May 2010 V.P. Report

Water & Sewer Rates Increased

April 6^th the City of Houston had its first meeting to roll out the newly proposed water and sewer rate increases.  On April 19^th they came back to the Fiscal Affairs Committee and introduced the revised plan that addressed concerns raised during the first meeting.  And on April 21^st Council officially passed the new increases with surprisingly little comment.  This is a tax increase that passed in less than a month after introduction, and made it through council without even being tagged.  Even Council Member Jolanda Jones who had been the most vocal in opposing the increase because of its potential impact on those living on a fixed income let the item slide when it came time for a vote.  The City would appear to recognizing the serious financial condition the city is in and for once is making the hard choices that it needs to make.  For the contractors the passage of this increase is good news, the water and sewer coffers have been underfunded for the last two years.  In 2008 it ran a deficit of $28 million and by the end of this fiscal year that deficit will have grown to $102 million.  The City this year had to cancel five of its water line replacement jobs scheduled for this spring because the budget crisis.  This rate increase now has all users paying the production cost of the water and council had already approved automatic increases based on the consumer price index increases so the rate should always be current with production costs.  Homeowners will get a slight break from the increases.  Unlike the commercial and multi-family users, single family homeowners will have three years to ease into the increase which is about 30% higher than current rates.  According to the city, once the rate is fully in affect the average homeowner will see an increase of about $10 to $12 per month for the average user.  The new rates are scheduled to take affect June 1^st and are already being figured into the new City budget for fiscal year 2011 which begins July 1^st.

One Call Closes

The Texas One Call System, a staple in locating and marking underground lines recently posted a notice on its website declaring that as a consequence of a legal setback, they have determined to end operations as a notification center in Texas and will be shutting down their operations over the next few weeks.  A call to their 1-800 number indicated that all Texas One Call inquiries were now being covered by Texas 8-11 which is the Texas Excavation Safety System, a competitor in the market to provide this information. In their web posting Texas One Call noted that there were two other providers of this information in Texas and recommended Dig-Tess.    

Renew Houston

There is a new referendum that will be circulating through the city soon and HCA is looking for your support on passing it.  Renew Houston is a charter amendment campaign to create a dedicated pay-as-you go funding source to repair our drainage and streets.  As most of you already know, Houston’s infrastructure is aging.  Over 60% of the city’s drainage and streets are past their useful life and that number is estimated to climb to 80% within the next twenty years.  Some facts that most people don’t know is that it takes the city twelve years to start any street reconstruction, the services that are in place now were not designed to handle the needs of today’s population, and the parts of town that we consider “new” are all over 40 years old. 

The Renew Houston plan is to pass a charter amendment requiring the city to create the dedicated fund.  To do this they will be circulating petition forms in order to collect the 22,000 signatures of Houston residents necessary to get the item on the ballot.  After that the voters must approve the amendment on November 2, 2010.  This amendment, once approved by the voters, will create a dedicated fund for the maintenance, repair and replacement of roads and storm water drainage in the City of Houston.  It will replace the current system of infrastructure funding, bond issuance, with a pay-as-you-go system.  This will free the city from paying the interest on $500 million worth of bonds as it currently does and negates the need for the every five years bond election and subsequent campaign to convince the voters that the bonds are necessary.  Funding will be provided by a new drainage development impact fee that will be applied to all new construction in the city, the freeing up of money once the bond debts are paid off and a monthly drainage fee that will be paid by property owners.  The proposers of this referendum estimate that once the bond debt is paid off, this fund should generate about $550 million annually for storm water and road maintenance.  Add that to the water and sewer dedicated fund estimates of $350 million and you have an annual CIP of $900 million, almost double the funding amount.  Petition forms will be coming to you in the mail, please encourage your employees, co-workers, friends and neighbors to sign the petition and support the amendment on November 2^nd.

Did You Know…

I was watching the news recently when a story came on talking about the U.N. and they mentioned “The Hague”.  It started me thinking, I have heard reference to The Hague my whole life and assumed that it was a city somewhere in Europe, but that is about as far as I ever went with it.  So for those of you, like me, who love trivial bits of information, here is what I found when I went looking for background on The Hague.

The Hague is the third largest city in the Netherlands behind Amsterdam and Rotterdam.  The Hague is the seat of government for the Netherlands, but not the capital.  The capitol is Amsterdam.  The Hague is the home of the States-General of the Netherlands, Queen Beatrix lives and works in The Hague, all foreign embassies and government ministries are located in the city, as well as the Hoge Raad der Naderlanden (Supreme Court) and the Raad van State (Council of State).  The Hague is also the de facto judicial capital of the United Nations, being the location of its primary judicial courts.

The Hague originated around 1230, when Floris IV, Count of Holland purchased land alongside a pond in order to build a hunting residence. In 1248 William II, Count of Holland decided to extend the residence to a palace. He died in 1256 before this palace was completed, but parts of it were finished by his son Floris V, of which the Ridderzaal (Knights' Hall), still stands. The hall is still used today for political events such as the annual speech from the throne by the queen.  The name “The Hague” loosely translates into the count’s woods.