Friday, January 11, 2008

The End of Boerne as We Know It


The End of Boerne as We Know It- a Report on Last Night's City Council Meeting.


The influence of Marlin Atlantis of Dallas, the developer for Esperanza, was in full evidence last night. We've come to expect this from those who have been hired by MA, that's understandable. It is the City staff, who are tasked with looking out for the welfare and safety of it's residents, that were center stage last night. MA could not have hired better representation than they had from the City employees- from the City Manager on down.


Since the development agreement has been kept out of the public eye (requests for copies have been denied), citizens are left to listen to the discussions and presentations as they unfold in Council.


While two Council members have repeatedly asked for staff to run different scenarios to determine what might be the best long term outcome for this property from the taxpayer's standpoint, the lack of due diligence by the City staff in this area was glaring. The City has the option of not approving Esperanza's water control district and annexing the property or allowing a MUD. No one knows what the pros and cons of these scenarios are, especially from a financial standpoint, because the City has failed to do a thorough study of them.


Even the most basic due diligence, such as determining road impacts, was not done. When asked by a concerned council member how the staff could state that MA's $2.3 million road contribution would even begin to address the impact on roads from this development that will double the size of Boerne, the Assistant City Manager made a most remarkable statement. He claimed that the impacts couldn't be quantified. The City Manager then added that it had already been determined by the County Citizen's Transportation Committee that expanding Herff Rd. and it's proposed extension to Main St., was needed with or without Esperanza. This was incorrect.The facts are that the Citizen Committee spent the better part of their year trying to find solutions to the traffic generated by Esperanza, and even with all their multi-million dollar proposals, still came to the conclusion that River Rd. and Herff would remain at unacceptable levels of service.


As to not being able to quantify the impacts or costs, doing an accurate and in depth traffic impact analysis is such a standard procedure, it would be considered irresponsible by any City to not conduct such a thorough study for a development that will double the amount of traffic on it's streets. The staff knows full well that this is what TxDOT and numerous other engineering companies do, not to mention many city engineers.


As to the costs, generic construction costs show that two additional lanes added to an urban arterial runs around $4.8 million a mile and a new two lane arterial is around $5.6 million per mile- not including the right of way costs of condemnation proceedings and buy-out. Bridges, such as the one at the intersection of Herff and River Roads, are quite expensive, as complex environmental mitigation measures are required during construction. The duplicity evident by the staff over this issue was nothing short of irresponsible.


Due to issues such as traffic and the sheer size of the development, the request for a more in depth look at the alternatives had been made by Councilmen Rob Zeigler and Bob Manning. The City Developer's 10 minute response was that he had done a rough estimate of the maximum number of houses that could be built in the MUD or annexation scenarios. That was it. No cost analysis to determine what the tax revenues might be, no profit and loss analysis, no comparisons of how lower density would impact our roads, the advantages of controlling zoning to allow for adequate commercial development to serve that area (and capturing the full sales tax from it), lowered costs for services and school bonds if the density were lower, etc.


Even the lawyer hired by the City commented in an earlier workshop that he had been tasked with 'getting to yes' for the development.


City staff, and some Council members continue to raise the specter of what will happen if an agreement isn't met. It is worthwhile to consider the consequences they fear:


Loss of $2.8 million for roads- This doesn't come close to covering the actual cost of doubling the cars on our roads. How much would we save on road bonds if the number of cars were lower due to less density from proper zoning and commercial services within the development?


Loss of 'amenities' - The City, like other responsible municipalities, has routinely asked for certain amenities within new developments, required impact fees and would do so with Esperanza. Again, how would a reduction in 7,000 residents also reduce the need and costs for fire station, library, park space and other 'amenities' ? They have not studied this.


Land donated - While land for new schools is helpful, the population of Esperanza will require new and higher school bonds much sooner than if it were less dense- it is the reason why the schools are having to be built in the first place. The cost of land is a very small percentage of the total cost of building, staffing and educating students. This continues to be glossed over.


The City will lose control over how it is developed - This won't happen if it is annexed. This is also most consistent with the Master Plan, which states that a water district like this should be avoided within the ETJ and proactive annexation should be used.


We will end up paying for the infrastructure - The utility services are already in the area. The estimated cost to connect is about $5 million. The developer will be responsible for internal infrastructure, and the City will gain the revenue from the utilities. This has been standard procedure. Can commercial tax revenue and lower road costs make up for this $5 million outlay? What if you add in taxpayer's cost for larger school bonds? No one has studied this.


Aside from the figures and the unresolved traffic congestion problems, there is still the issue of what such rapid and dramatic change to Boerne and our quality of life means.


Surely a change of this magnitude requires a sincere and legitimate study to determine the true long term impacts. With everything to gain from doing a thorough analysis-not to mention taking the time to determine the desires of City residents- it is more than reasonable to not rush to a vote on January 22.

However, the two Council members who attempted to raise these questions last night, were jeered and laughed at by members of the audience affiliated with this development, who showed up in force at City Council.


The saddest observation of all is that City residents are failing to show up and participate in a decision that will bring about the demise of Boerne as we've known it. They have relinquished their future to outside developers.

Remember this 10 years from now when we are in a crisis of congestion on River Road and Main Street, school bonds and taxes are skyrocketing and developer funded candidates sit on City Council.


Anonymous

5 comments:

Anonymous said...

Well written and 'spot-on'! Should go in the paper as a guest editorial.

Anonymous said...

One of the concerns raised with the 'no cost' scenario for Esperanza is that the figures to attain this are based on a 'perfect world scenario'. What this means is that all of the houses will sell, at the rate predicted, for the price predicted. The question was raised by one of the more astute councilmen about the local economy, housing slumps and rising gas costs.
How would that affect the City's risk in assuming Esperanza's bond debt, or not- resulting in a longer time without tax revenues?

After staff openly stating that the variables in the 'cost neutral' scenario were so numerous that it was impossible to say how reliable it was, two predominant responses were made- a pro-Esperanza councilman said he didn't think the slump would effect Boerne and the other response was from staff, indicating that the corresponding cost of services would be less if the build out was less.

The first comment is strictly hopeful conjecture and the second bears fleshing out and compared to the potential advantages to taxpayers by judiciously annexing and building out as the market demands, gaining the tax revenues along the way. Would it be safer for major road, sewage and infrastructure costs to keep pace with the market, rather than making large investments up front only to see these projections falter or fail?

Just this week, two articles came out about the economy. The first one came out two days after City Council. Here are some quotes:

"WASHINGTON (Jan. 13) - The unemployment rate leaps to a two-year high, record numbers of people are forced from their homes and Wall Street nose-dives again. Such is the fallout from a housing meltdown that threatens to slingshot the country into a recession..

The big economic question these days is whether the weakening economy will survive the strains or collapse under them...
The odds have grown that the economy will slip into a recession. At the beginning of last year, many economists put that chance at less than 1-in-3; now an increasing number says it has climbed to around 50-50. Goldman Sachs, the biggest investment bank on Wall Street even thinks a recession is inevitable this year...

Wall Street is on edge. The Dow Jones industrials plunged nearly 250 points on Friday. Also, consumer confidence tumbled in early January...

The current housing slump, made worse by a credit crunch, is weighing heavily on economic activity...
High energy prices, weaker home values that make people feel less wealthy, and a deteriorating jobs market all figure into more caution on the part of consumers. ..

The unemployment rate jumped to 5 percent in December from 4.7 percent, fanning recession fears. It was the biggest one-month gain since October 2001, during a time of massive layoffs in the travel industry after the Sept. 11 attacks."

The second article was an insert in the San Antonio Express News. The most notable thing about it was the focus on how well San Antonio was doing in commercial development and with military base monies. All they could say about residential construction was a blurb that the market was 'correcting' from over building the past couple of years. The sources for these articles were from the economic development and real estate sector, so one would expect them to put an upbeat spin to it.
In addition to housing slumps, think down the road a bit with the potential for gas prices to continue to rise and TxDOT's intentions to put toll roads on IH-10. If the shift in commuters was felt last year on 281 due to these concerns and costs ( several articles in the SA Express about folks moving back into SA), what will the long term commute issues be for Boerne?

All this to say- the idea of waiting to vote makes sense. Hope the Council will see the wisdom in this.

Anonymous said...

What about this comment in the paper from City Director Ron Bowman:

"Bowman noted that there is a broad consensus in the community that the Herff Road extension is needed.
"We are trying to get back to where we were before the county commissioner ran TxDOT out of the county," Bowman said referring to a controversial proposal for a loop road that had TxDOT officials taking flak two years ago.
"There are some significant things we can lose without this agreement," Bowman said. "($2.3 million) is a significant amount of money in my opinion." "

Consider:

- The Herff Rd. extension project he is touting was a result of the County Citizen's Transportation Committee- not TxDOT. It was this same County effort that he then turns around and blames for 'running off' TxDOT.

- $2.3 million is enough to add about a half mile of two lanes, not counting the right of way costs. (Looked at land costs lately?) Compare that with the impacts of doubling the population on our roads and Bowman's idea of a 'significant amount' is funny.

- It does not sit well with County residents when the City Manager- who has a direct influence on development agreements and their densities- pushes for 7,000 new residents, wants the roads to handle them to go primarily through County properties and then has the nerve to complain that County citizen's wanted to have a voice in the process!

This road planning process seems to have gone somewhat underground again, apparently even some of the ex-transportation committee members don't know who the supposed 'liaison' is and haven't heard a word of information from them. (Does this indicate that someone from the defunct citizen's committee is lobbying for their own interests?)

This always raises red flags- more so when you hear real estate talk shows like the one on WOAI last week talking about the 'inevitability' of growth, SH 46 becoming an outer loop and building toll roads.
Since this was a topic of concern over two years ago here that resulted from a lack of public interaction- Bowman's comments should not be taken lightly.

Esperanza's donation of right of way for such a road, and the density it provides to the calculation of toll road feasibility are key factors in this discussion. Add into the mix that the City's 'evaluator' of road impacts and needs is HDR Engineering, a member of the San Antonio Mobility Coalition which works with TxDOT and lobbies strongly for toll roads; it's been said a City staffer moved from HDR to his current City position; and you have good reason to ask that this process stay open to the public's eyes and input.

The mantra of 'growth is inevitable' causes citizens to feel that this also means the same way of dealing with growth is also inevitable. The idea that it has to track the way it always has is belied by the difference of approach in other parts of the state and country. How you respond to market demands is the difference. IH 10 doesn't have to end up like 281, and the Hill Country doesn't have to be covered in asphalt.

All it takes is the collective will of ordinary citizens to expect and work for good solutions and smart planning models.
After all, it is our place, our history, our resources, and our quality of life - who has a greater right or more compelling reason to have a voice in our future?

We need to use that voice and make a call to a council person or commissioner and tell them what we'd like to see happen. After all, they do work for us- including Mr. Bowman.

Anonymous said...

Thanks

Note what is missing - the so-called MUD or "Twin Cities" option - where the developer builds the proposed project on their own, and the City does not annex it.

This option is mentioned as having some of the costs, but none of the benefit to the City.

Without seeing this option objectively presented, the City should not enter into any development agreement.

Because this is the "default" scenario for any such residential development in an ETJ = 100% privately financed.


Development in an ETJ is typically done by the developer, with no participation by the City - with or without a MUD = that's up to the developer.

The City is not obligated to help finance or service the development at all = it's in the County.


If the development is a success, the City can annex it when it goes cash flow positive = when tax revenue is greater than cost.

If it does not go cash flow positive, the City does not have to annex it - ever. Nor does it have to assume its debt - ever.


Without seeing this option objectively presented, the City is not seeing the most obvious option.

Just the two the developer wants to present. And that staff has been talked into.

Anonymous said...

The City has run different scenarios for Esperanza- accepting the agreement or annexation.

A review of the studies shows a flawed approach to the financials. The City assumes, after everyone on both sides assuring citizens that the City has the right to turn this development agreement down if it is not in the best interests of its residents, that they will be sued by Marlin Atlantis.
Thus, their annexation scenario begins with over $1 million in litigation costs, and then they skew every category to reflect such unfounded conjecture and opinions as assuming a three year delay in build out and that the homes will be valued at 15% less! These assumptions then impact every category of the bottom line- ad valorem taxes sales tax, permit fees, etc.
It also assumes the City won't ask for or recieve any open space or trails. (There is a great deal of flood plain and steep topography that made up the open space in the first place.)
Most notable of all, the City failed to acknowledge that the developer will be required by Ordinance to pay impact fees- a minimum of their fair share of road impact costs- which has already been acknowledged to be at least $2.8 million. Did this appear in the income column of an annexation scenario? No- it ended up as a deduction! Even with all of this, the annexation scenario still came out ahead!
The denial of Open Records requests, 5 days for the public to read a complicated agreement, little supporting studies available, flawed financial reports,no public hearings held on the largest decision affecting our community (including major by-passes), feedback from local legal minds indicating the agreement appears to have serious flaws and financial reviews showing it will cost taxpayers more than annexation-
this is the worst case scenario for the citizens of Boerne.
No wonder there's talk of referendum or legal action!
The question of the day is- with so much at risk- why not allow for these issues to be corrected?
While consideration is given to the developer for their cost of reserving water while these discussions take place- what is the ultimate, long term cost to City taxpayers?
The meeting is tonight at Ye Kendall Inn. Public comment time (not to be confused with a true public hearing!) is our opportunity to ask for holding off on this agreement.