Hold the EDC Accountable!

Letter to Commisioner Lux

In being allowed only a brief time to address the Court’s October 22, 2007 session regarding agenda items 34 and 35, I was unable to discuss all of the relevant matters pertaining to the Kendall County Economic Corporation (EDC). Thus, I am submitting this letter which includes all of the issues for your review and consideration.

This discussion is about responsibility and holding an agency that receives county funding, in this case the EDC, accountable for adhering to its own representations and discrepancies. In this context, any discussion regarding the EDC is not about being “pro-growth” or “anti-growth”. But unfortunately, there will always be those that will attempt to paint it as such.

I attended several of the original presentation programs illustrating the purpose, objectives and benefits of the EDC including those for the Commissioners Court, Boerne City Council as well as the program for soliciting funding from private investors. In each program the themes regarding the benefits of such an organization to this community were consistent:

A. A focus on commercial development that would have the effect of increasing tax revenues from commercial sources and thereby relieve the tax burden that exists, then and now, on residential property owners.

B. Assurance that residential development would not be pursued.

C. Development that would allow for greater conservation and control of our limited and precious resources.

D. A recruitment process for new business that would not include tax abatements or other incentives. It was stated that incentives would not be necessary because this community would sell itself based on the quality of life, schools, location and environment.

Now we come to find that, after only two years of existence, the EDC has conducted itself in a manner that not only contradicts it original representations, but is also unaligned with, as well as detrimental to, the county’s development and resource conservation objectives. Some examples include:

1. Pursuing residential development. This pursuit has included lobbying state officials on behalf of the Esperanza development. Neither the city nor the county has given any indication of support to the Esperanza development. Thus, no mandate and no charter exist to justify the actions of the EDC board members to lobby our state representatives on behalf of a residential developer.

2. Using EDC funds for impact studies to support residential development. These impact studies are so subjective in nature that they can be made to illustrate whatever the producer wants it to.

3. Regarding conservation of water resources, representatives of the Esperanza developer and the EDC have testified at court hearings that this development would not use any of the groundwater that it has rights to by ownership of the property, thus implying a conservation of that groundwater. Yet they fail to disclose that those water rights will be assigned to another entity that will have the ability to allocate it however they like. And most likely, that allocated water would be used for other additional residential development.

4. Requesting tax abatements for new commercial development. From the beginning, utilizing tax incentives was addressed as a specific issue of concern. Due to the complexity of development agreements, appraisal issues and other specifics, future benefits to taxpayers are never guaranteed by additional development. Allowing tax incentives, at the least, lessens the chance of achieving any possible future benefits. At the worst, in the near term, it increases the existing tax burden on property owners. And at the best, presuming that there actually would be any future benefits, those benefits are prolonged to a future point in time that can not be determined now.

Concerning current and future funding by the county to the EDC, we are now witnessing the manifestation of the incorrect and misleading statements previously made by the leadership of the chamber and EDC. At numerous presentations for the EDC, Ron Warden, the then Chairman of the Boerne Chamber and now past Chairman of the EDC, stated that the city and county had committed to funding the EDC for three years. I sent him a letter, copied to the entire chamber board, pointing out that his statements were not only totally incorrect, but that those entities do not have the statutory authority to make that commitment even if they wanted to.

For someone in his position, and having a securities background, to make such a gross misrepresentation to potential investors was not only unethical, but has now put the county in a position of having a “perceived” commitment to funding. This was most recently illustrated last week y in commissioner’s court when one speaker referred to a “gentleman’s agreement” and the current chairman of the EDC referenced a “3 year commitment“ for EDC funding by the county.

The EDC, in its original format, could be a good thing for Kendall County. But that format has clearly changed. It could never be effective in its defined role when it is acting in a manner that is contrary to its own stated policies as well as acting in a manner that is detrimental to the county and which is not aligned with the objectives of the county.

Every resident in our community funds the EDC through the taxes they pay to the county, the city or both. In your capacity as an elected official, charged with determining the best course to take for insuring the best interest of the community, I encourage you to look at this matter of continued county funding of the EDC in the light of who is paying and who is actually benefiting from the actions of an agency behaving in a manner that the EDC currently finds itself.

If your decision is to continue funding, it is imperative that steps are taken to reiterate the county’s objectives as it relates to what the county’s expectations and interests are as well as entering into a written agreement with the EDC that any current and future funding by the county to the EDC is contingent upon the EDC acting in a manner that specifically reflects the objectives and interests of the county.

Thank you for your consideration in this matter.

Sincerely,

James W. McCormick III

County Treasurers Being Stripped

A pattern seems to be developing in several counties in the area whereby the Cof a portion of their authority.(Express News article entitled “Guadalupe trims treasurer’s duties”, dated, 10/17/07.)

Over a year or two ago, Kerr County did the same thing. Last year, Kendall County did the same thing, and now Guadalupe County. The manner in which the changes were accomplished was also similar: the duties and responsibilities for human resources were removed quickly, the treasurer’s office was physically removed from the main courthouse traffic, a new appointed position was created for the Human Resource activity, and budget transfers were made to accommodate the new activity.

It seems apparent that the reason this is being done is for more power to the commissioner’s court! The Treasurer is an elected official and the only power the Commissioner’s Court has over another elected official is the power of the purse, the budget. The person to head the new department is appointed by the Commissioner’s Court and reports to them, so the court has complete control of the new activity; more expense for the taxpayer; more control to Commissioner’s Court. The similarity in which these changes have been made leaves the perception that something suspicious is going on in county politics! What other elected officers with duel responsibilities are next?

Frank Wetzel

A Bit of History - Water

In Remembrance of Garland Perry
"Land and Water" by Garland Perry, 1982



“In 1835 the Texas Hill Country was said to have been one of the most beautiful natural areas on earth. It had tall grass, beautiful trees, and fresh, clear running water throughout the area. What the early settlers were unaware of was that immediately beneath that rich, lush, organic topsoil-saturated with moisture – was nothing but hard limestone rock.

“The first settlers to reach the Hill Country always camped near a spring of good water, or near a stream, where they built their temporary homes. Then they started clearing land, fencing and planting crops. As they plowed more land and began to overgraze grasslands with domestic animals, the rains soon washed the topsoil away, leaving limestone rock that only cedar trees could grow on.

“Without the organic matter to hold moisture in the soil, springs soon went dry and it was necessary for the settlers to move near larger streams of water or to dig shallow wells. Between 1860 and 1880, good well water could be reached at 30 to 35 feet. By 1900, windmills were a very popular and necessary means of extracting water from 100 to 125 feet. By 1950, most of the water wells were 200 to250 feet in depth and were operated by electric pumps. However, during the great drought of 1950-1957, many of these 200 foot wells went dry.

“Now, a great many of the private water wells are getting water at 500 to 550 feet below the surface. Obviously, this trend can’t go on forever. Water will be a limiting factor in the future growth and development of Kendall County.”

- Excerpt from Historic Images of Boerne, Texas 1982, First National Bank of Boerne

The Kendall County EDC-Esperanza Connection

The Kendall EDC paid Texas Perspective Inc. to do a study on Esperanza. Texas Perspective’s website says that it “is dedicated to helping its clients strengthen their cases to achieve particular goals.” The Esperanza report they produced for the EDC states that: “much of the underlying data used in this analysis was provided by the developer Marlin Atlantis.” This report did not take into account any of the costs that will be related to this development, therefore presenting an incomplete and one-sided picture.

This year, the Alamo Area Council of Governments convened a Committee for Economic Development Strategies. Eleven of the members were area economic development representatives, including Mr. Rogers. The goal of this committee was to identify key projects that are considered important to the economic vitality of the 12 county region. The short list chosen by ACCOG includes such major economic projects as base closures and realignments, the new Texas A&M campus coming to San Antonio, the establishment of a foundation to bring university courses to Fredericksburg, public transportation needs and the development of an industrial airpark in Hondo County. In contrast to these major business endeavors, the Esperanza development was also adopted as a regional economic goal. AACOG has verified that they based this decision solely on the Texas Perspective Report paid for by the Kendall County EDC, so the same accounting principles were used- relying on the developer’s input and projecting income without factoring in the costs in services, roads, schools and infrastructure.

With major residential development taking place throughout the 12 county region, how was Esperanza chosen as a regional economic goal? Why would AACOG unquestioningly accept figures provided by a local economic development group whose paying members include Esperanza’s developer and several others with current or potential financial connections to him? The support of AACOG, a regional quasi-governmental body, has been thrown behind a residential development that is still very much in the discussion and approval stages with our own local officials. No approval, costs, traffic impacts and infrastructure evaluations or development agreements have been made. Did this Council sanction this action prior to these important benchmarks? Was the EDC acting on behalf of the City? It seems reasonable to ask whether the interests of some members of the KCEDC are being promoted ahead of the interests of the majority of tax-paying citizens, and whether citizens’ elected representatives are being undermined. I believe the EDC can do a great service by building our commercial tax base, but I would like to see more accountability to tax payers. I have expressed these concerns to my commissioner as well.

Paula Cairns

Tax Break For Businesses?

According o the Boerne Star (October 9), the Boerne City Council and the County Commissioners are considering giving tax breaks to businesses.
The Star reports: "The council will consider establishing tax abatements as an incentive for current and future commercial property owners to invest in the city. Council members are also set to meet in executive session “…regarding information that the city has received from a business prospect that may locate in the city.”
The article goes on to say, "There have been reports that the city’s sudden interest in a new tax abatement policy is because of an existing manufacturing company that is looking to expand its operations."
There are some individuals in the City and the County who do not believe attracting businesses is necessarily a "good thing." They contend there are inadequate roads, water, and sewage facilities, as well as a fragile aquifer, and a fragile environment.
How do you feel about this issue?

Edwards Aquifer Authority Gets Tough

On Monday October 1, representatives from the Edwards Aquifer Authority made a presentation regarding proposed new rules on Hazardous materials containment and control. Hazardous materials storage and disposal becomes a major issue in an urban community. The proposed EAA rules will affect a large portion of southern Kendall County. Several hundred businesses will be required to register and comply with these new rules. Any business that stores and disposes of hazardous materials will be affected, and the cost impact on these businesses can be substantial. More information can be obtained from their web site at http://www.edwardsaquifer.org/. Do you think the EAA is going to far with this, or not far enough?