Water Revenues for 2014: Tale of Two Slides

San Angelo's City Council will consider increasing water rates at its November 3rd meeting.  The consultant's presentation has a slide on water revenue for the last four years (see above).

The City's FY 2014 Comprehensive Annual Financial Report (CAFR) paints a different, more robust picture of water revenues.

That's a difference of $6 million in water revenues for 2014.  Which picture is true?  It seems an important question to ask before Council meets to address the issue.

Council Paves Way to Implement Fugro Street Study

Ruben Williams of Fugro Roadware confessed that last week's presentation was his first to a City Council.  His message was not a surprise to people who've driven San Angelo's streets the last two decades.  Williams said in describing San Angelo's pavement condition index scores:

"This puts the city with not really the best road condition/  This really is not something that happens overnight.  Something with this, it's from decades of deferred maintenance."

"Just to put this into perspective, this is one of the lower scores I have seen."

The study showed San Angelo's major roads are generally in better condition than minor collectors and local streets.  Unfortunately that isn't saying much given the significant amount of work and money it will take to restore deteriorated streets.

"The current funding of $3.5 million would be sufficient if your road network was in the 80's (pavement condition index wise).  You're about half of what I'd recommend as a minimum.  Then with as much focus on preventive if you can and with any excess I recommend doing as many mill and overlay projects as possible."

Fugro's Ruben Williams echoed former City Engineer Clinton Bailey, who introduced the idea of a preventive street maintenance program to City Council in a February 2013 strategic planning session.    Both Bailey and Williams stressed the need for timely intervention that prevents streets from entering a state where they need more costly reconstruction.  Both encouraged adequate funding and making wise decisions that lever those very resources.

Oddly the two men who supervised the abject deterioration of San Angelo's city streets, Executive Director of Public Works Ricky Dickson and Shane Kelton, will be charged with bringing them back.

Consider the minutes from October 21, 2014 when Council approved hiring Fugro:

Operations Director Shane Kelton commented the last study was conducted ten years ago. He informed no funds were budgeted for that particular project study and now have experienced an additional ten years of road repair. 

Ricky Dickson led streets nearly the whole decade in several different roles, most of that with Kelton as his right hand man.  A decade ago this pair had the opportunity to sound the siren on street maintenance.  Neither did.

Ironically Kelton said to council with Fugro's Williams at his side:

"I'm going to be up here every budget season trying to beat you up to give me more money for maintenance."

City Council seemed ready to unlock the vault doors for streets.  Many council members expressed a desire to fund street rehabilitation/reconstruction at the highest level proposed.

Even at the $16 million per year level with $3.5 million in preventive activities San Angelo's roads are projected to continue to deteriorate.  Look at how the orange to red section of the chart below grows from now until 2020.  That's the group of roads needing the most work. 

The $16 million per year hits mostly major roads, leaving untouched the vast majority of San Angelo's bad streets. Over half of the $16 million per year would go toward reconstruction, the most expensive intervention possible.

In discussing funding the city could spend $8 million per year on roads and not raise taxes or impact its bond rating.  Last year council heard borrowing more to fund road rehabilitation could require a tax increase.

Fugro's Ruben Williams gave citizens a state of address on San Angelo's roads.  Nearly everything about it was a deja vu.  The difference was the clarion call for action to begin digging out of our decades dug hole

JMG's San Angelo Standard-Times to Join Gannett

San Angelo's Standard-Times will experience a new owner for the second time since Scripps jettisoned its newspaper assets in favor of television.  The Standard Times reported on their ownership change:

Journal Media Group was created in April 2015 after The E.W. Scripps Company and Journal Communications merged their local television operations and spun off their respective newspaper assets into an independent, publicly-traded company based in Milwaukee.

Correction by blogger:  JMG's stock began trading publicly on March 23rd, 2015 at $12.00 per share.  The stock lost nearly 20% its first day trading. Ticker symbol JMG had a rough time until the Gannet deal was announced. 

Gannett's buying JMG for $12 per share, exactly where the company initially traded.  As the deal is expected to close in the first quarter of 2016, JMG will have been an independent company for less than a year.

Standard-Times employees must be exhausted from change fatigue.  Readership plummeted by over 50% the last two decades as the company lurched from strategy to strategy to stem reader loss.  The paywall, implemented in 2013, failed to increase readership as top management theorized.   That's the same group that spun off JMG, then inked the deal with Gannet after a mere six months as a public company. To think these are the leaders of a knowledge business.

Here's what awaits the Standard-Times team

For those having trouble reading the strategic initiatives line:

The lurching continues.  Hold on folks!

Are City Fees for Animal Registration Going Away with Microchipping?

At the last City Council meeting Animal Shelter Director James Flores said the City tag will be replaced with a microchip.   ConchoValleyHomepage reported:

After much debate the city voted initially approving mandatory spay or neuter and micro-chipping of pets. the micro-chips will replace city tags.

Many citizens assumed the fee associated with the tag would disappear as well.  The draft City Ordinance makes clear that this is not the case.  Staff, without the advice and consultation of the Animal Shelter Advisory Committee, made no changes from current ordinance in the following sections:

Sec. 3.02.001 Registration required
Sec. 3.02.002 Expiration of registration
Sec. 3.02.003 Deadline for registration
Sec. 3.02.004 Registration fee
Sec. 3.02.005 Issuance of tag
Sec. 3.02.006 Duty of veterinarian issuing tags
Sec. 3.02.007 Annual or lifetime registration
Sec. 3.02.008 Records retention
Sec. 3.02.009 Failure to pay annual registration fee; proof of ownership
Sec. 3.02.010 Exemptions

Based on City Council feedback staff updated language in Sec. 3.02.011 which deals with "Selling or giving away animals."

Clarification of registration and the tag requirement would help the public understand exactly what is being proposed.  It would help if ordinances clearly spoke to those changes before Council approves anything.  We'll see if that happens on Tuesday.

Council to Nominate TGC Appraisal District Board Members

The last item on San Angelo City Council's October 6th public agenda is the nomination of board members for the Tom Green County Appraisal District.  Homeowners know the creep in appraisal values that have hit residential real estate since our local economy boomed, then un-boomed.  Did commercial real estate values rise similarly to keep up with actual sales prices?

The City of San Angelo inked a deal to buy the First Financial Bank building on the corner of Bryant and Beauregard for nearly $1.6 million.  City Manager Daniel Valenzuela spoke about the purchase:

“The local real estate market is ultra-competitive,” Valenzuela said. “Almost every other site we considered for a police station over the past three-plus years was purchased before we could make an offer. We feel fortunate to have secured perhaps the best site downtown San Angelo could offer at what we believe to be a reasonable cost."

The appraised value of the 301 W. Beauregard building is $225,930.  The purchase price is a mere 602% premium on the county's appraised value.   The appraisal changed every year since 2011 so the low number is not from inattention.

Why would this building have such a large differential between appraised and market value?  There are companies who work to lower commercial real estate appraisals.  Paramount Property Analysts has a division that does just that.  Paramount lists First Financial Bankshares as a client.

No matter the reason the City missed out on years of property tax receipts from an appraised value closer to market.  This raises a question.  Is the First Financial building on Beauregard an isolated case or common practice in San Angelo?  That's for the current Tom Green County Appraisal District Board and its successor, about to be appointed.

Note:  Another item on the agenda is public hunting at Twin Buttes Reservoir.   Does anyone else recall Council approving a Master Recreation Plan in May 2013?

Update 10-4-15:  Austin has a fight over commercial real estate tax appraisals.  The Travis County Tax Appraisal District attorney said "commercial property appraisals are within 90 to 110 percent of the market value. A council-commissioned study — which the district has said is unreliable — said 2015 commercial appraisals had a median undervaluation of 27 percent." Florida has a similar fight over commercial property valuations.

Update 10-8-15:  A Texas real estate man noticed the huge commercial real estate tax breaks companies get, directly and indirectly.  As a result residential property owners end up paying more than their share.

Update 3-16-22:   The replacement First Financial Bank had its property value lowered from over $860,000 to $570,000.  How many homeowners saw their appraisals fall by one third in the last four years?