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April 16th, 2013:

Texas On The Brink 2013

Quantifying what we long suspected to be true.

TxOTB

Texas remains behind most other states on issues related to educational achievement, public health and the environment, according to the latest version of the “Texas on the Brink” study released Monday.

The sixth edition of the report from the Texas Legislative Study Group, a left-leaning research caucus in the House, says the state has the nation’s highest rate of uninsured residents, ranks 50th in the percentage of the population with a high school degree, and has the highest carbon emissions of any state. The study ranked the 50 states and the District of Columbia.

Texas legislators should prioritize funding and support for education to improve quality of life in Texas, said state Rep. Garnet Coleman, D-Houston, chairman of the Legislative Study Group, at a news conference Monday about the study. The state should protect Texas’ future by restoring the cuts made last session to public education and “making sure the amount of money that goes into the budget is growing the budget appropriately for the new students coming in and for the resources they need to be successful,” he added. He also said an expansion of Medicaid would improve health care access for Texans.

The report also examines Texas’ ranking in areas like women’s issues, workforce and public safety.

You can read the report here, and the LSG’s press release here. Former Sen. Eliot Shapleigh released the first Texas On The Brink report in 2003, with the LSG taking it on in 2011 after Shapleigh’s retirement. I encourage you to look at the report, it’s mostly a collection of facts and figures in easy-to-understand pieces. Two tidbits from the section on Women’s Issues that may be of interest: Texas ranks #47 in women’s voter registration, and #51 in women’s voter turnout; on the flip side of that, we are #4 in the percentage of women living in poverty. Think there may be a connection there? Consider that another item for Battleground Texas’ to do list. BOR has more.

(In case you’re curious, the source for the first two figures is the US Census Bureau, Reported Voting and Registration, by Sex, Race and Hispanic Origin, for States: November 2010. The source for the latter figure is the Urban Institute and Kaiser Commission on Medicaid and the Uninsured, Adult Poverty Rate by Gender, States (2010-2011). Every fact given in the report has a similar citation.)

It’s always time for a tax cut

I have three things to say about this:

A corndog in every pot

A corndog in every pot

With less than two months remaining in the 83rd legislative session, Gov. Rick Perry on Monday called on state lawmakers to find $1.6 billion to give Texas businesses relief from the state’s franchise tax.

Perry’s proposal consists of four parts: reducing the overall franchise tax rates by 5 percent, making permanent a $1 million deduction for businesses with up to $20 million in gross receipts, lowering the rate for businesses that file their taxes using the state’s simplified “EZ form” and allowing out-of-state companies that relocate to Texas to deduct their moving expenses.

Perry said Texas needs to invest in more tax relief because other states are considering cutting their taxes to match Texas.

“The idea that we can just sit here and think we can stay at the top of the heap is just not correct,” Perry said Monday at a news conference at the Austin Chamber of Commerce.

1. All through the session, as Democrats have called for restoring the brutal cuts that were made to public education in 2011, one of the main arguments made by Republicans for not doing so is that we ought to wait and see how the Supreme Court rules on the school finance lawsuit, since it won’t be until that point that the Legislature will know what (if anything) it needs to do to comply. One would think that the same logic would apply here. In particular, if the Court upholds the ruling on adequacy, the Lege will have to find several billions of dollars in new revenue for the schools. Seems like a bad idea to be cutting one of the primary sources of that revenue before you even know what will be needed. Not that Rick Perry cares about such trivia, of course.

2. Speaking of the schools, as we know the margins tax has consistently fallen well short of replacing the revenue lost to the schools when the property tax rate was cut in 2006 in response to the previous school finance lawsuit. I don’t see that fact being mentioned in any of the stories I’ve seen so far.

3. As with the other form of tax relief being offered so far this session, the benefits are going (exclusively in this case, primarily in the other) not to individuals but to businesses. If you think tax relief is what is needed this session – I don’t, but it takes all kinds – wouldn’t you at least like to actually see some of that relief? Unless you happen to be a business owner affected by the margins tax, you won’t. Too bad for you.

It’s Chapter 42 week

We won’t know for years what the upcoming revisions to Chapter 42, the development and density codes in Houston, will mean to the city and its development and population patterns. There’s certainly a lot of hope that the changes will be positive.

Southwest Houston, with its glut of apartments and condominiums, is three times denser than the city as a whole.

Whatever the term – aging, blighted, dilapidated – many of those complexes are ripe for redevelopment, as are the empty shopping centers and abandoned warehouses around them. Often havens for crime, these eyesores depress property values and are themselves a drag on the tax rolls.

Some revitalization efforts are underway, but residents like Jim Bigham, president of the Sharpstown Civic Association, are looking for a spark, a catalyst for change.

With a proposed rewrite of Houston’s development ordinance headed to the City Council table on Wednesday, city leaders say they have one.

The new rules, six years in the making, would allow greater single-family housing density outside Loop 610. That, builders say, will enable them to fit more houses on the same piece of land, bringing down the price of each home and making it more likely that market-price housing can be placed on dormant tracts.

“We’re stuck right now. What’s not working is having an empty retail – vacant, crappy – building for 20 years sitting on the same corner,” Bigham said. “We see the overall rule change facilitating redevelopment at some level, and that in itself is a positive thing.”

By their own admission, however, homebuilders will struggle to develop many of the tracts targeted for renewal because they do not have the capital or because they risk being outbid by apartment developers. Experts say land developers, who buy large tracts, invest in infrastructure and then sell individual lots to homebuilders, will play an important role if revitalization is to be widespread.

“Our challenge that we have to think about is, we have an aging city, and we need to think about how we go in and allow for our city to be updated,” city Planning Department Director Marlene Gafrick said. “To some degree, these rules will encourage the redevelopment of property, and you’ll utilize the existing infrastructure that’s already in place where the city has already made an investment in the infrastructure, streets and sewers.”

That’s the plan, anyway. How well it will work, I have no idea. The theory is simple enough – when you’ve got a lot of demand for something, you should try to increase the supply of that something – it’s the ancillary effects that are the big unknowns. Check back in ten years and we’ll see where we are.

One way to know if the revision has been a success is if this trend slows down.

More than 80 percent of the homes that sold last year were outside of Beltway 8, according to a study commissioned by the Houston Chronicle. Compare that to just 6 percent inside Loop 610 and 12.8 percent between the Loop and the Beltway.

What draws people to these far-off suburbs, sometimes 30 miles from downtown? Homeowners cite a multitude of reasons, like schools, shopping and affordable housing. Another big draw is jobs.

Houston’s outlying areas are home to major business districts.

“You keep seeing oil companies and major employers locating outside of downtown. They locate along the West Belt. They’re moving up to The Woodlands,” said Evert Crawford of Crawford Realty Advisors and the Institute for Regional Forecasting at the University of Houston’s C.T. Bauer College of Business.

“A lot of people don’t work downtown anymore,” said Crawford, who conducted the study.

[…]

The median price per square foot for a home outside the Beltway was $72.98 last year, according to the housing data. That was up 3.7 percent from 2011, but still less than half of the Inner Loop value of $178.09 per square foot.

That’s an insufficient comparison, since the Chapter 42 revision is aimed at property between 610 and the Beltway, but you get the idea. We’d like to see a higher percentage of homes purchased inside the Beltway in order to say that the Chapter 42 remake is doing what we wanted it to do. Now, single-family houses aren’t the be-all and end-all – there’s a ton of high-end apartment construction inside the Loop, and smaller apartments, the antithesis to sprawling suburban mansions, are a trend as well. A fuller range of metrics will be needed to really get an answer to the question of how successful the Chapter 42 changes were. But since we’ve been talking so much about how the goal is to make it easier to build affordable housing in Houston, then let’s look first at those numbers.

More on that underutilized high speed toll road

More toll road travails.

Traffic counts on the new section of Texas 130, released Friday by the Texas Department of Transportation based on newspaper open records requests, show that the tollway southeast of Austin in its first couple of months was seeing fewer than 3,000 vehicles a day.

About 5 percent of those were big rigs in the 10 weeks between the road’s Oct. 24 opening and the end of the year, the period covered by open records requests filed with TxDOT by the American-Statesman and the San Antonio Express-News. The road saw 132 trucks with trailers per day between Mustang Ridge and Lockhart, and about 100 a day between Lockhart and Seguin.

Interstate 35, several miles to the west, saw more than 100,000 vehicles a day in 2011 counts taken by TxDOT.

The Texas Attorney General’s office rejected arguments from the Texas 130 Concession Co., which built and is operating the 85 mph road under a 50-year lease with TxDOT, that traffic and revenue information about the 41-mile tollway should not released to the public. The company had argued that the information constituted a trade secret and that disclosure would cause the company “competitive harm.”

The early numbers are about half of what the company predicted in 2008, according to Moody’s Investor Service, which is investigating whether credit ratings on the company’s $1.1 billion in debt on the road should be downgraded. The concession company, owned by a partnership of Spain-based Cintra and Zachry Construction Co. from San Antonio, spent about $1.3 billion building the road and paid TxDOT $140 million in lease payments.

That’s not a lot of traffic. The earlier story we heard was that the daily vehicle count was only about half of what had been originally estimated, but it didn’t say what that number actually was. I’m not sure what’s more remarkable, that the estimate was off by so much, or that 6,000 vehicles a day was considered worthwhile, at least at the beginning, for this project. If it’s mostly pass-through traffic that’s using SH 130, it’s certainly beneficial to get those vehicles off of I-35, but you really have to wonder how sustainable this is, and whether there might have been a more cost-effective solution.