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Schlitterbahn sold

End of an era, as another iconic family-owned Texas business is sold to a non-Texas firm.

Schlitterbahn Waterparks and Resorts — which has dealt with a gruesome death, indictments and financial troubles in recent years — is selling a chunk of its holdings.

Ohio-based Cedar Fair Entertainment Co. has an agreement with the owners of Schlitterbahn to purchase the company’s New Braunfels park and resort property as well as their Galveston park for $261 million, subject to certain adjustments.

“It’s important to know that Cedar Fair values Schlitterbahn’s character and brand promise,” the Henry family — Schlitterbahn’s owners — said in a statement. “They have committed to not only keeping Schlitterbahn awesome but helping us grow!”

Richard Zimmerman, Cedar Fair’s president and CEO, said the company is “very excited about the opportunity to bring these two award-winning Texas water parks into the Cedar Fair family.”

“These properties represent new markets for us with attractive demographics in the growing Central Texas region, and they align with our strategy to identify compelling opportunities to accelerate our growth and profitability,” he said in a statement.

That’s Schlitterbahn and Whataburger all in the same week, y’all. As we know, the Schlitterbahn has had some trouble in recent years, though at least the criminal charges that were filed have been dismissed. It sounds like the family had been looking to sell for awhile, as they were having cash flow problems that caused some planned new parks to not happen. They are retaining the South Padre park, which will be rebranded. I hope the new owners can get everything back to its old glory, and I hope the Henry family can get themselves back on their feet. The Current has more.

Whata lot of angst

I’ve lived in Texas a long time, but I wasn’t born here. As such, news like this doesn’t hit me the way it hits some other folks.

Chicago-based BDT Capital Partners said Friday it’s agreed to acquire a majority stake in Whataburger.

The burger chain will remain headquartered in San Antonio, and the groups will “begin exploring expansion plans,” they said in a statement.

Whataburger’s founders, the Dobson family, will keep a minority position in the company. President and CEO Preston Atkinson and Chairman Tom Dobson will retain their seats on the board but retire from daily operations.

Both will turn to running Las Aguilas, an investment company launched by the Dobson family in 2011 that focuses on real estate and philanthropy.

The decision “is both exciting and bittersweet” for the family, Tom Dobson said.

“Whataburger has been the heart and soul of our family legacy for nearly 70 years, but we feel really good about the partnership with BDT,” he said.

The news that Whatburger had been “exploring options” came out about a month ago, and it’s fair to say that it caused some anxiety among the faithful. None of what did happen sounds apocalyptic to me, but then I just never fully acculturated the way some other prominent immigrants have.

My wife and kids are coping as best they can, thanks for asking. We will get through this, y’all. I promise. Texas Monthly, the Rivard Report, and the Current have more.

Texas versus AirBnB update

From last week:

The Texas Comptroller’s office said Tuesday it’s reviewing the inclusion of Airbnb on a list of companies that boycott Israel and are banned from doing business with the state after the company announced a change to its policy for listings in the West Bank.

The home-sharing company said in a statement that it’s reversing a plan announced this November to remove about 200 rental listings from the territory, whose ownership is disputed by Palestinians. The company said it will donate the profits to humanitarian aid groups.

“Airbnb has never boycotted Israel, Israeli businesses, or the more than 20,000 Israeli hosts who are active on the Airbnb platform,” the company said in the statement. “We have always sought to bring people together and will continue to work with our community to achieve this goal.”

The company’s decision to delist the properties had prompted the state last month to blacklist it in keeping with a 2017 law that bans state agencies from contracting with or investing in companies that boycott Israel. The law was touted by Republicans, including Gov. Greg Abbott, as a way to show solidarity with Israel.

See here for the background. As I’ve said before, governments base policy decisions on who they do and don’t want to do business with all the time, so this policy is in and of itself not remarkable. It’s dumb and misguided, but not unusual. It’s also led to some other consequences.

Texas state agencies are beginning to divest nearly $72 million worth of stock in a company said to be boycotting Israel — the first financial move after a year-old law that bars Texas agencies from investing in such companies.

Two major state pension funds — the Employees Retirement System of Texas and Texas Permanent School Fund —own $68 million and about $4 million, respectively, worth of stock in DNB ASA, a Norwegian financial services company, officials said, though the company has denied it boycotts Israel.

[…]

The Comptroller’s office, upon the advice of two contracted consulting groups, identified four companies as having boycotted Israel, though all of them deny that they engage in any punitive ban.

Employees Retirement System spokeswoman Mary Jane Wardlow said the fund began divesting March 1, 2018, when it had about $68 million invested in DNB, and as of early April had divested about half that amount. Divestment should be complete by June, Wardlow said.

The Texas Permanent School Fund did not respond to a request for information on its divestment.

The state has no direct holdings in any of the other three companies on its divestment list, according to notifications to the state obtained by Hearst Newspapers.

Two of the six state agencies affected by the law —Texas County and District Retirement System and Texas Municipal Retirement System — had indirect investments in DNB, records show.

And three of the six state agencies affected by the law — the Employees Retirement System of Texas, Texas Municipal Retirement System and Teacher Retirement System of Texas — had indirect investments in Airbnb. (The only agency to disclose how much, ERS, had about $460,000-worth.)

But the law doesn’t require state governmental entities to divest from indirect holdings. It only requires them to send letters to the managers of the investment fund in question and request that they remove blacklisted companies from the fund or create a similar fund without those companies.

If the manager can’t come up with a fund with “substantially the same management fees and same level of investment risk and anticipated return,” the law requires no further action.

I mean, I don’t think this was a good idea, but if you do, then this is what you signed up for.

No backsies for Chick-fil-A in San Antonio

Since I mentioned there would be a re-vote, I figured you’d want to know how it went.

By a 6-5 margin, San Antonio’s City Council on Thursday narrowly rejected a proposal from mayoral contender Greg Brockhouse to revisit a controversial decision last month to remove Chick-fil-A from an airport contract because of its “legacy of anti-LGBTQ behavior.”

Brockhouse forced the issue by using a procedural move under Robert’s Rules of Order to revive the Chick-fil-A debate. With dozens of supporters standing in the council chambers, Brockhouse proposed revisiting the Chick-fil-A decision at the next meeting.

“I consider this opportunity today to be a defining moment for this council,” Brockhouse said in introducing the proposal, which he first broached last week.

All the members who voted against the contract last month voted in favor of Brockhouse’s effort, save one: Councilman Art Hall. He said once the council makes a decision, it should stick to it, swinging the vote.

Councilwoman Rebecca Viagran, who abstained from the first vote, approved Brockhouse’s effort, as did Councilman Manny Pelaez, who said he regretted his original comments about Chick-fil-A’s record.

Nirenberg, who has framed the issue in business terms, said before the vote that no business operating within the law is barred from operating in San Antonio. He proposed having a discussion about the city’s contracting process to ensure it operates under the full compliance of local, state and federal laws.

See here and here for the background. And now you have something else to think about this weekend, since I’m sure we could all use a change of topic by now. The Rivard Report has more.

Chick-fil-A follies, part 2

Noted for the record.

Best mugshot ever

The city of San Antonio voted 6-4 in late March to exclude Chick-fil-A from its renovation of the airport food court offerings due to the company’s “legacy of anti-LGBTQ behavior.”

Shortly after the city’s decision, public outcry in Buffalo, N.Y., led to a concessions company nixing the brand from its plans for the nearby Buffalo Niagara International Airport.

Chick-fil-A told Buffalo news station KBKW recent coverage of the company drives an inaccurate narrative about their brand. “More than 145,000 people from different backgrounds and beliefs represent the Chick-fil-A brand. We embrace all people, regardless of religion, race, gender, ethnicity, sexual orientation or gender identity,” the statement said.

Earlier this week, the city of San Jose, Calif., voted unanimously to settle the debate in an entirely different way — by flying rainbow and pride flags in front of Chick-fil-A locations both inside and outside of the airport.

On Thursday, the San Antonio city council will reconsider its previous vote. Councilman Greg Brockhouse said the city’s decision to exclude Chick-fil-A “embarrassed” the city, KTSA reported.

“Every day the Chick-fil-A removal decision is allowed to stand hurts our reputation nationwide as a welcoming and inclusive city. It sends a message we are anti-faith and we cannot stand by without speaking the truth and standing up for our principles,” he said.

See here for the background. I don’t know what the city of San Antonio is going to do at this point. There’s certainly a practical argument to be made that they have more to lose than to gain by picking this fight. But like Pete Buttigieg, I think there’s a lot of value in highlighting the moral bankruptcy of anti-gay animus, especially from Christian conservatives. Let the Chick-fil-As and their enablers explain why they choose to discriminate. Also, Greg Brockhouse can go jump into a vat of dipping sauce. Anyway, we’ll see what happens.

Texas versus AirBnB

This is one to watch.

Texas is adding short-term-rental site Airbnb to a list of companies that cannot receive state investments because it disallows Israeli-owned rentals in the disputed West Bank.

Airbnb is the only American-based company on Texas’ anti-Israel boycott list, which includes a Norwegian financial services group, a British wholesale co-op and a Norwegian insurance company.

Texas is making it “very clear that our state stands with Israel and its people against those wishing to undermine Israel’s economy and the wellbeing of its people,” said a statement from state Comptroller Glenn Hegar’s office.

In November, Airbnb said it would remove about 200 listings in Israeli settlements in the West Bank. It cited a variety of factors for its decision, including whether listings inside an occupied territory had a direct connection to a larger regional dispute.

“We unequivocally reject and oppose the BDS movement and are disappointed by the decision,” Airbnb said in a statement. “There are over 20,000 Airbnb hosts in Israel who open their doors and showcase the best of Israeli hospitality to guests from around the world.”

In addition to the West Bank, Airbnb also said it has removed listings in the disputed territories of South Ossetia and Abkhazia.

Airbnb has about 20,000 Israeli hosts who’ve welcomed more than 1 million visitors, including 4,700 Texans in 2018, the company said.

Texas’ move was praised by Christians United For Israel, the public policy arm of the nation’s largest pro-Israel organization. It likened the so-called Boycott, Divestment and Sanctions movement, which seeks to “end international support for Israel’s suppression of Palestinians,” to “terrorists” and “hostile nations.”

[…]

Democratic critics of laws cracking down on the Boycott, Divestment and Sanctions movement are increasingly skeptical of Israel’s policies and see such laws as an infringement on free speech. In January, Florida added Airbnb to a list of companies that it defines as boycotting Israel. The same month, a bill to crack down on the BDS movement was blocked by Democrats in the Senate.

The backlash against Airbnb comes as the company is reportedly preparing for an IPO sometime in 2019.

I don’t want to get too deep into the weeds here, so let me sum up: The Lege passed a law in 2017 that created this policy and led to AirBnB’s blacklisting. The push for this has largely come from the Christian far-right fringe, with radical clerics like John Hagee in San Antonio as the main cheerleaders. The author of that bill, Rep. Phil King, has filed another bill that intends to clarify that the law applies to companies and not individuals. One possible reason for that is that there has already been a lawsuit filed, by a speech pathologist in Pflugerville who lost her job with Pflugerville ISD over her support for BDS. The current law is broad enough that it may well be vulnerable to litigation on free speech grounds. AirBnB has 90 days to respond to the Comptroller’s actions, so if a lawsuit is to come of this, it’ll happen after that. Got it? Good.

Buc-ee’s comes to Alabama

Tomorrow, the world.

Texas road stop institution Buc-ee’s has opened a store in Alabama, its first location outside the Lone Star State.

Despite chilly weather, more than 100 people were lined up outside the Baldwin County store when it opened at 6 a.m. Monday. They were eager to experience a Buc-ee’s supersized gas station and convenience store, renowned for its cartoon beaver logo, clean bathrooms and clever billboards. Some die-hard Buc-ee’s fans drove hours to get to the store opening, said Jeff Nadalo, Buc-ee’s general counsel.

“It was packed and very busy all day,” Nadalo said. “I think a lot of people had heard what Buc-ee’s was about from friends and family who had been and were familiar with the experience.”

The 52,000-square-foot store, in Robertsdale, features 124 fueling stations and the “biggest, most pristine bathrooms the state of Alabama has ever seen,” a Buc-ee’s press release crowed. The store, has a similar layout to the new Buc-ee’s in Katy, except the Alabama location doesn’t have a car wash, Nadalo said.

[…]

Since it was founded in 1982, Buc-ee’s has mostly stuck to its Texas roots, operating 34 stores across the Lone Star State. A couple of years ago, the Lake Jackson company began looking to expand across the southeastern U.S., which shares a similar customer profile to Texas, Nadalo said.

“We’re taking the great experience that is Buc-ee’s to other states,” Nadalo said. “We felt it was something that would work well, certainly in Alabama, and we think it’ll be well-received in Florida.”

We first heard about this almost three years ago, though at the time they were aiming for Louisiana. It’s on I-10, so if you’re driving to Florida (where Buc-ee’s plans future expansions), you’ll see the familiar signs. Less familiar was this:

A lawsuit claims that Buc-ee’s illegally priced gasoline when it opened its first Alabama travel center last month along Interstate 10 in Baldwin County.

The lawsuit, filed in federal court by Oasis Travel Center LLC, alleges that the Lake Jackson, Texas-based company violated the 35-year-old Alabama Motor Fuel Marketing Act, and demands that the company halt its pricing strategies while the case is pending.

The law, passed in 1984, prohibits big oil companies from selling gasoline to the public for less than it costs to buy and transport it to a retail outlet.

Similar lawsuits, over the years, have been filed in Alabama against big-box retailers like Costco and Murphy Oil Corp., which operates Walmart gas stations.

“We contend Buc-ee’s, when it opened up two weeks ago, it opened at prices for regular unleaded and other grades at below costs as defined under the Alabama law,” said H. Dean Mooty, a Montgomery-based attorney who has represented smaller-sized convenience stores in similar cases.

The lawsuit specifically cites several dates when Buc-ee’s posted a price of regular gasoline under what state law allows. Among the dates cited is Buc-ee’s Jan. 21 opener, when regular gasoline was sold at a rounded price of $1.80 per gallon.

Oops. You really are not in Texas any more, y’all. As for the rest of us, enjoy the beaver nuggets and the clean bathrooms while you can.

Hitch-ing a ride

I’m kind of fascinated by this story about another ridesharing app/service.

High-tech hitchhiking has arrived in Texas.

Austin startup Hitch offers a ride-sharing service connecting people driving between Houston and Austin with people needing rides.

“Over 10,000 cars make trips every day just between Austin and Houston, and 90 percent of them have just one occupant — the driver,” CEO Kush Singh said in a news release.

Here’s how it works: Someone with a 2003-or-newer vehicle who is planning to drive between Houston and Austin downloads the “Hitch – Regional Ridesharing” app and registers as a driver. After a background and driving record check, which can take up to 24 hours, the drivers are authorized to pick up passengers.

Those needing a ride will enter a virtual queue and then proceed to a physical Hitch pickup location, which will be a public place like a coffee shop along the route. Riders are ID verified using scanned driver licenses and facial recognition,  and they must have a valid credit card on file with Hitch.

Drivers simply pull over at a Hitch pickup location and then collect the next person in line. They can pick up multiple riders — with each person allowed one typical-sized suitcase and a small personal item — and the middle seat is never occupied.

The concept is simple enough, and I can see some appeal for both drivers and riders. I have no idea if there’s enough demand on either side of that equation to sustain this, but that’s not my problem. If you want to try this for yourself, be careful about how you search for it, as there are other apps called Hitch out there. I found this particular app in the Google Play store on my Android phone. It had a 2.6 average rating, with five one-star reviews out of eight total. Megabus tickets are pretty cheap, y’all. I’m just saying.

Now how much would you pay for that emergency room visit?

Guess higher, and it is a guess because who knows what you’ll wind up getting charged for it.

Fifteen months after Texas enacted a law to bring transparency to the state’s for-profit free-standing emergency rooms, many of the facilities continue to send mixed messages about insurance coverage that could expose unsuspecting patients to surprise medical bills.

A Houston Chronicle review of websites representing the 52 free-standing emergency rooms in the Houston area shows a pattern in which many of the facilities prominently advertise that they “accept” all major private insurance. Some even list the insurers’ names and logos.

But often tucked under pull-down tabs or at the bottom of the page is a notice that the facilities are outside the networks of those insurers, followed by a reassurance that under the Texas insurance code, network status does not matter in emergency treatment, implying patients needn’t worry about coverage.

What the websites fail to disclose is that out-of-network status can result in insurance reimbursements far below the charges, leaving patients on the hook for the remainder of the bill — sometimes thousands of dollars.

“The word ‘accept’ means something very different to them than to the consumer, and they know that when they write their websites,” said Stacey Pogue, senior health policy analyst at the Austin-based Center for Public Policy Priorities. “They do not tell the rest of the story.”

For example, many of the Houston-area facilities advertise that they accept Blue Cross and Blue Shield of Texas, the state’s largest insurer. But the Chronicle’s review found that only five — about 10 percent — are in that insurer’s network.

Those findings are consistent with a statewide report by AARP Texas, to be released Monday at a state Senate committee hearing, that found 77 percent of the state’s 215 free-standing emergency rooms said they “take” or “accept” Blue Cross and Blue Shield insurance, but were out-of-network.

Free-standing emergency rooms defend their websites, describing concerns raised by advocacy groups and Texas lawmakers as manufactured outrage.

“I don’t see a problem with saying they ‘accept,’” said Dr. Carrie de Moor, CEO of Code 3 Emergency Partners, a Frisco-based network of free-standing emergency rooms, urgent care clinics and a telemedicine program. She insisted that patients understand that accepting someone’s insurance is different from being in that company’s network.

It may seem like a hair-splitting distinction, but it can carry high costs, health policy experts said.

Obvious point #1: It’s ridiculous that we live in a society where basic medical needs, including emergency care, are not met. It’s utterly scandalous that prior to the Affordable Care Act, there were thousands upon thousands of bankruptcies caused every year by medical issues. Plenty of other countries have figured this out. Our standard of medical care is no better than theirs. It’s just more expensive.

Obvious point #2: For those who believe in the power of the free market, why is it that medical services, especially those tied to emergency and hospital care, are so utterly opaque when it comes to their pricing? Think of all the other goods and services you buy. In nearly all of them, you know up front how much it’s going to cost. That is universally untrue for the vast majority of medical services, from basics like painkillers and bandages to anaesthesia and specialist fees to higher-end products like EKGs and colonoscopies. There’s no such thing as a free market with unknowable prices. You want to move towards something like a free market in health care, fix that.

Will Amazon ruin Christmas trees?

Maybe!

Amazon this year launched a new service to deliver full-sized, fresh Christmas trees to customers’ homes, betting that lots of people will prefer convenience over experience. The mega-etailer has shown time and time again that it can change consumer buying habits and longtime traditions, and that is making purveyors of fresh Christmas trees around Houston nervous.

Devine said he was flabbergasted that Amazon would try to break into the business. Shortly after Amazon began selling trees, Devine said, he burned his Amazon Prime card and swore to never buy anything from the online retailer again.

“Amazon has just gone too far with this, coming after our livelihood,” Devine said. “They’re going to hurt small, independent nurseries like us. We rely a lot on tree sales.”

Amazon isn’t the first retailer to ship Christmas trees direct to consumers. Specialty retailers, such as Williams-Sonoma and Hammacher Schlemmer, have delivered fresh Christmas trees for years, while Home Depot, which sells 2.5 million Christmas trees a year, started shipping trees in 2014. Third-party retailers have sold Christmas trees through Amazon.com for some time.

But Amazon’s direct entry into the market raises the threat to Christmas tree lots to a new level. Over the years, Amazon’s relentless drive into new markets has wiped out book stores, sellers of toys and electronics and long list of other retailers. When Amazon bought Whole Foods last year, the $13.7 billion acquisition sent a shock wave throughout the grocery industry, ushering in a new era of e-commerce.

Today, most major grocers in Houston offer online ordering, curbside pickup and home delivery of groceries. H-E-B, Kroger and Walmart are investing heavily in new technologies to compete with Amazon.

[…]

Tree farms, where Houstonians can cut down their own trees, said they’re not that worried about Amazon. Many farms host activities such as photo shoots with Santa and Christmas light shows, which Amazon can’t match online.

Larry and Mary Emerson have sold Christmas trees at Dewberry Farms since 2009. The husband-and-wife owners have planted nearly 17,000 Cypress and Blue Ice trees on some 20 acres on their farm in Brookshire, just 10 miles from a new 1-million-square-foot distribution facility where Amazon’s trees will be shipped.

The Emersons sell between 2,000 and 2,500 Christmas trees a year, ranging in price from $40 to $300. Tree sales are down a little from last year, but the farm is still doing well, Emerson said, declining to give specifics. Dewberry Farms attracts as many as 100,000 visitors a year to its fall pumpkin patch, Christmas tree farm and attractions, like big slides, a carousel and petting zoo.

“Our customers, they’re not just looking for trees,” Mary Emerson said. “They’re looking for tradition.”

I’m the wrong person to ask about this. I grew up with an artificial tree, and we buy our tree at Lowe’s every year. I figure when the kids are grown, we’ll just get something smaller. If we wind up getting that from Amazon, it won’t be a net loss for the tree farmers, since we were never their customers to begin with. Does tradition matter, and if so how much? I will note that there are still some independent bookstores out there, and they do the sort of in-person amenities that the tree farmers do to stay in business, so there’s at least some hope.

Rural counties and AirBnB

It’s working well for them.

Texans running Airbnb rentals in rural counties earned $20.6 million in supplemental income in the last 12 months with 169,000 guests, according to a new report from the hospitality company.

These results represent a growth rate double that of urban counties, the report added, citing a trend of more guests wanting to visit more than just Texas’ big cities.

The company said that while the Texas hotel industry is booming, most of this growth is concentrated in the four major metro areas, making Airbnb sometimes the only lodging option outside of these cities and suburbs.

You can see a copy of that report here. As CultureMap Austin notes, some of the biggest beneficiaries are counties in the Hill Country, which makes sense. I’m happy for these rural counties, but none of this changes my mind about the need for cities to be able to regulate AirBnB locally. AirBnB my be having a significant and mostly positive effect in some parts of the state, but it will have an even bigger impact of a more-unknown effect on those cities. At the very least, let’s not pre-emptively foreclose on any tools that cities will need to manage their own interests.

The power to pay more for electricity

Deregulation really does create jobs.

When Texas deregulated electricity markets 16 years ago, the Public Utility Commission created the website Power to Choose to help consumers through the power buying experience. But what was promoted as an easy, free way for Texans to pick electricity providers has turned into a such a complex and confounding experience that it is spawning a cottage industry to help consumers navigate the scores of companies and hundreds of plans available.

At least five companies in Texas are providing both free and paid services aimed at helping consumers in Houston and other deregulated markets decipher confusing electricity offers such as free nights and weekends, multi-tiered pricing plans, and credits for high electricity use.

The companies have built computer algorithms that try to ferret out the best deals based on factors such as past electricity consumption, home size, and the number of people living there. In some cases, it’s just a matter of plugging in your monthly electricity into a website calculator. Others provide more comprehensive services, charging a monthly fee to advise customers which plan will save them the most money and then monitor the market so if prices fall, consumers can switch.

This kind of hand-holding is akin to car buying services, which save customers the time, energy and aggravation researching models, doing comparison shopping and negotiating prices. But unlike cars, there’s no difference in the electricity provided by different retailers, making the emergence of these power buying services a sure sign of the complexity of the system.

“The third party guys demonstrate the consumer is getting ripped off by the Power to Choose artificial configuration that the Public Utility Commission has rammed down the throat of Texas consumers,” said Ed Hirs, energy economist at the University of Houston.

The Public Utility Commission recently recognized the shortcomings of Power to Choose, with chairman DeAnn Walker criticizing retail electric providers for misleading pricing plans. Those plans offer rock-bottom rates at 1,000 kilowatt hours, but if consumers use just one kilowatt hour more, the price per kilowatt hour can jump as much as 10 times.

[…]

Jesson Bradshaw, a power industry veteran, saw an opportunity when his friends and family asked him which company they should sign up with for electricity. He sent them to Power to Choose, but he quickly heard complaints.

“I saw how confusing it was,” said Bradshaw, who worked as a power trader and owned the retail power company Amigo Energy until he sold it to Just Energy in 2011.

Four years ago, he and a partner launched the buying service Energy Ogre. The company charges customers $10 each month to find the lowest price plan and monitor rates to see if it makes sense to switch mid-contract. It doesn’t take commissions from power providers.

Bradshaw said his business is not exactly popular among the retail providers, many of which bet that customers won’t shop for better rates when contracts expire.

“They don’t like us informing the customer,” he said. “ If there is a better rate, we move them. We don’t care which provider.”

Mark Axford of Sugar Land signed up with Energy Ogre about three years ago. Axford said the company switches electricity providers at least once a year and makes sure Axford and his wife do not get hit with penalties. The monthly fee is well worth it, he said.

If you want to save, you have to shop, said Axford. “But who has the time to keep shopping for electricity?”

The trade association for retail electricity providers in Texas said it recognizes that the buying services may help customers sort through offers. But it’s important to note, said Julia Rathgeber, president of the Association of Electric Companies of Texas, that these companies are not subject to oversight by the Public Utility Commission. It’s still up to consumers to decide whether plans are right for them, she said.

Got that? If you’re paying too much for electricity, it’s your own damn fault. Never mind how confusing or time consuming the shopping process is. There’s no reason I can think of why the state couldn’t provide, for free, the kind of easy, at-your-fingertips information that these entrepreneurs have done. Why wouldn’t we want to do that, if the goal of deregulation was to lower prices for consumers? The answer to that is left as an exercise for the reader. In the meantime, here’s the sidebar that tells you how to find the best deal for yourself:

MORE INFORMATION
Companies that help consumers find the best power deals:

Texas Power Guide

Website: TexasPowerGuide.com

Awesome Power Texas

Website: AwesomePowerTexas.com

Geek Your Rate

Website: GeekYourRate.com

Energy Ogre

Website: EnergyOgre.com

Real Simple Energy

Website: RealSimpleEnergy.com

You might also want to go back and look at some guest posts my friend Dan Wallach wrote about picking power plans. Good luck.

Buc-ee’s wins in court

That was quick.

After about six hours of deliberation, a jury in Houston found Tuesday that Choke Canyon company’s alligator logo violated state and federal trademark law, infringing on the pre-established Buc-ee’s beaver mark established by the popular Texas road stop chain.

“It’s absolutely not about a beaver versus an alligator,” said Jeff Nadalo, general counsel for Buc-ee’s Ltd. “There are more than 10 similarities between the two marks that we presented to the jury in this case.”

[…]

The judge asked the lawyers to meet and try to hammer out an injunction on how to deal of trademarked materials that violate the jury’s finding.

The damages phase of the trial remains pending.

See here for the background, and here for a later version of the story. Six hours of deliberation for a week-long trial is pretty darned quick. I may have been skeptical based on my view of the two logos, but I wasn’t there in court and neither were you. We’ll see what the damages look like.

Beaver v alligator

It’s a roadside rest stop animal logo legal smackdown, and it’s off to the jury.

Buc-ee’s, a popular chain of Texas pit stops, fought hard to build its reputation and wants a San Antonio-based competitor to stop “riding its coattails” by using a logo that confuses highway travelers into pulling off at a rival business, the company’s lawyer told jurors in his closing statement Monday in Houston.

“We don’t want to put Choke Canyon out of business,” said Buc-ee’s lawyer, Tracy Richardson, poised between poster boards displaying similarly colored T-shirts, beer koozies and plastic grocery bags with the animal logos from the two rival chains. Buc-ee’s just wants Choke Canyon’s owner to curtail what it views as an unfair ad campaign: “We just want him to stop using the logo.”

Richardson and the lead attorney for Choke Canyon offered closing pitches to jurors before they began deliberations Monday afternoon, following a week of testimony about the dueling roadside travel centers in a federal trademark case before U.S. District Judge Keith P. Ellison. The jury of three women and nine men will resume deliberations Tuesday.

The lawsuit brought by mega-chain Buc-ee’s claims that Choke Canyon’s alligator logo, posed against a circular yellow backdrop, is too similar to the buck-toothed beaver that is synonymous with its 33 gas stops. The Buc-ee’s chain, headquartered in Lake Jackson, also contends that Choke Canyon illegally mimicked its in store offerings, including friendly service, ample stock and plentiful, clean bathrooms.

[…]

[Defense attorney Charles] Hanor said the two trademarks are quite different, as are the offerings. The alligator is advertising a chain that specializes in barbecue, he told jurors, noting that Buc-ee’s only complained in court about its road stop competitor when Choke Canyon sought to open a chain in New Braunfels, where Buc-ee’s also had operations.

Trademark law doesn’t give either company a hold on any one attribute of their logo. Instead, the jury will consider the strength of Buc-ee’s logo, the similarity between the two logos and the stores’ product lines and whether Choke Canyon set out to or actually did confuse customers with the overlap.

It’s a balancing act, the judge explained in his directions to the jury. The goals of trademark law are to protect the public from being misled, to protect the rights of businesses to identify themselves in public and to protect the public interest in fair competition, Ellison said.

See here for some background. Earlier stories from the trial are here, here, and here. As I said when news of the lawsuit first appeared, I think Buc-ee’s is stretching it here. Maybe it’s because I’ve never seen a Choke Canyon, but I don’t see how a reasonable person could confuse the two. That’s up to twelve jurors here in Houston to decide. I wish them luck.

No Amazon HQ2 for Houston

Never really expected that we’d be a top contender, to be honest.

Amazon ruled out Houston as a candidate for its $5 billion second headquarters on Thursday, delivering a blow to local leaders who had hoped to lure the Seattle tech giant to a four-mile stretch between downtown and the Texas Medical Center.

The largest U.S. online retailer whittled down more than 200 proposals from North America cities to just 20, eliminating Houston but keeping the city’s longtime rivals Austin and Dallas on its short list.

Amazon’s decision marks a setback for local leaders including the Greater Houston Partnership, which led an effort last fall to pitch the city as an attractive market for the company to set down stakes.

“I believe this is a wake-up call for Houston,” GHP CEO Bob Harvey said in a statement. “While there has been growing momentum in the innovation space over the last couple of years, this is a clear indication that we have much more work to do as a region to grow our digital economy.”

Houston Mayor Sylvester Turner called Amazon’s decision ” disappointing and heartbreaking.:

But, he added, “It serves as a wake-up call that we must move at a much quicker pace. The city is well positioned, but it’s also is an indication that there is a lot of work that still needs to be done.”

[…]

In his statement Thursday, Harvey said Houston should focus on developing the Innovation Corridor and its technology sector further. He also said Houston should move forward with the proposed Houston Data Science Institute, a data center recently announced by the University of Houston.

“While we are the number one market in the country for STEM talent, we need to bolster our pipeline of digital tech talent that is relevant to tomorrow’s digital economy,” Harvey said. “This means working with our higher education partners across the region to develop and invest in programs that will produce the talent we need to succeed.”

But economists warned that Houston would rank low on Amazon’s wish list in the nationwide bidding war for a campus that could bring 50,000 jobs, saying the city lacked a robust public transportation system. Only 2 percent of the local population takes public transportation to work, according to Census data.

See here and here for some background. On the one hand, it’s always a bummer to miss out. On the other hand, I wasn’t excited at the thought of giving zillions of dollars in incentives and tax breaks to a behemoth like Amazon as deal-sweeteners. There’s too much of that going on already. Doing things like developing the Innovation Corridor and building a Data Science Institute, that’s fine and worthwhile as investments. And let’s be sure not to overlook the feedback about our public transportation infrastructure. Imagine where we could have been if we’d had a Congressional delegation that was unanimous in its support of of more robust transit system. We’ll have an opportunity to support that at the ballot box this November. If we’re serious about wanting to be more competitive with the cities we lost out to, we need to put our money where our mouths are. The Trib, Texas Monthly (which is very skeptical of the chase to lure in Amazon), Swamplot, and the Dallas Observer have more.

What Houston is showing to Amazon

Meet the Innovation Corridor.

Houston leaders hope to entice Amazon with a spot somewhere within the four-mile stretch of the Metro rail line that runs from downtown to the Texas Medical Center, an area they’re calling the Innovation Corridor – and the city’s best shot at winning the Seattle tech giant’s $5 billion second headquarters.

The rail line cuts through a part of Houston that includes some of the city’s largest companies and most prominent health care institutions, as well as Rice University, Hermann Park, the Museum District, Houston Community College, NRG Park and the collection of bars, restaurants and apartment complexes in trendy Midtown, according to a document outlining Houston’s confidential proposal.

City officials won’t say exactly where they want Amazon to plant a campus that could grow to more than 8 million square feet and house 50,000 high-paying jobs. But they have proposed multiple sites within the corridor, a slice of Houston that connects the city’s intellectual and cultural assets in the heart of its ethnically diverse population and bustling business hub.

“What’s remarkable is how concentrated all of this is in a four-mile-long area,” said Bob Harvey, president and CEO of the Greater Houston Partnership, the group behind Houston’s bid for Amazon. “Innovation Corridor seems to fit. It’s just like, wow, this is what Amazon is looking for.”

[…]

Local leaders have given Amazon its choice of undisclosed sites within the so-called Innovation Corridor, which, according to the document drafted by the Greater Houston Partnership, offers close access to two international airports, three interstates, 3 million workers, plus key game changers in business and an unparalleled array of amenities.

The document’s 32 bullet points highlighted the nearly 100,000 people who work in technology-related fields as well as the region’s low taxes, low cost of living, reasonable housing prices and eclectic neighborhoods and restaurants.

In particular, the document highlighted the city’s racial and ethnic diversity, which, Harvey argued, should appeal to a company that wants to attract millennial workers to a tech industry that has come under fire for its ethnic uniformity, particularly in Silicon Valley.

“As Amazon seeks to diversify its ranks at the executive, manager and professional levels, there is no better place to locate than in Houston,” city leaders said.

I still don’t think Houston’s efforts are going to amount to anything, but hey, it’s worth a shot. Given what Amazon has talked about for their new location, this is probably the best part of town to meet the requirements. Maybe we’ll learn something from the experience for the future.

Amazon and Houston

Does our city have a shot at landing Amazon’s HQ2? Eh, maybe.

Bringing Amazon to Houston almost certainly will be a heavy lift. The pursuit of the company that revolutionized the retail industry has highlighted both the potential and shortcomings of the local technology sector, made up of scattered groups of engineers in the energy, medical and space industries, which account for many of the city’s major innovations, but have yet to break out of their silos to create the kind of culture and buzz that animate tech centers such as Silicon Valley, Austin or Amazon’s hometown of Seattle.

But economic development officials say that regardless of outcome, the bid may well become the catalyst for the kind of innovation ecosystem that pushes the region and its economy into new directions to underpin its long-term prosperity.

“Amazon is a foil for thinking about where you’re trying to take a city,” said Bob Harvey, president and CEO of the Greater Houston Partnership, which is leading a team of developers, academics, Texas Medical Center executives and real estate brokers juggling a high-stakes bidding war and Hurricane Harvey recovery efforts.

[…]

Houston likely has a tough sell ahead of it. The local startup scene has grown in recent years, but has so far failed to attract the sort of venture capital activity concentrated in Austin and other tech-focused cities. Skeptics point to the city’s consistent failure to develop projects that would substantially expand its technological base and attract major firms such as Microsoft, Google or Dell, all of which have operations in Austin.

Most recently, the University of Texas system’s ambitious plan to transform roughly 300 acres of land near the Medical Center into a cutting-edge data science center failed in the face of intense opposition from University of Houston leaders and state lawmakers. Proponents of the deal blamed political sparring for scuttling a deal that could elevated the city’s chance of developing a more robust technology sector.

“That type of nonsense has to stop,” said Houston developer David Wolff, chairman and president of Wolff Companies. “You have to have the institutions working together.”

But local leaders argue that the city’s growing number of software engineers and computer programmers could complement Amazon’s ambitions as it expands its data science capabilities outside of retail and entertainment. In addition, city officials in recent years have made a push to elevate local startups and draw venture capital investors. Station Houston, a downtown startup incubator and co-working space, has attracted more than 260 member companies since it opened this spring.

The city’s most prominent universities have bolstered their technology programs in recent years to include data science and analytics. The University of Houston-Downtown offers a master’s degree in data analytics, and Rice University has partnered with IBM to develop robotics.

“We are still evolving, and we can grow and design a city with the help of an Amazon to help customize our city to their particular needs, which many other cities cannot do,” Mayor Sylvester Turner said in an interview. “We are just now beginning to focus on startups, technology, innovation in a very integrated sense.”

Just between you and me, I don’t think Houston’s odds are very good here, and I won’t be terribly grieved if we are not the chosen city. I think we’d have to give them a pretty substantive bribe incentive package to come here, and I have a hard time with that. (Turns out I’m not the only one who isn’t bullish on our fair city’s chances.) If we’re going to have a broader discussion about making the city more amenable to startups, or to address the infrastructure and transit demands Amazon is making, I’m all in. But let’s leave it at that. Swamplot has more.

AirBnB tax collection deal

Seems reasonable.

[AirBnB] announced Wednesday it will begin collecting and remitting the 6 percent state hotel occupancy tax May 1. The decision followed more than a year of talks, said Laura Spanjian, Airbnb’s Texas public policy manager. Airbnb has similar tax-collection agreements with 25-plus states.

“These agreements are a meaningful revenue boost for communities, and we hope to reach similar agreements with cities around Texas soon,” Spanjian said by email.

Houston homeowners who rent out their properties are supposed to pay a total of 17 percent in occupancy taxes, 7 percent of which goes to Houston First, which oversees hotel tax collection for the city.

Yet of the 7,200 active hosts Airbnb says operate in the area, only 70 have registered with the city as taxpaying hosts, said Jonathan Newport, Houston First’s director of government affairs.

[…]

Under the new agreement, the state portion of the hotel-occupancy taxes will be guaranteed. Guests will be charged the correct amount on their bill for a stay of 29 nights or less, and Airbnb will then remit the collected taxes to the state.

“The sharing economy plays an important role in our state’s overall fiscal health,” Texas Comptroller Glenn Hegar said in a statement. “We applaud Airbnb for agreeing to collect state hotel occupancy taxes, as all lodging facilities in Texas are required to do.”

See here, here, and here for some background. This is a positive step, as it gets some revenue that otherwise would have been lost for the city while giving AirBnB some regulatory certainty. People want to use AirBnB, and as seems to be the case with everything these days there’s a bill in the Legislature to override local restrictions on it, so this is another level on which it makes sense for the city to reach a deal with them. Hope it works as intended for everyone.

“Texas lives on immigrant labor”

Ain’t that the truth.

In Texas, an estimated 400,000 construction workers reside illegally, according to one study. If they were forced to leave the country, contractors say, state construction companies would face a difficult fallout, including higher labor costs, construction delays, and some projects canceled altogether.

“Texas lives on immigrant labor,” said Jeff Nielsen, executive vice president of the Houston Contractors Association. “Our economy is the way it is partly because cost of living is cheap and the reason for that is labor is cheap.”

Throughout his presidential campaign, Donald Trump advocated a “deportation force” to track down and remove millions of immigrants here illegally. This week, he moved closer to that goal with a memo instructing federal authorities to broaden the scope of targeted deportations.

The president’s actions dovetail with a current push in the Texas Legislature to outlaw so-called sanctuary cities, requiring local law enforcement to cooperate with federal authorities on immigration enforcement.

On Friday, the U.S. Hispanic Contractors Association and its Austin-based Texas arm sent a letter to Gov. Greg Abbott, warning that immigrants in Austin have been wary of showing up to work after an escalation of Immigration and Customs Enforcement activity.

“Our fear is that because of the perception that the public has on what the elimination of sanctuary cities means,” the contractors wrote, “it will be difficult to find and retain experienced workers, which is especially damaging to small businesses.”

[…]

Efforts at comprehensive reform have stalled repeatedly, most recently under the Obama administration, and has been wiped from the agenda under Trump, whose stated goal is to remove immigrants living here illegally from the country. Proponents of hard-line immigration policy have argued that unauthorized workers should simply attain legal status, but experts contend that there is no such option for the class that builds Texas.

“The ability for these workers to come in legally for a temporary work program is about as close to zero as you can get,” said Charles Foster, a veteran Houston immigration lawyer who advised on immigration policy for the George H.W. Bush administration. “There is no line to get legal. It’s all a myth.”

The closest thing, he said, was the H-2B visa program for temporary non-agricultural workers, which allows in about 66,000 people across the 50 states each year – hardly enough to account for the hundreds of thousands of laborers in Texas.

It would of course be better if we lived in a country where undocumented workers were not exploited as cheap labor for the rest of us but instead got to live and work here legally at a fair market wage. I don’t hold out a lot of hope for getting to that place any time soon. In the meantime, this is the reality. You want to deport ’em all? Then get ready for construction work, among other things, to grind to a halt. And if you don’t want that to happen, the don’t vote for politicians who stand for it, whether or not we’re supposed to take them seriously when they say it.

Global investors against SB6

From the inbox:

Led by New York City Comptroller Scott M. Stringer and Trillium Asset Management, a group of some of the largest investors in the world, with a combined $11 trillion of assets under management, today spoke out against Texas Senate Bill 6 (or SB6), a “Bathroom Bill,” as well as similar discriminatory legislation. In the wake of hundreds of millions of dollars in lost economic activity in North Carolina after HB2 – a similar bill – was signed into law in that state, major investors are standing up against this discriminatory legislation.

The 40 signatories include some of the biggest investors in the world, such as BlackRock, State Street Global Advisors, T. Rowe Price, and AllianceBernstein, as well as New York City Comptroller Scott M. Stringer, California Controller Betty Yee, Connecticut Treasurer Denise L. Nappier, New York State Comptroller Thomas DiNapoli, Oregon Treasurer Tobias Read, Rhode Island Treasurer Seth Magaziner, and Vermont Treasurer Elizabeth Pearce.

The investors’ letter urges Texas Governor Greg Abbott, Lieutenant Governor Dan Patrick, and House Speaker Joe Straus to oppose the legislation, which would discriminate against transgender individuals in Texas. This not only makes it more difficult for companies to attract and retain the best talent, but could have real effects on the Texas economy by undermining businesses operating there and delivering extraordinary reputational harm to the Texas business environment. The state could lose hundreds of millions – if not billions – of dollars in economic activity. Tourism dollars, sporting and other entertainment events, and corporate expansions – all are vital to Texas’s economy and could be at risk. As just one indication of the potential impact, organizations including the National Football League and the NCAA have already warned that the siting of future events in Texas would be jeopardized.

The investors’ letter also highlight opposition to SB6 from more than 1,200 companies doing business in Texas, including major firms like American Airlines, Dow Chemical, Southwest Airlines, Texas Instruments, and Waste Management.

“This bill is the 2.0 version of North Carolina’s HB2, and we saw how that bill impacted North Carolina. Not only is SB6 wrong for Texas residents, it also undermines anyone who is invested in companies in that state. SB6 would take Texas in the wrong direction,” New York City Comptroller Scott M. Stringer said. “This group of investors represents a truly extraordinary level of assets, and the market is unquestionably speaking out about the economic consequences of such bills. We hope that message will be heard. I couldn’t be prouder to lead this massive effort to protect not just the interests of New York’s retired firefighters, police officers, and teachers, but also fundamental human rights.”

“The evidence is overwhelming that inclusive corporate and public policy that embraces diversity and equality are essential to strong businesses and financial success. Trillium Asset Management, and the trillions of dollars of assets that support this letter, unequivocally and emphatically urge Texas legislators to maintain a healthy and vibrant climate for business in the State of Texas,” said Trillium Asset Management, CEO Matthew Patsky, CFA. “Senate Bill 6 must be defeated and not allowed to negatively impact the economy of Texas, the second largest in the United States.”

SB6, introduced in early January 2017, is similar to North Carolina’s HB2’s bathroom restrictions, and requires individuals to use the public restroom that aligns with the gender on their birth certificate, discriminating against transgender individuals. The bill also eliminates municipal bathroom access non-discrimination laws, effectively legalizing discrimination against the LGBT community in both public and private accommodations. SB6 allows the Texas Attorney General to impose fines of up to $10,500 a day for violation of bathroom access regulations.

North Carolina has faced significant financial harm since enacting a similar bill, HB2, in March 2016. In the months since the bill was enacted, sporting events, concerts, TV shows, and conventions were canceled and business expansions were halted. By some estimates, the cost to the state reached over $600 million.

To read the investor letter, and see a full list of signatories, click here.

Here’s a Chron story about this letter.

[Trillium CEO Matthew] Patsky told the Chronicle, “We didn’t have this level of support for divestment from South Africa during apartheid.”

[…]

Stringer and others said the state lost more than $600 million in economic activity after passing HB2, with the NBA and NCAA pulling championship games. Given that Texas’ economy is the second largest in the country, Stringer said there is fear that negative economic impact in the state as a result of passing the bathroom bill here could be felt across the nation.

“I’m worried that pension fund investments could suffer,” he said.

Patsky said Trillium Asset Management, which has business ties to Texas, has previously coordinated efforts to get investors to speak out against the North Carolina law. He said it didn’t take much to convince them to speak out against the Texas proposal.

T. Rowe Price and others echoed the concern over an economic backlash.

“Our decision to participate was taken out of concern for the likely adverse economic impact of the proposed legislation and its inconsistency with our commitment to fostering diverse and inclusive communities,” a T. Rowe Price spokeswoman said in a statement.

A representative of BlackRock said the company has previously signed a letter to North Carolina lawmakers in opposition of their law as well as signed an amicus brief in defense of marriage equality when the Supreme Court was reviewing it.

Patsky said passage of the bill also could deter venture investors looking for startup activity in the state or companies that might look to expand here. He also projected municipal bonds could be hurt as investment falls.

He also questioned the rationale behind the bill and said he recalled seeing misleading campaign ads during an effort in Houston a year and a half ago to overturn the city’s equal rights ordinance that guaranteed protections for transgendered people seeking to use the bathroom where they feel most comfortable.

No comment on this from Abbott or Patrick. I guess telling these folks to “stay out of politics and stick to business and finance” would sound weird even to them. It’s certainly possible that as with that TAB study that Stringer and Patsky et al are overstating the possible effects of SB6, but even if they are there’s no question that the effect we will have will be negative. A lot of investing comes down to perception in how things are and belief about where they are going, and the passage of SB6 would negatively change both of those things about Texas, for no real purpose. That is what this debate has always been about.

The “border adjustment tax” is a sales tax increase by another name

That’s a feature, not a bug.

Retailers across Texas and the country are warning that a proposed border adjustment tax would increase the cost of imports and, by extension, the price of food, clothing and other consumer goods. Texas companies, including Stage Stores of Houston and Neiman Marcus of Dallas, have joined more than 150 other U.S. firms in a coalition fighting a possible border tax, part of a broader tax overhaul championed by Rep. Kevin Brady, The Woodlands Republican who chairs the tax-writing Ways and Means Committee, and House Speaker Paul Ryan, R-Wisconsin.

The plan essentially proposes a 20 percent tax on imports, which the National Retail Federation, a trade group, expects would raise the price of consumer products by 15 percent. Randi Sonenshein, senior vice president of strategy and finance for Stage Stores, which has more than 800 locations in 38 states, said her company worries that the higher prices related to the tax would particularly hurt customers who shop at stores located in small and mid-size towns, where it primarily operates.

“The plan will have a disproportionately negative impact on retailers,” she said. “It’s a tough thing to contemplate.”

Border adjustment is one component of a tax plan that aims to shift the U.S. tax code toward favoring production of goods over their consumption. Under the plan, companies would lose deductions for the costs of importing goods; at the same time, sales revenues from goods they export would be exempt from corporate income taxes.

[…]

Companies with significant sales in foreign countries, including aerospace manufacturer Boeing, the industrial conglomerate General Electric, chemical maker Dow Chemical and pharmaceutical maker Pfizer, support the plan. But critics of border taxes say U.S. consumers will ultimately pay more, with the costs borne disproportionately by low- and middle income households.

If a border tax was enacted, apparel, autos, furniture and electronics equipment – much of which is imported – would see some of the largest price increases, at least initially, according to a recent analysis by the Wall Street investment bank Goldman Sachs. The National Retail Federation expects the cost of clothing, for example, would rise at least $350 a year for an average consumer.

Walmart, the nation’s largest retailer, as well as trade groups such as the U.S. Fashion Industry Association and the Association of Global Automakers, have joined the coalition against the plan, called Americans for Affordable Products.

The Texas Retailers Association, which represents companies of all sizes in every retail sector except convenience stores, has followed suit. George Kelemen, the association’s president and CEO, said every retail business in the state would be affected by the proposal in some way. In addition to clothing and other manufactured goods, food grown outside the United States, including everyday groceries, such as avocados, bananas and coffee would become pricier, he said.

“We are opposed to this,” he said. “It’s a cost passed on to the consumer.”

The real point of this is that once this is implemented, you – and by “you” I mean “Republicans” – can cut taxes elsewhere, which is always the goal. In that sense, it’s like the Craddick-era proposals to hike the state sales tax in return for a property tax cut. Dan Patrick would do that today if he thought he had the votes for it. I’m sure you can guess who would pay more and who would pay less in such a scenario. The bottom line is those tax cuts for the rich aren’t going to pay for themselves, but this might.

Dan Patrick and the wall tax

Hey, you know who’s going to pay for Dear Leader’s wall? You and me and everyone else in the country.

The Trump administration sparked widespread surprise Thursday by announcing it intended to implement a 20 percent tax on Mexican imports to pay for a coming border wall — followed by extreme confusion when it appeared to walk back the statement later that afternoon.

White House Press Secretary Sean Spicer made the initial announcement Thursday afternoon aboard Air Force One, as President Trump returned from a meeting with House Republicans in Philadelphia.

“Right now, our country’s policy is to tax exports and let imports flow freely in, which is ridiculous,” he told reporters. “By [imposing the tax], we can do $10 billion a year and easily pay for the wall just through that mechanism alone. That’s really going to provide the funding.”

Spicer further indicated that the administration has “been in close contact with both houses” of Congress.

“It clearly provides the funding, and does so in a way that the American taxpayer is wholly respected,” he added.

Later on Thursday, however, White House officials sought to characterize the tariff as one of several options to fund the wall, according to multiple news reports.

If passed by Congress, such a move is all but certain to have a dramatic affect on the U.S. economy and particularly in Texas, which imports far more from Mexico than from any other country, according to U.S. Census data.

Hmm, so that would be bad for the Texas economy. What does Dan Patrick think about that?

Many business and political leaders in trade-dependent Texas already have expressed reservations about the proposed import tax proposal itself, even without linking it to the wall.

Gov. Greg Abbott, who has championed increased trade with Texas’ southern neighbor since he became governor a year ago, had no immediate comment on Spicer’s suggestion.

Lt. Gov. Dan Patrick, an outspoken supporter of the wall who served as Trump’s campaign chairman in Texas, told Fox News that he was “not too concerned” about any adverse impact of such a tax. He suggested the proposal could be “the first warning shot across the bow” fired by Trump, and that the tax could end up being something less.

It’s only a little tax. You won’t even notice it. Also, of course Greg Abbott had no comment. I don’t know why anyone bothers to ask any more.

Now here’s a statement I got from the Texas Association of Business about this idea:

The following statement may be attributed to Texas Association of Business President Chris Wallace.

“Texas’ number one trading partner by far is Mexico, and imposing a 20 percent tax on Mexican imports to fund a border wall would hurt the Texas economy. This proposal could mean a loss of jobs and a hit to state tax revenues. We look forward to working with our Texas congressional delegation and our TAB members to address this proposal and I would encourage our state leaders to make the economic ramifications of this proposal known.”

Dear Chris Wallace and TAB: Dan Patrick cares way more about his pet ideological obsessions than he does about your interests. What are you going to do about that? The Rivard Report and RG Ratcliffe have more.

(Patrick has since said in a Facebook comment about his TV appearance discussing the wall tax that he is not concerned about it because it won’t happen, and he doesn’t actually support it. Which isn’t what he said on TV, and doesn’t say that he would oppose it if it does become a thing that might happen. I think that’s pretty wishy-washy, but in the interests of accuracy, there you have it.)

Business owners tell Dan Patrick to back off on bathrooms

More like this, please.

Saying Texas Republican leaders are threatening jobs and the economy, more than 200 small-business owners issued an open letter Tuesday urging legislators to abandon plans for a state law targeting transgender bathrooms.

The letter described “a growing sense of dread” that Texas will follow the path set by North Carolina, where a backlash to a similar law enacted in March will cost its economy several hundred million dollars in canceled sporting events, conventions, concerts and corporate investments.

“That’s why we oppose any Texas legislation — broad or narrow — that would legalize discrimination against any group,” the letter said. “That kind of legislation doesn’t just go against our values to be welcoming to everyone, it jeopardizes the businesses we’ve worked so hard to create, and it threatens the jobs and livelihoods of everyday Texans.”

Unveiled in San Antonio, home to the Final Four of the 2018 NCAA men’s basketball tournament, the letter was a direct response to Lt. Gov. Dan Patrick’s calls for legislation that he has dubbed the Women’s Privacy Act.

[…]

Tuesday’s letter not only sets the stage for an animated battle when the 2017 legislative session convenes in January, it underscored deepening divisions between social conservatives and many in the business community — a typically reliable GOP ally — on issues that include gay marriage and allowing transgender Texans to use bathrooms that conform to their gender identity, not the gender on their birth certificate.

The legislative priorities for the Texas Association of Business, adopted last month by its board of directors, calls for opposition to religious freedom bills that are “discriminatory” and would hurt the economy. The powerful business lobbying group also opposed similar bills in the 2015 legislative session.

Many business owners who signed Tuesday’s open letter — which was sponsored by Equality Texas, a gay- and transgender-rights group — said they rely on tourism or the ability to serve expanding corporations.

“Texas has always been a place of fierce independence and a great big pioneering spirit,” said David Wyatt with Wyatt Brand, a business-support company in Austin that endorsed the letter. “Companies, voters and political donors won’t stand for legislators dictating government overreach into individual liberties.”

Other Austin businesses listed on the letter include GSD&M advertising, Home Slice Pizza, Alamo Drafthouse Cinema and Bunkhouse, which manages Hotel San José, Austin Motel and Hotel Saint Cecilia, as well as hotels in San Antonio and Marfa.

Just remember, Dan Patrick is Donald Trump’s biggest fanboy in Texas, so you know how much he respects the ladies. This all comes down to the same question I asked before, when the normally Republican-aligned Texas Association of Business came out against any anti-LGBT legislation that Patrick and his buddies might want to peddle: How much damage does Dan Patrick have to do to Texas’ business interests before they decide that he’s not worth it to them? Putting it another way, at what point do the Republican members of these groups quit trying to reason with the radicals and work instead to defeat them? The definition of political insanity is to continue voting for people who oppose your interests in the hope that maybe this time they’ll listen to you. What’s it gonna be, fellas? The Rivard Report, the Chron, and the Current have more.

Buc-ee’s files another logo lawsuit

That’s one litigious beaver.

Buc-ee’s has sued the San Antonio-based operator of Choke Canyon Travel Center for promoting its barbecue and other travel essentials with its grinning, lip-licking, hat-wearing, finger-pointing alligator. The alligator sits in a circle -much like Buc-ee’s beaver — and adorns a wide range of products, from sweet and salty snacks to bags of ice to tee shirts.

The alligator, however, doesn’t have a name.

[…]

The case, which was filed late last year, alleged that the Choke Canyon convenience store, along with Choke Canyon Bar-B-Q and Choke Canyon Exxon, infringed on Buc-ee’s trademark by copying the look and feel of the roadside retailer, which has grown to 27 locations across Texas. Choke Canyon has three locations in and around San Antonio. Neither the owner of Choke Canyon or his lawyer returned calls seeking comment.

Besides the logos, Buc-ee’s alleges that Choke Canyon copied several other features, including oversized bathrooms, numerous fuel pumps, ample parking and a similar looking soda station. Buc-ee’s first learned of its competitor in December when it began receiving inquiries from vendors and customers about the Choke Canyon Travel Center, according to the lawsuit.

U.S. District Judge Keith Ellison set the trial for early next year.

Buc-ee’s won its previous logo lawsuit, against a company that also used a beaver in its branding. I get the zeal to protect these images, but I gotta say, this one seems like a stretch to me. We’ll see what happens in court. Whatever does happen in that case, I’d prefer Buc-ee’s stick to suing competitors and suppliers, and not former employees who will be impoverished by the experience. Don’t make me feel dirty about using your clean bathrooms, Buc-ee’s.

Here come the cannabis growers

For medicinal purposes only.

About 60 miles north of Dallas, amid green fields in the town of Gunter, population 1,486, Texas Cannabis CEO Patrick Moran has optioned to buy a former cotton gin, where he plans to grow the Cannabis sativa plant, known more commonly as marijuana.

The businessman and attorney is positioning himself at the forefront of what he estimates will be a $900 million a year industry in Texas – the recently legalized market for treating intractable epilepsy with a strain of marijuana that eases seizures without getting patients high.

Texas, as it turns out, may be one of the best states in the nation to grow pot. While the state has one of the most stringent medical usage laws in the country, it is setting up some of the cheapest licensing fees and one of the least restrictive markets for pot growers in the U.S.

Gov. Greg Abbott signed legislation last year allowing the state to license businesses to grow, process or dispense nonintoxicating marijuana or cannabis for medical use beginning next year. Moran wants to do all three with Texas Cannabis, cultivating marijuana from seed to sale.

Moran is waiting on the state to set up its registry, slated to go live by June 2017, to put in his application. He plans to use that former cotton gin, which has sat dormant for 40 years, to cultivate, extract and dispense cannabidiol oil, or CBD oil, from low-THC cannabis plants – just around the corner from the city hall in Gunter. THC, or tetrahydrocannabinol, is the psychoactive component that gives users a high when they smoke traditional marijuana.

The new market is being called the green rush.

“There’s a whole other industry that is being birthed in this country, just like what happened with the dot-com boom,” Moran said. “I think it’s once in a lifetime.”

[…]

The Texas law established narrow parameters on the type of cannabis that can be dispensed, who can take the medication and which physicians can prescribe, said Frank Snyder, a Texas A&M law professor who teaches the state’s first course on marijuana law, policy and business. But it doesn’t limit the number of competitors who can grow, extract or dispense.

“The process for getting a license and beginning to cultivate is probably the most liberal law of any of the medical marijuana states that I’m familiar with right now, in terms of putting up the fewest barriers to entry,” Snyder said.

Applicants aren’t required to have vast cannabis industry experience. They simply have to show they have the technological ability to grow, extract or dispense the product by having experience in related fields, such as cultivation, analytical laboratory methods and handling confidential patient information.

They also must show they can obtain the locations, resources and personnel necessary for operations, maintain accountability of all materials and have the financial ability to keep going for two years.

Regulations issued by the Texas Department of Public Safety in January also set fairly low licensing fees.

A cannabis operation seeking to become licensed in Texas must pay a $6,000 application fee to the state. Businesses will have to renew those licenses and pay another $6,000 application fee every two years.

That compares favorably with fees charged by some other states. Massachusetts, for instance, requires a medical marijuana dispensary to pay a $50,000 registration fee every year. Hawaii charges only a $5,000 application fee but requires a dispensary applicant to have at least $1 million in reserves, plus an additional $100,000 on hand for each retail site. Florida requires an applicant seeking a cultivation license to secure a $5 million performance bond.

Colorado, widely regarded as having some of the nation’s most permissive marijuana laws, charges as much as $25,000 in upfront application and licensing fees, depending on the type and volume of pot sold, plus additional fees.

See here for the background. One can look at the inexpensive fees for the grow/extract/dispense licenses and see low barriers to entry for cannabis entrepreneurs, and one can see a missed opportunity for generating revenue, since many of the arguments for legalizing pot in Texas come down to revenue in one form or another. What the Lege actually legalized is pretty limited, and some advocates for medical marijuana opposed the bill that got passed on the grounds that it didn’t really do anything for a class of people who need it. As such, I’m not sure how big or lucrative this business is going to be just yet. That said, I’m sure this issue will continue to be discussed in the Legislature, so the possibility of expansion will be there as well. We’ll see what the financial figures for these businesses look like once they’re fully operational.

Tesla takes its auto dealership fight nationwide

There’s more than one way to get into a market.

Tesla Motors Inc. hopes to capture mainstream auto buyers with its Model 3, an electric car it [recently unveiled] at a price about the same as the average gasoline-powered vehicle, but it may need a federal court ruling to succeed.

The Palo Alto, Calif., auto maker’s direct-to-consumer sales are prohibited by law in six states that represent about 18% of the U.S. new-car market. Barring a change of heart by those states, Tesla is preparing to make a federal case out of the direct-sales bans.

The auto maker’s legal staff has been studying a 2013 federal appeals court ruling in New Orleans that determined St. Joseph Abbey could sell monk-made coffins to customers without having a funeral director’s license. The case emerged amid a casket shortage after Hurricane Katrina. The abbey had tried to sell coffins, only to find state laws restricted such sales to those licensed by the Louisiana Board of Funeral Directors.

For now, Tesla is banking on a combination of new legislation, pending dealer applications and other factors to open doors to selling directly in Arizona, Michigan, Texas, Connecticut, Utah and West Virginia. But the company said it is ready to argue in federal court using the coffin case if necessary.

“It is widely accepted that laws that have a protectionist motivation or effect are not proper,” Todd Maron, the auto maker’s chief counsel, said in an interview. “Tesla is committed to not being foreclosed from operating in the states it desires to operate in, and all options are on the table.”

The ruling in favor of the monks, upheld by the Fifth Circuit Court of Appeals, could give Tesla the precedent it needs to join an “economic liberty” issue currently in dispute between circuit courts in the U.S., Northwestern University law professor John McGinnis said. The Second Circuit Court of Appeals, for instance, has upheld laws that require licensing to sell certain products even if there isn’t a clear reason for it other than protecting existing businesses from new competition.

[…]

Auto dealers are battle-tested and have notched a series of victories along the way. Earlier this year, the Second Circuit Court of Appeals refused to hear a case brought by auto makers that wanted to change laws using a similar constitutional challenge and involving warranty reimbursement levels.

Tesla could find powerful allies. The Federal Trade Commission has repeatedly said franchise laws are anti-competitive. Other organizations agree.

As we know, Tesla has tried and tried again to get a bill passed in the Lege to allow them to operate in their dealerless model, with no luck. I’m sure they’ll be back again next year, but in the meantime it can’t hurt for them to have a Plan B, especially if it solves the same problem for them in other states as well. We’ll see how this goes.

Bu-ee’s to expand to Louisiana

The road to world domination leads east.

The first Buc-ee’s outside Texas promises lagniappe, a little bonus, worthy of its Louisiana locale.

“It’s going to look like what we build, and it’s going to feel like what we build,” co-owner Beaver Aplin said this week. But in addition to the Beaver Nuggets and other proprietary snack foods such as fudge or jerky, Aplin said, customers should expect “Louisiana flair” with items like alligator, boudin and cracklins.

A 15-acre tract along Interstate 12 in Baton Rouge will soon get one of the Buc-ee’s mega-convenience stores. The chain known for its buck-toothed mascot, a cartoon beaver, has grown to 31 locations since the first one opened in 1982.

The store could also be the first of others in Louisiana and elsewhere as the Lake Jackson-based chain explores markets beyond Texas’ borders.

Exact plans are not yet available, but Aplin said Buc-ee’s has the Baton Rouge property under contract, and the company is working with the owner and the city. The store will likely be a 50,000- to 60,000-square-foot travel center, similar to ones in Baytown, Texas City or Madisonville. It will feature sprawling bays of fuel islands and expanded food and other items for sale.

“We think Louisiana will be a great market, and I look forward to being there,” Aplin said.

[…]

Many Louisianians, through traveling or living in Texas, have been exposed to the Buc-ee’s brand, said Kelli Hollinger, director of the Center for Retailing Studies at Texas A&M University.

“Buc-ee’s has a cult following,” Hollinger said. “You’re not just excited to go to Buc-ee’s, they’re part of the travel experience itself.”

Hollinger said tapping into Louisiana’s food culture should further help the brand there.

Added marketing professor Betsy Gelb of the C.T. Bauer College of Business at the University of Houston: “You always want to be putting a toe in a state where there are people who know you.”

General counsel Jeff Nadalo said Buc-ee’s continues “looking at all opportunities in Texas and outside of Texas.”

Louisiana is the current focus, Aplin said, with other sites, including along the I-10 corridor, under consideration. None of those projects is far enough along to announce, he added.

Makes sense. Just on billboards alone, you have to figure Buc-ee’s is well known to anyone who’s ever driven on I-10. Now you can stock up on Beaver Balls on your way to New Orleans. What more could you want?

TOP releases report on inefficiency of development tax subsidies

From the inbox:

[Thursday], the Texas Organizing Project and the Workers Defense Project released a report on the ineffectiveness of tax subsidies in cities across Texas, and proposed ways to increase requirements for such deals in Houston to offer benefits in the form of good paying jobs with community investment for Houstonians.

The report, compiled by the Workers Defense Project, looked at corporate tax subsidies throughout the state, including Houston, and found that Texas’ cities are giving away huge subsidies without enforceable community benefits agreements.

“Today, we are asking the hard, critical questions,” said Lola Garcia, a community leader with the Texas Organizing Project, “Economic development for whom? For out-of-state multi-billion dollar companies and wealthy developers? Or for neighborhoods and Houstonians in need?”

After analyzing Houston’s tax subsidy deals, contracts and compliance records, researchers found that Houston’s tax subsidy programs have failed to deliver on their promises of equitable development, specifically, they:

  • Failed to create good jobs that pay well;

  • Failed to incentivize affordable housing, and instead contributed to the gentrification of our neighborhoods; and

  • Failed to create a level playing field for small and local businesses to access these programs.

“It’s time to address the city’s long history of picking winners and losers through tax give-aways that fast-track gentrification and fail to provide any direct benefits to neighborhoods most in need of a lift,” said Tarsha Jackson, Harris County director for TOP. “The good news is that we have the opportunity to change this narrative, to redesign the programs, raise and clarify the city’s expectations and criteria for developers seeking multi-million dollar tax deals.

“We know Mayor Turner is committed to creating good jobs for Houstonians, and this research can help us set new standards on economic development projects.”

Get the full report here: The Failed Promise of the Texas Miracle: Corporate subsidies in the Lone Star state.

And here’s the executive summary:

Over the last year, researchers from the Workers Defense Project and the University of Texas at Austin have undertaken a study of tax subsidies and other economic incentives utilized at the state and local level to spur economic development in Texas. Researchers sought to understand the role economic incentives play in the Texas economy by examining how these programs have fulfilled or failed to fulfill their promise of creating high-quality, high-paying jobs and increasing local tax revenue. While there are over a dozen kinds of giveaways to businesses in the form of tax breaks, loans and grants in Texas, our research team conducted a thorough case study of one of the least transparent local programs: Chapter 380 (city) and Chapter 381 (county) agreements, which provide grants, tax breaks, and low-cost loans to corporations. To understand the impact of these economic programs, our research team combed through thousands of pages of contracts and compliance records from three Texas cities and county governments: Austin & Travis County, Houston & Harris County, and Dallas & Dallas County.

Researchers also examined data from over a dozen local, state and federal agencies including city and county governments, the U.S. Census Bureau, the U.S. Department of Education, the Bureau of Economic Analysis, and the State Auditor’s Office, among others. Additionally, researchers reviewed existing studies from numerous academic sources on the impact of economic incentives, as well as existing data on state incentive programs, including the state-level equivalent of Chapter 380/381 agreements: The Texas Enterprise Fund.

To provide context for the use and impact of Texas’ economic incentive programs, we have structured this report around the three pillars necessary to build a strong economy: good job creation, investment in education and training, and fair market competition. Researchers found that while the Lone Star State has made substantial investments to attract Fortune 500 companies to the state, it has failed to invest in Texas businesses and workers, and left many homeowners footing the bill for billions that have been doled out to big business. This study seeks to provide in-depth analysis to how these tax subsidy programs work, how they have failed or fulfilled their promise to Texans, and to provide robust solutions to ensure that our state builds a strong economy that puts Texas business, workers, and taxpayers first.

I’m not opposed to the idea of economic incentives. There does need to be a good, measurable return on the investment, there needs to be a way to enforce the agreements, and the benefits need to be distributed equitably among the population. There’s plenty of room to do all of these things better. The full report is here, and the Austin Chronicle, the Press, and KUHF have more.

Another look at AirBnB

Interesting.

The hotel industry is starting to object. On Wednesday, a report funded by a national trade group claimed some Airbnb hosts function illegally and operate essentially as full-time hotels without the same health and safety oversight. It also says they can reduce the number of affordable options for full-time renters.

The home-rental site has stirred tensions in cities such as New York City, San Francisco, Paris and Barcelona. Austin has created new short-term rental regulations as a result.

In Houston, which does not have similar regulations, the city’s primary tourism agency is working with Airbnb and similar operators about taxes.

A city of Houston spokesman said Wednesday that the state is responsible for health and safety regulations that affect short-term rentals. But a spokesman for the Texas Department of State Health Services, which regulates hotels and bed-and-breakfast operators, said it does not have a role in Airbnb or short-term rentals.

Houston is the state’s second-largest Airbnb market, behind Austin, and officials are preparing for an increase in tourism around the 2017 Super Bowl. It was one of a dozen large U.S. cities included in the American Hotel & Lodging Association study released Wednesday by Pennsylvania State University’s School of Hospitality Management. Researchers tracked Airbnb data from a 13-month period.

“This study shows an explosion in activity among multi-unit hosts and the rise of full-time operators in each of the 12 markets we analyzed. Further, operators renting out three or more units represent a disproportionate share of revenue with only 7 percent driving more than $325 million in the period studied,” said John O’Neill, the Penn State professor who directed the research and is director of the school’s Center for Hospitality Real Estate Strategy.

The study found that nearly 30 percent of the revenue generated from hosts comes from people operating as full-time landlords, or 360 days a year. Individuals or entities renting out two or more residential properties on Airbnb account for 17 percent of hosts and drive nearly 40 percent of the revenue in those markets, according to the study.

The report found that in Houston there are 30 full-time operators who rent out their space for at least 360 days a year, generating $3 million in revenue during the 13-month period studied. In all, 956 hosts generated a total of $11 million in revenue, the report said.

It found 83 hosts operating three or more properties and 82 others with two units.

A copy of that report is here. AirBnB has disputed its findings and released its own report about its potential tax revenue for cities. I have no judgment about who is right or wrong in their facts and figures, I’m more interested in how cities are going to react to AirBnB, which I presume they’re going to have to do sooner or later. So far it has not been on the radar in Houston, but it has been in Austin and may be in San Antonio and elsewhere. I’ll be a little surprised if we see AirBnB regulation on the Council agenda in the near future, but if there’s any indication that it’s negatively affecting hotel tax revenue that could change.

The Uberization of moving companies

For when you don’t have a friend with a pickup truck and you need to move on the cheap.

A new breed of online moving companies with names like Buddytruk and PICKUP has drawn interest from the Texas Department of Motor Vehicles, which wants to ensure the companies are following state laws requiring moving truck drivers to be licensed.

“Anyone moving household goods in a pick-up truck for hire is required to register with the Texas Department of Motor Vehicles and show proof of insurance in the amounts required by law,” reads a letter the department sent to Plano-based PICKUP in October. “Something bought at a garage sale for home use would qualify as household goods.”

Since May, the department has sent letters to four app-based moving companies, warning each that they may be violating state law, according to spokesman Adam Shaivitz. Along with PICKUP, they include Austin-based Burro, as well as HashMove and Buddytruk, both based in California but offering services in Austin.

“Providers that refuse compliance can be referred to law enforcement because moving household goods without a license is a crime,” Shaivitz said. So far, the agency has not referred any cases involving these four companies to law enforcement.

Department officials say the issue is more than just the state keeping track of moving companies. The agency has pursued unregistered movers in the past who demand more money before delivering goods or fail to show up for delivery at all. Often, such movers advertise their services on sites like Craigslist, according to officials in several states.

The past two years have seen the launch of more than a dozen Uber-style moving or delivery companies, most debuting in cities on the West Coast. Many advertise themselves as being more convenient than traditional moving companies. Like Uber, some encourage those with access to a large enough vehicle to sign up as drivers to make extra money.

“You need to have a smart phone, a full-size pickup truck legally registered to you and insured to State requirements,” says PICKUP on the driver sign-up page of its website. The company, which promotes its drivers as “Good Guys With Pickups On Demand,” launched in 2014, serving the Dallas area. Asked if the company requires its drivers be registered with the state as household goods movers, CEO Brenda Stoner said in an email that the company was addressing that issue.

“We are working closely with a very collaborative Texas DMV, other regulatory agencies, and our attorneys and consultants to ensure that customers can adopt this new style of delivery service in a trusted, safe, insured and compliant manner,” Stoner said.

Both Burro and HashMove only employ drivers that comply with state laws, according to company officials. Buddytruk declined to comment.

I don’t expect to move again any time soon, and if I were anticipating a move I’m not sure I’d go for a service like this. Too many questions about liability and insurance and how good the service is. That said, the last time we did move we used a no-name company that was basically a guy with a repurposed bread truck and his three or four helpers, so who am I to talk? I guess overall I feel the same way about this as I do about major software releases – I’d wait till the bugs have been worked out first. Your mileage may vary, and if you’re looking at a soon-to-expire apartment lease, this may be a good way for you to go.

Would you like to sit in armed or unarmed?

From Houstonia:

Imagine it’s a Saturday afternoon. You stop into Whataburger to pick up lunch with your kids in tow, the only thing on your mind remembering which kid doesn’t want ketchup on his burger, which kid only wants ketchup on his burger, and whether you want to add jalapenõs to your own. You place your order and are pulling out your wallet to pay when a man walks in with a Sig Sauer strapped to his belt. He’s not in any kind of uniform; he’s not wearing a badge. He’s just a guy with his gun, and you’re just a guy with his kids. Are you okay with this scenario? Maybe so. Or maybe you can’t understand why a guy would need to bring his gun into a fast-food restaurant, and you decide to leave without your burgers.

Whataburger has long bet that a good portion of its customers belong to the latter group, hence its company-wide policy against open carry, which has been legal for years in other states where the chain operates, from Arizona to Arkansas. In advance of the new statewide law that goes into effect in Texas this January 1—the much-discussed House Bill 910 that makes Texas the 45th state to allow residents to openly carry and display their handguns—the Corpus Christi–based company recently reiterated that policy.

[…]

The thing is, there’s still a great deal of confusion surrounding the impending changes, as business associations large and small, reluctant to enter the quagmire of gun control politics, have been slow to provide guidance to private entities that may want to ban open carry. (The Greater Houston Restaurant Association didn’t even return Houstonia’s requests for comment.) As a result, getting those signs up in the first place is proving tougher than expected.

And in fact, rules for the necessary signage are complicated. “Business owners that want to ban guns from their property must post a new sign that adheres to strict wording, colors and text size,” says Terry McBurney, president of the Greater Montgomery County Restaurant Association, one of the few restaurant associations to provide assistance in advance of the new gun laws. Those colors, the Texas Department of Public Safety mandates, must be contrasting. The lettering must be block, and at least one-inch high, for maximum legibility, with the notice in both English and Spanish, posted “conspicuously” at the entrance to the business itself. Any sign that isn’t absolutely perfect, down to the letter, will be null and void.

I would note that State Rep. Diego Bernal of San Antonio has taken it upon himself to help businesses who want to opt out on open carry by printing signs that conform to all of the mandated requirements, which he is providing free of charge. Perhaps one or more of our local legislators could follow that example – I’m sure plenty of businesses would appreciate it. Regardless, I wonder how long it will take before some establishments use open carry as a marketing tool, catering to whatever side they think represents a bigger opportunity for them. I feel reasonably confident saying that there will be more than a few establishments in my neighborhood that feature these signs, and that more than a few of them will not be shy about advertising themselves as such. Should be fascinating to watch.

On a tangential matter:

During a panel [recently] addressing Texas’s new open-carry law, Houston Police Chief Charles McClelland, Harris County District Attorney Devon Anderson, and City Attorney Donna Edmunson encouraged citizens to ask as many questions as possible.

Mostly, they asked McClelland and Anderson to consider a myriad of hypothetical situations.

For example, many asked, what if you’re just sitting on a bench at a park with your gun in your holster, and some concerned “mad mom” calls the police on you because she and her kids are alarmed by the very presence of your gun? Are the police really going to detain you and ask that you show your CHL even though you’re just sitting on the bench eating a ham sandwich? Isn’t that a bit invasive?

The resounding answer from McClelland and Anderson, to all of the above types of questions, was basically this: we understand your concerns, but you’re just going to have to deal with it.

Chances are, they explained, you’re going to come across a CHL holder openly carrying his or her gun inside of a Walmart, a Taco Bell, a JCPenny (not a Whataburger, which already said it’s not going to allow guns inside). And chances are, for CHL holders, a police officer is going to ask you to show your license once someone’s kids get scared and they call 911, and you’ll just have to comply, because that’s the law—even if you’re just sitting on a bench eating a sandwich.

This is going to be so much fun, isn’t it? There are already plenty of disagreements about what this law means and what if any restrictions can be legally enforced in various places. I suspect the courts are going to be very busy next year, and the Lege will be back to revisit this in 2017.

Some power companies like the Clean Power Plan

Not that you’d ever know it.

ERCOT

Thad Hill, in a split with many fellow power company executives, flatly opposes the lawsuits that Texas and 25 others states have filed to block the Obama administration’s Clean Power Plan.

The plan, which the Environmental Protection Agency unveiled in the summer, seeks to combat climate change by reducing carbon emissions at existing power plants. It would affect coal-fired plants most profoundly, because they emit the most carbon dioxide.

It’s no coincidence that the company Hill heads, Houston’s Calpine Corp., owns exactly zero coal plants.

While it’s intuitive that wind and solar power companies, which don’t emit greenhouse gas in generating power, support the Clean Power Plan, opinion within the traditional electricity generation sector is more nuanced.

Calpine, which operates the nation’s largest fleet of natural gas-fired generators, leads a relatively small group supporting the federal rule.

Most companies that generate power with coal oppose it, including Dallas-based Luminant, the state’s largest power generator. It also operates some gas plants and one of Texas’ two nuclear plants.

[…]

While the EPA has tightened other emissions regulations under President Barack Obama, the Clean Power Plan is the most sweeping overhaul, said Travis Miller, director of utilities research at Morningstar.

The plan is intended to reduce carbon pollution from existing power plants 32 percent from their 2005 levels by 2030.

“The Clean Power Plan is going to have ripple effects throughout the entire energy system in the U.S.,” Miller said. “Utilities need a long runway to adapt, but they’re willing to adapt.”

In the lawsuit challenging the rules put forth by the Democratic Obama administration, Republican Texas Attorney General Ken Paxton calls the plan a massive power grab by the EPA that would increase Texans’ electric bills significantly and threaten the reliability of the electric grid.

The Electric Reliability Council of Texas, which manages 90 percent of the state’s power grid, has estimated the rule could force the closures of some Texas coal plants and increase electricity prices 16 percent by 2030.

Miller agreed that the Clean Power initiative would affect Texas, though he said that Midwestern, Great Plains and Appalachian states most dependent on coal would feel the greatest effects.

Some of the changes in Texas’ power landscape are occurring anyway, because of cheap shale gas and Texas’ ranking as the largest wind power producer in the nation.

“There’s an impressive pipeline of new gas generation and new wind generation in Texas,” Miller said.

That presents market challenges to coal plants, and could move the state toward compliance with the Clean Power Plan. “Texas might not have to do all that much,” Miller said.

See here for the background. Miller’s statement is consistent with what ERCOT itself has said, and the Clean Power Plan would help conserve water, too. But this is Texas, and our leadership has to do things the hard way. Just remember, they don’t speak for everyone, not even in the power generation business.

Back to the business angle

I’m sure we’ll hear more of this in the next few weeks.

Business and tourism leaders worried Wednesday that voters’ rejection of a citywide anti-discrimination ordinance has hurt what had been one of their best recruiting tools: Houston’s emerging reputation as a diverse metropolis that supported an openly gay mayor and welcomes young talent looking to launch careers in a progressive environment.

Suddenly at risk, they say, are corporate relocations, nationally prominent sporting events and the lucrative convention business that generate millions of dollars and help the region thrive.

“In recent years, we have done a remarkable job of changing the perception and attracting people to Houston,” said Bob Harvey, president and CEO of the Greater Houston Partnership. ” … We have to quickly re-establish that this is a modern, open city.”

[…]

Mike Waterman, president of the Greater Houston Convention and Visitors Bureau, the group that recruits conventions that draw tens of thousands of people here annually, said many of those top organizers hope the new mayoral administration will pass an alternative measure quickly.

“We can’t go on as a city without a non-discrimination ordinance forever,” Waterman said. “It’s a differentiator, and one we do not have today.”

The Greater Houston Hotel & Lodging Association, which like the other booster group was vocal in its support of HERO, echoed that concern.

“I think the issue we face is we want people outside our city to know the true Houston, that we are very open and welcoming to all visitors,” association president Stephanie Haynes said.

[…]

There also was concern Wednesday that the defeat of HERO could make the city unattractive to diverse job candidates, including the increasingly sought-after millennial workers, said Keith Wolf, managing director of Murray Resources, a recruiting and staffing firm in Houston.

“I think the larger concern is that it feeds into the misperception by some that Houston and Texas, in general, is an intolerant, unwelcoming place,” Wolf said.

“If you’ve been on Facebook and Twitter in the last 24 hours, you’ve probably seen millennials expressing their embarrassment that the ordinance did not pass,” he added.

Harvey, of the Greater Houston Partnership, said it will be hard to know how many companies might avoid Houston because of the vote, but he said he agreed that major companies are eager for young professional workers. Those recruits, he said, care about social issues.

I’ve said this a few times before, and I’ll say it again: This is a political opportunity for Democrats to try and drive a wedge between business interests that tend to support Republicans and the Republicans like Dan Patrick and Greg Abbott who oppose them on matters of equality (among other things). All it would really take, at least in the beginning, would be for some Democratic elected officials to point out how Republicans are actively harming businesses in Texas by things like their opposition to LGBT equality. (There are plenty of other issues one could cite, from “sanctuary cities” to schools and pre-kindergarten and infrastructure, but with HERO in the news this is the place to start.) Acknowledge that business interests won’t always agree with Democrats, but they already strongly disagree with Republicans on many things, and they are not being well served by a political party that is taking them for granted. This is obviously a long-term project, but it’s basically free and has plenty of upside. Naturally, the first politician to take this path needs to be Sylvester Turner, since he’s the only candidate in the Mayoral runoff who has any interest in revisiting HERO if elected. I’m just saying.

Bring back postal banking

I still like this idea.

Postal unions and civil rights groups are among other advocacy organizations, along with the U.S. Postal Service inspector general, pushing USPS to expand into banking. Sen. Bernie Sanders (I-Vt.), a Democratic presidential hopeful, agrees. But USPS, which could use the business, has no interest.

Providing financial services in post offices “could benefit the 68 million underserved Americans who either do not have a bank account or rely on expensive services like payday lending and check cashing,” says an inspector general report issued in May. “The products also could help the Postal Service generate new revenue to continue providing universal service. Because it has a presence in every neighborhood, including many places where there are no longer any bank branches, the Postal Service is well suited to provide such services. In addition, its well-trained workforce is already experienced at handling complex transactions and watching out for related fraud and other risks.”

The push for postal banking received a boost this month with an article by Mehrsa Baradaran in The Atlantic. Baradaran, a University of Georgia School of Law associate professor, advocates a “central bank for the poor,” as an alternative to “the unscrupulous practices of payday lenders.”

Postal banking, she wrote, could provide short-term loans and “potentially drive out the usurious fringe-lending sector, which profits from Americans’ financial woes.” Her article was adapted from her book “How the Other Half Banks: Exclusion, Exploitation, and the Threat to Democracy.”

USPS officials regularly trumpet what they are doing to improve the Postal Service’s financial situation, including such things as selling greeting cards. But the officials have rejected postal banking.

“While we currently provide our customers with certain financial services, including money orders, electronic funds transfers, and cashing of U.S. Treasury checks, our core function is not banking,” said David A. Partenheimer, a USPS spokesman. Former Postmaster General Patrick Donahoe was more emphatic during his farewell press conference in January. “The key thing for any successful business is to work within their core,” he said. “We don’t know anything about banking.”

They must have forgotten.

Postal banking, known as the Postal Savings System, began operation in 1911 and officially ended in 1967, though the Post Office stopped accepting deposits a year earlier. Initially, savings earned 2.5 percent interest with a half-percent designated for operation of the system, according to a postal service history. “Although bankers first viewed the Postal Savings System as competition,” the history says, “they later were convinced that the Postal Savings System brought a considerable amount of money out of hiding from mattresses and cookie jars.” Most of the money was redeposited in local banks. The Postal Savings System, however, did not include lending, according to Mehrsa.

I’ve covered this before, and continue to be convinced that it makes sense. That Inspector general report quote above is a big part of it, but just having convenient access to their money without having to pay exorbitant fees or be at the mercy of the failings of unregulated “entrepreneurs” would be a huge book for millions of working people. I truly don’t understand the USPS’s objections to this, given their own history. It would be good for their business as well as good for so many people. Keep up the pressure, y’all.