The pros and cons of Renew HoustonLast week I was briefed on the Renew Houston city charter amendment initiative, which is trying to collect 22,000 signatures this month so it can be on the ballot in November. The basic argument makes sense: we pay dedicated fees for water and sewer, which keep them maintained properly year after year, but we pay for roads and drainage out of the general fund, which is always being short-changed by the politicians for nearer-term needs, leading to massive underinvestment, flooding, and decay - so let's make roads and drainage work the same way as water and sewer, with a dedicated set of funding sources. Drainage fees would be roughly proportional to the amount of land you own and how much you've covered it with an impermeable surface - which seems pretty fair to me.
Another benefit is that this initiative seems to shut down selling bonds for roads and drainage. That may seem like a bad thing, but the problem is that politicians want to have a short term impact, so they sell a big bond issue to build something (and get the credit), and then make future administrations pay for those bonds, including significant amounts of interest. If we operated instead on a pay-as-you-go basis, we could save all of that money going to interest and put it into actual infrastructure.
But the devil is in the details, and I'm hearing that the details were not vetted with some big players before going to petition. The biggest issue seems to be the open-ended developer impact fees. These have been a major problem in other cities. The argument seems reasonable - "make developers pay their fair share" - but that's not how they really work out in practice. Politicians find it easy to tax new development because that doesn't upset most voters (some of the anti-growthers even promote it). By raising the cost of new housing (often by many tens of thousands of dollars), it has an insidious secondary effect of raising the market price of all existing housing. Existing homeowners/voters love it - of course - but the city becomes less affordable and less competitive over time. It can also dramatically reduce new construction - costing thousands of skilled and unskilled blue collar construction jobs - as well as increase sprawl and incentivize development to move outside of the city. Discretionary incomes drop as more goes to housing, which means people spend less on restaurants, arts, sports, entertainment, charity, etc. All in all, it's a very destructive slippery slope.
The charter mandates a minimum annual budget of $125 million. I had a major concern that politicians would have too much incentive to make developers pick up as much of that burden as possible to keep the drainage fees lower for most homeowners - but after reviewing the charter language, that doesn't seem to be an issue: it clearly specifies that the $125m must come from drainage fees - all other sources of funding are "gravy", including impact fees. But that doesn't mean the city council still couldn't set up outrageous developer impact fees - they just can't do it to reduce the drainage fees on land owners.
So my feelings on the initiative are mixed: I agree with the concept, but have serious concerns about the details - especially the open-ended development impact fees. Unfortunately at this point, the language is set - and I think that language will bring out some tough opponents in the fall. In addition, this is shaping up as the year of the angry, anti-tax, Tea Party voter, which does not bode well at all for initiatives like this. DOA? Maybe. We'll just have to see how it plays out.
An interesting side note: I've often wondered how much new development outside the city affects runoff into the city. Steve Costello, a city councilman and engineer, said he felt pretty confident there are adequate regulations in the surrounding counties to make new development runoff-neutral, i.e. they have enough local water detention. I do hope that's the case. If you have confirming or conflicting information, I'd appreciate hearing about it in the comments.
If you'd like to read more, the Chronicle, Rick Casey, and lots of other bloggers have written on Renew Houston too: Kuff, Bay Area Houston, and Brains and Eggs (which also has additional links) to name a few.