April 2010 V.P. Report

Political Strength

Whether you voted for Mayor Parker or not you have to admit one thing, she has wasted no time in doing exactly what she promised to do while on the campaign trail.  During the campaign, then candidate Parker talked a big game about the need to address the city’s growing financial problems, about the city employee pension funds, debt service and the loss of city funds due to falling sales tax revenue, decreasing property value and a stifling national recession.  The city is currently looking at a $100 million budget shortfall for next year according to the Houston Chronicle and reports from Controller Green show that gap to be widening.  Earlier this month Mayor Parker saved $7 million for the city by increasing the monthly insurance premiums for retired city employees under the age of 65 by 50%.  This action of increasing costs to retired city employees would be considered a sacred cow and untouchable by most city leaders, but not by Parker.  Making this change even more impressive is the fact that she did it as a procedural action that did not need city council approval, i.e. she did it all by herself with no political cover from council. 

Another political taboo (at least in Texas) is raising taxes.  No one wants to be the guy that votes for raising taxes of any kind because they know what will happen when the next election cycle comes around.  This fear of raising taxes nearly overshadows the desire to keep needed infrastructure in tack and functioning.  As an example look at the shock that was felt when Senator Dan Patrick announced that he was not opposed to increasing the state gas tax and indexing it to the consumer price index.  You could almost feel the collective “WHAT” rising out of the crowd when he first made this statement.  Never mind the fact that the primary beneficiary of the gas tax is TxDOT, that the money is used to keep all of the state’s highways and byways running smoothly, and that for years this funding has barely been able to keep up with needed road repairs let alone construct new highways.  It took a strong leader, educated on the issue and brave enough to step up and state the obvious fact that this tax needs to be increased to meet public demand for good, safe roadways in Texas.  Mayor Parker has taken similar action recently by rolling out a proposed water and sewer rate increase for the city of Houston.  This proposal which appeared at a Council Fiscal Affairs Committee meeting earlier this month, laid out an increase in the combined utility system rates (water and sewer) that amounts to $5.85 for the average household and would increase the rate for multi-family locations (apartments and townhomes) by 50%.  Again the collective “WHAT” rose from the crowd.  Nobody wants to pay a higher rate on water, and that gut reaction was evident in the crowd, but by time Director Marcotte, with the Department of Public Works, finished explaining the burden that the city has been under to provide this service, opinion had changed.  Among the unseen charges that the city has incurred since 2004 when this fund was restructured are 228% increase in fees from the state, 167% increase in the cost of chemicals, 136% increase in the cost of electricity and a 99% increase in the cost of sludge disposal.  Remember this bill covers both water and sewer treatment.  On top of that the city’s estimates of water usage were off due to dropping demand, a reflection on the city’s efforts to support water conservation and promote low flow technology.  Mr. Marcotte stated during his presentation that the fund began running a deficit in 2008 of $23 million and that number is estimated to grow to $102 million by the end of this fiscal year.  City Council is now considering an increase that would fix the problem and set the fund on the right path for the next decade, but as of the writing of this article the item has not gone before council for a vote yet.  Let us hope that they do the right thing.

My point of this article is this, in an age when most of our political leaders seem intent upon giving away the farm in order to buy your vote for the next election, it is refreshing to see that some of them still have the strength of character and political moxie to make the hard decisions for the betterment of our community.

State of the City

I attended the State of the City address this month and heard exactly what everyone already knows, that things are tough, but they are better here than anywhere else in the country.  Mayor Parker spoke candidly with the crowd about the difficult issues the city is facing, stating that unemployment is high, job growth is slow, both property tax and sales tax collections are down and the once booming housing market has not yet recovered.  The City is looking at a budget deficit between $100 and $130 million this year.  Mayor Parker stated that the City’s rainy day fund balance will be drawn down to help cover the deficit but that will only cover so much.  She stated that the city will be under immense pressure to live within its means while the economy works to get back to normal.  She said that there would be no property tax increase and noted that while she has proposed an increase in the water and sewer fees, this does not go into the general fund, cannot be used to balance the budget and will guarantee that the city has safe drinking water for the next 50 years.  Mayor Parker stated that she has already created budget “swat teams” to scrub the budget of all waste and they would be looking into all areas of the budget for savings.  She called this an era of innovation in city government and stated that the City will cut waste and improve services.  She also stated that she would be sticking to commitment to hire Houston first as she stated early in her campaign.  She noted that she has made five new appointments to the Metro Board along with a new chairman. The Mayor stated that there would be a new face heading up Metro and a new public service attitude.  She also committed to completing all five rail lines.  The Mayor also promised an operational overhaul for both HPD and HFD.  Mayor Parker said that she would look at modernizing the city’s web page and overhaul the city’s parking ordinance.  The best part, at least for me, was when Mayor Parker announced that the City would be doing a public service project with the Houston Contractors Association on May 22^nd called Demolition Day where we will tear down 200 abandoned homes in neighborhoods throughout the city.  Mayor Parker closed by stating that things are tough but we will make it though this time better for it and stronger as a city than when it began, and urged everyone to work together to support our common goals.

Demolition Day

As you may be aware, the Houston Contractors Association is working with Mayor Parker’s office on a project to remove dangerous buildings from the community.  We have named this project “Contractors Demolition Day”.  The event will be held on Saturday, May 22, 2010 beginning at 8:00 a.m.  As in the past the contractors will be responsible for demolishing the structure, scraping the debris into a pile and then fencing off the debris with orange construction fencing.  The City will be responsible for ensuring that all utilities have been disconnected, the home is empty, that the permits have been pulled and provide an inspector for each site to verify the location.  The number of buildings to be demolished this year is tentatively set at 120 homes so we are looking for as many participants as possible to help take down these dangerous buildings.  We will also be looking for help from our associate members in the form donations of t-posts and construction fencing as well as help with transportation from our heavy haul members.  If you are interested in participating in this event, please call the HCA offices, (713) 349-9434 as soon as possible.  Your participation will not only help HCA, but will help to beautify the City of Houston and make it a safer place for the children in these affected neighborhoods.

Word of the Month

Some time ago I asked one of our older, more experienced contractors what exactly a “Jake Leg” contractor was.  He told me the definition that I already knew; an unscrupulous or disreputable builder that does shoddy work and then disappears into the weeds once they are paid.  I told him that I was more interested in the derivation of the word, what the heck is a Jake leg?  Nobody knew the answer, and I am betting most of you don’t either.  Well here is the condensed answer as best as I can relate it to you I hope you enjoy this bit of trivia. 

Jake leg is a wholly American word that is a variant of the term Jack leg which itself comes from the term black leg.  “Jack” apparently held some derogatory meaning in the 1830’s.  The first recorded use of the term was reference to a jack-leg attorney in 1837.

The transfer from Jack-leg to Jake-leg is believed to be connected to the popular use of Jamaican Ginger in U.S. medicines.  In the 1850’s Jamaican Ginger was a primary ingredient in several U.S. medicinal patents.  By the 1870’s it was widely used in medicines across the country and was claimed as a cure for everything from cholera to flatulency.  The ginger based medicine was cheap to make and had a high alcohol content which made it very popular with the less affluent in America.  During the prohibition times it was reviled by members of the temperance movement as being only second to applejack as an intoxicant.  Jamaican Ginger was very popular during prohibition because officially it was considered a health drink and was sold over the counter in pharmacies, however officials eventually caught on to what it was being used for and attempts were made to restrict its use in medicines.  One innovative maker attempted to side step the new laws by adding a phosphate ester to increase the solids content of the drink so to mislead tests of its alcohol content.  This substance was a fuel additive and plasticiser that was thought to be harmless.  In reality this additive was the cause of 50,000 cases of a neurological disease from which many never recovered.  One of the symptoms was high-stepping walk caused by the partial paralysis of the leg where the heel and toe would land at the same time and make a distinctive sound.  This symptom later became known as Jake-leg.

Executive V.P. Report

December 2009

City Elections

The city election cycle is done and Houston now has a new mayor.  Annise Parker beat out her opponent Gene Locke in a tough, dirty and hard fought campaign that was unlike any other Mayor’s race in recent memory.  Annise won the election 53% to Locke’s 47% defeating the business community’s candidate for the first time in a decade.  Houston Chronicle exit polls showed that Annise’s popularity stemmed from the generally positive opinion that residents have for her and the job she did as Controller, and her unwillingness to make over the top campaign promises.  The current financial crisis that the country is in helped focus that opinion causing many voters to be more interested in someone that is more numbers based and financially conservative.  Annise was able to portray Locke as a politician, lobbyist and political insider and linked him to the financial troubles being faced by the Houston Sports Authority relating to the financing of their bonds.  That was enough to push her over the top, despite a last minute attempt by the Locke campaign to use a conservative group to attack her on her sexual preference.

Voter turnout for the runoff wasn’t bad considering that this race was more of a Democratic primary election than anything else.  While city elections are technically non-partisan races, candidates typically affiliate with one party or the other.  This year there was no strong Republican candidate on the ballot, this led to low voter turnout in the general election (19.1%).  Typically runoff’s have very low voter turnout, but in this case it was 16.5%.  Not bad considering the two candidates were very similar in their positions on almost all issues. 

The good news with this election is that for the first time in a decade the City has a mayor that understands and appreciates infrastructure.  Better yet with the election of Steve Costello to the At Large 1 Council seat, we now have a civil engineer on council who will be pushing as one of his main objectives, the expansion of the CIP and the redevelopment of the City’s infrastructure.  The bad news is that the financial outlook for the City is bleak and while we may now have people in place who are committed to focusing attention on an area of the city that has been neglected since the 80’s, they may not have the money to do anything about it.  At least not this year, hope springs eternal for future years and we will have them there for the next six.

Harris County wins lawsuit on SWPPP

For those of you contractors who missed this story earlier, take heed now.  According to a press release from the Harris County Attorney’s office, the County recently settled a $100,000 lawsuit with Pace Services, LP over the companies multiple violations of the County’s storm water management regulations.  According to the press release, this settlement may be ranked as one of the largest settlements received by a local government for stormwater violations.  According to the County, Pace failed to properly install and maintain erosion control devices on several of their construction sites.  Harris County Attorney Snehal Patel said, “There are several basic ways to violate the County’s regulations - not having proper erosion control devices, not maintaining the entrances to construction sites to reduce vehicles’ tracking mud on the road, keeping a clean work site, for example – but Pace disobeyed all of them at one time or another.”

According to the County, failure to maintain erosion control devices could result in an immediate impact on the functioning of our storm drain system and flood control functions, and ultimately the health of our local waterways. As stormwater flows over land it picks up heavy metals, bacteria, pesticides, suspended solids, nutrients, and floating materials. In the United States, stormwater runoff from residential, commercial, and industrial areas is responsible for 21% of impaired lakes and 45% of impaired estuaries (EPA, 2009).

The moral of this story is to check your erosion control devices regularly and keep up with your SWPPP regulations or you could be the next topic of a Harris County press release.

Christmas Pictures

For those of you that were at the HCA 2009 Christmas Dinner and Dance, had their picture taken at the party and would like to see the pictures.  HCA has made those photos available on line.  Simply go to www.mikeduhon.net scroll down to the bottom of the page and click on the box that says “to view projects or order prints”.  Once inside click on the file of photos you wish to look through.  This will take you to a password screen type in “contractor” and you are there.  All of the photos are free to view, but if you would like to purchase a copy, the cost begins at $13.00 for a 4x6.

Happy Holliday’s

I would like to wish all of our members a very Merry Christmas and a Happy New Year.  Speaking for myself and Antonette, this has been a great year and we have enjoyed being able to work with such a wonderful group of people.  I would also like to thank all of the members that have volunteered their time throughout the year.  Whether it was driving a beer cart or serving on a committee, it is the participation of our members that makes HCA the organization that it is.  Finally, I would like to send a really big thank you to all of the companies that that have sponsored events over the last year.  Your contributions are greatly appreciated. They enhance the enjoyment of all the members attending an event, and strengthen the image of both the association and your company.  Thank you all again and I will see you next year.

This board will have the distinction of serving as the 54^th Board of Directors, however they do not officially take their positions until January 1, 2010.  HCA would also like to thank the members that will be stepping down from the board for their service to the association; Peck Boswell with BRH Garver Construction, Mark Boyer with Boyer, Inc., Phillip Hassell with Hassell Construction Co., Maury Stiver with Stiver Engineering and Bruce White with Jerdon Enterprise, LP.

HCA would also like to recognize the outstanding job done by this year’s president, Connard Barker.  Connard has had a challenging year, leading the association through the on-going market recession.  This year has seen the collapse of the banking and credit industries, the disappearance of the housing market and a downturn in all aspects of civil construction.  Through it all Connard has stoically led this association, with one eye on the budget and another on the members.  Connard has represented the industry well during his term as president and we can all be proud of the job he has done on behalf of the civil construction industry.

2009 November Cover Story

Harris County Judge Ed Emmett Talks About the Future of the Region

Harris County Judge Ed Emmett was the guest speaker or this month’s HCA luncheon.  The October luncheon is a special one in that it is the final luncheon of the year, it is the last one that will be overseen by this year’s President, Connard Barker and it is the meeting that we historically use to recognize the contributions that have been made to the industry by out past presidents.

Judge Emmett began his presentation by thanking the audience for their attendance.  He then commented that it is always a pleasure come before our group and speak.  Judge Emmett also thanked HCA President Connard Barker for his introduction but stated that he needed to comment on part of that introduction.  In his introduction Connard thanked the Judge for all of the work they have been putting out lately.  The Judge said that he wanted to clarify that it is not he that puts out jobs put the County Commissioners and Art Storey’s office and that it is they that deserve the credit.

The Judge stated that we are on the cusp of change in Harris County and that change is going to affect the contractors a great deal.  The good news is that it is going to affect you in a positive way, said Emmett.  The economy is slowing down some right now, Judge Emmett stated that he thinks that we are setting the stage for a revival, partly because of some specific things that have happened and some due to shear dumb luck and happenstance.  The Judge said that we all know that we are going to face challenges building more roads and highways.  According the Judge the State of Texas doesn’t have any money and the state legislature is going to be hard pressed to change that fact.  The days of building more and more highways are going to be difficult.  Much of that money is going to be allocated toward maintenance and rehabilitation.  The Judge stated that we are going to have to start focusing on other forms of transportation and all of this change will be good or different groups of contractors.  But what will really benefit this region for years to come, according to the Judge is where we are located.  Judge Emmett stated that international trade is going to continue and we are perfectly situated to be the gateway to North America.  As more products come across the ocean, as the ships get bigger and with the widening of the Panama Canal, more of our trade is going to shift to the Indian sub-continent which by the year 2025 six o the worlds largest cities will be located on or near the Indian Sub-continent.  Trade from there will come through the Suez Canal to the Gulf Coast because of our location.  Judge Emmett was quick to note that he did not say the products were coming to the United States but instead said North America.  According to the Judge Mexico is going to be a big country, and right now one third of the overseas, international trade that goes into Mexico comes into the Port of Houston.  The Judge said that is going to continue because the east coast of Mexico does not have a deep water port.  Any of the trade that is coming from Europe or the Indian Sub-continent destined for Mexico is very likely to come through the Port o Houston.  The Judge went on to make a prediction that eventually we may be referred to as the Port of Texas with Houston, Galveston, Freeport and even Corpus Christi and the Port of Victoria will end up being a Texas port that focuses on our region.  The only way we can achieve that destiny and realize that potential is if we take the steps now to make sure that we have the infrastructure to move that freight once it gets here.  It doesn’t do us any good to unload one of these mega ships and not be able to get the containers and other cargo off the docks and out of the area.  Judge Emmett stated that is why it will be important for the elected officials at all levels to pay as much attention as we can and spend as much money as we can to make sure that the infrastructure is in place.  That is going to be the future economic engine for this area and we have to make sure that it happens.

The Judge changed topics to talk about the changing demographics of the region, specifically where are people living.  According to Judge Emmett more and more people are moving into the inner loop area.  The Judge stated that people will continue to move out to the suburbs as well.  He said that he loves those people that say if we don’t build the highways then we won’t have suburban sprawl.  The Judge said that his answer to that is people are going to continue to move out to the suburbs for better schools and lower home prices.  It is not a question of does the building of roads cause sprawl, the County is supposed to react to the needs of the constituents.  If that is where the constituents want to live and they want road improvements, then that is what we do, said the Judge.  Now that there is an influx of people moving back into the city limits means that we will need to change the way we think about things.  Judge Emmett stated that years ago every new neighborhood built was done so with the idea that it would be annexed by the City of Houston.  That is not going to happen anymore.  The Judge used the example of the 1960 area.  He asked what is going to happen when their utilities grow old.  The Judge stated that each neighborhood has its own MUD districts and treatment plants.  When it comes time to replace them is it more logical to replace them individually or do so with a more regional water treatment system.  Obviously a regional system would be better, but when it comes to the roads, those were supposed to be city streets but are now going on to the County road logs.  The Judge asked where the County is supposed to get the money to repair these roads when they begin to fall apart.  Judge Emmett stated that the County will be turning to the legislature to help find an answer to this question, but it is the County’s responsibility to find a way to keep the infrastructure of these curb and gutter enclaves in place.  In the Judge’s opinion the County owes that to those residents, so somehow the MUDs and the County or some other type of district will have to come together and figure out who is going to be responsible or these services.  Right now these roads are going on the County road log, but if you ask the Commissioners they will tell you that they have more than they can say grace over with the traditional County roads and County operations without having to maintain curb and gutter neighborhood streets. 

The final issue that Judge Emmett spoke on was the topic o healthcare.  According to the Judge the Harris County budget is $1.7 billion and the Harris County Hospital District budget is $1.2 billion.  This comes as a surprise to some people Emmett said and people can argue about who does and doesn’t get served, but it becomes an irrelevant question.  According to the Judge, healthcare is a regional issue, and right now each county gets to define what an indigent is.  Harris County defines an indigent as 200% of the federal poverty level.  Other neighboring counties define it as 28% of the federal poverty level.  So if you live in that neighboring county and make 50% o the poverty level it is pretty clear where you are going to go for healthcare said Judge Emmett.  The Judge stated that healthcare is an issue that we need to look at as a regional issue and not just something that we in Harris County should take on ourselves.  Judge Emmett stated that he has had to spend considerably more time in addressing healthcare issues than he ever thought he would.  Healthcare is a growing cost to the County and we have to get smarter about how we deal with this issue said the Judge.  The Jeff Davis Charity Hospital was replaced by the Harris County Hospital District.  According to the Judge that has run its course and now we need to look at spending money on neighborhood clinics, mobile units and providing medical homes for indigents so that they are not using the emergency rooms as their primary care facilities. 

Harris County has almost four million residents.  It is unique in the fact that we are the only big county that has 1.3 million of its four million residents that live in the unincorporated areas.  According to the Judge if you took that number by itself, it would make the County the seventh largest city in the United States.  Most people don’t think about County government being responsible for those 1.3 million people.  As an arm of the State the County does not necessarily have all the tools that it needs to take care of all of those people.  Judge Emmett stated that Harris County still operates under the same 1876 constitution as the other 253 counties, which means that Harris and Loving Counties are basically treated the same.  Harris County has a population of 4 million people and Loving County has 90 people.  Judge Emmett stated that he and the Commissioners will be calling on us to get together with our legislative delegation and start prioritizing what will allow Harris County and our region to continue to develop infrastructure and meet the needs of our residents so that we can fulfill that destiny of becoming the gateway to North America.  Judge Emmett stated that he could not think of a better group to work with to achieve that goal than HCA.

November 11, 2009

To All HCA Members:

As of this morning's HOUCONPAC meeting, HCA has officially endorsed Annise Parker for Mayor of the City of Houston.  Annise's strong showing in the general election, beating Gene Locke by 10,000 votes, and the excellent working relationship that we have had with her over the past twelve years  is exactly what the Board was looking for in the next Mayor of Houston. 

HCA asks that all of its members support Annise Parker in her race to become the next Mayor of Houston and consider making a financial contribution to her election.  Contributions can be sent to the Annise Parker Campaign, 5300 Memorial Drive, suite 1070, Houston, TX. 77007. 

Let's elect a contractor friendly Mayor to this City.

Jeffrey Nielsen

Executive Vice President