USHouse, that is now heavily Republican.  Of particular note is District 23, which the Dems have targeted nationally.  They want to oust GOP Will Hurd, an African American in heavily Hispanic West Texas, where Gina Ortiz Jones is facing Rick Trevino in a runoff.  Stay tuned. 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 →

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 →

February 2, 2018

Volume 39, Number 42

Downtown Austins skyline is an intriguing thing to behold.  Its continually changing, with office, hotel and residential skyscrapers replacing tall construction cranes on a regular basis.  Infrequent visitors to downtown Austin express amazement over the visual transformation.  Well, it wont be long before two more office towers will emerge closer to the State Capitol.  Yep, the State of Texas will soon join the building spree.  Lets check out the latest.

Consolidating state offices and state employees has long been discussed.  After all, in a state that has been one of the fastest-growing in the nation for years, it is not surprising the size of state government has been expanding as wellAs this expansion takes place, many state agencies have been paying rent to provide space for state workers.  And, many of those employees are spread around town.  So, what’s the plan?

The Capitol Complex Master Plan is composed of three phases that will consolidate several state agencies in buildings near the State Capitol.  It’s big.  The current cost is estimated at $581 million.  And, this is planned to deliver about one-million square-feet of office space in two new office buildings.

One building is a 14story office tower.  It is planned to contain about 600,000 square feet of office space.  The other state office building is a 12story tower.  The plans call for it to contain about 400,000 square feet.

Yeah, but what about parking in this area that is adjacent to the downtown area, where City of Austin policies have severely restricted auto access and parking?  Part of the plan includes a fivelevel underground parking garage.

 To the credit of most state building plans, a lot of effort is focused on cosmetics.  Right now, a grassy openair mall, with a lot of trees, on Congress Avenue is part of the Master Plan.  After all, this is public space that hosts visitors.  It will run from the Capitol’s north steps for several blocks up to MLKJr Blvd.

When viewed as part of the overall downtown Austin skyline, 14story and 12story office buildings will not compete visually with the highrises shooting skyward a couple of blocks away.  But the investment is planned to save state money in the long run and theoretically make state government more efficient by this consolidation.  And it will “fill-in” a changing skyline. 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 →