Tag Archives: Austin

Firestorm Erupts Over 100,000 Housing Unit Target Issue

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By Bill Oakey – August 4, 2015

The reaction to Monday’s posting on this topic has been swift and fierce. The same reaction fell upon Marty Toohey after his blog posting in the American-Statesman. Austin has indeed hit a tipping point that in some respects mirrors the national divide over wealth inequality and wage stagnation. Your viewpoint on a variety of issues depends on where you sit along the economic divide. Politics also enters the picture. Nationally speaking, I have made my position clear. I am an official Elizabeth Warren Person In Waiting.

As for the uproar over the affordability and sustainability of Austin’s current boom, I would just suggest this question to ponder, What comes after a reckless boom without any foresight or careful planning? Here in Austin, we have seen that movie more than once before. The crash at the end of the 1980’s sent many out of town landlords, well, back out of town for a pretty good while. And a great many of us were not sorry to see them go.

This blog welcomes a wholesome discussion from all points of view. See the comments below. Everyone is entitled to their opinion and everyone else is entitled to agree or disagree. We should do so with passion, but in a polite and civil manner. In my view it is unduly harsh and insensitive to sacrifice a community of several hundred thousand people for the benefit of an encroaching wealthy class. To not expect the citizens who have invested decades of their lives in their community to fight for their homes and their neighborhoods is unrealistic, at the very least. Yes, gentrification can be a natural consequence of “free market forces” or “supply and demand.” But in a democracy, we govern ourselves. We get to decide how we want to interact with our elected officials. And what values we want our elected officials to incorporate into their policies.

We certainly need new housing, and of course we cannot call a halt to all growth. That has never been my argument. The challenge and the controversy involves how to incorporate new housing into the planning process. We need to find some way to allow existing neighborhoods to thrive and co-exist with new housing. The CodeNEXT rewrite of the land development code should complement rather than replace current neighborhood master plans. Developers are pushing hard to build housing with little or no zoning regulations. The wrong kind of planning can lead to gentrification rather than preservation of existing neighborhoods. Housing that is already affordable cannot be torn down and replaced in every corner of the City, if we want to be fair and reasonable to longtime residents. We have seen an abundance of discussion on how and where to build new housing, and even how best to make that new housing affordable. But there is no official policy or planning effort directed toward preserving the existing affordable housing that has not yet been scraped off the lots.

Austin has historically seen battle lines drawn between developers and real estate interests versus neighborhood and environmental interests. We call ourselves a “progressive city” that welcomes diversity and embraces social justice and equality. However, we are not immune to the immense power of money and influence that infects all levels of government. I was both saddened and appalled to learn recently about yet another City ordinance that passed two years ago and then fell into a black hole. In 2012 there was a public outcry after a balcony collapsed at a low-income apartment complex. Investigative reports from the Statesman revealed that Austin had one of the poorest sets of policies and enforcement to help this class of vulnerable residents. The landlords got away with shabby conditions and disrepair year after year. So, the City Council wrote a tougher ordinance and demanded action on enforcement from the City Manager. But guess what…Here we are two years later, and the new ordinance is not being enforced.

Another hot button issue is short-term rentals. Here again, peaceful neighborhoods with hard working residents ate being disrupted by rude, late-night partiers who could care less about anyone else around them. And the  “entrepreneurs” who own the commercial short-term rental properties often get by without proper registration and with wildly excessive occupancy levels at their party-pads. We could just back off and say, “Let the free market rule.” But what kind of “freedom” would that leave for the neighborhood folks who are stuck with the noise and the parking issues. One part of this problem could be solved easily. The City should require that a valid license number be included in every website, blog, social media and print ad listing. But I can only imagine a bitter battle with the special interests over such a simple and logical suggestion.

I will end back where I started by mentioning that Austin is at a tipping point. We simply cannot afford to continue on a path that puts growth for the sake of growth ahead of common-sense planning. Choices will need to be made that will determine whether an “Austin for Everyone” means truly everyone, or just the outsiders without regard to what happens to current residents and their neighborhoods.

One final thought. Whether Austin can defy gravity and keep booming forever depends on its capacity to sustain the costs of the boom. This may sound like a wild idea, but we could…just maybe…consider adding up the total cost of all the plans that Austin, Travis County, CAMPO, Central Health and the other entities have already approved. Then, simply measure that total cost against the taxpayers’ likely ability to absorb it. There isn’t a private business or corporation of any size that would dare embark on an unbridled expansion without careful planning with cost projections and analysis. Cities, on the other hand, are more apt to march their citizens to the edge of a cliff. Before someone finally shouts, “Hey look, we might have a problem here!” Then after the crash, the leaders all sigh and say, “Gee, it’s not our fault. None of us ever saw it coming.”

How Do We Respond To The Developers’ 100,000 Unit Target?

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By Bill Oakey – August 2, 2015

While relaxing in a chair a couple of evenings ago, I was hit with an emailed blog posting with the craziest juxtaposition of terms that I’ve seen in a long time:

The Premise: “Austin Rents Are Too High. That Is a Serious Affordability Problem.”

The Cause: “It Is a Simple Problem of Supply and Demand.”

The Solution: “Build 100,000 New Housing Units As Fast As Possible. That Will Magically Make Austin More Affordable.”

The blog posting in question was fired from a cannon on Friday by American-Statesman reporter Marty Toohey. The main theme of the blog is that the Real Estate Council of Austin (RECA) has established a 100,000 target for the number of new housing units that will transform Austin into an affordable city.

At Long Last! Relief is Finally On the Way!

In the old days, the Alka-Seltzer pain reliever ads promised to bring us a lifetime of happiness. Their slogan was “Relief Is Just a Swallow Away.” The Statesman blog posting suggested that Mayor Steve Adler has already swallowed RECA’s affordability potion. But I have to wonder if he read all of the fine print in the warning messages that accompany their prescription.

alka-seltzer

The Number One Goal, In Fact the Only Goal, Is to Build “An Austin for Everyone”

Those of us who attended the Austin Monitor’s CodeNEXT panel discussion on July 27th, got a jaw-dropping introduction to the “come one, come all” approach to meeting the challenges of Austin’s growth. In the most unabashed manner imaginable, panelist Steve Yarak from a group called AURA repeatedly championed the mantra, “Let’s build an Austin for everyone.” His entire storyline from beginning to end was that every facet of Austin planning should focus on bringing as many people here as possible, as quickly as possible. To accomplish that one and only goal, we need to build, Build, BUILD – as many housing units as possible, with reduced regulations and as few zoning restrictions as possible. Build, build, build. Do it now. Do it fast. And don’t let anybody or anything stand in your way.

This unapologetic fervor on the panel was followed by sprinklings of applause, delivered in slices by pockets of followers who had swallowed the potion. Others in the audience who came out of curiosity or to learn how CodeNEXT might affect their neighborhoods, saved their applause for panel members Jim Duncan and Jeff Jack. Both of them have long histories in Austin and hard-earned reputations for balancing the exuberance of growth-at-any-price against neighborhood preservation and the interests of long-term residents.

More Growth at a Breakneck Pace Is the Solution to Affordability…Really?

Let’s put that proposition to a test with this list of questions:

1. Austin has grown tremendously since the 1970’s. Is the city more affordable now than it was in the 1990’s? the 1980’s? the 1970’s?

2. A major push to build more rental units was undertaken last year. Did the increased supply lead to lower rents? (Average rents actually increased 6.6% to $1,172 in the past year).

3. When new luxury housing units are built in older established neighborhoods, do those neighborhoods become more affordable as a result? Or do they become gentrified, with taxes rising so fast that older residents are forced to leave?

4. Transportation is the second leading component of affordability, behind housing. Is transportation more affordable in Austin as a result of rapid growth? Has growth led to improvements in traffic congestion?

5. The fastest growing cities in the country include Portland, Seattle, and several major cities in California. Are any of them more affordable now than they used to be?

Is There Some Way to Address the Challenges of Growth, While Admitting the Realities of Affordability?

Like any other problem in life, the first step toward solving it is to admit that there is a problem. Then that problem needs to be approached with openness, honesty, and a willingness to balance the needs and desires of everyone. Austin has been designated the most economically segregated city in America. It is clearly not affordable for several significant categories of people:

1. People who work for low wages, who need to be paid more for what they do, and who deserve better opportunities for better jobs.

2. Older people on fixed incomes, or who retired from jobs paying much less than today’s market salaries. These people make up a growing percentage of Austin’s population.

3. Long-term residents who struggle to make ends meet, as their neighborhoods become gentrified and they face high transportation costs if they move to the suburbs.

Here Is the Biggest Question That Many of Us Would Like to See Answered In a Positive Way…

Will our new mayor and our first 10-1 district City Council spend as much time and energy addressing the needs of long-term residents and existing neighborhoods as they do in answering to the whims and wishes of big business, the developers and the real estate industry? It takes six votes to pass an item on the City Council agenda. It also takes six votes to defeat one. Everyone has an opportunity to influence those votes and to take note of them after they have been cast.

We also know that five Council members – Greg Casar, Sheri Gallo, Delia Garza, Leslie Pool, and Don Zimmerman will be up for re-election next year.

If anything in this posting leaves you feeling a bit uneasy, don’t take any medication without reading the warning label. As an alternative, you might consider reaching for a drink, while listening to Eddie Noack’s 1959 song, “Relief Is Just a Swallow Away.” (Later recorded by George Jones).

The Whole Truth About The City Manager’s Proposed Budget

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By Bill Oakey – July 30, 2015

On Thursday morning the new City Council members were treated to something they have been  eagerly awaiting all summer long – the proposed FY 2016 City Budget. If you would like to get an overview, you can see Volume One right here from the City’s website.

We have all known since the spring that property tax appraisals shot through the roof for most Austin homeowners, to the tune of mid to high double digits in many local zip codes. So, my approach to analyzing the taxpayer impact of the new budget will be different from the spin that appears in the budget’s executive summary. The word “affordability” appears a total of 8 times in Volume One, while the word “tax” appears 290 times, and “fees” appears 134 times. Here is the opening statement on the first page:

“This budget will raise more total property taxes than last year’s budget by $36,413,252 or 7.7%, and of that amount $13,926,299 is tax revenue to be raised from new property added to the tax roll this year.”

It is easy to see from those figures alone that the City intends to spend more money much faster than the growth in new population. Imagine what would happen to the tax impact on long-term residents if that trend continued for the next 10 years. Another disturbing tidbit is that the City Manager proposes adding 347.4 new staff positions, which is more than double the number of 151.25 positions that were added last year. Also, utility and fee increases averaging $7.98 per month are included in the budget.

So, What’s the Bottom Line On This Year’s Proposed Tax Increase?

The fairest and most truthful way to answer that question is to look first at the tax appraisal map from TCAD that was published in the spring when the new appraisals went out. Click to enlarge the map.

Notice this statement that appears next to the map, “The average market value for houses with a homestead exemption in Travis County went up 11% on average to $355,312.” Because the map includes several areas that are outside the City of Austin, it is hard to tell exactly how much the average appraisal increase is for Austin residents. But we can see that almost every Austin section on the map will, on average, hit the 10% tax appraisal cap.

However, the City told the Austin American-Statesman that “The owner of the median-valued homestead worth $232,272 would pay $1,051.08 in city taxes, up from $1,011.24 this past year.” That works out to a very modest-appearing tax increase of only $40. This includes the new 6% homestead exemption approved by the City Council.

What’s Wrong With This Picture?

Here is a comparison between the data in the current FY 2015 Budget (Vol. 1, Page A-16) and the proposed FY 2016 Budget (Vol. 1, Page A-13). But this comparison is not accurate, as you will soon see.

FY 2015 FY 2016 $ Difference % Difference
Median Home Value $202,254 $232,272 $30,018 14.8%
Property Tax $973 $1,051 $78 8.00%

It turns out that the data presented in each of these budgets only allows an “apples to oranges” comparison of the numbers. After conferring with the reporter of Thursday’s article in the American-Statesman, I obtained the missing number needed to derive the $40 tax increase for the “median value” homeowner. The “median value” of $232,272 for a home in the FY 2016 budget is actually the “median homestead value.” They used that value because the City has adopted a 6% homestead exemption. So, in order to calculate the tax increase, we need to know the “median homestead value” for FY 2015. That number, which does not appear in either of the budgets, happens to be $210,279. Thanks to Andra Lim with the Statesman for tracking it down from the City.

With all of the required figures in hand, here is how to calculate the estimated tax increase:

  FY 2015 FY 2016 $ Difference % Difference
Median Homestead Value $210,279 $232,272 $21,993 10.5%
Less 6% Exemption $0 $13,936    
Taxable Value $210,279 $218,336    3.8%
Tax Rate Per $100 0.4809 0.4814    
Property Tax $1,011 $1,051 $40 3.9%

The median homestead value only includes owner-occupied homes, and not the ones being rented. So, there is a vast difference in the variety of residential properties on the tax rolls. A $40 annual tax increase looks small, but the median value numbers above include small units in multi-family properties such as condos. The biggest tax burden is borne by single-family homeowners, who make up a large percentage of Austin’s long-term residents.

We have been told that the City Manager’s budget proposal calls for a tax rate increase from 48.09 cents to 48.14 cents per $100 valuation. But that doesn’t tell us the percentage increase above the “effective rate,” which would take the appraisal increases into consideration.

A Taxpayer Impact Statement Would Be a Good Tool for Truth In Taxation

My “Truth In Taxation” proposal calls for the City to produce a Taxpayer Impact Statement that includes a chart of home appraisal values in $50,000 increments. The chart should include the following information:

1. A column showing last year’s taxable values, with no homestead exemption, plus columns showing the standard homestead exemption and the over-65 and disabled homestead exemption.

2. Additional columns showing this year’s taxable values at various appraisal levels, up to the 10% cap. And the dollar amount of taxes due at each appraisal level.

3. Columns showing the average amounts of utility and fee increases.

4. A final column showing the estimated grand total of tax, utility and fee increases.

It is time for the City to finally bring the full, complete and truthful impact of the budget out of the shadows and into the open!

Page A-11 of the budget spells out the frustrations of the people in the results of a citizen satisfaction survey. Here is just one example:

  • When asked to rate “Overall value for city tax dollars and fees,” 40% of citizens responded that they were satisfied or very satisfied, four percentage points better than the national average. However, 30% of respondents expressed dissatisfaction. Satisfaction is down nine percentage points from previous years, indicating that residents and business owners may increasingly be feeling the pinch of higher tax and utility bills.

Austin And Travis County Should Announce Joint Affordability Initiative

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By Bill Oakey – July 15, 2015

In about 7 weeks the City of Austin and Travis County will each have to finalize their Fiscal Year 2016 budgets that will take effect on October 1st. For the past several years, citizens throughout the area have been clamoring for major steps toward affordability. Today I am calling upon City and County officials to make some decisions on what affordability measures and proposals they will include in their new budgets, and to make a public announcement telling the citizens what their affordability plans are. As I have said many times in public presentations – the time for talking about affordability is behind us. The time for action is now.

The Austin American-Statesman has repeatedly editorialized on the need to slow down the growth of the City Budget in particular. Austin’s downtown has added countless high rise buildings that should be adding to the tax base and making it easier to pay for expanding City Services. The same is true for neighborhoods all over town that have seen gigantic new resort-style apartment structures that take up a full block. Traditional neighborhoods in all parts of Austin have seen older homes scraped off and replaced with expensive luxury housing.

So that leaves us with a fundamental question. Where is all the increased tax revenue from all of those high-priced new buildings going? Why are our property taxes continuing to rise so rapidly that people are being priced out of their homes?

What Is the Bottom Line On the Growth of the City and County Budgets?

What you are about to see is not a pretty picture. Notice the rapid increases in the general fund in both of these budgets. That is the fund that is paid for with property taxes, sales taxes and some of the fees

City of Austin
  2010 2015 % Increase
General Fund $614,915,000 $854,040,000 38.9%
Total Budget $2,747,105,000 $3,493,973,000 27.2%

Travis County
  2010 2015 % Increase
General Fund $455,661,280 $650,897,476 42.8%
Total Budget $655,140,525 $910,988,941 39.1%

Has Affordability Been Addressed In These Past Budgets?

You will find that word sprinkled quite liberally throughout the current FY 2015 City Budget. In fact, in Volume 1, it graces the pages no less than 29 times. On Page A-8 within City Manager Marc Ott’s cover letter, he issues the following pronouncement with italics included:

“Carefully balances the service demands of a growing community with ongoing concerns over affordability by proposing a full penny decrease in the tax rate.”

That statement contrasts with the opening sentence on the very first page of the Budget:

“This budget will raise more revenue from property taxes than last year’s budget by an amount of $29,970,162, which is a 6.7 percent increase from last year’s budget. The property tax revenue to be raised from new property added to the tax roll this year is $8,375,296.”

What that means is that existing property owners paid the overwhelming bulk of the tax increase, to the tune of $21,594,866. The word “tax” appears 298 times in the first volume of the three-volume document. The word “fee” shows up 277 times. But, alas, on Page A-15 “affordability” gets its own section heading, with the title “Maintaining Affordability.” Most of the initiatives listed pertain to subsidies and assistance to low-income and senior residents. These are, of course, very worthy programs. But the bottom line for the average homeowner is that total property taxes for all of the taxing entities in Central Texas increased 6.1%, as shown on Page A-16. And that does not include the relentless forward march of the various “add-on fees” that appear on our utility bills.

What Can the Taxpayers Expect Over the Next Five Years?

You would probably be less frightened by spending a weekend alone in a haunted castle during a thunderstorm, while reading a Stephen King novel. But if you care to take a look, here is a glimpse of Page 60 in the City’s current Five Year Financial Forecast:

City of Austin Property Tax Assumptions

Fiscal Year Projected Assessed Valuation Growth Projected Total Tax Rate Projected Operations & Maintenance Revenue
FY 2016 9.0% (actual amount is 11%) 0.4782 $385,500,000
FY 2017 7.0% 0.4850 $420,900,000
FY 2018 7.0% 0.4860 $452,500,000
FY 2019 5.0% 0.5008 $492,700,000
FY 2020 5.0% 0.5192 $540,100,000

This chart assumes that property values and tax rates would both increase at the same time. If that were to happen, it would be in stark contrast from current policy, which has been to reduce the tax rate somewhat, to offset the increase in property assessments. In any case, the City’s O&M revenues are projected to increase 40.1% over the five years. When you look at percentage increases, keep one important factor in mind. As the base dollar amount continues to increase, the percentage applied to that base derives a progressively increasing amount. The same is true of your home valuation and your tax increases. The taxable amount of your home value is capped by law at 10% per year. So, if your home started out a few years ago being valued at $200,000, the 10% cap meant that you could only be taxed at $220,000. That’s a $20,000 increase. But once the value of that same home has doubled to $400,000, then the 10% cap yields a taxable value that is $40,000 higher. This year, as the TCAD map shows, Austin has many zip codes with home appraisal increases into the double digits. Click or tap the image to enlarge it.

That’s all the more reason why our City and County officials need to come together and decide on an affordability agenda to be incorporated into their upcoming budgets. A failure to adopt meaningful near-term and long-term reforms would only intensify our already critical economic divide.

Should We Vote to Approve Bonds for a New County Courthouse?

There is no question that Travis County needs a new Civil and Family Courthouse. It is my understanding that no other area taxing entity will place any additional bonds on the November ballot. The current price tag is pegged at $291 million. But Travis County officials are working feverishly to come up with strategies to offset the cost. Discussions have included using fees from after hours parking at the courthouse, certain rental receipts from other County properties, and the sale of other County owned land. Between now and the November election, we will know more about the total amount of those offsets. In addition, the firm that is awarded the contract to build the courthouse could potentially make some design changes that would make the project more efficient.

No decision has yet been made as to whether this blog will endorse the courthouse bonds. But I am hopeful that both the City and the County will join together and demonstrate to the community a serious commitment to affordability. The Travis County Commissioners that I have met with have laid out some innovative ideas for cost-savings, through County-specific initiatives as well as cooperative strategies with the City. Both bodies have appointed representatives to the Regional Affordability Committee. At my suggestion, that committee has embarked on the development of an Affordability Strategic Plan. If the local voters are shown that affordability efforts will finally bear fruit with tangible results, then they are much more likely to stand behind the County Commissioners’ recommendation and vote to approve the courthouse bonds.

A Resolution To The Solution Of Meaningless City Council Resolutions

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By Bill Oakey – July 11, 2015

On Friday I reported that the City Manager’s Office finally provided a response to the many months of questions surrounding the long-delayed May 1, 2014 City Council resolution dealing with special event fee waivers. Well, I am (somewhat, but not really) pleased to announce that late on Friday I received another update.

Update On July 10, 3:04 PM

From Mr. William “Bill” Manno:

Mr. Oakey, please see my responses below.

  1. Will the report include an evaluation of using ticket surcharges as an alternate funding source? Response: Surcharges are included in the discussion.
  1. Will your report to the City Council by October or earlier be coordinated with the Parkland Events Task Force as part of their review of special events funding? Response: That is very likely, however, we will have to wait until that task force begins to meet and sets its agendas.
  1. What is the status of the staff proposal for multi-year agreements for large special events that was addressed in the City Manager’s memo shown below? Will that topic be addressed in your report on alternate funding sources? Or will these be two separate reports? Response: They are related, but separate issues.

My Conclusions

Friday’s update showed that the resolution’s required deadline of August 2014 that got extended without City Council approval to August 2015, has now been extended to “October, if not sooner.” This little peek into the back rooms of City Hall should be a powerful lesson for anyone wishing to become engaged with “the process.” When I first became a citizen activist in the mid-1980’s, my mother started out by telling me what all mothers say, “You can’t fight City Hall.” Well, it tuns out that you can not only fight them, but you can win. However, the watchdog and reform business requires a level of patience and persistence that can only be described as crazy. Let me put it this way. If you really want to take on City Hall, you don’t do a little tiptoe up the steps and a little rap-tap on the door. You grab the entire building by its foundation and shake it till the bureaucrats’ eyeballs rattle in their sockets!

Lessons Learned From This Exercise

City Council resolutions with lofty language such as, “Now therefore, be it resolved…The City Manager Is Directed To,” and “This report is due back to the City Council no later than…” etc. carry about as much weight under today’s procedures as a feather in a hurricane. Stay tuned for an effort to establish a policy to make these resolutions respect the dignity of the folks who appear at the very top of the City’s official Organization Chart…The Residents of Austin.

The City Can Save $4 Million Every Year – But There Is a Huge Mountain To Climb

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By Bill Oakey – July 10, 2015

In the last few weeks I have met with several City Council offices. One of my top cost-saving priorities is to replace taxpayer-funded special event fee waivers with alternate funding. In May of last year, the City Council passed Resolution # 20140501-036 directing the City Manager to review options for this alternate funding. The intent and the deadline were crystal clear:

“The City Manager is directed to present the proposal for the special events fund and fee waiver process by August 7, 2014 to allow Council to consider the proposals as part of the City’s budget process.”

We now know that last August’s deadline came and went with no formal response to the resolution. So, we have a critical policy issue and very possibly a legal one as well. When the City Council passes a resolution and it is signed and placed into the public record, does it carry the force of law? You would think that a change to the substance and intent of a resolution, or a change to the deadline for directed action would require another public vote by the City Council. This is certainly true of City Ordinances. Is there any provision in the City Charter or the City Code that addresses required actions to amend a resolution? Is there a process in place to follow up on the status of resolutions to ensure that they don’t fall through the cracks?

Not only does the City need to establish a clear set of policies and procedures for timely implementation and amending of resolutions, but the process needs to be made transparent to the public. It would be most helpful if the Council Members, their staffs and the public could go online and check the status of a pending ordinance or resolution. It is my understanding that Council Member Ann Kitchen is interested in pursuing a model that is similar to the one that it is used in the Texas Legislature. And I am looking into resolution tracking systems that have been adopted in other cities.

Here’s what can happen when no one on the outside can see what the insiders are doing with a Council resolution. I found an undated City Manager’s PowerPoint presentation on the City’s website that reveals that they were attempting to comply with the May 1, 2014 resolution on special events funding. Slide # 17 in the presentation shows that 30 Texas cities use funding sources other than fee waivers to support special events. Most of those cities use Hotel Occupancy Tax funds. In the PowerPoint, the staff was told to bring back a funding plan for Council action in time for the resolution’s August 2014 deadline.

But sometime between this presentation and November of 2014, a major intervention took place behind the scenes. Without a vote of the City Council directing him to do so, the City Manager issued a memo to the Council on November 7th. This memo addresses a completely new approach to handling large special events. Although no detailed backup is provided, the aspect of alternate funding sources is dropped from the discussion. The central topic has shifted from single-year contracts with large event promoters to multi-year agreements. Under that arrangement, the local taxpayers could very well find themselves locked into the status quo system of funding special events with fee waivers.

Keep in mind that last November the old City Council was still in office. Here is what the City Manager related to them in his memo:

“I have directed staff to take the next several months to gather the necessary information to develop recommendations that can be evaluated as we begin discussion of the upcoming FY2015-2016 budget process.”

So, it appears that the City Manager and his staff are operating on a path to action that is, at the very least, unclear to the public and unclear to the newly elected City Council members. In my meetings with them, I have found no one who is aware of what the City Manager’s staff is working on with respect to the November memo. In another twist, I have been informed that the question of how to fund City services for special events will be taken up by the Parkland Events Task Force. When you click the link to their page, you will notice that they have not held any meeting yet, and in fact the City is still accepting applications for new members. In addition, the primary function of the task force is addressed in a completely different resolution.

My efforts are focused on a compromise plan to pay for special events from three sources: The Hotel Occupancy Tax, surcharges on ticket sales, and requiring the event companies to pay a reasonable portion of their own fees. I have asked the City Council to set an early 2016 deadline for studies and discussions of the new funding formula. In the meantime, I have asked them not to fund any fee waivers for large for-profit events with local tax dollars in the new budget.

We have a new City Council that wants to find cost-savings in the budget. They have also promised a high level of public engagement and better transparency. Later this month when the Council members get back to town, I will post a link for you to email them and ask them not to include any local taxpayer funding for special events. It’s a golden opportunity to save $4 million per year in recurring expenses. But it will never happen unless they commit to a firm timetable to establish a new funding formula. And whatever path the City Manager’s Office is taking on the matter needs to be clarified and communicated to the City Council.

Update on July 10th, 11:53 AM

I just received the following email from Mr. William “Bill” Manno, City of Austin Management Services, Corporate Special Events Program Manager. This information request was forwarded by Mayor Pro-Tem Kathie Tovo’s office.

Mr. Oakey,

The presentation you referenced was one I made for the very first stakeholder group meeting for the specific purpose of getting the conversations started.  It is in no way the final report to this Resolution and should only be used as a reference as to how this process was started.  The response to Resolution is currently being drafted and will be sent to Council by October, if not sooner.  The research mentioned in that presentation was done by interns and was limited to identifying cities that in some way use HOT funds for events.  I have staff currently doing more in-depth research as to how they actually apply those funds.  This information will be included in the report back to Council.

Resolution No. 20140501-036 included the following language:

“WHEREAS, the City collected approximately $54.8 million from hotel occupancy taxes in Fiscal Year 2012 and these collections from Austin hotels are used to fund the Austin Convention Center, the Austin Convention and Visitor’s Bureau, and the City’s Cultural Arts Program; and

WHEREAS, the City’s Music Commission has recommended that City Council explore other funding mechanisms for special events, including considering whether anticipated increases in hotel occupancy taxes could support special events costs;”

Therefore, the report will discuss other cities’ use of HOT funds, however, it will be Council’s decision as to what aspects of alternative funding mechanisms they wish to move forward with.

Please feel free to contact me directly should you have further questions.  Until the report is finalized and presented to Mayor and Council, it would inappropriate to release any portion of the report.

Thanks,

Bill

The Affordable Housing Issue That Nobody Wants To Talk About

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By Bill Oakey – July 6, 2015

If you take a stroll around downtown Austin and find yourself within a few blocks of City Hall, the chances are pretty good that you will hear the chatter. If you don’t, just try putting your ear a little closer to the ground and you are bound to hear a certain phrase…

“Affordable Housing…”

As a sometimes City Hall insider, I’ve heard that phrase hundreds of times. But like any other popular buzzword, it has been abused and misused so often that its meaning and its value to the community have become very fuzzy. In fact, the fuzziness of affordable housing in the average person’s mind is surpassed only by the unfathomable convoluted mess of formal City policies on the subject. I will attempt to wade into that morass in a future posting. But first, let’s get one thing out in the open…

Almost All Official Discussions of Affordable Housing Center Around New Housing That Could Be…Might Be…Perhaps Even Ought to Be…Built In Austin Someday. Not Today, Probably Not Tomorrow Either. But Someday…

Walk into a meeting where people are talking about affordable housing, and you will hear about things like density bonuses to encourage developers to include affordable units in their new projects. You will hear about the need for more concessions for developers, more fee waivers from the City taxpayers, etc. Once in a while you will hear about expanding subsidized housing programs. And another popular phrase that keeps popping up this year is “missing middle” affordable housing. That refers to building duplexes and townhouses that should have a place somewhere in Austin, next to the McMansions and the Big-Box-Block-Long-$1,600-to-$1,800-For-One-Bedroom-Rent-With-No-Equity-Apartment-Community-Resort-Type-Buildings. (Sometimes more politely referred to as “walkable and bicycle-friendly, transit-oriented new urbanist activity centers).” Is it even remotely possible to build one of those things without it being so hideously ugly?

Getting Back to My Original Point – The Affordable Housing Issue That Nobody Wants to Talk About. Well, I Guess You Could Say That It Is the…Elephant In the Room!

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Last week I asked a friend to take me on a drive through several neighborhoods in North Central Austin that…now, listen to this carefully…that ALREADY HAVE EXISTING AFFORDABLE HOUSING! There are, of course, pockets of housing like this in various neighborhoods all over town. Concentrate as hard as you can on a great big wish. Maybe if we all wish hard enough, somebody down at City Hall will pick up the vibrations. Let’s hope and let’s wish that there is a way for Austin to…

Preserve and Protect the Affordable Housing That We Already Have…Before Every Remaining Square Inch of It Is Scraped Away to Oblivion to Make Way for Gentrification!

Remember that I said that nobody really wants to talk about this. But all of you are hereby granted permission to not only whisper about it, but to stand on the rooftops and SHOUT ABOUT IT, until somebody downtown hears you. Now, this next comment means that I am really going way out on a limb. But why not take one final step and suggest that…

Austin Should Create a Formal “Existing Affordable Housing Preservation Plan.”

In order to do that, our local officials could look at other cities from San Francisco to the East Coast to find out how in the heck they have dealt with housing affordability and neighborhood preservation for the past 30 to 40 years. The pattern in Austin of chip-chipping away at every lot in every neighborhood, bit by bit, block by block, street by street until everything except luxury housing disappears is not the only pattern that exists in the United States.

As you gaze at the modest homes in the photos below, keep in mind that the dirt beneath them is most likely pushing up the tax appraisals to the point where some of them are no longer as “affordable” as they once were. But at least they are more affordable than what you will find in a fully scraped, gentrified neighborhood. For musical accompaniment, here is Gene McDaniels’ top 10 recording for Liberty Records in 1962, “Chip Chip.” 

A Photo Tour of North Central Austin’s Existing Affordable Housing

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Let’s Put Democracy Back Into Austin’s “Progressive” Organizations!

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By Bill Oakey – July 2, 2015

As I write this, we are about to head into the Fourth of July weekend. Celebrations are definitely in order, as we are all very fortunate to live in the freest country on Earth. This is also a time when we can pause and reflect on what we can do to ensure that we practice the best principles of democracy in our civic activities. To fall short of those principles would be to succumb to certain human weaknesses that threaten the very democracy that we claim to support and embrace.

Our Progressive Organizations Need to Consider One Fundamental Reform

How many times have you been to a civic meeting in this town, where the membership was called upon to vote to endorse a candidate for office, or to take a position on a ballot proposition? And how many times did you come to that meeting, hoping to hear presentations from both opposing candidates or both viewpoints on that ballot proposition? In far too many cases, Austin political and environmental organizations who consider themselves “progressive,” will only present one side of an issue. Last November’s urban rail bond proposition is a perfect example. The “Old Guard” leadership of several organizations only saw fit to trumpet their viewpoint at the endorsement meetings. No spokesperson for any faction opposed to the rail bonds was given equal time to lay out their viewpoint in a formal presentation to the group.

My immediate reaction to this non-inclusive approach is to ponder a simple question. What were the anointed leaders who came to these meetings with their minds firmly set in their convictions afraid of? Were they afraid that giving both sides a fair chance to present their case would somehow harm their chances of winning the vote? Were they afraid that their version of the facts on the issue would not be strong enough to win over those who disagreed with them? I prefer to ask a different question. Why not offer equal respect to the members of both sides, and let the beauty and the power of the democratic process play out in a spirit of fair play? I welcome anyone who disagrees with that concept to share their comments at the end of this blog. Perhaps I am missing something here, and if so, I would sure like to know what that is.

With candidates for office, many of these same organizations use a variety of methods to steer endorsement votes to the hand-picked favorites of the insiders. Meetings can be stacked with brand new recruits who had their membership dues paid for them by supporters of the anointed candidates. Or else, the executive committee of the organization decides which candidate they want to endorse, without providing any speaking opportunities for opposing candidates in front of the whole membership. I would like to think that 2015 would be a good year to put that style of backroom dealing out to pasture. Let’s leave those shenanigans to the Old Guard political hacks of the past. For the rest of us, let’s confront the leaders of these organizations and insist that they revise their bylaws and put procedures in place that respect fairness and the basic principles of democracy.

And if those leaders would prefer to maintain the status quo, let’s vote them out and usher in a New Guard that will operate in the open without any fear whatsoever of what fairness and the democratic process might bring.

U.T. Journalism Student Reports On Vacant City Staff Positions

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Introduction By Bill Oakey – June 25, 2015

Last week I was pleasantly surprised to receive an email from Amanda Atwell, a journalism student with a minor in government at U.T. As a follower of this blog, she became interested in the high number of vacant staff positions in the City budget. She asked me some questions for a paper on that subject for one of her journalism classes. So, today I welcome her to this blog by posting her report, which I found to be quite impressive.

But first, a few quick notes about Amanda. Last year she received College Honors from U.T.’s Moody College of Communication. She belongs to Texas Student Television and currently works as an intern at KXAN-TV. Her career interests include sports broadcasting and political journalism.

Amanda Atwell

Amanda Atwell

Resolution Passes Regarding Vacant Positions

By Amanda Atwell

Austinites will have a better idea of where some of their tax dollars are being spent because of the recently passed resolution by City Council regarding excessive city job vacancies.

The resolution, which passed June 11, will attempt to eliminate some of the 1,012 vacant city staff positions. It will also allow City Council to re-appropriate the funding for vacant positions. The resolution allows the council to reevaluate the necessity of the long-term vacancies, some vacant for nine years. Many positions have been vacant due the difficulty of the city being able to compete salary-wise with the private sector. The resolution requires the city manager to bring vacancies before the council from the varying departments, allowing the council to determine what to do with excess funding and whether or not to terminate the position for the next fiscal year.

Austinite and author of a website focused on affordability in Austin, Bill Oakey, believes the resolution is a step in the right direction, but is still concerned about the lack of transparency in where tax dollars are going. Oakey is a former member of the City Electric Utility Commission and continues to work with City Council to find solutions to alleviate excess city spending, in turn lowering the burden on city taxpayers. According to Oakey, much of the unused money for the vacant positions has gone into a “slush fund,” making it unclear what exactly the money was used on. “It’s (money) just thrown into a pile and they can use it without much accountability,” Oakey said. According to the resolution, $73 million is allocated in the budget for the current vacant positions.

While the lack of transparency in city government presents a major issue, the inability to fill these positions could have major implications in the city’s ability to provide necessary services. According to Oakey, Austin’s Emergency Call Center (911) remains badly understaffed, resulting in excessive overtime and increased stress on employees. The fire department suffered vacancies because of a hiring dispute and a federal mandate that resulted from the issue, postponing the hiring process. The police department and Austin Energy also have suffered from vacant positions because of the lack of applicants with the proper skills.

Austin Energy has struggled to fill vacancies because of the competition with private-sector employers. According to Ken Craig, policy advisor for Council Member Ann Kitchen, other employers are capable of being much more competitive with salaries, therefore making it difficult for Austin Energy to fill high-skill positions such as engineers, and information technology specialists. “There is a potential impact in not being able to fill needed positions, as services to citizens may be compromised,” Craig said.

The resolution allows the city manager to bring forward specific positions to be discussed by the council, whether to eliminate the position or reevaluate the pay. “It would be helpful for the city manager in situations where we have trouble filling a vacancy because we’re not being competitive in the pay that we’re offering, it would allow him an opportunity to make that case to the council, as well,” Council Member Troxclair said at the council meeting June 11.

Some believe while this is a step in the right direction, there is room for further improvement. Michael Searle, policy advisor for Troxclair, said this is just the first step in the process of reducing the number of vacancies and improving budgetary transparency. Cities such as San Antonio place protections on the percentage of allowable city job vacancies, capping their allowable vacant positions at around 6 percent. Austin is currently at 8 percent according to Searle.

The resolution does not place a percentage cap on vacant positions, but aims to increase transparency in the budget, and allows City Council to re-appropriate funding for non-sworn positions that remain vacant more than 12 months. The resolution will allow City Council to determine whether to continue funding of the long-term continuing vacancies by requiring the city manager to notify the council of positions vacant over 12 months. “This will allow us to put a structure in place so that we don’t get into this position again,“ Troxclair said at the council meeting June 11. “We don’t have to check in every, you know, every few years, and say, oh, well, we’ve been spending, you know, $500,000 on this position that was vacant.”

In order to completely alleviate the issue, Oakey believes more change should happen. “I think the new resolution was a softball approach to the problem,” Oakey said. He favors the “Honolulu policy,” which places funds for vacant positions under the control of one central office. This office will then distribute the funds on an as-needed basis, preventing departments from padding their budgets with the excess funding. Honolulu, Hawaii, adopted this policy when the city had a similar affordability crisis. Oakey also suggested that the city’s website should provide the taxpayers full transparency.

Oakey supports the resolution, but still questions where the money previously allocated for these positions went. According to an article in the Austin Business Journal, in August 2013, Austin had 934 jobs available, but only 76 were advertised and open to applicants. According to Oakey, three council members said that the funds specifically for the salaries of these vacancies could be used for other unknown purposes without discretion. Because of lack of regulation regarding the unused money, Oakey said it is difficult to tell where exactly is has been spent in previous years.

Oakey said the most immediate impact the resolution will have would be the requirement of regular reports from the city manager on the amounts of budgeted funds from vacant positions that are available to be re-apportioned. While this doesn’t eliminate the funds from the budget, it allows for accountability to the taxpayer and helps to ensure their money is spent responsibly, improving on the lack of policy regarding the issue in previous years.