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Rebuild Houston Has Not Paid Down One Penny on the City's Debt

by Bill King

One of the greatest hoaxes ever foisted on the Houston public is the claim that the Rebuild Houston program has paid down $1 billion of the City's bond debt.  In reality it has not paid down one penny on the debt.  Here are the facts.

  According to the City's June 30, 2017 audit, the City's total bond debt as of June 30, 2011 (the last fiscal year before Rebuild went into effect) was $12.3 billion.  As of June 30, 2017, that bond debt had risen to $13.5 billion, a nearly $1.2 billion increase.  And since then, the voters have authorized another $1.4 billion dollars in bonds which have either been issued since then or will be in the near future.  

To be fair, the intent of Rebuild Houston was to reduce only one specific category of bond debt, an account referred to as "Public Improvement Bonds" (PIB).  These are the bonds that the City has issued to general improvements like streets, drainage, parks, city buildings, etc.  For decades the City issued bonds to build these various improvements and then reissued new bonds as the old ones paid off to start new projects.

  There was never any intention that any funds from Rebuild Houston would actually go to pay down the PIB bonds.  Rather, the City would stop issuing new bonds for streets and drainage and consequently the PIB debt would begin to go down as the City retired those bonds from the General Fund.  The theory was that as the balance was reduced, the City would save money from having lower bond payments and those savings would be transferred to Rebuild to fund streets and drainage on a pay-as-you-go basis.  

But what the Rebuild advocates did not count on was that the City would step up its issuance of PIBs for other purposes.  As result, there has been only a minuscule reduction of the PIB balance, and therefore no consequential savings from the hoped-for reduced debt payments.   Again, referring to the schedule of the City's debt in its latest audit, it shows that the PIB debt in 2011 was $2.468 billion.  By 2017 the PIB debt had only been reduced by $67 million to $2.401 billion, a 2.7% decrease.  But the average outstanding debt during the time Rebuild has been in effect has actually been $70 million higher than what was owed in 2011.

So, how in the world do City officials stand up with a straight face and claim Rebuild has paid down a billion dollars of debt when the debt is just as high as it was before the Rebuild program was implemented?  You might want to take a couple of aspirin before reading the explanation, because their contorted justification of this claim is likely to give you a headache.  

When Rebuild was adopted, there was an accounting problem.  No one knew how much of the $2.4 billion of outstanding PIB debt related to streets and drainage.  So, they had to make an estimate.  They settled on assigning 70% of the then-outstanding PIB debt to streets and drainage.  

Each year thereafter, the outstanding debt "attributed" to streets and drainage was reduced by 70% of principal payments made on all PIB bonds.  So, by the end of FY2018, the theoretical amount of the PIBs attributed under this estimate to streets and drainage had been reduced from about $1.8 billion to just over a $1 billion.  Of course, that still does not get you to a billion dollars.  So, to further exaggerate their claim, they also added the interest payments made over that time.

  So, in the City's financial alchemy, a billion dollars of principal and interest payments made from the General Fund, and which the City would have had to make whether Rebuild was ever enacted or not, has been magically transformed into Rebuild paying down a billion dollars of City debt.  What utter horse hockey. 

  The financial antics of the City would be comical if this were not so serious.  In 2017 and 2018, the City cut infrastructure spending over $180 million from the 2016 level, a reduction of over 20%.  And this reduction was made notwithstanding that the City's revenue increased in both years.  The failure of the City to invest in its infrastructure has a direct impact on the daily lives of Houstonians, particularly when it comes to protecting us from flooding.

  Our City officials should spend their time trying to actually fix our streets and drainage instead cooking the books in a vain attempt to justify a program that is clearly an abject failure. 

 

 

Harris County Republican Party Chair Urges Democrat Voter Registrar to

Stop Confusing Voters and Follow the Law

Laments Democrat Voter Registrar Incompetence and Asks if Democrats Actually Live in UPS Stores

HOUSTON - Paul Simpson, Harris County Republican Party Chair, today responded to false attacks by the Harris County Democrat Party and others trying to pin the blame on Republicans for mistakes by Democrat Harris County Voter Registrar Ann Harris Bennett who wrongfully suspended thousands of voter registrations, and trying to intimidate citizen volunteers from following Texas law:

“Democrat Voter Registrar Ann Harris Bennett’s records lists thousands of voters registered at locations that do not seem to be residences, including UPS stores, churches without residences, industrial facilities, and the Harris County Jail. Volunteer Harris County Republican Ballot Security Chairman Alan Vera exercised his right as a registered voter to ask Ms. Bennett to verify these addresses - a request that Texas law allows only a registered voter to make. The list of addresses included voters of all stripes - even a Republican precinct chair.

“In response, the Democrat Voter Registrar mistakenly suspended the registration of thousands of voters.

“The Harris County Democrat Party then claimed Mr. Vera’s request had ‘changed the registration status’ of thousands of Democrat voters, when the list was party-neutral and it was the Democrat Voter Registrar who had suspended those registrations. More disturbingly, a Democrat partisan then published online the personal information of party volunteers who work with Mr. Vera, in a vain attempt to intimidate them.

“We will not be intimidated. It is inexcusable that Democrat Ann Harris Bennett failed to follow the law. She should not have suspended voters’ registrations. And the outrageous doxing and threats against Republican volunteers by leftists only hardens our resolve to fight their dirty tricks.

“This also shows that the Harris County Democrat Party doesn’t understand the law, and traffics in ‘fake news’ in a futile effort to gin up support for dismal Democrat candidates dedicated to failed left wing policies that Texans reject. Or do Democrat voters actually live in UPS stores, industrial facilities, and the Harris County jail?

“Democrat Voter Registrar Ann Harris Bennett should NOT have jumped the gun by suspending those voters’ registrations. Instead, the law requires her to give them 30 days to respond to a written inquiry about their residence, to ensure they vote in the right jurisdictions. We urge Democrat Ann Harris Bennett to follow the law and quit violating voters’ rights.”

Background:

Texas Election Code does not permit local registrars to question the eligibility of registered voters based on residency, but registrars are required to act on challenges to the registration of other voters in their county initiated by local citizens. Texas Election Code Section 16.033 states a county registrar “may use any lawful means to investigate whether a registered voter is currently eligible for registration in the county,” but it“does not authorize an investigation of eligibility that is based solely on residence.” If the challenge is based on residence, Section 16.0921 says “the registrar shall promptly deliver to the voter whose registration is challenged a confirmation notice.” Section 16.0921 says that if the voter fails to respond to the registrar’s notice within 30 days from the date the notice was mailed, “the registrar shall enter the voter’s name on the suspense list.” Bennett appears to not have followed the statute to provide voters 30 days to respond, but instead suspended registrations immediately. 

 

 

 

 

 

Harris County releases $2.5B flood bond project list, two days before voting begins

The Harris County Flood Control District on Monday released its complete list of projects that would be funded by the county's $2.5 billion flood infrastructure bond proposal, two days before early voting on the measure begins.

The 237 projects include $1.2 billion for channel improvements, $401 million for detention basins, $242 million for floodplain land acquisition, $12.5 million for new floodplain mapping and $1.25 million for an improved early flood warning system.

Matt Zeve, the flood control district's operations director, said the vast majority of projects will address problems engineers identified years or decades ago but lacked the funding to tackle. The flood control district's budget totals just $120 million annually.

"It's always been OK, how do we afford to solve these problems?" Zeve said. "With the bond, we'll have funds to solve some of these drainage and flooding issues.

If approved, the bond would be the largest local investment in flood infrastructure since Hurricane Harvey flooded more than 154,000 Harris County homes a year ago. Voting begins Wednesday and concludes on Saturday, Aug. 25, the one-year anniversary of the storm's landfall.

The bond also would put $184 million, coupled with more than $500 million in outside funding, to purchase around 3,600 buildings in the floodplain. It would not pay for a third reservoir to complement the Addicks and Barker reservoirs in west Houston, but would chip in $750,000 to help the Army Corps of Engineers study the idea.

Thirty-eight projects were added based on ideas from residents at more than two-dozen public meetings this summer. These include $6 million to improve flow in Horsepen Bayou, $15 million to do the same in Brays Bayou and $30 million to design and build new bridges over Buffalo Bayou.

Harris County Judge Ed Emmett said the additions to the projects list proved that the flood control district was serious about incorporating ideas from residents.

"We said from the start that we recognized that this effort was going to have to be as transparent as anything the county has ever done," Emmett said in a statement.

More than 4,500 residents attended the meetings, according to the flood control district's head count. They submitted around 2,400 comments and made 682 requests for flood infrastructure maintenance.

The flood control district left $500 million un-allocated on the projects list. Zeve said while engineers initially planned to draw down that sum as more projects were added, the flood control district decided to leave room for new projects over the 10- to 15-year lifespan of the bond.

"We want to give ourselves some wiggle room," Zeve said.

The proposal is a gamble by Harris County Commissioners Court, whose members are betting residents see the value in a significant investment in the area's flood management system. There is no option for skeptical voters to approve a smaller sum.

If different funding sources become available, such as through the state or federal government, the county may not need to borrow the full $2.5 billion. Emmett said last month that $700 to $900 million of the bond would be used to secure federal matching funds, potentially netting the county an additional $2 billion to spend on flood infrastructure.

The bond will increase property taxes for homeowner 2 to 3 cents per $100 of assessed home value, according to county budget analysts. Those who are disabled or above the age of 65, and whose home is worth less than $200,000, would pay no additional taxes.

For a full list of the 237 Projects approved by Harris County Flood Control

https://www.hcfcd.org/media/2907/2018bondprojectlist2018-08-06-1130.pdf

 

"Let's Raise Taxes for More Police":  We Saw this Movie in 2006

Last week it was suggested that Houston voters should agree to pay more in property taxes in order to hire more police. We have already done that once, in 2006.  Perhaps before we rush to allow the City to increase property taxes by more than the 4.5% annual amount the City charter now allows we should take a look at how that 2006 increase worked out.

As most of you know, in 2004, Houston voters amended the City charter to keep the City from raising property taxes by more than the sum of inflation and population increase. In 2006, the City came back to voters and asked for an additional $90 million above that cap, in perpetuity. That is to say, $90 million would be added to the calculation of the 2004 cap each year in the future. That extension of the cap has now been in place for 11 years, so Houston taxpayers have forked over nearly a billion additional dollars over the original cap for "public safety."

How much additional public safety has our nearly one billion dollars bought us? Turns out, not so much.

FY2006-2007 was the last year before the City began collecting the extra $90 million each year. According to the City's annual reports, since 2007 the City added a whopping 20 employees to the police department's payroll, a three-tenths of one percent increase (0.3%). [ii] Seventy police officers and forty-five cadets have been added, but the number of civilian employees and cadets have fallen by ninety-five, meaning that more officers have been transferred from patrol and investigation to administrative jobs.

Of course, the HPD budget has risen significantly, going from $576 million in 2007 to $827 million this year, a 44% increase. The budget for personnel has grown from $535 million to $782 million, a 46% increase. The average per-employee personnel cost (salary plus all benefits) has grown from $85,283 to $123,553.  

Based on any objective measure I can find, there is no evidence that these added expenses have made the police department more efficient. The number of arrests made by HPD fell from 122,000 in 2007 to just under 52,000 last year, a 57% decrease. It issued 544,000 fewer tickets last year than in 2007, a 58% decline. The City only started reporting clearance rates in the budgets in 2012. That year, HPD cleared 18.6% of "Part I" offenses (all violent crime plus burglary and auto theft). In its budget request this year, HPD estimated it had cleared 13.4% in FY2016-2017. HPD estimates of its response times have not changed significantly.

Nor is it true that HPD is significantly understaffed compared to other cities. According to a 2016 Governing Magazine study, the ten largest cities in the US have an average of 25 officers per 10,000 residents. Houston has 22 and is, therefore, 12% below the average. However, there are three cities, New York, Chicago and Philadelphia which are significantly above the average at 42, 43 and 41, respectively. If you drop those three out, the average of the remaining cities is 21, slightly below Houston.  

Of course, it is patently absurd to compare Houston to New York in terms of police staffing because of all of the special risks New York faces, e.g., the United Nations. Chicago and Philadelphia have violent crime rates that are roughly equivalent to Houston's, indicating that their larger forces have not accomplished much. It is also worth noting that these three cities have the largest negative net deficits of all U.S. cities. So, they should hardly be examples by which we should manage our city.

The next five largest cities in Texas have an average of 15 officers per 10,000, well below Houston. Among the five, only Dallas is higher at 25.

  So, does Houston need more police officers?  Probably.  But personally I am fed up with throwing more money at the police department with no accountability.  I mean, have you ever heard anyone at the City ask why arrests are down by 57% in the last ten years, including a 16% drop last year?  Have you heard anyone ask HPD why the violent crime clearance rate is down by nearly 5% in the last six years?  I certainly have not.

  Communities all over this city are already coming out of pocket to hire constables and private security companies to patrol their neighborhoods because they cannot get HPD to do so.  Does anyone really believe that if we allow the City to raise property taxes, patrols will suddenly appear in their neighborhoods.  After the City used the drainage fees to pay for employees and pet projects, does anyone believe this money will really be used to hire police officers?  Until we have some demonstration that the City can more efficiently manage HPD and that it can keep its promises on how it will spend our money, I am not voting to give it another dime.
 

 

 

 

 

 

 

 

 

 

 

DISCLAIMER: Political advertising paid for by Kingwood Area Republican women PAC, Regina Thompson, Treasurer, P.O. Box 5906, Kingwood, TX 77325-5906. Political contributions are not tax deductible for Federal Income Tax.
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