Going further than prior proposals, Abbott unveils a plan to slow Texas property tax growth

Texas Gov. Greg Abbott on Tuesday unveiled a plan to limit annual local governments' property tax revenue growth to 2.5 percent. To increase revenue beyond that, governments would need approval from two-thirds of voters.

HOUSTON — Gov. Greg Abbott on Tuesday unveiled a plan to "rein in skyrocketing property taxes" in Texas, looking to lay down a marker in a debate that dominated the legislative sessions last year and promises to remain front and center through the 2018 primaries and his re-election campaign.

"Enough is enough," Abbott said at a news conference flanked by Republican Lt. Gov. Dan Patrick and several lawmakers. "Texans are fed up with property taxes being raised with impunity. They are tired of endless government spending while honest, hard-working people struggle just to keep up with paying their tax bills. We can no longer sit idly by while homeowners are reduced to tenants of their very own property with taxing authorities playing the role of landlord."

A key tenet of Abbott’s proposal is to prevent cities, counties and school districts from collecting more than 2.5 percent more in property tax revenue than they did in the previous year without voter approval. That’s a far lower cap than controversial thresholds that twice failed to make it through the Legislature last year. And his plan would require that two-thirds of voters — well beyond a simple majority — approve any increase above that 2.5 percent threshold.

But Abbott’s plan also offers local leaders something last year’s property tax overhauls didn’t. The state would no longer be able to saddle local governments with providing new services without providing state funding to cover the costs, he said. And when it comes to funding public education — which makes up the majority of local property tax bills — Texas lawmakers would likely be required to put up more state funds under Abbott’s proposal.

At the news conference, Abbott acknowledged that the Legislature might need to pass a school finance reform package as a precursor to his tax proposal, pointing to his successful push last year for the creation of the Texas Commission on Public School Finance. The panel is expected to report its findings to the governor and the Legislature by the end of this year.

The governor’s plan would also subject school districts to the same revenue caps as cities and counties, which is almost certain to be controversial.

Another provision in the proposal would also require local governments to be more transparent about the debt they carry when asking voters to approve new bond packages. And it would also require a supermajority of voters to approve additional debt.

While the plan would slow increases in how much money local governments collectively take in, it wouldn’t necessarily lower individual property tax bills. The amount of money a landowner must pay each year is not just tied to the tax rates that local governments set. It is also determined by the appraised value of the land and any buildings on it. So a city could lower its tax rate and a homeowner could still pay more in property taxes than a previous year if the owner's assessed values have gone up.

The cap in Abbott’s plan wouldn’t be applied to either the tax rate or the increase in appraised value -- it would only pertain to the total amount of money a local government collects on existing land and buildings.

Current law allows voters to weigh in on increased property tax revenues that cities, counties and special purpose districts collect. But that only happens if revenues increase 8 percent or more — and voters collect enough signatures to force an election.

Revenue increases from new construction don't apply toward the election thresholds in current law or Abbott's proposal. 

It’s still unclear how much luck Abbott will have with lawmakers who return to Austin next year. Similar property tax overhauls failed amid an intra-Republican party war between the Senate and House last year, with members of each chamber blaming the other for the failures. But the lower chamber next year will have a new leader since House Speaker Joe Straus, R-San Antonio — often cast as the chief obstructor of Abbott and Republican Lt. Gov. Dan Patrick’s agenda — is not seeking another term.

Asked Tuesday about his plan's chances in the 2019 legislative session — especially given the hurdles less ambitious proposals faced last year — Abbott expressed confidence that public sentiment will force lawmakers to act.

"Frankly, I think it will be easy to get it through both the House and Senate because taxpayers in the state of Texas are frustrated," Abbott told reporters. "Every member of the House is running for election right now. Every member of the House is hearing they need to do something to constrain property taxes in Texas, and so I know when everyone comes back to the Capitol, they understand they have to do something."

Patrick, meanwhile, cited the pending change in House leadership as a possible catalyst for a property tax bill. 

"It is my hope that leadership in House next session understands that we're not going to wait any longer for real property tax reform and relief and that we'll have a partner to get this done," Patrick said, later telling reporters he hopes a commitment to reducing property taxes is "one of the prerequisites before House members" vote on their next leader. 

The proposal is also expected to ignite anger from local leaders, who say state officials in recent years have overstepped their bounds and tried to control how cities, counties and school districts operate. In Texas, only local governments are allowed to collect property taxes. The state is largely funded by sales taxes. Texas is among seven states that don't have a state income tax.


A Fort Bend engineer's warning, 25 years old, comes true during Harvey

Twenty-five years ago, Fort Bend County's assistant engineer emerged from a meeting with the U.S. Army Corps of Engineers. He had new information, and he was worried.

Charles Glen Crocker, then 38, had learned that the footprint for Barker Reservoir was bigger than the land owned by the government, placing future homeowners in the Cinco Ranch and Kelliwood subdivisions within what engineers called "flood pools." The reservoir, dry much of the time, could fill during a major rainstorm and spread into the homes of unsuspecting residents.

His resulting letter, written on July 6, 1992, was a warning to county officials: "...recent rainfall events and weather conditions have shown that many areas considered relatively safe from rising waters have been flooded."

The land in the reservoir was sinking, "subsidence" in engineering terms. Houses were being built at a level lower than the water level the dams were designed to hold. A long period of rain could mean trouble in the two massive planned communities.[Former Assistant Fort Bend County Engineer Glen Crocker stands at the Barker Reservoir spillway Tuesday, Jan. 9, 2018 in Houston. Twenty-five years ago he discovered that new Cinco Ranch subdivisions could flood because the Barker reservoir footprint was bigger than the government-owned land. He reported his findings but was ultimately ignored.

Crocker alerted everyone he could think of: the county judge, county commissioners, the Fort Bend County Drainage District and the county's emergency management coordinator.

He wanted the county to look at the matter more closely. Instead, a special purpose district formed to benefit developers by paying for drainage improvements attacked Crocker. Its letter criticized him for writing the memo, questioned his credentials and said Crocker's assertion could hold back development in the county.

Crocker describes the period as a "firestorm." He said the furor was a big factor in his decision to leave his county government post two years later.

The county ignored Crocker's warning. By 2017, development in the flood pools in Fort Bend and Harris counties would swell to 30,000 homes and businesses.

Last August, as huge pools from Hurricane Harvey flooded more than 9,000 structures upstream of the Addicks and Barker dams, Crocker strode into the second-floor office of his Sugar Land home.

There, in a manila folder, he found the two-page letter he had written so many years ago. He looked at the subject line: "Barker Dam – Possible Flooding of Non-Government Owned Land."

The Houston Chronicle found the document through a public records request filed late last year with the Willow Fork Drainage District and contacted Crocker to discuss it.

Crocker's letter was addressed to Roy Cordes, then the Fort Bend County judge, now its county attorney.

"I think the letter was very informative and raised issues about the possibilities with the [reservoir] elevations," Cordes said in an interview Friday. "He was well-entitled to raise the issue."

Cordes said he didn't recall what happened, if anything, after he received the letter. "I can't cite any specific action based on the letter," he added.

Jim Blackburn, an environmental lawyer and planner who has studied the Houston area's vulnerability to flooding for years, said Crocker's letter sheds light on what he calls the "flood disease" that has gripped the Houston area for several decades. It's a development attitude that resulted in magnifying the impact of the rainstorm of the century, he said.

"The flood disease keeps information from being brought forward," Blackburn said. "It's about the failure to allow for exchange of ideas, a failure to hear, and a decision to attack those who don't agree. It's been going on for a long time. The reaction to Crocker's letter is a perfect example of the pervasiveness and the insidiousness of the flood disease."

'Noteworthy' flood pools

It would take a while for Crocker to grasp those attitudes. A graduate of Sharpstown High School, Crocker earned a bachelor of science degree in construction management in 1983 from the University of Houston.

Two years later, Fort Bend County officials recruited him away from a construction company to help open the new engineering department. He was hired as the assistant engineer and worked in a two-room hut that was part of the former World War II prisoner of war camp in Rosenberg.

The tasks of the employees, who wore jeans and drove pick-up trucks, captured the county's dramatic transition from rural to suburban, from pulling dead livestock out of ditches so roads didn't flood to reviewing subdivision maps. All around Crocker, streets were being built and holes dug to put in water and sewer pipes as plans for subdivisions sprouted.

In 1992, Crocker attended a meeting at the Corps of Engineers' office at the base of Barker Reservoir. The agenda: a discussion about Fort Bend County's plans to build a park, with the YMCA, with soccer fields on the land within the reservoir. 

Crocker said during the meeting, Richard Long, then the Corps' manager for the Barker and Addicks reservoirs, showed him a piece of paper listing "noteworthy" flood pools. Crocker said he asked Long what it meant. Long replied that when the reservoirs fill, the water exceeds the land that the federal government had bought.

It was Crocker's job to work with the developers of the Cinco Ranch and Kelliwood subdivisions, and the engineering firms they hired. Following the meeting with Long, Crocker said he consulted Fort Bend County Commissioner Alton Pressley, whose precinct included the two subdivisions.

Pressley said Crocker needed to write a letter to the entire county commissioners' court, then led by Cordes.

Crocker's letter, dated July 6, 1992, said the Barker Dam was "designed/and or modified" to contain 8.7 more feet of water than the land the federal government had purchased. That meant that the land where the subdivisions were being built would be part of the reservoir during times of heavy rain.

"This 8.7 feet of water translates into the flooding of approximately 4,679 acres of land, not under jurisdiction of the Corps of Engineers," Crocker wrote.


Thousands of homes behind the Addicks and Barker reservoirs sit in what engineers call the “flood pool” — a muddy lake that would form behind the dam if the floodgates were closed long enough and it rained hard enough. During Hurricane Harvey, huge pools formed that forced the evacuation of 30,000 properties with 150,000 people in neighborhoods upstream of Houston’s two dams. The map shows the subdivisions that were threatened by the storm. Not all neighborhoods shown were impacted, but those closest to the dams suffered the most damage. An estimated 9,000 homes were damaged.

Crocker added that the "unofficial report" from the Corps found that if four more inches of rain had fallen in the storms of March 1992, "there would have been floodwaters inside of residences located in developments adjacent to the Reservoir."

He concluded that Fort Bend County officials and developers should work with the Corps on the issue. "Certainly additional data and studies will be required to determine the actual existence of/or extent of any problem with encroachment on privately held land," Crocker wrote.

But Ron Drachenberg, who was Crocker's boss as Fort Bend county engineer and now is retired, said last week that the county didn't have any options.

"We didn't have a way of stopping development because it wasn't our property," he said. "It wasn't governmental land. It was private land."

The Chronicle sent copies of Crocker's letter and the responses to Fort Bend County Judge Robert Hebert; to the sole current commissioner who was on the panel at that time, Grady Prestage; and to the commissioner whose precinct includes Cinco Ranch and Kelliwood, Andy Meyers.

Hebert said in a written statement: "The letters reflect the pressure applied to the County in 1992 to keep quiet about their concerns about the reservoir. While we received more than the 4" the letters discuss from Harvey in 2017, it is now obvious to all that the Corps will allow the reservoir to overflow onto homes behind it to protect downstream property. I will not comment further as I was a private citizen at the time and was completely unaware of this issue."

Bad for business

In 1985, the state created a special purpose district called the Willow Fork Drainage District. The focus was development, specifically to sell bonds to reimburse developers for drainage improvements and then levy property taxes to repay the money borrowed – with interest.

Crocker's letter soon came to the attention of the district's engineering firm, Turner Collie & Braden.

Michael B. Hunn, director of the engineering firm's land development division, responded to Crocker's correspondence in a four-page letter in November 1992.

He began by noting that concern had been expressed that Crocker's letter "could unnecessarily adversely impact sales of land in the high quality residential neighborhoods currently being developed in Fort Bend County."

He said Turner Collie & Braden had interpreted Crocker's letter as inferring that the "properties immediately upstream of Barker Reservoir are in imminent danger of being flooded and that the level of protection from flooding is not as secure as anticipated."

Hunn wrote that the "properties within the Willow Fork Drainage District are well protected from individual storm events and/or ponding levels in Barker Reservoir that have a 1 percent or greater chance of occurring." This meant that the subdivisions were safe from 100-year floods, he wrote.

Hunn could not be reached for comment. A Turner Collie & Braden engineer who was copied on Hunn's letter didn't return messages seeking comment.

George Nilsson, president of the Willow Fork Drainage District board of directors, also took aim at Crocker's letter in a response sent to Cordes, the county's top official.

"Mr. Crocker's conclusions were made without the benefit of adequate research, independent verification or proper scientific methodology," he wrote.

The drainage district, according to Nilsson, was surprised that Fort Bend County would allow someone "who is not a registered professional engineer" to use county letterhead to "make such baseless, unfounded and potentially damaging assertions." The Chronicle gave Nilsson copies of Crocker's letter, his rebuttal, and Turner Collie & Braden's response. He said he was too ill to discuss them.

In a recent interview, Crocker said he intentionally did not pursue a professional engineering license from the state.

Having known engineers who worked for counties and cities before who were asked to put their seal on things that weren't quite copacetic, I just dropped my pursuit of getting a PE," he said.

Sad to be vindicated

Crocker said the responses to his letter were among the reasons why he left his job in 1994. He said the commissioners' court had meetings about what he wrote, but he was not allowed to attend.

In retrospect, Crocker said he was "young and naïve" and thought he was raising a technical issue that Fort Bend County needed to examine. He said he was not thinking that Turner Collie & Braden worked for the drainage district, some municipal utility districts in Cinco Ranch, and as a result, "there might be some political fallout."

After leaving his county job in 1994, Crocker worked for four utility billing, development, and engineering firms and later moved to the Middle East to work on development projects. He returned to Houston in 2015 and now is a land development construction manager for Cobb, Fendley & Associates, a Houston engineering firm.

When Harvey struck, Crocker said news accounts of floodwaters backing up behind the Barker Dam reminded him that he had written the letter in 1992. He said he hoped that what he had written about subdivisions being threatened by the flood pool would not come true.

"But then it did," he said. "I feel vindicated – but in a bad way. For me to be vindicated, millions of dollars in damage was done to people's houses.''



New Texas laws took effect Monday. Here’s what you need to know


Don’t be surprised if you’re asked to show a photo ID the next time you use a debit or credit card to make a purchase.

True, many retailers already ask to see that ID for certain purchases.

But as of Monday, Texas law will allow retailers to reject any sale where shoppers can’t or won’t show their photo ID.

“While clearly not a panacea, [this bill] allows a merchant to request government-issued photo identification at point of sale and will provide the ability for that merchant to decline a transaction,” a bill analysis for Senate Bill 1381 states. “The option to turn down a transaction if a customer fails to provide photo ID verifying their identity is not currently available to merchants.”

Texas lawmakers decided during the 2017 legislative session this measure is needed in an era of data breaches that have affected millions of shoppers.

SB 1381 is one of more than two dozen laws that take effect with the New Year — whether Texans know it or not.

“Most Texans are too busy thinking about holiday parties and prepping for visits from in-laws than the vagaries of when Texas laws go into effect,” said Brandon Rottinghaus, a political science professor at the University of Houston. “By the time the laws are set to go into effect, most Texans are concerned with other matters.”

Said Allan Saxe, an associate political science professor at the UT Arlington: “Most people are very busy with their lives, trying to make a living and trying to escape from the daily grind of life, [and] laws and the Legislature are boring and often hard to understand.”

The new measures come on the the heels of 673 new laws — ranging from banning texting and driving to allowing Texans to carry long knives and swords around — that went into effect Sept. 1.

Here’s a look at a few of the new laws going into effect Monday.

Paying for purchases

Security breaches remain a major concern for retailers, banks and customers alike.

Texas lawmakers said requiring shoppers to show a photo ID that matches the name on the credit card is needed to protect retailers who “may now be ‘on the hook’ for some losses resulting from fraudulent transactions,” according to SB 1381 analysis.

This, they say, can guard against information obtained during data breaches that then is used to create fake debit and credit cards that are used not only online but also in person.

“This legislation will provide merchants with an additional tool to attempt to minimize fraudulent transactions and losses,” the analysis states.

Senate Bill 5, passed after courts ruled that the 2011 state law discriminates against Latino and black voters, gives voters who say they can’t obtain required forms of ID more options.

Anyone who has a “reasonable impediment” to obtaining a photo ID may show an alternate form of ID — bank statements, utility bills, paychecks — to vote. But anyone who lies about the photo ID and then uses one of the new alternates to vote faces being charged with a state jail felony.

The law also requires the Texas secretary of state to set up mobile units to provide election ID certificates to voters who need them.


The next time ownership of a vehicle is transferred, the odometer reading requirement may be a little easier, under SB 1062.

Currently, federal law requires the odometer disclosure “to be made on a secure form to prevent tampering,” according to the bill analysis.[odometer]
A new state law is geared to make the odometer reading requirement of transferring ownership easier.

Texas Department of Motor Vehicles has a carbon copy paper form. But since that has to be mailed, the process delays the ownership transfer process.

This bill lets the state accept an electronic copy of forms needed to do the transfer — whether the vehicle is for sale or for an insurance claim — to speed up the process.


Perhaps a little-known fact is that when liquid milk is transferred, tractor-trailers hauling it can be as heavy as 80,000 pounds on state highways, county roads and farm-to-market roads.

SB 1383 increases the amount the trucks can carry to up to 90,000 pounds with a permit for tandem-axle trailers.

The permit costs $1,200 and the revenue will be split between the counties where the trucks would run, the state highway fund and the DMV.


Those who have protested their property tax appraisals probably know that their appraisal could go down, stay the same or go up as a result of their protest.

Right now, if the value goes up, the appraisal is final and there’s no way for a property owner to protest the new higher value.

SB 1767 guarantees that a property owner has a chance to weigh in on a higher value.


A new law that went into effect Sept. 1 but applies to insurance plans that go into effect or are renewed after Jan. 1 requires commercial health insurance providers in Texas to cover the cost of high-tech 3-D mammograms, rather than just the traditional 2-D mammograms that have been offered for years.

House Bill 1036 means that women in Texas soon will no longer be asked when they go to their annual mammogram if they want to pay an extra charge — perhaps $100 or more — to have a 3-D mammogram.

Instead, commercial insurance providers in Texas will automatically cover that cost, as they have long done for regular 2-D mammograms when patients are at least 35 years old.

This makes Texas the sixth state — along with Connecticut, New York, Pennsylvania, Illinois and Arkansas — to have a law requiring insurance companies to cover all mammogram costs.

Breast cancer is the cancer most diagnosed in women, potentially affecting 1 in 8 women. Doctors say all women are at risk, whether or not they have a family history of problems.



Texas Legislature

Bills Effective on January 1, 2018

85th Legislature Regular Session

Report Date: 1/3/2018

Number of Bills: 26

HB 493Author:Perez | Button | Murphy | Clardy | Blanco


Last Action:05/29/2017 E Effective on 1/1/18

Caption:Relating to reporting requirements for the College Credit for Heroes program.

HB 1101Author:Pickett | Guillen


Last Action:05/26/2017 E Effective on 1/1/18

Caption:Relating to the authority of the chief appraiser of an appraisal district to require a person to file a new application to confirm the person's current qualification for the exemption from ad valorem taxation of the total appraised value of the residence homestead of a 100 percent disabled veteran.

HB 2126Author:Button


Last Action:05/29/2017 E Effective on 1/1/18

Caption:Relating to the franchise tax rate applicable to certain taxable entities that sell telephone prepaid calling cards.

HB 2228Author:Murphy


Last Action:06/01/2017 E Effective on 1/1/18

Caption:Relating to deadlines for performing various functions in connection with the ad valorem tax system.

HB 2279Author:Goldman


Last Action:06/15/2017 E Effective on 1/1/18

Caption:Relating to the regulation of residential service contracts.

HB 2358Author:Metcalf | Bell | Keough | Perez | Murphy


Last Action:06/15/2017 E Effective on 1/1/18

Caption:Relating to eligible voters in a confirmation election for a conservation and reclamation district.

HB 2492Author:Frullo


Last Action:06/15/2017 E Effective on 1/1/18

Caption:Relating to domestic surplus lines insurers; authorizing and imposing a tax.

HB 2999Author:Bonnen, Dennis


Last Action:05/29/2017 E Effective on 1/1/18

Caption:Relating to the exemption from ad valorem taxation of property owned by certain medical centers in certain counties.

HB 3018Author:Phelan


Last Action:06/15/2017 E Effective on 1/1/18

Caption:Relating to reciprocity requirements for nonresident insurance agents to offer or sell insurance policies issued by the Texas Windstorm Insurance Association.

HB 3232Author:Darby


Last Action:06/12/2017 E Effective on 1/1/18

Caption:Relating to the penalty imposed on certain delinquent oil and gas severance taxes.

HB 3254Author:Phillips


Last Action:06/12/2017 E Effective on 1/1/18

Caption:Relating to the regulation of a motor carrier and the enforcement of motor carrier regulations; authorizing the imposition of a fee; creating a criminal offense.

HB 3275Author:Capriglione


Last Action:06/15/2017 E Effective on 1/1/18

Caption:Relating to the monitoring of major information resources projects by the Department of Information Resources.

HB 3342Author:Parker


Last Action:06/12/2017 E Effective on 1/1/18

Caption:Relating to the prelicensing education requirements for residential mortgage loan originators.

SB 5Author:Huffman | Bettencourt | Birdwell | Buckingham | Burton | et al.

Sponsor:King, Phil | Laubenberg | Geren | Parker | Sanford

Last Action:06/01/2017 E Effective on 1/1/18

Caption:Relating to requiring a voter to present proof of identification; providing a criminal penalty and increasing a criminal penalty.

SB 549Author:Kolkhorst


Last Action:05/23/2017 E Effective on 1/1/18

Caption:Relating to refunds of certain bingo licensing and registration fees.

SB 594Author:Creighton


Last Action:05/18/2017 E Effective on 1/1/18

Caption:Relating to the procedure for the approval of rules adopted by the comptroller relating to the appraisal of qualified open-space land and qualified timber land for ad valorem tax purposes.

SB 1047Author:Creighton


Last Action:06/12/2017 E Effective on 1/1/18

Caption:Relating to installment payments of ad valorem taxes.

SB 1062Author:Perry


Last Action:06/01/2017 E Effective on 1/1/18

Caption:Relating to documentation for the transfer of a motor vehicle title.

SB 1083Author:Perry


Last Action:05/22/2017 E Effective on 1/1/18

Caption:Relating to the applicability of the sales and use tax to certain insurance services.

SB 1148Author:Buckingham | Bettencourt | Burton | Campbell | Hinojosa | et al.

Sponsor:Bonnen, Greg | Darby

Last Action:06/15/2017 E Effective on 1/1/18

Caption:Relating to maintenance of certification by a physician or an applicant for a license to practice medicine in this state.

SB 1345Author:Watson


Last Action:06/15/2017 E Effective on 1/1/18

Caption:Relating to the exemption from ad valorem taxation of property owned by a charitable organization and used to provide tax return preparation and other financial services without regard to the beneficiaries' ability to pay.

SB 1381Author:Hughes


Last Action:06/12/2017 E Effective on 1/1/18

Caption:Relating to photo identification for certain debit or credit card transactions.

SB 1383Author:Perry

Sponsor:King, Ken

Last Action:06/12/2017 E Effective on 1/1/18

Caption:Relating to the operation of vehicles transporting fluid milk; authorizing a fee.

SB 1524Author:Nichols

Sponsor:Morrison, Geanie W. | Martinez, "Mando" | Paddie | Bonnen, Dennis | Deshotel

Last Action:05/23/2017 E Effective on 1/1/18

Caption:Relating to the movement of certain vehicles, including vehicles transporting an intermodal shipping container; authorizing a fee; creating an offense.

SB 1557Author:Kolkhorst

Sponsor:Shine | Darby

Last Action:06/09/2017 E Effective on 1/1/18

Caption:Relating to the administration of gasoline and diesel fuel motor fuels taxes and the fee on the delivery of certain petroleum products.

SB 1767Author:Buckingham


Last Action:06/15/2017 E Effective on 1/1/18

Caption:Relating to hearings and protests before appraisal review boards involving ad valorem tax determinations.




Martin explains San Jacinto River issues at TIRZ meeting

Written by Bruce Olson
 Published: 13 November 2017

At the Nov. 9 directors meeting of the Lake Houston Redevelopment Authority and Tax Increment Zone No. 10 (TIRZ), Houston City Councilman Dave Martin provided an update about what he has learned about the causes behind the San Jacinto River flooding following Hurricane Harvey. Martin pointed out that his observations were the result of many recent hearings and meetings by various agencies and particularly as a result of what he saw on a recent comprehensive tour of the area.

He said, “On Tuesday I had the opportunity to go up and take an aerial view in a HPD [Houston Police Department] helicopter with myself, Senator Brandon Creighton, Niel Golightly [acting as the City of Houston’s Chief Recovery Officer] and Stephen Costello who is our city’s Flood Czar. We went all the way up to Conroe, went around Lake Conroe, saw the dam structure from the air and followed the path, repeatedly, of the San Jacinto River all the way down through the end of the river into Lake Houston, down to the spillway and a little bit further.”

After the helicopter tour Martin saw the same thing on a boat tour of the river area in a HPD boat and went as far as U.S. Highway 59/69.

“From the aerial view it’s pretty clear that the siltation that is in the San Jacinto River is being caused by the number of sand mining operations along the river, so it was good to have a state senator with us. It was unbelievable to see how much siltation is formed in the middle of the river. It became loud and clear to me, seeing it from the air and then getting in the boat and seeing it again, exactly why so many places flooded for the first time,” he said.

Martin explained that the cause is because the sand siltation in the middle of the river has significantly changed the pattern of the San Jacinto River. It is no longer the same as it was. The change has forced the river to flow in such a way that it now floods into areas that had never flooded before. He pointed out it will flood again in those areas unless action is taken. Martin discussed what this all means and what can be done from this point going forward.

“I have been adamant in that all these authorities are controlled by the State of Texas. The governor actually controls the San Jacinto River Authority, etc. so my thinking is there are two issues. There is a governance issue and there is an operational one,” he said.

Martin explained that on the governance side there is no one making ongoing river management decisions representing those living downstream.  All the decisions are being made by people that have upstream property concerns.

On the operational side, Martin pointed out that the river authority maintains the water at the Lake Conroe Dam at 201 feet above sea level. He said, “They start releasing water from the dam when it rises to 202 feet, 6 inches and when it gets to 206 feet that’s when we get flushed.”

Martin contrasted it to a situation near Austin where the lake has 33 feet of rising capacity before it is released. He noted that because of all of these factors, dredging Lake Houston is not the answer as much as dredging the San Jacinto River itself is.

“From a general standpoint, this [the dredging] is a long-term project,” Martin said and added from a long-term standpoint the restructuring of the various agencies involved would help to better represent the people living downstream from the dam and the sand mining operations. However, from an immediate governance standpoint, Martin said there is a way to take an action that could happen tomorrow and not cost a penny while greatly improving the situation. “Lower the ponding level by 3 feet or 2 feet.  Pick a number, Mr. Engineer. 


Martin noted that in almost an instant, this could add 3 feet of capacity before water must be released downstream due to heavy rains. He pointed out that in most years the heavy rains that result in flooding come in March, April and May. If now in November, one began to take the level of the lake down by slowly trickling the water downstream in a manner that would not cause problems, it would add a tremendous amount to the capacity for the lake to handle the heavy rain periods. Martin pointed out some would say the lower level of the lake would be an inconvenience to a lot of lake property owners and boaters, but Martin pointed out that thousands of those now living downstream have already been inconvenienced and inconvenienced a lot. “It’s called shared sacrifice,” he said.

“So that’s our message to the governor. For Kingwood, we need people to show up for hearings to promote these proposals,” Martin said. He pointed out that he recently had a hearing about the subject in Houston where two buses were committed to take people from Kingwood to the hearing but only seven people showed up to go.  He also pointed out that State Representative Dan Huberty had a similar hearing and only 15 showed up.

Martin said loudly, “Kingwood … Show up! This is the future of our neighborhood. I am serious. People need to show up and they need to let their voices be heard by the governor of the State of Texas. Without our voices being heard we will sit back and do nothing and we will get flushed again! Trust me, I was on that river. It is not going to take much to flush us next time.”

Martin closed his presentation by explaining TIRZ directors could also play a part in the process. He pointed out that the TIRZ has some money it can lend to move the process forward. He added that the shopping centers in the center of Kingwood can’t be rebuilt with the expectation that this will never happen again. It can happen tomorrow, especially if no action is taken, he said.

The next Lake Houston TIRZ Directors Meeting will be on Dec.14 at 8 a.m. at the Kingwood Community Center, 4102 Rustic Woods Dr.


City Comptroller Releases Rebuild Houston Audit: It is a Farce

By Bill King

In the 2015 mayoral election, all of the candidates except Steve Costello agreed that the drainage fee adopted by voters in 2010 had serious problems.  Each of the candidates had various prescriptions.  Turner agreed, expressing his concerns about how the money was being spent and promised a complete review of the program.  Two years later we are still waiting.
In response to some questions from Council, Controller Chris Brown has been promising an "audit" of the Dedicated Drainage and Street Renewal Fund (DDSRF), which was finally released last week.  It is a farce.
The audit examined three projects which totaled about $44 million.  Through the end of this fiscal year, about $1.4 billion will have been deposited into the DDSRF.  So, this audit covers a whopping 3% of the total.  

The report includes an appendix which lists 35 projects that it indicates are completed "using the drainage utility fee component" from 2014-2016 at a cost of $246 million.  There is no explanation of that phrase nor are there any supporting schedules.  Presumably, the report is suggesting that these are the projects that were paid for by the drainage fee.  Beyond that, there is no detail other than a general description of the location of these projects and no indication that the audits did any review of them.
Even if we accept that $246 million was spent from the dedicated fund on these projects, that would only be about 76% of the drainage fee collected for those years and only 39% of the total amount deposited into the dedicated fund.  Where was the rest spent?  That was the question we were all hoping an audit would answer.
We used to have a better idea of how the money was spent.  During the Parker Administration, the budget document available to the public had 13 pages of information that included a reasonably detailed description of the expenditures and a list of personnel paid from the fund by position type. It was from that detail that we were able to determine that most of the positions paid by the fund were office personnel.  But since Turner took office, the budget document has only seven pages and omits most of that detailed information.
The drainage tax was sold to taxpayers on the promise it would be dedicated to alleviate flooding.  

Since the drainage fund was set up in 2011, Houston taxpayers have paid over $750 million in drainage fees and an additional $650 million has gone into the fund from other taxpayer sources.  Does anyone think we have gotten $1.4 billion worth of value in flood control or street improvement projects?


Bondholders not notified of potential flooding

By James Drew

​The special purpose districts that have powered development in the Cinco Ranch area west of Houston repeatedly failed to disclose to bond investors the risk of severe flooding from the adjacent Barker Reservoir, a Houston Chronicle investigation found. This is true in other areas where there was flooding as well.

Hundreds of homes near the reservoir were flooded when Hurricane Harvey battered southeast Texas in late August. Many homeowners complained bitterly that they were never warned the reservoir could pour into their neighborhoods during an extreme storm.

Bond investors who placed bets on the long-term economic health of the Cinco Ranch area were not told about the danger, either – although it had been documented for years in Fort Bend County planning records and in reports by the U.S. Army Corps of Engineers, which operates the reservoir. Who's job is it to let people know about flood areas or is it just Caveat Emptor ? 

A patchwork of municipal utility districts, known as MUDs, and similar agencies oversee basic services in Cinco Ranch, a master-planned community 25 miles west of downtown Houston. They regularly sell bonds to install and improve water, sewer, drainage systems and other infrastructure. This is true in many communities out side Cinco Ranch

The Chronicle looked at 10 districts that serve subdivisions along the southwestern fringe of Barker Reservoir. All were flooded or evacuated during Harvey.

Those districts have sold bonds 74 times since 1991, borrowing a total of $297 million. For each sale, an offering statement was distributed to investors, with a detailed description of risk factors that could affect property values, the quality of life and the district's ability to make timely payments of interest and principal on the bonds.

Only one of those 74 statements disclosed the risk that the reservoir could inundate nearby subdivisions, the Chronicle found. Maybe we need to make it a law to inform Bond Buyers and Residents that they are buying in a flood zone.

The sole exception was a 1992 bond sale by the Willow Fork Drainage District, which acknowledged the problem. In 17 subsequent bond sales, including one this year, the same district's bond statements made no reference to the potential for flooding from the reservoir. Why do you think this happened possibly because the Bonds didn't sell well in 1992  since the bonds were in a Flood Zone.

The absence of disclosure cut off a potential avenue for investors, homebuyers and the wider public to become aware that neighborhoods near Barker could be under water after an intense storm. Bond statements are one way such information enters the public domain.

Federal securities law requires government agencies to disclose any "material" information that would bear on a reasonable investor's decision whether to buy their bonds. Whether the risk of flooding from Barker Reservoir is "material" within the meaning of the law has never been tested.

 Jim Blackburn thinks investors deserved to know.

He's an environmental lawyer and planner who has studied the Houston area's vulnerability to flooding for years.

The lack of disclosure reflects the tendency of developers, business people and elected officials to downplay the threat of flooding, for fear that talking about it could inhibit economic growth, he said.

"We don't reveal the weaknesses in our system, and it is our obligation to the people who live here and invest in Houston," said Blackburn, who is co-director of Rice University's Severe Storm Prediction, Education and Evacuation from Disaster Center.

Larry Dunbar, a lawyer and engineer who advised Fort Bend County officials on the risk of reservoir flooding back in the 1980s, said the problem has been hiding in plain sight for decades.

"It's obviously something that not only should the homeowners have been made aware of, but obviously any bond investors likewise would probably want to know about it," he said.

Disclosure is crucial to bond investors because they put their money at risk for 10, 20 or even 30 years, depending on a bond issue's repayment schedule. Special purpose districts repay bonds with property taxes. A decline in property values could reduce tax revenue and, potentially, jeopardize repayment of the bonds.

Bonds like those sold by the Cinco Ranch-area districts are held mainly by wealthy individuals, said David Loesch, owner of DRL Group, a Katy-based firm that sells municipal securities.

The devastation caused by Harvey has not affected the districts' ability to keep up with interest and principal payments. Experts said the potential threat to bondholders is longer-term: Repeated flooding, especially if it damages sewage plants or other infrastructure, could make neighborhoods less desirable, depressing property values.

Subdivisions in the eastern part of Cinco Ranch are imperiled by the reservoir's "flood pool" – the technical term for the water that builds up behind Barker Dam during storms.

Because the reservoir is open terrain, without banks or walls, the size of the flood pool varies depending on how much rain falls and how much water is released through the dam's gates, to flow downstream toward Houston. The reservoir is dry much of the year and is filled with parks and trails, so many people don't recognize its true purpose.

Barker and Addicks Dams were built by the Army Corps in the 1940s to protect downtown Houston from flooding. They were originally designed to hold back storm runoff for short periods.

But as development filled more of the floodplain downstream of the dams, releases of water had to be carefully restricted. Development in the prairie west of the dams further complicated the situation, increasing storm runoff into the reservoirs. The flood pools grew steadily larger.

In an extreme storm, more water can accumulate in the reservoirs than the Army Corps has land to contain it. The government-owned area behind Barker Dam covers about 12,000 acres. But the dam can hold back enough water to submerge more than 16,000 acres. That's called the "maximum flood pool," and it now includes thousands of homes and businesses.

Concerns about the potential for devastating flooding prompted Fort Bend County, beginning as early as 1991, to include a fine-print notation on subdivision maps for areas near the reservoir. It states that the land is "subject to extended controlled inundation under the management of the U.S. Army Corps of Engineers." Does Harris County do this ?

Developers submit the maps when they seek approval to subdivide land for homes. County officials intended the notation as a way to alert home buyers. They now acknowledge it was ineffective, because few buyers know to consult the maps.

The flood risk surfaced anew in a 2009 Army Corps master plan for Barker and Addicks Reservoirs. The report said the reservoirs – as of then -- had not overflowed into adjacent neighborhoods, but indicated that it could be only a matter of time.

If some severe storms of the preceding decade had "been centered over Addicks and Barker Reservoirs or the Upper Buffalo Bayou Watershed, the combined rainfall and runoff could have resulted in flood pools exceeding the limits of government owned land," according to an appendix in the report.

Subdivisions had been built right up to the edge of government-owned land – and well within the maximum flood pool. The question begs for answers why did the County allow them to build up to the edge.

In internal emails that came out in 2011 in an environmental lawsuit over the Grand Parkway, Army Corps officials discussed how the reservoir flood pools were getting larger and larger, heightening the risk that they could spill into surrounding communities.

"Should this occur, a large number of residents, businesses and infrastructure located within the maximum possible pools could be severely impacted for an extended period of time," one email said.

Why the drafters of the Cinco Ranch-area bond statements almost always omitted that danger is unclear. By phone and email, the Chronicle contacted two dozen lawyers, financial advisers and others involved in the bond sales. Only two would comment on whether the reservoir flood risk should have been disclosed.

W. Dickinson Yale Jr., a lawyer for Cinco MUD 8, said the district "gives all the notification required by state law." He said that if a threat of flooding existed, it was a matter for buyers and sellers of property and their title insurance companies. Sounds to me like State Law needs to be changed.

Jim Boone, managing partner of Allen Boone Humphries Robinson, which serves as both bond counsel and general counsel for several Cinco Ranch-area MUDs, ( and MUD 415)said the firm's lawyers did not know about the flood warning on the Fort Bend County subdivision maps.

Boone said his firm's involvement in preparing bond statements focused on "legal and federal tax matters," and that other MUD advisers were responsible for disclosing risk factors.

Referring to Harvey-related flooding in Cinco Ranch, he added: "We were shocked and surprised that the United States Army Corps of Engineers would flood private property … through their operation and management of the Barker Reservoir, without any legal right to do so."[Barker Reservoir engulfed parts of Cinco Ranch after Hurricane Harvey, a scenario that had long worried engineers, planners and the U.S. Army Corps of Engineers. Photo: Mark Mulligan/Houston Chronicle] Guess we need to ask the question does the Army Corp of Engineers need to notify that the Flood Pool is expanding ? Do the people in the Flood Pool have a right that supercededs the Army Corp of Engineers duty to keep the City of Huston from Flooding ? Did the Army Corp of Engineers actually do something to expand the Flood Pool or was the reservoir and Dam just over-come by the Hurricane? Lastly shouldn't the MUD Lawyer have looked at the maps indicating the flood pool before issuing the bonds?

Cinco Ranch was a vast stretch of cattle ranches, dairy farms and rice fields when developers began turning it into master-planned suburbia in the 1980s.

MUDs played a central role in the transformation, as they have in unincorporated areas across the Houston region.

MUDS are created by the legislature or the Texas Commission on Environmental Quality, typically at the initiative of developers. A handful of "electors" can vote to ratify a district's existence and authorize it to sell hundreds of millions of dollars in bonds. The electors are hand-picked and sometimes live in trailers on the site of the future subdivision, to satisfy a legal requirement that they be residents of the district.

The initial bond sale goes to reimburse the developer for putting in roads, water mains and other infrastructure. That way, the developer doesn't have to add infrastructure costs to the price of homes. More bonds are sold as new stages of the community are developed.

As residents move in, the MUD becomes the de facto local government, contracting with outside firms to provide basic services. The MUD taxes property owners to repay the bonds, with interest.

Other special purpose districts build, improve and maintain water, sewer or drainage systems. Serving individual MUDs or groups of MUDs, they also sell bonds, and pay them off by collecting property taxes -- on top of those collected by the MUDs.

The system has been criticized for cronyism and lack of transparency, although its defenders say it helps keep housing affordable and is less costly and intrusive than traditional local governments.

The districts' bond sales are handled by professional advisers with varying responsibilities.

The bond counsel issues an opinion on whether the bonds are being sold for a lawful purpose and qualify for tax-exempt status. The financial adviser helps a district decide how to structure the bond sale, when to issue the bonds and how to market them. The adviser typically oversees preparation of the bond statement as well.

In some cases, a "disclosure counsel" weighs in on what should be in the bond statement. The underwriter, which buys the bonds in bulk and then sells them to investors, often hires its own counsel to check the bond statement for accuracy and make sure disclosure is sufficient.

Before a bond sale can go forward, the district's board of directors must approve the statement.

Typical of the bond sales examined by the Chronicle was a $4.7 million issue put on the market in 2014 by Grand Lakes MUD 1. The purpose was to refinance existing debt.

The offering statement went into detail about esoteric matters, including the potential impact of stiffer state standards for issuing permits for "Phase II (Small) Municipal Separate Storm Sewer Systems."

It said nothing about the threat of flooding from the reservoir.

First Southwest Co., now part of Hilltop Securities, was listed as financial adviser for the sale. The law firm Fulbright & Jaworski, now Norton Rose Fulbright, was underwriter's counsel. Neither responded to requests for comment. No disclosure counsel was listed.

The law firm Schwartz, Page & Harding is general counsel and bond counsel for Grand Lakes MUD 1 and two other special purpose districts near the reservoir.

Asked for comment on the bond statement, a lawyer with the firm, Christopher Skinner, said he would consult with the MUD 1 board of directors.

"Following due consideration of your request, the Board determined not to expend District resources in responding to your inquiry," Skinner said by email.

Asked why resources would have to be expended, he replied: "As attorneys, our time is chargeable to our clients."[For an opening ceremony in 1986, Mason Road, which bisects Cinco Ranch, was decorated with a street mural depicting past and future uses of the historic property. Photo: Carlos Antonio Rios/Houston Chronicle]
Photo: Carlos Antonio Rios/Houston Chronicle

For an opening ceremony in 1986, Mason Road, which bisects Cinco Ranch, was decorated with a street mural depicting past and future uses of the historic property.

■  ■  ■

Mention of reservoir flooding was also missing when Cinco MUD 2 sold $4.3 million in bonds in 1992. The district serves Cinco Ranch South Lake Village, Bayou Park Estates and other neighborhoods.

The 94-page bond statement listed various "risk factors," including uncertainty about whether the resale values of homes will support "the growth and maintenance of taxable value in the district and tax revenues."

Under the heading "Matters Related to the Developer," the document stated: "The District can make no prediction as to the effects that inflation, interest rates, a depressed economy, falling energy prices, potential transportation problems, flooding or other factors, whether economic, governmental or otherwise, may have on the plans of the Developer."

The statement also noted that the Willow Fork Drainage District, which encompasses Cinco MUD 2 and several other MUDs, had financed construction of drainage improvements within Barker Reservoir.

But the document said nothing about the possibility that the reservoir could flood adjoining neighborhoods, including those in MUD 2.

The bond counsel for the sale was the law firm Vinson & Elkins. The financial adviser was Legg Mason Wood Walker. The bond statement does not list a disclosure counsel or an underwriter's counsel.

In the lone exception to the pattern of non-disclosure, the Willow Fork Drainage District, in its offering statement for a $9 million bond sale in 1992, acknowledged that the Fort Bend County Engineering Department had expressed concern about "potential flooding of non-government owned land upstream of the Barker Reservoir, including portions of the District."

In 17 subsequent bond sales, the district did not mention that risk.

Fulbright & Jaworski (later Norton Rose Fulbright) was disclosure counsel or underwriters' counsel on eight of the district's post-1992 bond sales.

Counting its work for other Cinco Ranch-area districts, the law firm was disclosure counsel or underwriter's counsel on 40 bond sales in all – none of which acknowledged the risk of reservoir flooding.

Many of the bond statements reviewed by the Chronicle mention the 100-year floodplain, an area with a 1% chance of being flooded in a given year. The statements typically say that no areas within the district are in the 100-year floodplain, or they describe drainage improvements made to remove areas from the 100-year floodplain.

The flood pool is different from the floodplain. Measure taken to safeguard property against a 100-year flood won't necessarily offer protection from the flood pool. Parts of Cinco Ranch that are not within the 100-year flood plain were nevertheless inundated by Barker Reservoir during Harvey.

The risk of reservoir flooding was mentioned in only one of the 38 bond sales for which RBC Capital Markets and its predecessor firms served as financial adviser or underwriter. (The exception was the 1992 bond sale by the Willow Fork Drainage District.)

Matt Dustin, vice president of municipal finance in RBC's Houston office, declined to comment on whether all the bond statements should have cited the danger. But he said the issue is now top of mind for bond professionals.

"There has been lots of discussion about the need for more disclosure post-Harvey, for sure," Dustin said. "And I think going forward, every underwriter and financial adviser and bond counsel is going to be more diligent about the types of disclosures.

If a bond statement misrepresents or leaves out material facts, investors can sue those involved in preparing the document, and the federal government can pursue fines and other penalties under anti-fraud laws.

Determining whether information is material "can be a very complex analysis," said Robert Doty, a municipal bond expert based in Annapolis, Md. "It would take into account how realistic people would have viewed the threat."

Doty has been a bond counsel, underwriter and investment banker and is now a consultant and expert witness in municipal bond cases. He helped write the disclosure guidelines used by the Government Finance Officers Association.

He said those who prepared the Cinco Ranch-area bond statements should, at a minimum, have seriously considered disclosing the risk of reservoir flooding.

Doty said it was significant that Fort Bend County saw fit to require the notation on subdivision maps warning of the danger of "extended controlled inundation."

"It shows that somebody thought of it," he said. "That would be part of the information that would be considered in an analysis of whether this was material information."

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.
Website by Online Candidate