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January 26th, 2019:

The first targets for 2020

We’ve already agreed that the 2020 election season has begun, so a little attack advertising over the shutdown seems like a good play

Mike Siegel

National Democrats have five Texas Republican congressmen in their crosshairs as they begin the 2020 election cycle looking to build on their gains here in November.

As part of its first digital ad campaign of the cycle, the Democratic Congressional Campaign Committee is targeting U.S. Reps. Michael McCaul of Austin, Chip Roy of Austin, Pete Olson of Sugar Land, Kenny Marchant of Coppell and John Carter of Round Rock. They are among 25 GOP House members across the country included in the ad offensive, which the DCCC announced Friday.

The ads criticize the lawmakers for voting against recent Democratic-backed legislation to end the government shutdown without funding for a border wall — a demand by President Donald Trump that prompted the closure. The ads, which come on the day that federal workers will miss their second paycheck under the shutdown, feature an image of a helicopter rescue mission over the water, accompanied by text reading, “The Coast Guard, Border Patrol, & [Transportation Security Administration] just missed another paycheck thanks to” the targeted member of Congress.

Good thing they got this out as quickly as they did, eh? I put Mike Siegel in there for the featured image because he’s already announced his candidacy for 2020. Doesn’t mean he’ll be the nominee, of course, but he’s in the running. I am of course delighted to see CD24, which some people think might wind up being an open seat, among the targets. As for CD23 and Will Hurd, he gets a pass this time around because he has been (wisely) critical of The Wall and has voted for reopening the government. He’ll be targeted another time; as the story notes, Gina Ortiz Jones is saying she wants to run again. All of this is one reason why one of my criteria for supporting a Democratic Presidential nominee is their level of commitment to competing in Texas next year. There’s more than just our plentiful electoral votes at stake.

Port Arthur

The Harvey-damaged industrial town is trying to draw new residents while holding onto the ones it has now.

Port Arthur may be surrounded by prosperous oil refineries, but the city itself faces challenges. The refineries employ fewer workers than they once did, and those they do hire come from all over. The city’s unemployment rate stood near 8 percent in November, more than twice that of the state, and the median household income is $33,000 a year, well below the average for Texas.

Some residents worry about the air they breathe in the shadow of so much industry. On top of it all, the city is reeling from 2017’s Hurricane Harvey, which affected an estimated 80 percent of its households.

The mayor worries people are not sticking around. Between 2000 and 2010, Port Arthur’s population fell by 4,000, to a total of 54,000. And though 2017 estimates show a slight uptick, some think the number will dip below 50,000 in next year’s census — a change that would make the city ineligible for certain federal grants.

While some residents have come back to try and turn around Port Arthur, drawn by family and a sense of community pride, some seem discouraged by the state of things.

[…]

On a Tuesday in November, Mayor Derrick Freeman sits on the dais. He is African American, as are the other six city council members. The major topic of discussion is fixing the city’s roads. By Freeman’s count, 340 miles of roadway need repair, at a cost of $1 million per mile. The city this year plans to spend $14 million, nearly a quarter of its $65 million operating budget, he said.

About one-third of that budget comes from industry agreements. The refineries in Port Arthur sit outside city limits. They have deals with the city to pay certain amounts in lieu of annexation, which could potentially bring Port Arthur more revenue but, as Freeman said, would also require taking on more responsibility, liability and staff.

Port Arthur still has a tax base that other local governments would envy, said Steven Craig, professor of economics at the University of Houston. Valero and Total overall reported adjusted net incomes of $2.2 and $10.6 billion, respectively, in 2017. What matters is how the local governments spend what they get.

“The question is: can you change your town or do you have to embrace what you have?” Craig said. “In some sense, I think the industrial towns that do the best they can to help the people they have are the ones that actually do sort of change.”

It’s a good story, and I’m rooting for them to meet their challenges. The main thing I wish I knew that I still don’t after reading this is what the overall quality of life is in Port Arthur. It’s big enough to have some city amenities like restaurants and an arts scene, but with less traffic and lower housing costs. That ought to be the draw of a town this size, which is also on the coast and not too far from Houston and the Louisiana casinos. What’s the elevator pitch for Port Arthur, and what’s the vision for its future? That’s what I would want to know.

Is the craft brewing business in a slowdown?

Item one.

Alluring as those wide-open skies and rugged vistas may be, the hardscrabble life in West Texas can be unforgiving. And so it was last year for the region’s popular and award-winning craft brewer, Big Bend Brewing Co., despite a planned expansion to San Antonio that might have turned its luck around.

In December, the 6-year-old brewery surrendered to multiple challenges and announced it was shutting down Big Bend Brewing’s hometown operations and taproom in Alpine and abandoning the move to San Antonio.

“We had high aspirations and lofty goals, and we did everything we could to achieve them,” read the Dec. 21 Facebook post announcing the closure. “We remain hopeful and are working hard to make the stoppage temporary. The goal is to come back better than ever. We are no stranger to adversity – forging a craft beer brand in the rugged frontier of West Texas is no easy task.”

[…]

“The main trend is if you’re a local brewery doing small-batch beers, with an old-school small brewpub and restaurant model – those that are still popping up – if they are well-enough financed, they seem to be doing OK as local or hyperlocal places,” said Travis Poling, co-author of San Antonio Beer: Alamo City History by the Pint.

“But the time of the large regional breweries seems to have kind of come and gone,” Poling added. “Everybody wants to be the next Sierra Nevada or Sam Adams, but … the barrier to entry is a lot higher because there’s a lot more competition not just from larger regional brewers, but also the regional breweries bought up by Anheuser-Busch, Coors, and others.”

The Brewers Association reports there are 6,372 breweries in the nation, and of the $111 billion overall beer market, craft beer accounts for $26 billion, up 5 percent in 2017. Texas ranks ninth in the country for most craft brewers with 251 total breweries, or 1.3 per capita. The industry had a $4.5 million impact on the state’s economy in 2016.

In March, Brewers Association Chief Economist Bart Watson wrote, “Compared to many parts of the U.S. economy, craft’s 5% growth rate [in 2017] is quite strong. That said, it’s probably not as strong as many breweries expected as they built their business plan.”

“It’s a difficult time to invest in craft beer,” [Mahala Guevara, vice president of operations for Big Bend Brewing] said. “There’s been an enormous number of breweries opening in the last five years, and we’ve seen a lot of high-profile closures and reductions-in-force and layoffs. Five years ago, the market was going wild, everyone was making money, experiencing tremendous growth. Now there’s depressed investment in craft beer, so even though people are interested, everyone wants to wait out the business cycle.”

I don’t think the cash flow problems of one brewer in a rural part of the state is representative, but I’m keeping an open mind. Item two:

“I think people think Houston is getting saturated, because they haven’t been to a big beer city,” Platypus Brewing’s head brewer Kerry Embertson told me last week during an interview. “Like, Houston’s beer scene is relatively new. Yes. There are the St. Arnold and Southern Stars that have been around forever. But there’s a bunch of people like us that have been around three years or less. There’s plenty of room to make good beer, and customers will come to your place. Especially as spread out as this city is.”

John Holler, who co-owns Holler Brewing along with his wife Kathryn, just a couple blocks from Platypus echoed his colleague’s thoughts.

“I think Houston can definitely accommodate more breweries,” Holler said, during that same interview for an upcoming story. (Sorry! No spoilers!) “The key is, you know, we can accommodate probably 20 or 30 more Platypuses or Hollers. But not 20 or 30 more Saint Arnold.”

This story was based in part on a recent NYT story on the slowdown in growth of the craft brewing industry, and noted the switch from beer to cider at Town in City Brewery. As far as Houston goes, I think John Holler is exactly right. There’s still plenty of room here for small breweries that mostly serve the neighborhoods they’re in and a few bars and restaurants in town. Very few, if any, of those places are going to grow up to be Saint Arnold, or Karbach. Nothing wrong with that, and no reason to panic. Just a bit of perspective.