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Growth & Development

January 12, 2018

Volume 39, Number 39

The formal announcement this week that former City Councilmember Laura Morrison will run against Mayor Steve Adler should trigger spirited discussion about Austins governing policies up until the November election day.  Many of their positions differ dramatically, but the mayor only has one vote out of eleven in Austins CouncilManager form of government.  It could be a good time to explore the possibility of changing to a Strong Mayor form of government called a MayorCouncil.

In the Mayor-Council form of government, under which most big US cities currently operate, the Mayor is paid a full-time salary and takes over most of the functions allocated to a City Manager.  The mayor is the citys CEO and directs daytoday affairs of city departments.  The mayor does the hiring and firing.  And of course, the mayor answers to the voters, unlike the city manager who is hired by the Council.

Based on the 2010 USCensus figures and according to the National League of Cities, Austin is one of only nine of the nations 30 most populous cities operating under a CouncilManager form of government.  The five biggest cities, including Houston, are all governed by a Mayor-Council.

Austin is listed as the 14th most populous city on this list.  And, frankly, it is one of a very few cities that manages and sets policies for three very complicated enterprises an airport, an electric utility and a water utility.  Most cities utilize independent entities to manage one or several of these enterprises, negotiating contracts, etc.  As a result, running Austin is a formidable management task.

The arguments pro and con for the two forms of government have valid points.  The City Manager has too much power.  It’s better for the city to be managed by one who answers to voters, rather than a bureaucrat.  Or the flip side, you need to remove politics from these decisions.  You get the picture.

If a change is made, it would be a laborious process that would need to be put on the ballot by the Austin City Council and approved by the voters – much in the same way the City of Austin expanded to a ten-member council elected by districts and a mayor elected citywide, in 2014.  Frankly, it’s a long shot to happen.  But as the campaign for mayor and other council seats unfold, it will be a good thing to keep in mind for the future direction for a growing city. Read more →

January 5, 2018

Volume 39, Number 38

The final official 2017 tally wont be released for a few more weeks, but after 11 months it is clear the 2016 record number of travelers through AustinBergstrom International Airport (ABIA) will be shattered.  In fact, the 2017 number will easily exceed 13 million passengers in the airport that was designed to handle 11 million.  If the 10+% annual increase continues, its time to examine the status of expansion plans at ABIA.

ABIA officials reported this week that, through November 2017, “the annual passenger mark stands at 12.6 million passengers flying Austin.”  The total in November was 1,229,791 – up 15% compared to the same month the year before.  And the 11-month cumulative was up 11%, to 12,698,792.  All signs point to a continuation of significant increased traffic through 2018.

Recent ABIA users have noticed quite a bit of construction activity during the past year.  But, will the planned increased capacity be complete in time to handle the growing demand?  Start with the fact that the pace is behind the curve as we speak –there are already 2 million more passengers than originally anticipated.  So the answer is “yes” for certain areas of expansion, and “no” for other areas.

Additional parking capacity in the form of a new 6,000space parking garage is on schedule to be completed this year.  This will be a big help.  You can track the availability of parking at www.abiaparking.com.

The biggie though will be the completion of nine more gates at the east end of the current Barbara Jordan Terminal, at a total cost of almost $400 million.  This will increase the number of gates with boarding bridges from 24 to 33, but they wont be completed until 2019.

Yeah, but.  Will this just be a “catch-up?”  What about future growth?  ABIA officials say “the expansion project will increase the airports capacity to 15 million passengers annually.”  Okay, this is all well and good.  But, when do the airport folks anticipate that level of passenger traffic will be reached?  “At least 2025,” is their projection – seven years from now.  We’ll see.

There’s more work underway.  The expansion includes the replacement of three existing gates.  All gates will be able to accommodate domestic airline operations.  Four gates will accommodate international flights.  You get the picture.  It’s a scramble to handle demand. Read more →

September 15, 2017

Volume 39, Number 24

Most Austinites complain about traffic problems, but no one seems to be as vociferous and knowledgeable as civic activist Mike Levy, the founder and former publisher of Texas Monthly.  He minces no words, he names names and he tosses out zingers right and left.  Here are some of Levys rants about problems downtown and on The Drag.

About UTAustin’s Drag:  “The city’s transportation department head Robby Spillar plans to reduce the Drag to one lane each way for cars, dedicating the other lanes for usage only by increasingly empty buses (as per Capital Metros own data) and then for trolley cars, for guaranteed gridlock in the UT campus area in addition to the downtown areas, as promoted by Mayor (Steve) Adler and Council Member (Ann) Kitchen.  In addition to increasing congestion, the impact on small business owners stores and restaurants along The Drag will be devastating because of the elimination of parking.”

Levy also zeroed in on downtown traffic:  “Robby, under his ‘Great Streets’ initiative, has already made Colorado and Brazos into two-way streets with loss of vehicular lanes to allow for wider sidewalks and tree pots for cigarettes and benches for sleeping with similar plans for Guadalupe, Lavaca, Trinity, San Jacinto and all streets from the river to 10th.

At 5 pm East 7th is backed up to Brazos with cars headed to IH35.  Make it two way and it will be backed up to Johnson City.  (A big chunk of East 5th between IH-35 and Brazos was quietly made two-way the weekend of August 26.).  More lane elimination is planned throughout the city using money from the last bond election.

“The mayor talks about reducing congestion.  Help me out here.  Please.  How does taking away vehicular lanes throughout the City, and especially in the downtown and UT areas, reduce congestion as per the mayors promise?”

“Under Robby Spillar’s Grand Plan, with the support of the mayor and the Council, has as a ludicrous goal to create intentionally so much congestion people will get out of their cars to ride buses and trolley cars or bikes or walk to downtown,” concluded Levy.  “Hes letting Robby Spillar create gridlock that will make New York Citys look good.”  Check out the next item for more Levy comments about the mayor, council and CapMetro. Read more →

September 8, 2017

Volume 39, Number 23

The City of Austin leaders didnt need a survey to tell them what anyone with a heartbeat understands:  the most important issue facing Austin is traffic.  The survey they conducted anyway confirmed this fact.  But a deeper dive into the recentlycompleted survey also revealed some interesting observations:  such as how longtime residents feel, compared to relative newcomers.

Take the issue of whether residents feel the city is headed in the right direction or wrong direction.  A majority of those surveyed (53%) feel the city is on the right track.  But, a substantial minority (44%) feel it is going in the wrong direction.  When you break it down by how long residents have lived here, there is a dramatic contrast.

EMC Research reporting to the City on its research had this observation:  “There is a stark division based on how long residents have been in Austin, with those who have lived in the city less than twenty years more positive about its direction and more satisfied with it, and those who have lived in the city for longer than two decades more negative about its direction and less satisfied.”

But, what about the city’s taxing and spending priorities?  It’s a much different picture. “There is near unanimous agreement the City has enough money and just needs to do a better job making sure it is spent on the right priorities (82% agree; 17% disagree),” reported the researchers.  But newer residents were still more open to tax increases than long-time Austinites.

Now, back to that bugaboo – traffic.  Taken together, traffic, transportation and roads/infrastructure were by far the major topofmind concern.  Top-of-mind means unprompted.  The question was open-ended, without listing a series of problems.  This approach is a solid gauge of respondent concerns.

Oh sure, there were a number of other concerns mentioned by respondents.  After all, this is Austin where almost everyone has an opinion.  Unprompted responses related to housing came in second – way back in the pack.  But, when prompted, the numbers jumped way up as they expressed concern about the rising cost of living in Austin.  And, housing was the biggest driver of those responses.  Taken as a whole, the responses were not all that surprising – even the ratio between those who have lived in Austin awhile compared to recent residents. Read more →

August 25, 2017

Volume 39, Number 21

Is the Austin area economy at a tipping point?  Impressive current numbers are actually causing problems of a different sort, according to Richard Florida, one of the leading thinkers about cities and their future.  This is significant, because 15 years ago Florida published a book that became a bible for Austins changing economy highlighting what he called the creative class.”  Now he is issuing a mea culpa in his new book, The New Urban Crisis.

Austin was used as a prime example.  Florida’s examples of artists, musicians, tech workers, etc. building a creative economy in an environment that attracted more young people, and subsequent investment led to a new and prosperous urban core.  Sound familiar?

Florida served as an inspiration for mayors, developers, and planners who pedestrianized streets, built bike lanes and courted attractions,” observed Sam Wetherell, a British professor writing in Jacobin magazine.  He compared Austin to London and other major world cities who have followed Florida’s model.

Now what?  Wetherell notes “when the rich, the young and the (mostly) white rediscovered the city, they created rampant property speculation, soaring home prices, and mass displacement.”  In his new book, Florida recognizes some of the impacts of his original thesis – in effect, retreating from his earlier optimism.

Wetherell says Florida now realizes “the rise of the creative class created economic growth only for the already rich, displacing the poor and working classes.  The problems that once plagued inner cities have moved to the suburbs.  The ‘creative class’ were just the rich all along, or at least the college-educated children of the rich.”

This is what’s happening in Austin.  The euphoria accompanying Austin’s meteoric economic rise is now being affected by deep-seated concerns about affordability.  Families, businesses, musicians are moving away from Austin because, as Florida now implies, the rise of creative classes has brought dizzying levels of income inequality into every city theyve inhabited.

Florida, the city guru who singled out Austin as he hailed the rise of the creative class, is now admitting he was wrong about its ultimate impact.  For now, though, Austin’s creative class economy is still humming along when using jobs as a measuring stick.  See the next item. Read more →

July 21, 2017

Volume 39, Number 16

For years, Austin Neighborhood Organizations have been a powerful force at City Hall, many times taking a NIMBY (Not In My Back Yard) position against various development proposals, including building new housing/apartment units.  Now, because some NIMBY efforts have led to rising housing costs creating even fewer available living units a new countermovement is emerging nationwide to combat resultant rising housing costs.  Its called YIMBY (Yes In My Back Yard).  Can Austin be far behind?

YIMBY groups are springing up to battle long-established neighborhood groups and local elected officials.  They are demanding an end to strict zoning and planning regulations.  They want to prevent housing construction proposals from being delayed or even derailed.  YIMBY’s view is that rising costs are forcing residents to move further away to find less expensive housing, thereby damaging the environment as people get pushed into longer commutes.  Right now, YIMBY’s efforts are expanding in Colorado and California.

Take California.  The New York Times reported this week “a full-fledged housing crisis has gripped California, marked by a severe lack of affordable homes and apartments for middle-class families.  The median cost of a home (in California) is now a staggering $500,000, twice the national cost.  Homelessness is surging across the state.”

YIMBY groups have organized in many California communities, with full-time staff.  As a testament to their growing influence, the California legislature, controlled by Democrats, is now considering measures that will override local zoning laws, much to the chagrin of neighborhood groups.

Take Colorado.  YIMBY’s first gathering was organized by a group that included Boulder’s former mayor Will Toor who said “… tackling the lack of housing in thriving urban areas, caused largely by local zoning restrictions, is key.”  YIMBY conferences (called “Yimbytowns”) attract several hundred attendees.

We know of no YIMBY group in this area, though Austin is beset with many of the same concerns (high cost of housing, lack of available living units, homelessness, sprawl, local development restrictions, etc.) that have given rise to action in other cities.  But Austin has its own controversial process tackling these issues.  See the next item about CodeNEXT. Read more →

July 7, 2017

Volume 39, Number 14

The President of the Austin Chamber of Commerce Mike Rollins published an article titled Heres how your city can become the next Austin, Texas in a major Washingtonbased publication.  What gives?  Is he giving away secrets?”  Nope.  It was a clever ploy to do a little bragging and to lobby for additional resources for Austin.

An Austin area delegation of business and civic leaders descended upon Washington DC, shortly after titans of Silicon Valley met at the White House.  Rollins said they wanted to “share a fivepoint agenda we believe will create and strengthen more regions like ours.”  And, as a Chamber exec should do, he extolled Austin’s successes: “We have added more new jobs 350,000 in 12 years as a percentage of our labor market than any major US metro.”

But he did more, much more, than that.  He suggested ways Austin’s success can be enhanced, and replicated, with actions needed in Washington, such as investments in research, technology and innovation.

Congress and the White House must shoulder the lions share of Americas basic and translational research investment:  energy, the National Institute of Health, the National Science Foundation, advanced research projects and education sciences all need funding increases,” he argued.

We can’t cover all he recommended here.  But he did emphasize an Austin hot-button issue – physical infrastructure on a “scale of investment contemplated by the president’s $1 trillion vision.”  Rollins said “we need Congress to pass a plan which recognizes fastgrowing regions by using uptodate census data and includes states like Texas that lack new publicprivate highway partnerships.”

Pointing out “regions like Austin need more and better-prepared talent.  Austin maintains a low unemployment rate, despite 110 net new people moving here each day. We applaud the president and Congress for focusing on apprenticeships and $1 billion net workforce investment,” Rollins reinforced.

He supported international trade agreements that benefit American workers and grow jobs here at home.”  But, he devoted some of his strongest comments toward taxes, in combination with another pitch about the Austin area’s successes.  See the next item. Read more →

June 23, 2017

Volume 39, Number 12

If you ever had any doubt the City of Austin is doing all it can to restrict cars in downtown Austin, just pick up the Street Design Guide released this week by the citys Transportation Department.  There it is in blackandwhite.  It reads:  “the modal hierarchy is pedestrian first, then bicycle and transit, then vehicles.”  But there were even more examples this week.

Civic activist and former publisher/founder of Texas Monthly Mike Levy (we used to call him a gadfly) criticized details of the Guide.  He also e-mailed “they have told folks along Sixth (street) that they are already committed to taking away lanes on each side for twoway bike lanes on each side of the street, and making Sixth two-way, and removing even more parking spots from the downtown area.”

Levy added:  “Two big retailers have recently left downtown:  Brooks Brothers on the southwest corner of 6th and Congress; and Keepers on the southeast corner of 6th and Congress.  The reason they have given:  No parking for customers.”

“Step on a bus in afternoon rush hour that’s stopped in a dedicated bus lane on Guadalupe or Lavaca, take a quick look, and get off.  Most only have a few passengers, at best,” he continued.  “But the gridlock on these two streets is unnecessarily compounded by the usage of a vehicular lane for empty buses.  Gridlock in the downtown area is also compounded by Brazos and soon Colorado streets converted to two-way from one-way and a loss of a lane on each street.”

Attorney Brian Greig, who offices downtown, emailed his concern about the Guide that gives private vehicles the lowest priority:  “Until there is a viable transit system this will keep many from downtown, especially older and disabled folks, and anyone not wanting to walk or peddle to town when its 90 degrees.”

Oh yeah, Mayor Pro Tem Kathie Tovo is floating an idea to ban all cars from Congress Avenue a distance of about two miles for one day, from the State Capitol south, across Lady Bird Lake, all the way to West Mary Street.  She wants to do this to spread the word about bicycle transportation, calling it Ciclovia.”  She may not pull this off until sometime next year.  In the meantime, she is getting city staff to explore the possibility, including what costs would be associated.  Question:  Is this just one more thing — or part of a trend? Read more →

June 9, 2017

Volume 39, Number 10

A shift in Austins economy is taking place as we speak.  It may not be discernible to some, but it is real nonetheless.  Tech jobs are diminishing as a percentage of the employment in the Austin area.  In fact, for the first time since the end of the last recession, tech job growth falls short of overall job growth.  Lets look at what this economic change means.

This is not a crisis, not by any means.  As a matter of fact, some will argue that, even with Austins reputation as a tech job mecca, diversification of the types of jobs is a good thing.  You know, the old don’t-put-all-your-eggs-in-one-basket cliché.  And we’re talking about the percentage of jobs in the tech sector diminishing, not the total number of jobs in a growing job market.  The Austin tech job market is quite healthy.

This week, the Austin Chamber’s VP/Research, Beverly Kerr, said more than 5,800 high tech employers are in the Austin metro.  And, jobs in Austin’s tech industries total nearly 129,700, or 13.6% of all jobs. Compared to 6.7% nationally.  But in 2016, Austin tech jobs grew by only 1.1%.  “Thats a smaller gain than the 3.3% increase for employment across all industries,” noted Kerr.

Kerr tosses out one more example.  She reports that in 2016, high tech jobs represent 13.6% of all Austin area jobs, but only 4.7% of the years net new jobs.  Net new jobs.  This further illustrates that the growth of tech jobs is slowing.

Over the last few months, we have reported on the changing situation of Austin area jobs.  (Check the April 14, 2017 edition in our Archives section, where we pointed out the Registered Nurses category was at the top of Job Listings one month.)  Healthcare jobs (some of them fall into the tech category) will likely grow exponentially in the coming years, if for no other reason than the magnet provided by DellMed.

Job diversification is occurring in other areas as well.  Take tourism and travel – just check out all the new hotels that are frequently full.  Oh, yes, and try to move around downtown most weekends when various events draw free-spending travelers.  Of course, underpinning all this job growth are the government paychecks that regularly flow through the Austin economy from state employees, UTAustin faculty and staff, other educational enterprises, city and county employees, etc.  So, while tech jobs as a percentage of the whole may be slipping a bit, the overall continuing job growth balance appears to be a good thing. Read more →

May 5, 2017

Volume 39, Number 5

Theres a big pot of money that flows regularly into Austins government.  Its growing by millions of dollars each year.  Its not tax money taken from you.  Its tax money paid by people who dont live or work here.  Near the end of this month, the Austin City Council will hear suggestions for how the money could be allocated.  Many local entities want a piece of the pie.  And one big chunk of it could be used to greatly increase the growing annual amount.

We’re talking about the Hotel Occupancy Tax (HOT).  When the Texas Legislature enacted the tax 30 years ago, it allowed cities to increase the tax, with those dollars going directly to the cities.  In Austins first fiscal year of assessing the HOT, the city received almost $6 million.  Not bad.  But after the growth of the lodging industry and a huge increase in tourism and convention business, the most recent full fiscal year ending in August 2016, the HOT had mushroomed to more than $87 million.

The primary push for the HOT was to raise money to promote tourism and to build convention centers.  Over the ensuing years, the uses for those funds expanded to include promotion of the arts that directly promoted tourism and hotel activity.  The same for historical restoration and preservation.

For the last few months, the citys Visitor Impact Task Force has been studying the way the HOT revenue has been spent.  A number of suggestions are being considered, with talk about funds being distributed geographically and culturally throughout the city.  Their report will go to the Council for final consideration.

The current discussion on allocation of the HOT funds also includes a biggie this time around — major expansion of the successful Austin Convention Center (ACC).  It’s a big bucks issue.  The backers point out the ACC is losing business regularly because it is too small to handle the groups that want to meet in Austin.  (Hey, even hometown Dell is going to hold its next big gathering in Las Vegas because it cannot fit into the ACC.)

Some say the HOT is the “goose that lays the golden egg” and they want to fatten the goose with the ACC expansion, so it can lay even more golden eggs.  But will disparate interests nibble away at the money, stopping the ACC expansion?  Stay tuned to see if the City Council takes a short-sighted or a forward-looking vote. Read more →