Off the Kuff Rotating Header Image

Greater Houston Partnership

We’re still #4

We’ll probably be that for awhile.

According to the new report from the Greater Houston Partnership, the domestic population growth for the Houston region has slowed down over the last eight years. The report, which is based on population estimates data from the U.S. Census Bureau released this spring, cited factors such as the downturn of the oil and gas industry and Hurricane Harvey as reasons for the slump.

“At the current pace, Houston won’t overtake Chicago for another 25 years,” the GHP stated in a July 2019 Economy at a Glance report.

Another notable trend the report found is that international migration to the Houston region has outpaced domestic migration over the last eight years, meaning more U.S. residents are moving to Houston’s outskirts while immigrants are moving to the city.

[…]

One-third of the metro Houston population now lives outside of Harris County, according to the report. Harris County accounted for all of the negative losses in domestic migration for the region from 2016 through 2018 – more than 100,000 residents. No other Houston area county experienced a loss in domestic migration, according to the report.

In fact, domestic growth into Houston’s nine surrounding counties has picked up over the last decade. Fort Bend County was ranked as the nation’s No. 10 fastest growing county from 2010 to 2018; while Montgomery was ranked No. 18; Waller No. 41,; Chambers No. 52 and Brazoria No. 83, according to the report.

“Harris County, with two-thirds of the region’s population, captured only 56.3 percent of the region’s growth over the past eight years,” the report stated. “The suburban counties, with one-third of the region’s population, captured 43.8 percent of the growth.”

It doesn’t really matter when, or even if, Houston passes Chicago to become the third largest city in America. This isn’t a race, and there’s no winner or loser. Growth trends can change on a dime, too, so the same kind of report made in, say, 2024 might well give a very different timetable. What does matter is how we respond to and plan for the effect of these growth trends. What can and should the city of Houston do to attract migrants, and retain existing population? Remember, population is representation, which is to say political power. How can the region react and get on top of housing, transportation, and flood mitigation needs in a coordinated way? We’ve had decades of growth in the Katy Prairie area that have had all kinds of negative effects downstream. We can’t afford to continue that. Part of the challenge here is precisely that there isn’t much in the way of regional authority. Needs and solutions don’t end at county lines, so more and better cooperation is needed. These are the things we need to be thinking about and acting on.

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.

Dear business community: Dan Patrick is not your ally

Here’s the full Chron story about the latest group of business leaders to call for a stop to the bathroom bill. I want to focus on one key aspect of this:

A week after police chiefs from Houston, San Antonio and Austin joined in protest against the bill, Abbott said the legislation specifically attempts to avoid adding any added burden on local police.

“There is not a role for law enforcement to play,” Abbott said Monday at the annual Sheriffs’ Association of Texas Training Conference and Expo in Grapevine. “Enforcement of this law is done by the Attorney General.”

According to the Fort Worth Star-Telegram, Abbott said because it is a civil action and not a criminal one, police will not be part of the enforcement.

“So what I urge is for everyone to step back, calmly look at what the bill actually says, before they cast some misguided judgment,” Abbott said.

Patrick, another champion of the bathroom bill, blasted the partnership’s letter.

“The Partnership is out of touch with the majority of Houstonians who voted overwhelmingly in 2015 to reject the same kind of ordinance that Senate Bill 3 will prohibit. They warned of economic doom at the time, but there has been no negative impact on the City’s economy. In their rush to be politically correct this business group is ignoring the fact that companies continue to expand and new ones are moving to Houston. The people of Texas are right about this issue and they are wrong,” Patrick said in a statement.

Look at the language Patrick is using to describe business leaders whose companies employ hundreds of thousands of people in Texas. “Out of touch”. “Politically correct”. Patrick has been treating the business community with contempt and hostility since the beginning of this manufactured fight. He will never back down – if SB3 doesn’t pass and Abbott doesn’t grant his wish to have yet another special session, he’ll work to get more legislators like him elected and he’ll be back in 2019. The fight business leaders are putting up now is great, but unless they’re ready and willing to keep fighting, next March and next November, it will mean nothing. Actually, that’s not true. It will mean Dan Patrick will be totally vindicated in his belief that he cannot and will not be stopped by anyone, that there are no checks or limits on his power and his agenda. He’s going to keep doing damage until enough people stand up to him. There’s never been a better time for that.

I keep coming back to this because I keep seeing stories like the recent one about the NFL Draft in which it is implied or outright stated that business organizations may or will lack options if the bathroom bill passes. Which is ludicrous, of course, since their first and foremost option is to stop supporting politicians who oppose them on this very fundamental principle. Turn off the campaign contributions, for a start. Even if it’s too scary to back an opponent, everyone can do that much.

And again, remember that a win on this issue in the special session is not a final victory. Dan Patrick will be back, and it’s up to all of us whether he’s stronger than before or not. The good news is that it’s beginning to look like maybe he will lose this time around.

[House Speaker Joe Straus] may not even refer SB 3 to a committee, leaving it to die untouched by House members.

In addition, the author of two House bills to limit transgender bathroom policies acknowledged Monday that his legislation is at risk.

Rep. Ron Simmons, R-Carrollton, said he was promised a public hearing — but nothing more — on his bills by the chairman of the House State Affairs Committee, Rep. Byron Cook, R-Corsicana.

“Chairman Cook said he going to give us a hearing. At the same time, he said he’s not going to move the legislation,” Simmons said during a downtown Austin event sponsored by the Texas Tribune.

“I think the prospects are not great, not because the (Republican) majority doesn’t want it … but because there are some key leaders who do not want it. That’s the way the system works,” he said.

Simmons predicted that his bills would pass if given a vote by the full House, and Abbott has been pressing House leaders to allow a floor vote.

Abbott also urged conservative Republicans last week to add their names as co-authors to Simmons’ bills as well as to other legislation pertaining to his special session agenda.

By Monday evening, 49 House Republicans had attached their names to House Bill 46, Simmons’ main piece of legislation. A somewhat similar bill had 80 co-authors — 76 votes ensures passage in the House — in the regular session that ended in May.

The special session bills take different approaches.

Here are those House bathroom bill sponsors again, which should be read as a starter’s kit of legislators who need to be voted out. Some of those legislators are in swing districts. Some will need to be taken out in a primary. Opposition to the bathroom bill is broad and diverse. Support for it is narrow and zealous. It’s time to change the culture. We can win, but we can’t let up. The Chron has more.

Still more big businesses against the bathroom bill

It’s like there’s a strong, overwhelming consensus or something.

Top executives of big oil companies and other major Houston firms and organizations on Monday weighed into the political dogfight over the controversial bathroom bill, calling on Gov. Greg Abbott to block passage of the legislation that they warned will harm Texas’ ability to grow its economy.

That stance puts the Greater Houston Partnership in direct opposition to Abbott, who has championed the legislation.

[…]

In a two-page letter that followed similar pleas from executives at several Fortune 500 companies, Houston business leaders noted that Texas has worked for decades “to establish its reputation as a great place to do business.”

[…]

“We support diversity and inclusion, and we believe that any such bill risks harming Texas’ reputation and impacting the state’s economic growth and ability to create new jobs,” the letter from Houston business leaders states. “Innovative companies are driven by their people, and winning the talent recruitment battle is key. Any bill that harms our ability to attract top talent to Houston will inhibit our growth and continued success — and ultimately the success of our great state.”

The letter asks Abbott to “avoid any actions, including the passage of any ‘bathroom bill,’ that would threaten our continued growth.”

You can see a copy of the letter here. It has a few names on it you might recognize. Everyone is from Houston, and as we know Abbott doesn’t care about Houston or other cities, except to the extent that he can meddle in their business. So, you know, don’t expect too much from this. RG Ratcliffe has more.

“Bad, but not awful”

Your Houston economy, folks.

As Houston enters the second year of the worst oil downturn in decades, its once-booming economy has sputtered, and the strain finally is starting to show.

Houston could flirt with recession in 2016 as the oil and gas industry cuts jobs and spending, but the local economy isn’t collapsing the same way it has during prior oil busts, and most economists don’t think it will happen.

“It’s bad, but it’s not awful,” said Ed Friedman, director at Moody’s Analytics.

The infamous 1980s oil slump reverberated across Houston, causing 1 in every 7 local workers to lose their jobs before the market eventually recovered. This time around, a healthy national economy coupled with continued population growth and a surge of construction is buffering the metro area from deeper trouble.

The city is harnessing momentum from other booming sectors – petrochemicals, refineries, health care, construction – to offset the losses in energy and energy-related manufacturing.

“Houston is not the same Houston it was 30 years ago,” Friedman said.

Hospitals, clinics and medical offices are expanding as they try to keep up with a population boom of nearly 10 percent since 2010. Downtown Houston has been revitalized with new office towers and residential construction that sprang up when oil was hovering around $100 a barrel the previous two years.

And an estimated $50 billion in investment along the city’s petrochemical corridor is in the works, enough to build downtown Houston two times over. That industrial renaissance is bringing thousands of new construction jobs to the area that is helping compensate for the losses in energy.

“It’s the gift that keeps on giving,” said Bill Gilmer, director of the Institute for Regional Forecasting at the University of Houston.

Nevertheless, economists predict that 2016 likely will be an austere year for Houston. The oil and gas industry is bracing for anemic crude prices over the next 12 months, and most analysts don’t expect meaningful improvement until 2017.

As a result, Houston could lose as many as 50,000 jobs in manufacturing and oil and gas before the industry recovers. How much those cuts drag down the local economy is an open question. The city still is expected to see a net gain in jobs this year that could reach nearly 25,000.

[…]

If Houston slips into a mild recession, the city may already be out of it by the time economists can measure it, as government data often lags by several months.

The Houston Purchasing Managers Index, a closely watched predictor of the city’s economic health, indicates the city already may have reached a tipping point.

“We’ve got a pretty good chance of moving into recession in the first quarter, if we’re not already in one,” said Harvison of the ISM.

Still, any contraction in economic activity will likely be short-lived as the pace of energy layoffs slows and Houston’s population continues to grow.

“People aren’t abandoning Houston,” said Patrick Jankowski, senior vice president of research for the Greater Houston Partnership.

In addition, the flurry of construction activity in the region’s petrochemical corridor isn’t slated to peak until late 2016 or early 2017, with Houston expected to add up to 10,000 more construction jobs next year, according to the Greater Houston Partnership.

To put this in somewhat technical terms, upstream – i.e., finding and extracting oil and gas – is in the dumps due to low prices, but downstream – i.e., refining and selling it – is doing fine. The price of crude is a fixed cost for refineries, after all, and the area still has plenty of those.

That said, upstream is where the big money and the highest-paying jobs are, and there’s a trickle-down effect when upstream is struggling. Texas Monthly frets about the real estate market in Houston.

It’ll be different this time. We diversified.

When you make the comparison to the oil bust that devastated Houston’s economy in the 1980s, that’s the mantra you inevitably hear from those who have remained bullish on the Houston economy since oil went in the tank late last year. (For the record, comparing 2015 to 1982 exasperates the hell out of Jankowski: “This is in no way going to look like the ’80s and hopefully this is the last time I have to say that to anybody,” he said when the GHP released its official economic outlook for 2016 in December.)

Almost all of those people cite the booming Texas Medical Center as exhibit A in defense of Houston’s diversity, but as we pointed out in October, though it’s true that the Med Center has grown, O&G has grown even more. At its peak it was proportionally even more important to Houston’s economy last year than it was in the 1980s.

Many of those optimists struggle to come up with an exhibit B, but some of those who do cite a boom in the construction industry, which brings us back to real estate, and how we are just starting to see how oil patch job annihilation is trickling down into the residential real estate market.

It’s becoming apparent in home sales. Since we last looked in on the market, they have fallen 10 percent in October and 10.5 percent in November. Townhouses and condos fell 10.3 percent in November, and now the apartment market is starting to soften. That comes on the heels of a Forbes report that shows Houston has permitted more residential projects than any other large U.S. urban area between 2011 to 2014.

That extends to rentals. Neal Verma owns 16 apartment complexes in Houston, totaling 6,000 units. A quarter of those are Class B (8 to 20 years old) and the remainder Class C (older than 20 years.) Verma told the Houston Chronicle in December that many of his Class B tenants work in O&G, and many of his Class C tenants are construction workers. He is seeing a decline across the board. As oil workers get their walking papers, they move out. As oil companies tighten their belts, they stop building new office buildings, and thus construction workers pack up their toolkits and beat feet out of town as well.

The decline isn’t drastic—yet. Verma said that his complexes have dipped from 100 percent occupancy to 95 percent at his Class B properties and 98 at his Class Cs, but there’s no way to spin those numbers positively, especially not with a grim year ahead. The bulk of Houston’s top paying white-collar jobs are in energy, and construction stands atop the heap for blue-collar jobs. Now that the oil downturn has cooled construction, we have seen the first ripple, and barring a sudden, drastic upswing in the price of crude, it seems inevitable that these losses will soon become apparent in retail and restaurants, if they have not already.

What’s keeping the Houston real estate market above water for now is empty nesters from the suburbs who aren’t really affected by the fluctuations of crude oil prices, and the Chinese. You can click over to read the rest. However you look at it, pretty much everyone is hoping things will get better before they get worse, because there’s still a lot of room for it to get worse.

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.

Who cares about Bob McNair?

Another bad decision.

HoustonUnites

Houston Texans owner Bob McNair donated $10,000 this week to opponents of the city’s embattled equal rights ordinance, entering the political fray over the law headed to voters in November.

McNair, a frequent GOP donor, mailed the $10,000 check to opponents earlier this week, according to Campaign for Houston spokesman Jared Woodfill. He said the donation “was very exciting for us.”

Critics of the law, largely Christian conservatives, object to the non-discrimination protections it extends to gay and transgender residents — the law also lists 13 other protected groups. Supporters of the ordinance, including Mayor Annise Parker, have warned that repealing the law could damage the city’s economy and could jeopardize high-profile events such as Houston’s 2017 Super Bowl.

Woodfill pushed back on that notion Wednesday.

“The HERO supporters have tried to scare people into believing that we would lose the Super Bowl,” Woodfill said. “Obviously, if there were any truth behind that, Bob McNair wouldn’t’ be donating to the folks that are opposed to the ordinance.”

Here’s the longer version of the story. As Campos notes, there is something to that. I’ve always been skeptical about claims we could lose the Super Bowl if HERO is voted down for the simple reason that logistically, it would be very hard to do and would inconvenience a lot of people. The NFL doesn’t want to do that unless it absolutely has to, and I don’t think there would be enough of a national outcry to make that happen. What I do expect is that a defeat for HERO would jeopardize our chances of landing other big events, sporting and otherwise, and would likely cause some planners of events that are already on the calendar here, at the George R. Brown and big hotels, to reconsider and find alternate options.

So Woodfill gets a symbolic trophy, for whatever good it does him. It would be nice if this story went national, as a lot of other HERO-related news has done, as it might put a little heat on McNair and generally serve as bad publicity for him and his team. The Texans aren’t exactly a revered franchise outside of Houston, so a little ridicule there could go a long way. In the meantime, this story appeared in the paper the same day that this full-page ad ran in the local section:

HoustonBusinessLeadersEndorseHERO

For those who have been trying to claim that HERO is only of concern to the LGBT community, note the presence there of the NAACP, the Greater Houston Black Chamber, the Houston Hispanic Chamber of Commerce, and among the individuals, the President of the Houston Urban League, Judson Robinson III. There was also this in my feeds from yesterday:

As the Texas director of AARP, a nonpartisan, nonprofit advocacy organization for all persons age 50 and older, I am proud that this Association — with 38 million members, including more than 2.2 million in Texas — believes firmly in the fundamental right of all people to be free from discrimination.

Approval of HERO by voters would help ensure that Houston, the nation’s fourth-largest city, provides its residents and visitors with an environment free of discrimination based on sex, race, color, ethnicity, national origin, age, familial status, marital status, religion, disability, sexual orientation, genetic information, gender identity, or pregnancy.

There are lots of people talking about why HERO matters, to them and to the city. The Houston Area Women’s Center has been heavily involved to help debunk the dangerous and pernicious falsehoods that liars like Jared Woodfill have been spreading, now with the assistance of a fool like Bob McNair. The Press has more.

Business groups get into the HERO campaign

Welcome to the table, fellas.

HoustonUnites

Three major local business and hospitality groups are warning voters that the city’s economy could take a hit if Houston’s embattled equal rights ordinance is repealed in November, boosting supporters’ attempts to cast the law as not only a moral issue but also a practical one.

The Greater Houston Partnership, Greater Houston Convention and Visitors Bureau and Hotel and Lodging Association of Greater Houston released a joint statement Thursday backing the ordinance and calling Houston “a diverse and welcoming city.”

“Discrimination of any kind is not a Houston value; it’s bad for the people of our city and it’s bad for our economy,” the statement read.

[…]

Though the Partnership originally expressed reservations about early drafts of the law, it eventually publicly supported the ordinance before City Council passed it 11-6 last year. A.J. Mistretta, a spokesman for the Visitors Bureau, said Partnership President Bob Harvey encouraged the group to issue the joint statement.

Houston Unites campaign manager Richard Carlbom said the groups’ support demonstrates a desire in the business community to remain competitive with other large cities that already have similar nondiscrimination policies in place.

“If this gets repealed, I think a lot of folks will look at Houston and wonder if they should send employees here or hold conferences here,” Carlbom said. “They will wonder whether or not there are the appropriate protections in place.”

The argument is not new. Mayor Annise Parker and other officials long have warned that Houston’s selection to host the 2017 Super Bowl and the 2016 NCAA Final Four, for instance, could be in jeopardy if the law is repealed.

“Houston simply isn’t the City it was 20 or 30 years ago,” Parker said last month. “It is this open and inclusive atmosphere that helps make Houston attractive to new residents, new business, major sporting events like the Super Bowl and more. The ongoing effort by this group threatens to hurt that image and our progress.”

Gotta say, I was a little afraid that the GHP was going to sit on its hands during the campaign, and let others do the heavy lifting. I’m delighted to be proven wrong about that, though I hope this statement isn’t the extent of their involvement. And again, however you feel about HERO, if you think there won’t be consequences if it gets repealed, you’re kidding yourself. We can argue about what the extent of the consequences might be, and whether or not the Super Bowl and Final Four are really in jeopardy – I personally don’t think the NFL or NCAA would move them on that short notice, but for sure we’d be out of the running for future events like those, and other already-scheduled events could get canceled – but the question is not “if” but “how much”. I would like for the GHP to reinforce that message as much as possible. And just as a reminder, despite what the likes of Jared Woodfill and Ben Hall would like you to believe, HERO is about a lot more than bathrooms.

Yet another report on pensions

Yippie.

BagOfMoney

Some city leaders have spent years standing in the town square, hollering themselves hoarse that Houston’s financial footing is unstable, that huge pension costs threaten the city’s future ability to police the streets, pick up trash and maintain parks.

In recent weeks, they’ve been joined by two others with bullhorns: The Greater Houston Partnership and the Arnold Foundation.

The region’s most influential business group and one of its best-funded think tanks each has released a formal paper focusing on city finances and pensions, arguing in varying degrees that action – or at least an honest discussion of the way forward – is urgently needed.

Marc Watts, who chairs the GHP’s Municipal Finance Task Force, acknowledged some city leaders long have sought the partnership’s help in addressing their budget struggles.

“There were efforts in the past that were aborted because it can be such a contentious issue. But I think the issue now has got to be addressed, and we’re willing to be a partner to help solve the problem,” Watts said. “We’re going to push this to a solution to the maximum extent of our capacity. We can’t wait.”

Both groups’ initial papers were largely informational, covering few facts unfamiliar to those who have followed public discussion of city finances. Each organization plans to release more detailed reports in the coming months.

Watts said the partnership’s goal, for now, is voter education. He said his group views itself as most effective in a “fair arbiter” role.

“It’s not because we’re afraid to put forward a solution. It’s because we think that would make us less effective,” he said. “The partnership is not normally comfortable in a role of being out front on an issue that could be considered controversial. We’re only here because we feel like for the good of the city of Houston, for our families, for the future of all of us, somebody has to do it.”

[…]

The GHP’s report explains how dollars flow into and out of the city’s $2.4 billion general fund, which draws mainly on property and sales taxes to pay for basic services such as police, fire, trash pickup, parks and libraries. It also focuses on the rapid growth of pension payments and, because even these rising payments have not kept up with the growth in costs, the $3.2 billion unfunded liability that has built up in the police, fire and municipal pension funds.

The Arnold Foundation’s report accuses city leaders of mismanaging the pensions, in part by using risky assumptions about future investment returns to artificially depress the annual payments required from the city. Despite this, the city still has failed to cover these lower payments to fund the benefits being promised.

The report advocates for moving control of pensions from the Legislature to local leaders, for implementing what the authors argue are more prudent policies guiding how the plans are funded, and for paying the full annual amount that policy change produces.

[…]

Todd Clark, who chairs the fire pension board, said the GHP and Arnold Foundation reports do not change his views.

“They have their thought process on what they think needs to be done, but I’ll say it again: Pension reform is not the answer. The city spends their money on all these wasteful pet projects,” Clark said, mentioning hiking trails, bike lanes and dog parks. “They just keep on harping on this, and the bottom line is the city just owes the money and they need to pay what they owe.”

The fire pension has met its 8.5 percent investment return over recent decades, Clark said, and expects to over the long term, as well. The fund was on target to finish the last fiscal year well below its target, however.

Rhonda Smith, executive director of the city’s municipal pension fund, called for any discussion of city finances to include not only pensions but the slowing local economy and the voter-approved cap limiting the revenue Houston can collect in property taxes.

You can find the reports if you want. The GHP’s may be worthwhile, but I don’t trust the Arnold Foundation on this, any more than I trust them on education reform. They’ve got an agenda. Let’s be clear here that there are two issues with pensions. One is with the firefighters’ pension fund, which is well-financed but which is not controlled by the city. The city would like to have control over how much it has to contribute and how much of a cost of living adjustment the pensioners get – this is the short-term problem with pensions, as the city’s contribution amount has increased – while the firefighters point out that the city has this power over the other pension funds and has shortchanged them as a result, causing them to have greater unfunded liabilities – this is the longer term issue. I’m sure the reports make this clearer than the story did, but I trust we’re all familiar with the terms of debate here.

As for Todd Clark, I agree that the firefighters’ pension fund is in fairly good shape, but it’s disingenuous to claim as he often does that pension contributions are a relatively small part of the city’s budget, then blame items that are even smaller for the city’s financial troubles. Like just about everyone else in this debate, he glosses over the fact that public safety is two-thirds of the budget, and it’s been growing as well. Given that a large number of firefighters don’t even live in the city of Houston and thus would be conveniently unaffected by the cuts Clark prescribes, I find the attack on hike and bike trails distasteful. (Not to mention the fact that they’re part of a bond referendum that was approved by the voters.) Rhonda Smith is on the right track in calling for a broader discussion of finances than just pensions. I’m still waiting for this subject to come up.

I guess what really frustrates me about this issue and the discussion around it is that it seems to take it for granted that if the next Mayor just doubles down on trying to get a bill through the Legislature to wrest control of the firefighters’ pension fund back from Austin that all of this can be neatly solved. I’ve yet to see anyone explain what the next Mayor ought to do that Mayor Parker didn’t try, and I’m still waiting to hear how this solves the long-term underfunding issue for the other two pension funds that the city already controls. Maybe – I know this is crazy talk, but stay with me – there are ways to improve this situation without waiting till 2017 to do once again what we haven’t been having any success at doing in the past several years. Maybe offering a higher base salary in return for some cost certainty might entice the firefighters to negotiate. I’ve seen it suggested elsewhere that maybe the various TIRZes could be made to chip in a few bucks towards the pension funds each year. Maybe there are some other possibilities – I wouldn’t know, since that just doesn’t seem to be part of the discussion. And maybe this really is the most viable alternative. It would just be nice to have some confidence in that rather than have to accept it as an article of faith.

I should note that Steve Costello released his full pension plan yesterday, which claims to address these things I’m complaining about, while still starting with the premise that he can succeed at getting a bill passed; he cites the Murphy bill from last session, which never got a vote in committee, as his basis. I remain skeptical.

A setback for transparency

I don’t care for this.

BagOfMoney

The Texas Supreme Court on Friday limited the public’s right to know about private groups that get government funds.

In a 6-3 opinion, the court sided with the Greater Houston Partnership, agreeing that GHP doesn’t have to open its check registers even though it received funds from the city of Houston and other local governments worth about $1 million per year.

Open government advocates slammed the decision to curtail the reach of the Texas Public Information Act.

“Now GHP and groups like it that tap the spigot of public funding may draw the curtain against citizens examining how those funds are spent,” attorney Paul Watler wrote in a statement for the Freedom of Information Foundation of Texas.

GHP hailed the decision as a protection against unwarranted intrusions on private business.

“With this ruling, economic development and chamber of commerce organizations like the Partnership can continue to work on behalf of their communities without being mischaracterized as governmental bodies,” President Bob Harvey wrote in a statement, saying those protections are now also extended to other private organizations that contract with the government.

[…]

The case stemmed from a 2007 request by Jim Jenkins of Montgomery County, who wanted to see how GHP spends the city’s money. GHP, the region’s major economic development group, argued it wasn’t a governmental body for the purposes of the act, and eventually sued to block disclosure of its finances.

The Texas Attorney General, a trial court and an appellate court each previously ruled that GHP must open its books because, although it runs primarily on membership dues, it performs work for the city that makes it, in essence, an extension of the government. GHP plays a significant role in Houston’s economic development programs, courts new business for the city and plans mayoral business recruiting trips. It also analyzes business prospects to help City Council determine whether to offer incentives.

Jenkins, a small business owner, complained that there is too much money and politics at play in the way businesses get taxpayer-funded incentives, creating a field of “haves” and “have nots” based on political access. He argued that GHP’s expenditures would shed light on that process.

If the city “can just give money to a private entity like that with no accounting, we’re all in trouble,” Jenkins said.

[…]

Joe Larsen, another Freedom of Information Foundation attorney, said the court’s new test could have the effect of allowing government to easily outsource its functions. For example, a corporation with $200 million in total revenue could run the city’s water department for $10 million. As long as most of its income comes from other ventures, the corporation wouldn’t be subject to public information requests about the utility.

“That’s pretty hard to swallow,” said Larsen, who believes the all-conservative court is giving undue deference to private enterprise in this case.

Lynne Liberato, who argued for GHP, said governments outsource to the private sector all the time – like the foreign companies that build and operate toll roads. She said even in those situations, much information is still available through the government, such as contracts, reports and expenditures.

Gotta say, that explanation from the GHP’s attorney makes this ruling sound even worse. I just don’t get the justification. Rulings like this are a good argument for having more diversity of opinion on the court. Maybe having at least one person analyzing this from something other than a conservative perspective wouldn’t have changed the outcome, but it’s hard to see how it would have hurt.

Nothing but not-so-good-times ahead

Maybe if everyone chants “This time is different than the 80s!” loudly enough it will have the talismanic effect we all hope it will.

For five years, a domestic oil boom has created a bounty of high-paying jobs and a general climate of prosperity here. But as the rest country starts to see signs of economic revitalization, many of Houston’s biggest companies are slowing down. Both phenomena are due at least in part to the precipitous slide in the price of crude.

Halliburton, Schlumberger, Weatherford and Baker Hughes have dominated headlines with news of their layoffs, but the vast array of nonenergy businesses that feasted on their good fortune also are coming to the realization that the boom may finally have run its course.

That was clear in a series of interviews last week, in which even the most sanguine business owners agreed things could change dramatically over the next several months.

A financial planner whose customers include oil and gas executives said he’s advising clients to start “hunkering down.” A prominent hotelier is warning managers to get ready for “some belt-tightening.” A high-end real estate broker predicted builders could soon be offering incentives – “closing costs, appliances, upgrades” – in a market that only recently had homebuyers writing plaintive letters to sellers and paying well over asking price to get their second- or third-choice house.

“Nobody should be afraid, but people should be concerned,” added Patrick Jankowski, senior vice president of research at the Greater Houston Partnership. “We will feel the impact, even outside of energy. We just haven’t felt it yet.”

By almost every metric, Houston’s economy flourished during the domestic energy renaissance. The biggest impact has been jobs: nearly 485,000 added to the region in the last five years, according to Jankowski. The impact of those workers, whose wages are about double the local average, extends far beyond the energy sector itself, as they buy homes, purchase cars and spend money around town.

Optimists look to the medical, shipping and logistics industries to offer a cushion. But it’s naive to believe that if Houston thrived during the energy boom, it won’t suffer as the sector struggles.

Bill Gilmer, director of the Institute for Regional Forecasting at University of Houston, noted that although Houston’s economy has diversified since the oil bust that rocked the region in the 1980s, about half the region’s economic activity is still affected by the oil industry.

“I don’t think we have seen any significant diversification,” he said.

If the price of crude oil settles at $50 a barrel, the city would narrowly avoid a recession. But at $40 it won’t, said Mark Zandi, chief economist at Moody’s Analytics, in an interview earlier this month.

Doesn’t that make you feel better? I don’t really have anything to add to this. For what it’s worth, I agree that this time around, it likely won’t be as bad as it was before. That’s not going to be much comfort to anyone who’s been or going to be laid off, or whose business will suffer, but it’s something. And if you’re one of those people who once sported a bumper sticker that said “Lord, please send us one more oil boom, we promise not to piss it away next time”, well, I hope you feel like you’ve lived up to that.

Early Matters presents its case

They’ve got a good coalition. Let’s see where they can go with it.

Access to preschool programs – and their quality – varies widely across Texas. A broad coalition of Houston-area executives, educators and nonprofit groups assembled by Houston’s premier business organization is working to change that, though a major hurdle remains: securing funding in a state that ranks toward the bottom in pre-K spending per pupil.

The coalition’s 10-year plan, to be released Friday, calls for full-day pre-K classes for all disadvantaged 4-year-olds, with tuition required for wealthier families; lower student-to-teacher ratios; higher standards for private child care providers; and parent education to help ready their toddlers for school.

Leaders of the local group, called Early Matters, say they plan to lobby the state for more money – an estimated $700 million to extend full-day pre-K to the hundreds of thousands of 4-year-olds from disadvantaged families in Texas.

“This is really going to be the job of the Legislature, to really understand that this early investment has a big return,” said Jim Postl, chairman of the coalition, organized by the Greater Houston Partnership.

Both gubernatorial candidates, Republican Attorney General Greg Abbott and state Sen. Wendy Davis, a Democrat, have declared preschool education a priority, though they differ on the details. Abbott has focused on improving quality; Davis has championed expansion.

[…]

The Early Matters report calls for no more than 20 students in a class – with one teacher and one aide. Like Alief, several local districts assign one aide to work with two or three teachers to save money.

Postl, the retired chief executive of Pennzoil-Quaker State Co., said he expects the Early Matters group will gain more traction than a smaller effort last year – made up of some of the same members – that tried unsuccessfully to get a 1-cent tax hike on the Harris County ballot to increase funding for early childhood education.

In the short term, Postl said, the group does not expect to seek city or county funding for its effort.

See here and here for the background, and here for the Early Matters page on the GHP website. I’ll say again, I think Davis’ plan is the better, but even if you think Abbott’s plan has merit, I see no reason to believe that it’s something he really cares about. There’s nothing in his rhetoric or his record to suggest to me this is a priority for him.

A followup story on Saturday showed some more support for Early Matters.

Houston Mayor Annise Parker and Harris County Judge Ed Emmett, in short speeches, expressed general support for the early childhood effort.

“Money is not sufficient, but it is necessary,” Parker said. “So we’re going to have to have hard conversations about how we fund what we need to do.”

Leaders of Early Matters, a group organized by the Greater Houston Partnership, have said they don’t plan to turn to the city or county for significant funding in the short term. An effort last year to get a 1-cent tax increase on the Harris County ballot under an obscure law failed after Emmett said that approach wasn’t legal.

“Early Matters is a program worthy of all our support,” Emmett said Friday about the new initiative, “and we need to make sure that it bears fruit and actually becomes a reality.”

It’s going to take all the voices we can get for that to happen, and if we want the Legislature to take action, we’re going to need to talk to them, and to the Governor. We can make that conversation easier or harder depending on how we vote this year.

More on Early Matters

Scott McClelland, president of H-E-B Houston and also the chair of the Greater Houston Partnership Education Advisory Committee, pens an op-ed about the importance of pre-kindergarten and the latest effort to provide for it.

It’s hard to believe, but more than 60 percent of children in Houston start kindergarten lacking basic letter identification skills and almost 80 percent are challenged with number recognition. Additional research shows that a student who can’t read at grade level by the end of the third grade is four times more likely to drop out of school.

Those facts are concerning in and of themselves. But here’s why we all need to pay attention: Our job market is booming. But 60 percent of new jobs coming to Texas will require education beyond a high school diploma, and our state ranks last in high school graduation rates. Only 1 in 5 Texas children will earn a post-high school credential.

Quite simply, our region’s growth and expansion will be stifled if we cannot supply quality candidates to fill these jobs over the longterm.

Because the challenge is so great, local business leaders, educators and nonprofit organizations formed a broad-based coalition called “Early Matters.” The group has a singular focus: ensuring that our children are reading at grade level by the end of the third grade.

The group has set a 10-year vision that is predicated on being collaborative and inclusive – both of people and ideas.

Our approach is necessarily broad – all phases of child development leading to third grade need to be addressed. And while some of our plan calls for innovation that could pool existing resources, or make them work more efficiently, yes, achieving the goal will take money. A good plan that can’t be funded won’t make a difference.

See here for the background. Early Matters doesn’t appear to have its own webpage yet, but there is this page off the Greater Houston Partnership website, which contains a fact sheet and the press release of their announcement that they exist. I’m sure there will be more to come. This is all still very much at the high level stage, with most of what they’re talking about being the need for early childhood education solutions and not much yet about what those solutions will be. I’m glad they’re making the need to pay for something that will be effective and make a difference a key component of their early push, because that will be the greatest challenge. But how bug that challenge ultimately will be is not set in stone.

In the 2011 legislative session, $200 million was cut from pre-K programs. $30 million in funding was restored in 2013, but full restoration of these cuts is needed.

The ultimate goal of the Early Matters coalition is expanding to statewide, full-day pre-K. However, we know this will require substantial funding and additional time to ensure effective planning and implementation.

Just as a reminder, Greg Abbott’s big idea for pre-k comes with a $118 million price tag, which is to say that his fully funded plan for the 2016-2017 biennium would represent at most sixty percent of what the Legislature cut from pre-k spending in 2011. Wendy Davis, on the other hand, is proposing that school districts across the state offer full-day pre-K programs, which is to say exactly what this effort is pushing for. I recognize that an effort like Early Matters needs to be bipartisan, and I recognize that there are plenty of Republicans that support fully funded, quality pre-kindergarten programs. I just hope that the people that support Early Matters recognize that they can make their jobs easier if they want to or they can make their jobs harder. It’s their choice.

Trying again with pre-K

Different approach, hopefully a different result will follow.

On the first day of school for most Houston-area children, a coalition called “Early Matters” organized by the Greater Houston Partnership announced Monday it would release a 10-year “game plan” at a summit next month to expand pre-kindergarten and child care programs and assist parents so they can “become the best parents they can be for their growing child.”

Coalition members, including Chair Jim Postl, the retired president and CEO of Pennzoil-Quaker State Co., also made clear they would be looking to the Texas Legislature, which gutted state funding for full-day pre-K in 2011, saying restoring that money would be “a very important first step” to carrying out a plan they say will increase the likelihood that kids will stay in school and be prepared to join the workforce or go to college when they graduate.

[…]

The Partnership, Houston’s most influential chamber of commerce group, helped commission a study in 2012 that found that the vast majority of brain development occurs before age five and that greater investment in early childhood programs would be crucial to the region’s future economic success. The resulting report inspired the formation of another coalition of local business and community leaders called Early to Rise that launched a petition drive last year to place a 1-cent property tax hike on the November ballot to generate funding for these types of programs. The effort was based on an obscure, decades-old law that said the county judge must call an election to raise the tax rate of the Harris County Department of Education if enough valid signatures are gathered.

Harris County Judge Ed Emmett refused to place on the item on the ballot, however, saying he supported improving early childhood education but that the petition language the group had used did not comply with the law. He and others also did not like that the proposal would have diverted the tax dollars to the coffers of a private group.

The group sued, but an appeals court backed Emmett’s decision.

Harvey said he and other GHP committee members convened a few months later and decided to launch another effort with “more active involvement of the business community” and “a much broader coalition.” In addition to business leaders, the coalition was joined Monday by a half-dozen local school superintendents, including Houston ISD’s Terry Grier.

“I think there was a lot of answered questions in a lot of people’s minds” about last year’s proposal, including “how you raise the money and how you have a countywide tax rate, who is going to be in charge of those dollars,” Grier said. “I think that this has the full support of the Greater Houston Partnership and it’s a wide coalition, a much broader coalition than it was a year ago. I’ve seen both programs. This is not the same program repackaged. This is totally different.”

Clearly, going for a statewide plan is the optimal path, but it’s also the heavier lift politically since it would involve spending money. I know the GHP and their partners in this effort would like to be nice and bipartisan and all, but there are some fairly significant differences between the two major candidates on the issue of pre-K. If you don’t feel like clicking those links, just ask yourself who as the next Governor will be more amenable to fully funding a statewide pre-K program. The question answers itself. The Early Matters coalition, who have County Judge Ed Emmett on board with the idea, haven’t zeroed in on how they would fund this, and still have a lot of blanks to fill in policy-wise, but it’s the goal that matters. I personally would have no problems with the Lege doing this via appropriation, but we should certainly take advantage of whatever federal and private grants exist, too. Let’s make this happen, and let’s make it happen in a lot less than that ten-year time frame.

White return flight

Some interesting demographic trends going on.

Between 2000 and 2010, [Harris] county, like much of the U.S., saw a sharp decline of its white population, losing about 12 percent of Anglos or about 83,000 people.

The drop mirrors demographic shifts across the nation as white birthrates have slowed. But in the past three years, Harris County added about 25,000 white residents, about 11 percent of its approximately 227,800 new residents, according to U.S. Census data released Thursday.

While the greatest drivers of the county’s growth are still Hispanics, it’s the reversal of the decadelong white decline that grabs demographers.

“It’s a surprising pattern given what we saw in the last decade, and indicative of the overall pervasiveness of population growth in Texas and especially in Houston,” said Steve Murdock, a onetime state demographer and former Census Bureau director who now leads the Hobby Center for the Study of Texas at Rice University.

“The amount of growth, percentage-wise, is almost the same as the decline … that’s a fairly substantial change,” Murdock said.

Though Anglos remain the nation’s largest racial group, it’s the only demographic group which is shrinking rather than growing. Last year, it was the sole group to count more deaths than births.

Texas, on the other hand, saw the largest numeric increase of white residents in the U.S. between 2012 and 2013, gaining about 51,000 Anglos

Within Harris County, where Anglos make up about 32 percent of the population or about 1.3 million, some 9,000 white residents were added last year.

“There’s a significant amount of Anglos moving into the region from outside of Houston,” said Patrick Jankowski, vice president of research for the Greater Houston Partnership, an economic development organization.

“They’re coming here because of the jobs. … If you look at all the growth in the Energy Corridor and the Medical Center, and the new Exxon campus in The Woodlands, we’re attracting workers who are more skilled, and many of them are white.”

But he suggested there might be a more subtle shift as well. Because Houston is attracting more single or young workers seeking to cash in on the energy and medical booms, an increasing number, like Carey and Bowen, are choosing to live in Houston rather than more suburban, neighboring counties.

“There’s no white flight anymore,” Jankowski said. “People are more and more accepting of different races and different ethnicities. They don’t care about their next-door neighbor as long as the lawn is mowed.”

As we know, some parts of town were getting whiter long before this. There are lots of questions one could ask about this, but for me I always come to the political implications. While it’s true that the increase in Harris County’s Anglo population is a reversal of earlier trends, the overall trend of Harris County getting less white hasn’t changed, it’s just decelerated a bit. I doubt there will be much change at a macro level, but there could be some effects here and there, especially in lower-turnout environments. It would be nice to know more about where these folks are coming from and what their existing proclivities are, but without that information we’ll just have to hypothesize.

One related tidbit from a different story.

Demand for high-density living grew across the state, according to the report. San Antonio saw the biggest increase in sales at 18 percent, followed by Austin at 14 percent. In Dallas, sales were up 4 percent.

“There is little available land for housing development in Texas’ major metro areas, particularly in its urban centers where housing demand is strongest,” [Jim Gaines, an economist with the Real Estate Center at Texas A&M University] said in the report. “Developers are now looking upward for opportunities to build and invest in multifamily developments both in these centers and even in some suburban areas. Condo sales will likely be a strong driver in the Texas housing market for the rest of the year.”

Developer Randall Davis said rising single-family housing prices are driving expansion in the condominium market. Builders can put multiple units on one site, he said, and “deliver a product that’s almost equivalent but at a lesser price.”

More of Houston’s big builders, too, are interested in developing in the central city, said Gary Latz of Bohlke Consulting Group, a consulting firm for the housing industry.

Over the last 12 months, residential permits within Beltway 8 were up 22.8 percent over the same period last year. That’s compared with the overall Houston area, which was up 9.3 percent.

“People love the idea of living in closer and being close to all the amenities Houston has to offer,” Latz said.

Again, that’s a trend that’s been happening for some time now. Maybe if it keeps up we can get some more infrastructure spending inside the Beltway, too? Because that would be nice.

The story from Dallas is similar but not quite the same.

“Let’s look at Dallas County,” said Steve Murdock, director of the Hobby Center for the Study of Texas at Rice University. “There was growth in the Asian population, no doubt about it. But we also see a turnaround in growth in the non-Hispanic white population.”

While Dallas County showed a loss of 1,436 non-Hispanic whites from the 2010 census through July 1, 2013, that’s minuscule compared with losses in the previous decade, Murdock said.

“If you had the same pattern going on as you had in the last decade, you would have lost a good number more,” he said. “At this rate, you might lose 5,000 over this decade, compared with the loss of 198,000 over the last decade. We’re seeing the same thing in Harris County, where it changed from a negative to a positive.”

While non-Hispanic whites continue to move to suburbs, it could be that some younger folks and empty-nesters are finding urban centers more attractive for lifestyle reasons. And, demographers say, those leaving are being replaced by others looking for jobs, either from other parts of Texas or out of state.

“When you look at the state level,” said Lloyd Potter, the Texas state demographer, “we’re seeing positive immigration of non-Hispanic whites.”

The splashy numbers, though, came from growth rates in the Asian population — up 20 percent in Denton County, 18.5 percent in Rockwall, 18.1 percent in Collin, 14.9 percent in Dallas and 10.8 percent in Tarrant — over the last three years. In many ways that’s a continuation of the trends from 2000 to 2010, when Asians and Hispanics were the two fastest-growing groups in the state.

Hispanic growth rates were still double-digit in Collin, Denton and Rockwall counties at 11.2, 13.7 and 14 percent, respectively, for the three-year period, “but the rate of growth is down in Collin” compared with the previous decade, Murdock said.

[…]

The non-Hispanic black population is growing rapidly as well — up 19.6 percent in Denton, 18.1 percent in Collin, 12.5 percent in Rockwall, 10 percent in Tarrant and 5.8 percent in Dallas.

Much of the growth across the region and the state comes from migration, Potter and Murdock agreed, and that migration is driven largely by jobs.

“Overall, I think we’re seeing that Hispanic growth rates are down, but the non-Hispanic white losses have been significantly reversed,” said Murdock, a former director of the U.S. Census Bureau.

He used Travis County as an example.

“From 2000 to 2010, Travis County added about 59,000 non-Hispanic whites,” Murdock said. “This time, it has added 41,000 non-Hispanic whites in the first three years,” an annual rate that roughly doubles that of the previous decade.

I don’t really have anything to add to that, I just find stories like these to be fascinating. Whatever else you can say about Texas, it’s not static.

We’ve got slogans, yes we do

We’ve also got No Limits, apparently.

Alex Tonelli, a 2011 graduate of the Stanford Graduate School of Business and a San Francisco entrepreneur, has never visited Houston. But he has impressions: Extreme heat, strip clubs, NASA and an oil-dominated economy.

His friends who have moved here have positive things to say, Tonelli added. But for the most part, among his peers, “Houston is not a commonly mentioned place where people consider moving.”

Well aware of such attitudes, the Greater Houston Partnership on Tuesday launched – to fanfare that included a three-minute video featuring everything from an astronaut bouncing on the moon to musicians rocking at the local House of Blues – a new image campaign designed to highlight some of the city’s amenities, from parks and museums to restaurants and the Galleria.

The campaign slogan, “Houston: The City With No Limits” also was unveiled to civic leaders and media gathered at NRG Stadium.

The image campaign will include television spots that reflect Houston’s upbeat spirit, diversity of opportunity and fun atmosphere, said Bob Harvey, president and CEO of the Greater Houston Partnership.

TV spots will run locally this year, and Harvey said the campaign will go worldwide next year.

Around $12 million will be spent over the next five or six years, either on marketing the city through the image campaign or targeting degreed young professionals. Starting next year the Greater Houston Partnership will visit college campuses, Harvey said.

Many outsiders consider Houston a good place to find work, but may not think of it as a great place to live, said Jamey Rootes, president of the Houston Texans and chairman of the Greater Houston Partnership’s image campaign.

Misperceptions about the quality of life in Houston impede the city’s ability to attract new companies and young professional talent, Rootes said. He wouldn’t name names or give dollar amounts, but he said specific opportunities have been lost in recent years.

The “City With No Limits” website is here; scroll down a bit to see the aforementioned video. It’s pretty good, with catchy music and visuals. If you didn’t already know it was about Houston, you might not clue into it until towards the end when there are clips of the four pro teams plus the Shell Houston Open. That may be the intended effect, to have it sort of sneak up on you. Anyway, I thought the hipness campaign from last year was pretty decent, but that was a Greater Houston Convention & Visitors Bureau effort, whereas this is the Greater Houston Partnership aiming at getting people to move here. I’m not sure if the two different themes will build on each other or if they and they myriad others we’ve had over the years are just a confusing jumble. I wonder if anyone has any data to track the effect of these campaigns, some of which have surely been more successful than others. Be that as it may, if nothing else we’re more confident about the product we’re selling these days; all that love about our food scene has to have helped. Swamplot and CultureMap have more.

It’s not so cheap to live in Houston any more

It’s the downside of a hot job market and an improving national reputation for being a cool place to live.

BagOfMoney

Business and city leaders often tout the Houston region as one of the most affordable markets in the country. But first-time homebuyers like the Schaefers are finding that image increasingly outdated.

“We are in a hot market, and it does pose some challenges,” said Patrick Jankowski, executive vice president of research at the Greater Houston Partnership. “There’s a cliché in Houston that you just drive until you find something you can afford. People are finding that’s becoming a farther stretch.”

The housing market has seen sales soar, prices rise and inventory shrink. Many households now could spend up to half their paychecks on housing and commuting.

Jankowski said Houston’s job growth led to an influx of new people seeking housing options in the last few years. He said affordability could be a concern going forward, especially as longer commutes tack on more cost.

[…]

Real estate experts and economists say that, although Houston is still affordable compared to other large markets, double-digit price increases could chip away at that reputation. The pattern could alienate first-time homebuyers, leave the middle class with fewer options and drive low-income residents into rundown apartments.

“It can be a challenge to understand why home price increases can be a bad thing coming out of the recession,” said Janet Viveiros, with the Washington, D.C.-based National Housing Center, who authored a report about affordable housing this year. “House prices are surging, and rents are surging. It puts buyers in a situation where they have to make difficult decisions.”

In Houston, the fact that about 80 percent of housing activity is outside Beltway 8 contributes to its reputation as an inexpensive market.

Home sales and prices from 2013 show strong growth everywhere: Overall, home prices rose 9.4 percent, the Houston Association of Realtors reports in an analysis of sales, prices and inventory for the Houston Chronicle. Inside Loop 610, prices rose 12 percent, and they were up almost 20 percent from the Loop to Beltway 8 and 9 percent outside the Beltway.

[…]

“Is it losing some of its competitively priced housing? A little bit, but it’s not a major concern yet,” Jim Gaines, research economist at the Texas A&M Real Estate Center, said of the area. “The middle class, or working class, can still find affordable housing. It’s just not as abundant as it was.”

Still, he said, recent price increases threaten to hurt.

“If prices go up 12 percent, I guarantee incomes didn’t go up 12 percent,” he said. “If you continue double-digit price growth for several years and don’t get corresponding income, then you get out of whack.”

The median household income for Houston, The Woodlands and Sugar Land is $55,910, according to the 2012 U.S. Census American Community Survey.

The low housing stock is driving up values on all types of properties, according to Sheri Smith, an associate professor in the school of public affairs at Texas Southern University. Working Houstonians who can afford $125,000 to $150,000 houses are being priced out of the market or forced into rentals or housing in the suburban fringes.

“Middle-income individuals are not finding affordable housing,” Smith said.

A recent Rice University study found Houstonians typically pay 30 percent of their income on housing, including mortgages and rents. Compare that to those in New York City who spend 25 percent of their income on housing, 25 percent for Chicago and 31 percent in Los Angeles, based on 2011 data.

Once transportation costs are factored in, almost half of the typical Houstonian’s income – 46 percent – is gone.

I’ll bet those figures are a surprise to a lot of folks. New York especially has a reputation for being an expensive place to live, but if you’re earning enough money, it’s not a problem. Of course, you have to earn a heck of a lot of money in Manhattan or you’re screwed. So Houston still has that going for it.

As for what should be done about the problem, clearly more supply is needed. I’ve talked before about how we really have to do something with the many empty spaces in Houston. The reason so much construction occurs in the far out reaches of Harris County is because that’s where the empty land is. Empty and underutilized spaces exist in Houston, too. We need to figure out ways to encourage construction in these places. That’s going to require an investment in infrastructure in a lot of these places – fixing roads, adding drainage, etc – but the alternative is letting all the growth occur in the hinterlands and dealing with the effects of that.

Another solution is going to be more highrises. It’s the only way to increase the available housing on limited land. Houston does have some limits on where highrises can be built, but the bigger constraint these days is neighborhood resistance. Lots of places are not appropriate for highrises, and you can’t do much about aesthetic objections to them, but traffic concerns can and should be addressed. As I’ve said before, more density needs more transit. As with infrastructure, that’s going to cost some money, but it’s a vital investment. The alternative is to curse traffic for all eternity, as the folks down in Pearland are fixing to learn.

I guess what I’m saying is we can keep doing what we’ve always done and hope it works out for the best, or we can try to figure out some policies that might help alleviate the housing shortage and make the best use of the land we have available, then figure out a way to pay for it. The former is easy, of course, and it’s more or less worked fairly well for the greater Houston area, though arguably not so well for every part of it, and arguably not so well for the city as opposed to the metro area. Doing the latter is a lot harder and there’s no guarantee we can even pull it off, but it has the upside of maybe solving some of these vexing problems that the market tends not to care about. I really don’t expect anything but Door #1, but it can’t hurt to point out that we do in fact have a choice.

GHP endorses proposed NDO

Good for them.

RedEquality

The Greater Houston Partnership came out in support of Mayor Annise Parker’s proposed equal rights ordinance, giving the measure a boost as it heads to a City Council committee hearing on Wednesday.

Parker plans to put the measure before the full City Council for a vote next week.

The Partnership initially had reservations about the sweeping anti-discrimination proposal, aimed at private businesses as well as city employment and contracting, but President Bob Harvey said most of the group’s concerns had been addressed by the time the mayor’s office released a draft of the ordinance last week. The Partnership’s executive committee voted unanimously on Friday to support the proposal.

“The business community and the community in general views our city as remarkably diverse and welcoming,” Harvey said. “I think this ordinance is consistent with what this city stands for.”

That’s exactly right. Many large companies have had their own version of this for years, so it’s something they’re comfortable with. Via Houston Legal, the Houston Business Journal makes this message even more explicit.

If Houston businesses are concerned about the potential unintended consequences of Mayor Annise Parker’s Equal Rights ordinance, they should look to the Americans with Disabilities Act, said Stephen J. Roppolo, a regional managing partner and employment law attorney at Fisher and Phillips.

“All of us were concerned that 40 million people were going to be declared disabled,” Roppolo said. “There were some jokes at legal seminars that were only half jokes that claimed, ‘If you’re follicly challenged, you’re disabled.'”

The net result of ADA, Roppolo said, “was not nearly as bad — as expansive — as everyone thought.”

[…]

Gender identity can be confusing to some people, Roppolo said, but he’s confident human resources departments at most Houston businesses are already prepared for this. In fact, businesses have been dealing with gender identity issues for some time.

“Everyone likes black-and-white, easy-to-decide issues. Gender identity is not black and white; it’s shades of gray,” Roppolo said. “What I tell employers is that if you’re focused on whether that person, whomever they are, is doing the work in a way that helps the business, that’s all that matters.”

Furthermore, Roppolo said employers are increasingly sensitive to workplace harassment.

“It’s not productive,” he said. “When people are doing that kind of stuff to one another, they’re not doing work.”

But the biggest message that Roppolo and other lawyers have for Houston employers is: Relax.

“Sit tight,” he said. “This is going to be fine. At the same time, I am telling employers that this is going to take some work to get your front-line supervisors to understand what the new parameters are.”

Yes, it’s going to be fine. It’s good to have the GHP officially on board, since that ought to shut up anyone that wants to claim this fairly benign ordinance would somehow be harmful to business. If anything, it’s the opposite, as the kind of innovative employees that companies like to recruit want to live in a city that reflects their own values. There’s nothing controversial about this ordinance, which as CM Ellen Cohen, the chair of the Quality of Life Committee, noted has been revised multiple times after much feedback from stakeholders.

That doesn’t mean the usual suspects won’t piss and moan about it, of course. Back to the Chron:

Major Republican donor Steven Hotze sent an email from his Conservative Republicans of Texas PAC that dubbed the proposal “Parker’s Sexual Predator Protection Act,” suggesting the measure will create a loophole to allow people to lie about their gender to enter bathrooms where they could attack women and children. He also wrote against protections based on sexual orientation.

“This would make those who engage in deviant sexual acts a new minority class equal to African-Americans, Hispanics, Asians and other legitimate minorities. This is a slap in the face of true minorities,” the email read.

Dave Welch, of the Houston Area Pastor Council, echoed Hotze in saying the ordinance is a solution to a problem that does not exist and that the true reason for Parker’s proposal is to force the Houston community to accept her same-sex marriage.

Texas Leftist has a copy of Hotze’s hate mail. I’m loathe to give these d-bags the attention they so desperately crave, but a reminder of who they are and what they stand for is always useful. They represent a small and shrinking group, and they deserve to be ignored. When Council finally takes up the NDO – in two weeks, since I assume someone will tag it – I hope Council passes it unanimously, or at least overwhelmingly. Don’t be with the losers here, Council members. Campos has more.

Mayor Parker releases draft of non-discrimination ordinance

From the inbox:

Mayor Annise Parker

Mayor Annise Parker

Mayor Annise Parker today released a draft of her proposed Equal Rights Ordinance. The document is the result of more than two months of collaborative discussions with various stakeholders.

“As I stated in my State of the City Address earlier this month, the Houston I know does not discriminate, treats everyone equally and allows full participation by everyone in civic and business life,” said Mayor Parker. “We don’t care where you come from, the color of your skin, your age, gender, what physical limitations you may have or who you choose to love. It’s time the laws on our books reflect this.”

Houston is currently the only major city in the country without civil rights protections for its residents. The draft ordinance will prohibit discrimination in city employment, city contracting, housing, public accommodations and private employment at businesses with at least 50 employees. To avoid First Amendment issues, religious organizations are exempt from the definition of an employer.

Complaints about violations of the ordinance and decisions regarding prosecution are to be handled by the City’s Office of Inspector General and the City Attorney. If the subject of a complaint refuses to cooperate with an investigation, the City Attorney may ask City Council to approve the issuance of a subpoena to compel cooperation.

In addition, the mayor has the discretion to create an advisory task force to study and report on matters related to the ordinance.

“Equal protection under law is a cornerstone of our democracy and the Equal Rights Ordinance will help to ensure that all Houstonians are protected from discrimination,” said District C City Council Member Ellen Cohen, who has been involved in the drafting of the ordinance. “As the most diverse city in the nation, I’m pleased that we will offer these protections in public accommodations and employment to all our citizens.”

“This ordinance gives us another tool to demonstrate that Houston is a world class city that is open for business,” said District J City Council Member Mike Laster, who has also played an integral role in the drafting of the ordinance. “If you are willing to work hard, and treat your neighbors with respect and fairness, you will be welcome in Houston, and you will succeed in Houston!”

Mayor Parker intends to present the draft ordinance to City Council’s Quality of Life Committee on April 30. Consideration by the full City Council is scheduled for May 7. The ordinance may be viewed by clicking the Ordinance Feedback icon under the mayor’s photo on the homepage of the city’s website at www.houstontx.gov.

See here and here for the background. A direct link to the ordinance is here, and if you’re wondering why we need such a thing in Houston, I recommend you read this Equal Rights Ordinance Guide helpfully put together by the Houston Stonewall Young Democrats. As we know there had been some concern about private employers not being included in the ordinance, but as you can see that has been addressed. Nothing like a little public engagement on an important issue.

The Chron story gives us a feel for the lay of the land.

Parker initially had talked of creating a human rights commission to hear complaints, but that idea was left out of the proposal announced Monday.

[…]

Greater Houston Partnership President and CEO Bob Harvey said his group’s key concern with the idea had been the commission.

“At this juncture, admittedly upon a very quick review, I would say there is plenty in this proposal that we can support,” Harvey said, noting that a majority of GHP members already have anti-discrimination policies. “We now must take the time to review the proposal in detail, and we plan to take it before our board for discussion in the next several days.”

The Houston GLBT Caucus, during last fall’s elections, asked the mayor whether she would introduce, and council members whether they would support, a nondiscrimination ordinance; Parker and 11 council members said yes. Caucus President Maverick Welsh said he is pleased private employers were included.

“She kept her commitment to the GLBT community and I’m hoping the council members that made a commitment will keep theirs, too,” Welsh said. “Houston is competing with other cities for the best and brightest talent out there and if Houston has these protections in place we’re more competitive and welcoming.”

Councilman Michael Kubosh said he is concerned Parker is stressing the ordinance’s sweep when her goal is adding protections for gay and transgender residents. If accurate, he said, that is where discussions should focus.

“The mayor needs to come out and just say what it’s really about. Let’s start from there and go on,” Kubosh said. “The most important thing is transparency.”

Councilman Jack Christie said the draft’s dropping of a commission makes it an improvement over earlier discussions.

“Just have direct access to the city attorney, if the state and federal hasn’t helped you,” Christie said. “I just don’t hear that much discrimination, but if there is, if there’s less than 1 percent, we need to stop that.”

There was a quote in there from one of the usual suspects that can be summed up as “haters gonna hate”, but beyond that I find these reactions to be encouraging, and boding well for passage. Still, I am sure there will be more opposition now that this is out, and I’m sure some members of Council will need a bit of pushing, so don’t quit engaging just yet. Just remember, when the predictions of doom and employers fleeing and whatever else begin to crop up, plenty of other cities in Texas and elsewhere have passed ordinances like this one, and last I checked the earth was still rotating on its axis. Nothing bad will happen, but a lot of good will. Texas Leftist, Lone Star Q, Texpatriate, TransGriot, and PDiddie have more.

The Chron keeps trying to talk to Ted Cruz

It’s kind of cute, and probably about as effective as my efforts to talk to my dog.

Not Ted Cruz

Not Ted Cruz

When U.S. Sen. Ted Cruz, R-Texas, stands before the Greater Houston Partnership tomorrow morning to deliver his “State of the Senate” address, he’ll receive a respectful hearing from an audience of Houston’s most influential business and civic leaders. We hope he’ll respond in kind, in light of the fact that a number of those same leaders are frustrated with the zealotry and ideological rigidity that have marked his brief Senate tenure so far.

Immigration reform is high on their list, and yet the state’s junior senator has been a stumbling block, not a pragmatic problem-solver when it comes to sorting out the complicated issues involved with determining who belongs in this country and who doesn’t. An attitude of stubbornness and rigidity is not the way Partnership members operate their businesses; nor is it the way they expect elected officials to represent Texans and their interests in Washington.

Cruz professes to be an immigration reform advocate, but his notion of reform is to build a Berlin Wall along the 2,000-mile Mexican border at $21 million per mile, deploy so many troops and Border Patrol agents that those ubiquitous “boots on the ground” will be stomping all over each other and set a standard of apprehension so high – 100 percent “situational awareness,” it’s called – that a skittish jack rabbit couldn’t venture into this country from across the border. In other words, he doesn’t want reform at all.

[…]

The Senate already has passed a bipartisan legislative package that goes a long way toward reforming the nation’s unfair and unwieldy immigration system, despite immigrant Cruz’s typically adamant opposition. For the moment, and probably for the foreseeable future, the effort is stalled in the House.

With consensus for sensible reform building across the nation – and certainly here in Houston – both Cruz and House opponents need to be held accountable. Tomorrow, Greater Houston Partnership members have an opportunity to do just that.

Well, at least they didn’t embarrass themselves with another invocation of Kay Bailey Hutchison. Maybe there is hope they can learn from their mistakes. Obviously, Cruz isn’t listening to what the Chron has to say – I mean, come on – but it’s possible that the Greater Houston Partnership is. It’s going to be five years before anyone gets to hold Ted Cruz accountable. It can’t hurt in the meantime to remind groups like the GHP that if they want elected officials that will actually listen to them, they’re going to need to support someone other than Ted Cruz.

Council to consider wage theft ordinance

Good.

The Houston City Council may step up its efforts to combat wage theft, sanctioning companies that deny workers pay to which they are entitled and monitoring firms accused of doing so, regardless of whether they do business with the city.

City Attorney David Feldman laid out a proposed ordinance to a City Council committee on Tuesday, receiving a generally positive reaction from council members and worker advocates, who flooded the chamber in yellow or teal T-shirts, representing the Fe y Justicia Worker Center and Texas Organizing Project.

Workers who believe they have been improperly denied pay can file civil complaints with the Texas Workforce Commission or in a justice of the peace court, or pursue criminal complaints with police or prosecutors. Feldman said most workers who file complaints choose the state agency.

The city’s best chance to help, Feldman said, is to create a database of companies found guilty of wage theft and to keep a watch list of firms accused of the practice, in the hopes of using its leverage as a source of contracts, permits and licenses as a deterrent.

“Obviously, we do have a large amount of buying power, purchasing power, a large number of contracts, and, obviously, we want to make sure the city of Houston says, ‘We’re not going to be doing business with somebody that’s found to be guilty of this type of activity,'” Councilman Ed Gonzalez said.

Existing city rules state that firms who commit wage theft can be barred from city work, but do not specify how the city would identify offending companies, Feldman said.

Stace was on this earlier and then again afterward. This is a very basic premise: People who do work deserve to get paid for it, and they deserve to get paid what they were promised, without delays or extra conditions or any other BS. Denying someone the pay they were promised is wrong and should carry consequences. This has been a huge national problem lately, and it’s a disgrace. What was especially encouraging about this proposal was the overwhelming agreement that this ordinance would do good. It’s a shame that it’s needed, but it will be good to have it. Contact your Council member and let him or her know that you support this, too.

Would you pay more for pre-K in Harris County?

You might get the chance to vote on it.

pre-k

The recently formed Harris County School Readiness Corp., a group whose membership includes former Houston first lady Andrea White, is circulating a petition calling for the placement of an item on the next election ballot that would increase the county property tax rate by 1 cent, generating about $25 million a year to train teachers and buy school supplies for child-care centers serving children up to age 5.

“All the recent brain science development has indicated that early childhood education is absolutely pivotal,” said Jonathan Day, a member of the corporation’s board and a former Houston city attorney. “The business community and academics, everybody’s of the single mind that, if there is a single point of investment for leverage to improve children’s education, it’s at early childhood.”

The initiative stems from a recommendation made in an April report commissioned by the Greater Houston Partnership and the Collaborative for Children. It is similar to one launched by San Antonio Mayor Julian Castro, which ended in voters last year approving a modest sales tax hike to build new pre-kindergarten centers.

The corporation, however, faces several big hurdles before voters have a say.

Chief among them: Harris County Judge Ed Emmett, who says he believes the state law dictating the petition process the group is following is no longer valid.

While most county-related matters require the approval of the five-member Harris County Commissioners Court, the corporation is going by a process laid out in a state law that technically no longer is on the books that says county judges must call elections to increase the tax rates of county education departments if enough signatures are collected on a petition. The corporation will have to gather at least 78,000.

While conceding that the group’s legal interpretation “may be right” and describing childhood education as “a great need,” Emmett said he believes that portion of the education code no longer applies, and has asked the county attorney’s office to review it.

“I’m going to ask probably even the attorney general if I have to,” Emmett said, expressing a declining lack of confidence in the education department for hiring lobbyists to visit court members and state lawmakers. “They didn’t recodify these sections and you can’t find these anywhere in state statutes today.”

The issue here is that only two counties, Harris and Dallas, still have education departments. As is often the case, the laws on the books don’t quite line up with current reality, and as such there’s an ambiguity. Judge Emmett will seek counsel about that, as he should, but it’s a lead pipe cinch that if this election goes forward and the proponents of raising the tax rate win, someone will file a lawsuit to invalidate it. I can already hear Paul Bettencourt and the Hotze brothers cracking their knuckles in anticipation. Hell, there will probably be a lawsuit even before the election if enough petition signatures are collected to require one. At least then we’ll have a more definitive answer to the Judge’s question, though it might be quicker to just wait till 2015 and try to get a bill passed to clarify matters then.

Be that as it may, getting to the point of having an election is no sure thing. As Campos calculates, it’ll take about 78,000 signatures to clear that bar. I’m not exactly sure what that is based on – it’s always some percentage of the turnout of the previous election, but what that percentage is and which election it’s derived from are unknown to me. It’s also not clear to me that this would pass if it made it onto the ballot. The San Antonio pre-k initiative that Mayor Julian Castro championed passed with 53.56% of the vote, which is solid but not overwhelming and it happened in a city rather than a county in a high-turnout election. It’s easy to visualize the campaign against this initiative, no matter how good it sounds on paper. Don’t get me wrong, I like the idea, I’m just saying it’s far from a slam-dunk.

There’s not a lot of information out there about the Harris County School Readiness Corporation right now – no webpage or Facebook presence, though I am told both will be up soon. I did get this press release yesterday, which fills in a few blanks.

Houston: Citizens for School Readiness made a presentation today to the Harris County Board of Education on the importance of early childhood education. The Board received a report commissioned by the Houston Endowment and conducted by the Greater Houston Partnership and Collaborative for Children, demonstrating the need for improved early education. Also presented to the Board was a plan to place a ballot measure before the voters this November that would create a dedicated revenue stream for early childhood education.

The additional revenues will be overseen by the Harris County School Readiness Corporation, a public/private partnership board headed by Mr. James Calaway, Chairman of the Board of the Center for Houston’s Future. Also serving on the board is Houston’s Former First Lady, Mrs. Andrea White, as well as Pastor Kirbyjon Caldwell of Windsor Village United Methodist Church, Mr. Jonathan Day former Houston City Attorney and civic leader, leading Houston businessman Mr. Lupe Fraga, Ms. Y. Ping Sun, and Ms. Laura Jaramillo, Senior Vice President of Wells Fargo.

A poll conducted by Dr. Richard Murray of the University of Houston found strong support for the proposed measure. Dr. Murray’s survey showed, “Nearly 70% of county voters said a local effort to improve early childhood education in Harris County should be a priority.”

“People from every sector of this city recognize the critical importance of strengthening early childhood education for our youngest children. Kindergarten is the new first grade, and children need to enter kindergarten already knowing their ABCs and with their skill sets already developed.” said Mr. Jonathan Day, referencing numerous studies that tout the long-term social benefits of early childhood education programs.

There’s more, so click over and read the rest. Like I said, I think the hill is a lot steeper than Dr. Murray’s poll suggests, but I daresay the pro-pre-K group won’t be outspent. What do you think about this?

UPDATE: HCDE trustees approve the plan, which has a wrinkle I didn’t catch the first time around.

The Harris County Department of Education board of trustees voted 6-1 Tuesday to allow its superintendent to review a proposal calling for a 1-cent increase to the agency’s tax rate to fund early childhood education programs. Board members, however, expressed concern about the lack of oversight they may have under the proposal, pitched by recently formed nonprofit Harris County School Readiness Corp.

The group’s plan, which it presented to the board on Tuesday, involves collecting at least 78,000 signatures on a petition, which would – according to a 1937 state law – require the county judge to place the tax hike on the next election ballot.

The increase would generate an additional $25 million a year, which would be used in part to train teachers to staff child-care centers in the county serving children up to age 5. If voters were to approve the hike, the nonprofit’s plan says its own board would administer the new revenue.

The item approved by the board Tuesday allows the superintendent to review the plan and later bring a recommendation back to the board.

I’m a little uncomfortable with the funds being administered by the unelected board of a nonprofit. See CPRIT for the reasons why. I’d still like to see pre-k funding happen, but I’d like to know more about how these funds would be administered.

Drivers licenses for all – maybe

Not quite drivers licenses, exactly, but close enough.

TDL_Sample

A Dallas Democrat has teamed up with two powerful Republicans to craft a compromise version of a bill that would give immigrants here illegally the ability to drive legally in Texas and obtain insurance – but only after they submit to a criminal background check, fingerprinting and prove state residency.

The proposal is being sold by supporters as anything but a tool to expand the rights of people residing in Texas illegally. And they caution that a new form of driving permit will be granted, not an actual driver’s license.

Rather, they are pitching it as a law enforcement measure to fix an unintended consequence of a law passed last session that requires people to prove their citizenship to renew a driver’s license.

That 2011 measure has left immigrants who drove legally in Texas for decades unable to renew their licenses or buy insurance, a problem that has caused major headaches for law enforcement officials across the state.

“It’s good for law enforcement. It’s good for security,” said Rep. Roberto Alonzo, D-Dallas, who authored the measure, House Bill 3206. “We have already gone past the immigration debate, and now we’re into the law enforcement debate.”

Major business groups across the state, including the Texas Association of Business and the Greater Houston Partnership, are backing the bill, as are local law enforcement, including Harris County Sheriff Adrian Garcia.

“This bill is a good idea. It would make the streets of Harris County safer for everyone,” Garcia said. “We would learn a lot more than we know now about drivers who are already traveling our roadways every day, but have been unable or afraid to obtain a driver’s permit and insurance. Having more legal, insured drivers helps all drivers.”

This is one of those situations where the right thing to do is simple and obvious and most rational people recognize it as such, but the politics of it are dicey because the opposition is so fierce. HB3206 has every single one of Rep. Alonzo’s Democratic colleagues as coauthors, and it passed out of the State Affairs committee on an 8-1 vote last week, so it does have some bipartisan appeal; Sen. Tommy Williams and Rep. Byron Cook, the Chair of State Affairs, are the Republicans noted in the story as Alonzo’s allies. It’s starting to get late in the session, though, so if it doesn’t have enough support soon it’s likely to become a casualty of the calendar.

Making the case for the parks

Ed Wulfe advocates for the parks-related referendum on the ballot.

Over the past several months, multiple organizations dedicated to Houston’s Bayou Greenway Initiative and a new organization, ParksByYou, have been uniting parks and bayou enthusiasts. Their work aims to mobilize all of us to vote “yes” for Proposition B on the ballot, a parks bond referendum that will pump $166 million into our parks and bayou properties – all of it targeted at real construction and capital improvements. While $66 million will be used to make critical improvements to existing neighborhood parks all across the city, $100 million of those funds will be matched with private dollars to finally close the gaps along our bayou system and create continuous parks and trails. In less than a decade, with these bond dollars, Houston will have more than 150 miles of trails and a park system like no other in America. Our bayous are Houston’s unique natural feature and will be improved, enhanced and expanded, rather than paved and neglected as in the past. Proposition B is a way to create parks and green space for all of us to experience and enjoy with no increase in taxes.

Our bayous meander through almost every neighborhood, and by building a system of connected linear parks along their banks, we will ensure that a majority of Houstonians will have access to green space within just a few miles of work or school or home. It’s been shown that regular physical activity reduces the risk of obesity, heart disease, diabetes and other diseases, and there is strong evidence showing that people exercise more when they have convenient access to parks and recreational opportunities. A vote for the parks bond will contribute to the overall health of Houston’s population while simultaneously enhancing our quality of life.

Parks along our bayous will inspire and energize economic development, increase property values, improve flood control and help manage water quality. The desirability of property located near parks and green space is high because people are attracted to inviting and pleasurable places to play and exercise, resulting in stronger and more active neighborhoods with appealing places for people of all ages.

Here’s the Parks By You website, if you want to learn more. As Wulfe notes, there are five city of Houston propositions on the ballot, each relating to bonds for different purposes. In addition to the parks referendum, there’s one each for public safety, “general government” which I believe has to do with the Solid Waste department, libraries, and housing. I think it’s an easy call to vote for them all, though only the parks issue has an active campaign promoting it. I’ll have an interview next week with Mayor Parker to discuss what these bonds are for and what they will do.

Metro meeting about the General Mobility Program

Put it on your calendar.

You’re invited to attend a special board meeting to tell METRO what you think about the agency’s General Mobility Program (GMP) and the upcoming referendum.

The board meeting is scheduled for Monday, June 18, from 6 p.m. to 8 p.m. in METRO’s board room at 1900 Main St.

If you wish to speak before the board, you may sign up the day of the meeting at tables in the lobby. There’s a three-minute limit on comments.

If you have an opinion on this, make sure you attend so you can have your say. Harris County Commissioners Court has an opinion about it.

At the court’s May 22 meeting, Commissioner Steve Radack held a series of annual payments to economic development groups, saying he wanted to know whether they supported the continued flow of mobility money from Metro.

The county heard back from five of the groups — (1) Bay Area Houston Economic Partnership, (2) Baytown-West Chambers County Economic Development Foundation, (3) Economic Alliance Houston Port Region, (4) Katy Economic Development Council and (5) Lone Star College -– and all said they wanted to keep the road money coming (along with, presumably, their combined $316,000 in county support).

The Greater Houston Partnership didn’t respond, so Commissioner Jack Morman asked today if GHP had specified its position on the mobility money or planned to do so. County officials didn’t know, so Radack again held the item –- and GHP’s $140,000 payment -– for another two weeks.

“GHP has no position on that right now,” said Micah Hirschfield, the group’s vice president of communications, when I asked him Wednesday afternoon. “Until our board of directors passes a resolution, if they do pass a resolution, we will have no position on it.”

No one has ever accused Steve Radack of being too subtle. I just wonder, if the GHP comes back with the wrong answer, will Radack continue to hold up their funds until they see the light? Nice little annual payment you’ve got there, sure would be a shame if something were to happen to it. Houston Tomorrow has more.

Mayor to announce Hobby expansion deal

Here it comes.

Houston Mayor Annise Parker is planning to announce Wednesday morning that the city and Southwest Airlines have come to an agreement on how to finance a $100 million expansion of Hobby Airport to accommodate international flights, according to a City Hall source.

The agreement is subject to approval by City Council. The mayor said last week that if the city and Southwest could negotiate a memorandum of understanding, she intended to put Hobby expansion on the May 30 Council agenda.

No details of the agreement have yet been divulged. But several City Hall sources say Parker has scheduled a news conference at the Southwest ticket counter at Hobby Airport.

We’ll see what that amounts to. Southwest has been pretty aggressive about this, with CEO Gary Kelly sort of promising to pay for it all. Whatever the deal is, Council will have to vote on it, presumably next week. In the meantime, prior to this announcement the proposal picked up some endorsements:

The Greater Houston Convention and Visitors Bureau has endorsed expansion of Hobby Airport to accommodate a proposal by Southwest Airlines to start international flights in 2015. But that endorsement comes with a caveat.

In a released statement from Lindsey Brown, the organization’s director of marketing and PR, the Bureau announced:

As the official destination marketing organization for Houston and our region, the Greater Houston Convention and Visitors Bureau supports expanding international air service at William P. Hobby Airport that encourages reasonable air service pricing. We have historically supported the expansion of Houston air service and we believe it is good for our customers and the citizens of Houston/Harris County. International meetings and tourism are an essential part of our core mission. The case for allowing international travel through Hobby Airport is a strong one, but that move should not significantly diminish existing international traffic at Bush Intercontinental Airport. We encourage the City of Houston to determine what actions will provide the best service and competitive fares for the traveling public and the greatest benefit to the Houston hospitality community.

Also on Friday, the Greater Houston Partnership made official its position in support of Hobby expansion. Its board of directors voted to approve a resolution previously supported by both its Executive Committee and its Business Issues Committee.

We’ll know more in a little while. At this point, I will be surprised if this doesn’t get done.

United’s study predicts doom and disaster if Hobby expands

Well, what did you expect it to say?

You are NOT free to move around the country

Expanding Hobby Airport to allow for international flights will cost the Houston area 3,700 jobs and $295 million in economic activity, according to a study released by United Airlines Thursday afternoon.

United’s conclusions contrast starkly with the projections of a study commissioned by the Houston Airport System that an international Hobby would create 10,000 jobs and inject $1.6 billion into the local economy annually.

[…]

The United study attempts to dissect the city study by challenging several assumptions, including what United considers unrealistically low fares on new routes. Much has been made of the city study’s finding that fares to Bogota would decrease from $739 to $133. Although it concedes the average fare would decrease, United finds that the city study overstates current fares and understates the projected fares.

Southwest and the city study assert that new low-fare routes would increase passengers at both airports.

“Competition is always good, but there is already plenty of competition at Bush where it can take advantage of the enormous economies of scale associated with a large hub,” said Barton Smith, one of the United study’s authors and professor emeritus of economics at the University of Houston. “Diminishing the volume of connecting flights through Bush could be very damaging. The HAS study finding that Southwest Airlines proposal would actually increase trips through Bush is just sheer nonsense.”

You can find United’s study here and a summary of its findings here. I guess United’s claim of 1300 lost jobs wasn’t sexy enough. This was posted late yesterday and I have not had the time to give it a read-through, but clearly United’s economists and whoever did the HAS study were operating under two completely different sets of assumptions. One or both of them must be wrong. I still think Darren Bush wimped out by not offering an actual opinion on this matter, but his advice to Council to “trust no one” sure seems apt. Let’s have one more study to break the tie!

The United study came out as the Greater Houston Partnership formally endorsed Hobby expansion.

“We want two vibrant airports and the benefits that go along with it: more jobs, more travelers and a competitive advantage for our city,” Greater Houston Partnership chairman Tony Chase said in a statement after a unanimous vote by one of the group’s 60 committees.

[…]

Partnership president Jeff Moseley said in the Wednesday statement that the organization “carefully deliberated on how increased competition changes the landscape within airport systems.”

More on that here and here. I’ll leave the wisecracks about who put these words in their mouth as an exercise for the reader. So, is anyone convinced by United’s study? Let me know in the comments.

How Perry punked the GHP

Last week, I wrote about Rick Perry’s budget suicide pact and how it was endorsed by the Greater Houston Partnership in a credibility-killing move. Turns out, according to Patti Hart, Perry didn’t exactly tell them what it was they were endorsing.

Is this not an honest face?

Through statements vetted by committee, the GHP has supported increasing the cigarette tax, saying the state needs to “create new revenue streams to address the state budget shortfall.” It has opposed budget cuts to Texas colleges and universities. Citing research showing the importance of early childhood education, the pro-business group has supported funding for pre-kindergarten programs.

The resolutions go on and on: Spend more money to educate more Texas doctors and nurses to expand our inadequate healthcare workforce. Make sure Texas Medicaid healthcare providers are adequately reimbursed for their services. Tweak the margins tax to make it fairer, and resist the urge to exempt all small businesses.

So it was shocking to see the GHP’s CEO, Jeff Moseley, standing next to Gov. Rick Perry on Monday when Perry unveiled his “compact” promising no new taxes next legislative session. Perry’s plan not only flies in the face of all of the GHP resolutions, but would make it impossible for the Legislature to provide any funding for highway construction or water resources outlined in our drought-stricken state’s water plan.

How could Moseley support a “compact” in light of these resolutions?

“You are exactly right,” Moseley confessed, when I caught him a few days after his appearance with Perry. “The specifics (of the Perry plan) have not been approved by our board. We’ve got positions that go in another direction.”

[…]

Moseley’s explanation can be boiled down to what I’ll call the Cool Hand Luke defense: What we’ve got here is failure to communicate.

It seems that the governor’s people informed Moseley’s people that Perry was coming to town to talk about the state budget. Would Moseley provide an endorsement of the pro-business principles that Perry advances?

Sounded reasonable at the time, but before Moseley knew it, his generic words were being offered as approval of a specific plan that he had not seen.

“We support his pro-business agenda, his principles,” Moseley said. “I didn’t know the detail of his plan – the five points. I didn’t know it was a compact.”

Let this be a lesson to you, Jeff Moseley. You can’t trust Rick Perry. He only has his own interests at heart. He’s happy to use you when you can be helpful to him, but you won’t get anything out of it that you weren’t always going to get. The fact that Rick Perry occasionally does things that you support should not distract you from the fact that he opposes things you support far more often, and by going along to get along you harm yourself and your members’ interests.

Which is the larger point Hart wanted to make:

In a bygone era, governors sought the counsel of the Texas business community. Its leaders not only identified problems, but sought solutions, and held our elected officials accountable. Remember Ross Perot’s commission on public education?

Now it seems our business leaders are only interested in lining their own pockets. They don’t stand up to Perry, because they want his environmental board to clear the path for a radioactive waste facility (billionaire Harold Simmons) or they have their hand out for a grant from the governor’s Enterprise Fund.

Passing resolutions is better than doing nothing but what’s really needed is a Texas business leader willing to speak up – loudly – and challenge the governor. It’s hard to think of a recent example of a Texas business leader accomplishing a public-spirited goal.

This is a theme I’ve hit on over and over again with the Texas Association of Business, which has claimed for some time now to want to stop the demonization of immigrants but who keep on supporting the demonizers like Leo Berman and Debbie Riddle. Long as they get their tax breaks and crony appointments, it’s all good. It would be a lot easier to achieve some of the goals they say they support if they weren’t actively opposing them at the same time. Burka and EoW have more.

Perry’s budget suicide pact

I have four things to say about this.

What Rick Perry wants to do with the extra revenue

Borrowing a tactic from national anti-tax crusader Grover Norquist, Gov. Rick Perry used a tax day appearance in Houston to propose a no-new-taxes pledge for Texas lawmakers, a pledge that would, in his words, “lead to a stronger Texas.”

[…]

Perry laid out a five-part Texas Budget Compact that, in addition to no new taxes, called for truth in budgeting, a constitutional limit on spending tied to the growth of population and inflation, preserving a strong Rainy Day Fund and cutting unnecessary and duplicative programs and agencies.

He also urged the continuation of the small-business exemption to the Texas franchise tax.

“Each and every member of the legislature or anyone aspiring to become a member of the legislature should sign on,” Perry said.

[…]

Jeff Moseley, president and chief executive officer of the Greater Houston Partnership, endorsed Perry’s compact.

“The pro-business policies and accountable and responsible budgets adopted by Gov. Perry and legislators have given Texas an enormous advantage when competing for high-paying jobs, and helped Houston prosper to become the top region for corporate relocations in the U.S. in two of the last five years, including in 2011, and these principles will keep us on that path,” he said.

1. Everybody recognizes this as a gimmick, right? I mean, there’s nothing new here, just the same old rhetoric wrapped up in a slightly different package. Beyond that, there’s no purpose to any of this. I mean, what exactly is the point of pouring money into the Rainy Day Fund? The original purpose of this fund was to provide economic stability in times of budgetary crisis, but apparently we’re not doing that any more. The Rainy Day Fund isn’t a trust that generates revenue for something; unless the Lege explicitly authorizes it, whatever goes into the Rainy Day Fund stays there. What’s the point of a fund that never gets used? We may as well convert it to cash and stuff it under a mattress. For that matter, we may as well rake it into a pile and make a bonfire. That’s more than we’re getting out of it now.

2. Putting it another way, politicians love to say that taxes are the people’s money. Well, sometimes the people want to spend their money on things they need. You know, like schools and roads and a statewide water plan, that sort of thing. How many schools and roads and reservoirs do you think we’d have now if we’d only spent money based on some arbitrary inflation-plus-population-growth formula over the past hundred years?

3. By signing on to this frivolity, the Greater Houston Partnership has officially declared that it is no longer a voice for reasoned public policy. From this point forward, whenever you see them advocate for something like education reform, you can safely ignore them because they’re not serious about it. Which is a shame, because we need more organizations that take these matters seriously, but that’s the path they’ve chosen.

4. As you might expect, Democrats have been loudly critical of this. My inbox is filled with statements from various legislators – Reps. Jessica Farrar, Garnet Coleman, Mike Villarreal, Sens. Jose Rodriguez, and Kirk Watson, for example. Which is good, and what they should be doing, but let’s be honest: Barring an even greater wave than what we saw in 2010, the fate of this piece of fluff is up to the Republicans. There are a number of incumbent Republicans who have carried a pro-public education banner in the past, and a number of Republican challengers who are running as the pro-public education alternative. As with the GHP, if any of these candidates sign on to this pledge, they are declaring that they don’t really mean it. (They can follow this example if they need to.) I sincerely hope that endorsing organizations whose missions are pro-public education realize that, or else we’re going to be right back where we were after the 2013 legislative session.

Job growth was good last year

More hopeful news for this year.

Jobs and job growth for the region (Source: Greater Houston Parnership)

Boosted by gains in energy, manufacturing and retail trade, the Houston area added 75,800 jobs during 2011, a 3 percent increase over the previous year, the Texas Workforce Commission reported Friday.

“The numbers are impressive,” said Barton Smith, professor emeritus of economics at the University of Houston.

Improvement appeared to begin at the end of the summer and has been broadening over a greater number of sectors.

“The improvement in energy is now spilling over to the rest of the economy,” Smith said.

You may be looking at that 75,800 figure and saying to yourself “Didn’t we just see some better numbers than that for 2011? What gives?” You’re right, we did. The difference is that the numbers reported in that earlier post were for the November 2010 to November 2011 period, while these here are December 2010 to December 2011. What accounts for the difference? Barton Smith suggests the November ’11 numbers were a bit wonky. Here’s another explanation:

Last year the Austin area — and Texas as a whole — showed modest job growth at an annual rate of about 2 percent. Texas added 204,500 jobs last year, while the Austin area added 16,100 jobs over the year .

However, the rate of net job growth was negligible for December and well below the annual rates for Texas and the Austin area.

Alan Miller, executive director of the regional arm for the state workforce commission, said he doubts the survey is capturing Austin’s growth accurately.

“Personally, I think our local economy is growing and adding more jobs than what is reflected,” he said.

For example, he said there have been numerous news reports of software firms expanding or relocating here, but the workforce commission’s report reflects zero job growth in the information sector.

“I can’t explain that,” Miller said.

The data are based on a survey of employers and are updated monthly as well annually. For that reason, the monthly data indicate directions for the economy, but economists tend to favor the annual, corrected numbers.

In other words, it’s also quite likely that the December ’11 numbers are not accurate, and will be significantly revised when the next report comes out in March. So don’t panic.

“If it slowed down, it slowed down from a 100-yard dash to a mile run,” added Patrick Jankowski, vice president of research for the Greater Houston Partnership. “Maybe we’re finding the pace we can sustain over the long run.”

Jankowski also noted that local job growth in 2011 was the sixth strongest of the past 21 years. Houston saw year-over-year growth in all but four sectors: transportation, warehousing and utilities; information (which includes media); arts, entertainment and recreation; and government.

Austin saw government employment shrinkage as well. Unlike some people, I expect more of that this year, though I fervently hope not as much as there was last year. The Trib has more.

Thinking outside the box on the city’s finances

We’ve seen the ideas generated by the Long Term Financial Management Task Force, which I thought lacked a certain amount of breadth to its perspective. Here’s a taste of what else might be out there to think about.

Good Jobs Great Houston, of which the Houston Organization of Public Employees is a member, held a news conference outside Wednesday’s City Council meeting to get their own ideas out. They claim that some of the ideas they had submitted to the Task Force did not make it onto the draft list. Among the union’s ideas distributed Wednesday:

  • Raise the city’s tax rate;
  • Establish a higher property tax bracket on homes with a value exceeding $500,000;
  • Establish a 1 percent income tax on city residents who make more than $30,000 a year;
  • A “blight tax” on foreclosed homes that banks would pay on vacant properties they let deteriorate;
  • End the practice of double dipping — remaining on the city payroll while collecting a pension;
  • Put a cap of $100,000 a year on annual pensions for new hires;
  • Review all outsourced services to see if they can be done more efficiently in house.

There are a lot more, but the Good Job Great Houston and HOPE officials said they want the conversation to include more than what’s already on the Task Force’s 229-item draft list.

As with the LTFMTF, some of these ideas are more practical than others, and some cannot be done without legislative input, possibly even a Constitutional amendment. I’ve been an advocate of rolling back the miniscule property tax rate cuts that were implemented during the Bill White years – the savings for an individual household is minor, but the cumulative revenue for the city adds up. You do have to be aware of the limitations imposed by the revenue cap, however – even if you wanted to, you can only raise the tax rate so much before that would kick in.

I really like the idea of the “blight tax”, as I want to see more thought given to generating growth here inside city limits. The city has been admirably aggressive under Mayor Parker to condemn and demolish derelict properties – Patricia Kilday Hart wrote about a new tool in their chest for that – but it’s only half of the equation. You still have to get someone to build or rehab or otherwise do something useful with the property afterward, and as far as I can tell we’re still short on ideas there.

And if we’re going to go after blight, let’s aim for the biggest target out there – abandoned buildings downtown. There are properties downtown that have been derelict for decades, and that’s some of the most valuable real estate in the city. Some of these buildings are within a couple of blocks of the Main Street light rail line, and would make excellent mixed use/transit oriented projects, if only they could or would be used for something. Do we not have the tools to make something happen, or have we just not put enough effort into it? I don’t know, but I wish we’d put more thought into it. The same is true for other empty or blighted lots along the existing rail line, and the ones that are now being built. There’s been quite a bit of development in the Main Street corridor, but there’s room for much more. If the secret to making Inner Loop housing less expensive is to generate more of it, then these are the places to start. What are the obstacles, and what can we do to overcome them? This needs to be part of the long term financial conversation.

Area job growth in 2012

We’ve seen a prediction for job growth in Texas for this year, now here’s some soothsaying about job growth in the Houston area for the year.

Jobs and job growth for the region (Source: Greater Houston Parnership)

The Greater Houston Partnership predicts the Houston area will add 84,600 jobs this year. Some economic observers are speculating the estimate may be conservative – especially since the most recent data from the Texas Workforce Commission shows that Houston-area employers created 87,900 from November 2010 to November 2011.

We asked experts in finance, real estate, recruiting and economic development to assess the area economic picture. Here is what they said:

Q: Where is Houston’s economy headed in 2012?

A: “I think it’s headed up,” said James Weston, associate professor of finance at Rice University. “Everything I see points to a return to moderate economic growth.”

He ticked off the factors: Energy prices are stable; housing prices were essentially flat in Houston last year even as they fell nationwide; and Houston is adding jobs at a faster clip than the nation as a whole.

The likelihood of a double-dip recession – which was a worry not that long ago – has faded, he added.

Regina Morales, director of economic development for the city of Sugar Land, characterized 2011 as the year of recovery, when the region regained the jobs it lost during the recession.

“Now we’re poised for expansion in 2012,” said Morales, who predicted that energy, technology, health care, education and food service will drive the growth.

The real estate community looks at job growth, and those 87,900 new jobs last year are a good sign, said Bruce McClenny, president of Apartment Data Services, which gathers information on pricing, occupancy and rents on apartments.

Job growth is tied directly to the demand for multifamily housing, especially from people who are moving to Houston from other states and new college graduates.

That sets the stage for the same kind of growth in 2012, McClenny said.

Here the distinction between the city of Houston and the greater Houston area is made more clearly than in the earlier story about real estate projections. Note that the region has about a quarter of the state’s population but nearly half of its projected job growth for the year. Either one of those projections is out of whack or the state isn’t in such great shape overall. The story also notes the likelihood of flat property tax revenues and a continued shrinking of the government sector. Some different policy decisions, mostly but not entirely at the state level, could have led to a better outcome, but it’s way too late for any of that now. Maybe we’ll get lucky with sales tax revenues and not have as big a problem this year. We can hope, anyway.

On targeting public pension plans

I have three things to say about this.

Texas could be gearing up for its own Wisconsin-style grudge match over public employee benefits.

A group of high-powered Houston business leaders is starting a statewide campaign to overhaul retirement for future teachers, firefighters, police officers, judges and other state and local government workers.

“I think the state needs to get the hell out of this (pension) business completely,” said lawyer Bill King, who is forming Texans for Public Pension Reform with others from the Greater Houston Partnership, an über-chamber of commerce with business members representing $1.5 trillion in assets.

Taxpayers bear too much risk on behalf of public employees by providing them a guaranteed retirement that most private sector workers don’t get, King said.

But advocates of the public pension system say there are ways to eliminate or reduce risk without doing away with the program.

“They don’t have to destroy a system that works,” said Keith Brainard, research director of the National Association of State Retirement Administrators.

He said government pensions provide retirement security for millions of Texans in a cost-effective manner for taxpayers. Research by the Center for Retirement Research at Boston College shows that professionally managed pension funds produce better investment returns than 401(k)s and cost less to administer.

King said the campaign is in its infancy, and its specific goals are still being developed. It’s not clear how the campaign will get involved in next year’s elections or the 2013 legislative session, but King said he is confident the campaign will soon make pensions an issue for lawmakers.

King said he would support a constitutional amendment eliminating public pensions in the state and moving all government employees to retirement accounts akin to 401(k)s. Legislators would have to approve such an amendment on the ballot when they convene in 2013.

[…]

King, the son of a union pipefitter, said he was disappointed with the anti-worker tenor of the Wisconsin battle over collective bargaining rights. This campaign, he added, is not intended to bully public employees.

Well, that’s nice to hear, and I don’t have any particular reason to doubt King’s sincerity on this, but let’s be honest: It’s highly likely that if this campaign gains any traction, it will pick up support from people who will be happy to demonize and bully public employees. To think that won’t happen is naive. It’s also the case that no matter how good King believes his own intentions are, once the employees whose pensions are threatened by this become engaged, they’re likely to play rough, too. It will be easy to blame them for any shift in rhetoric that King’s campaign will feel the need to make down the line.

Both the Employee Retirement System of Texas and the Teacher Retirement System of Texas have more than 80 cents for every dollar needed to pay their long-term obligations, a level considered to be a benchmark of a strong fund. The state funds also have tight restrictions on contributions and benefits.

There are about 1,800 public retirement systems in Texas, the vast majority of which are small cities and counties that pool their resources for investment purposes. The big cities, however, have mostly set up shop on their own and have separate plans for police, firefighters and other municipal workers.

Given the large number of plans in Texas, Brainard said, the state “has been striking in the relative absence of abuse and pension problems.”

Where there have been problems, Brainard said, they have been in the big-city pensions. Those plans have fewer constraints on increasing benefits than do the state systems.

The sentiment that pensions are unsustainable gained traction across the country after the 2008 financial market collapse sank the value of funds everywhere. State and local governments failed to cover $660 billion of their $2.94 trillion in pension liabilities last year, according to the Pew Center on the States.

There’s nothing in this story to indicate how big a problem King is talking about. We know Houston has some pension issues, and the story gets into that, but its problems mostly stem from a change to pension benefits that was made a few years ago. If the state or other cities have similar issues, you wouldn’t know it from this story. How much money are we talking about, and how much of it is attributable to the economic downturn? If you’re going to claim there’s a crisis, then show me some numbers.

By the way, on the matter of Houston’s pension problems, one of the issues the city faces is that its options for taking action to deal with it are constrained by state laws. If King and the Greater Houston Partnership have done anything to help persuade the Legislature to give Houston more tools for taking care of this, I am not aware of it and the story does not discuss it.

The problem is that states can’t save money anytime soon by doing away with pensions.

In fact, it costs more in the midterm because taxpayers must contribute more to cover the benefits accrued by retirees and current workers because new workers would no longer be chipping in to the pension, [Stephen Fehr, a researcher with the Pew Center on the States] said.

When a Texas Senate committee looked in 2008 at a similar pension conversion, the committee found no compelling reason to do so.

The state’s Pension Review Board at the time estimated the combined contribution from the state and employees to the Employees Retirement System of Texas would have to rise from around 17 percent of payroll to as much as 30 percent if the pension were closed to new people.

In 30 years, the contribution rate would climb beyond 80 percent .

Nevertheless, King argues that finally wiping clean the public pension liabilities is worth the higher costs now.

“It will require sacrifices in city services and higher taxes than would otherwise be necessary,” King wrote. “But at least the number will be finite, unlike in our current predicament.”

Again, if you believe in this environment that there would be any kind of tax increase to help cover the cost of shifting to a 401(k) plan, you are naive in the extreme. The cost would be covered by general revenue, which would either mean further cuts to things like public education, or more budgetary flimflam like what we saw this session with deliberately underfunding Medicaid. That’s not acceptable, especially for a problem whose scope is not clear, but it’s what we’ll get for as long as we have a Lege that resembles the current one. When we get these mostly Republican-created problems that are affecting us right now under control – that is to say, when we get a different Legislature, one that really is fiscally responsible – then maybe we can talk about this. Texans for Public Pension Reform, you let me know when you’re willing to help with that effort. EoW has more.